House Chair, the ACDP wishes to thank Dr Burke for raising this important issue. We agree that there is an urgent need to reform the country’s public procurement laws to tackle poverty, unemployment, and economic exclusion.
Public procurement accounts for a significant portion of government expenditure, as indicated by previous speakers, nearly a trillion rand annually which is approximately 22% of South Africa’s GDP.
The ACDP does not support preferential procurement provisions which have contributed to state capture and corruption, have grossly inflated government contracts, and benefitted only a small group of politically connected individuals.
The Public Procurement Act was supposed to be a comprehensive response to the Zondo Commission’s damning findings on preferential procurement that contributed to state capture and corruption. The Act is, we believe, largely a missed opportunity to fundamentally address the many deficiencies in public procurement.
Judge Zondo himself has expressed doubts as to whether this Act will stop corruption in the public sector. The sharpest legal brains in South Africa came together to form the Joint Strategic Resources to comment on the bill and suggest amendments. Scant regard was, however, given to these inputs and it this sad to see this valuable resource largely overlooked.
The drafting and finalisation of complex regulations is still outstanding and is crucial to provide more specific operational details such as permissible procurement methods and thresholds.
Professor Geo Quinot of the African Procurement Law Unit states that those are important practical aspects that he hopes will get some sight of very soon because, for many procuring institutions, the changes that those detailed operational rules will bring about are going to be very important in terms of their own planning, operational systems and standard operational proceedings.
The ACDP trusts that these legal experts will be consulted when the regulations are being considered. The Act is still subject to litigation regarding its constitutionality. This, we hope, will be finalised soon in order to avoid wasting a lot of time drafting regulations, only to find that parts of the Act are found to be unconstitutional.
Lastly, the ACDP is also concerned that certain provisions in the Act will embolden extortion syndicates who, under the guise of business forums, show up armed at construction sites demanding that 30% of the projects be subcontracted to their companies. These groups don’t hesitate to disrupt construction projects and must be faced with the full force of the law.
I thank you.
