Supply chains in spotlight

THE TREASURY has said that the cabinet will consider the Public Procurement Bill by April.

Delivering the medium-term budget policy statement yesterday, Finance Minister Pravin Gordhan said the bill, which seeks to consolidate the legal and policy framework for supply chain management, would strengthen accountability and oversight in supply chain management.

“We have indicated in previous years that supply chain management reforms and transparency were important elements in achieving value for money and combating corruption,” Gordhan said.

He said the Treasury was revising the preferential procurement regulations to ensure that at least 30 percent of government procurement went to designated groups, including small and medium enterprises, co-operatives and rural and township enterprises.

“Contracts are being renegotiated with airlines, hotel groups, software suppliers, pharmaceutical companies, property owners and construction firms. The aim is to achieve savings of R25 billion a year by 2018/19,” Gordhan said.

The bill is part of efforts to tighten the noose around corruption. It will give the chief procurement officer, Kenneth Brown, the power to conduct lifestyle audits and review transactions across the public sector.

The legislation would also establish a procurement authority as envisaged in the constitution, which requires public procurement to be fair, equitable, transparent, competitive and cost effective.

Gordhan said the eTender Publication portal, which was introduced in May last year, had seen more than R80bn worth of tenders published, saving R650 million a year in printing and advertising costs.

The Treasury launched the portal to eliminate duplication and fragmentation of notices for government tenders. It was meant to standardise and automate the procurement process.

The Treasury said the government would also expand the scope of transversal contracting over the next three years.

“These contracts allow multiple organs of state to buy goods and services at competitive pre-negotiated prices, reducing costs and administrative requirements. There are now 50 such contracts covering 23 000 items with an estimated value of R37bn,” it said.