Treasury orders organs of state to stop issuing tenders
28-02-2022
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Taranis
Source
In response to the recent Constitutional Court judgement, which declared the 2017 Preferential Procurement Regulations invalid, Treasury has issued a communique to all organs of state to stop issuing tenders, until it has received clarification from the Court as to whether the Regulations, will still be valid until February 2023 or not.
The notice also advises organs of state that they should continue to apply the Regulations to tenders, which were issued prior to 16 February 2022, the date on which the Court delivered its judgement as well as holding in abeyance tenders issued, on or after this date.
The reason for seeking this clarification is that the Court did not address the issue of the 12-month suspension period of the Regulations, which was instructed by the Supreme Court of Appeal in its order, issued in November 2020.
This follows a statement made by the Minister of Finance, Mr Enoch Godongwana, during a briefing in Parliament a day after the budget speech, indicating that the Treasury will issue new Preferential Procurement Instructions (not Regulations), within the next two weeks.
Mr Godongwana said, that the Draft Procurement Bill, was meant to have been issued with the Budget Speech, but Treasury has decided to keep it back until after, it has studied the Zondo Commission Report and the Court’s judgement on the legality of the 2017 PPPFA Regulations.
The Minister also confirmed that in the meantime, Treasury is working on a set of instructions, which will give increased delegated authority and flexibility to Accounting Officers (AOs) and that it will be issued within the next 14 days.
According to Gerrit Davids, Lead advisor at TaranisCo Advisory, tendering agency, “This latest statement and advisory to organs of state, not to issue any new tenders, will create a vacuum and could lead to a myriad of administrative backlogs for supply chain management units, if no swift reply is received from the Court.”
“Bidders who are in the process of submitting bids, issued on or after 16 February 2022, are advised to still submit it before its closing date, since the relevant organ of state, will have to place a moratorium on evaluating and adjudicating it”, says Davids.
Davids said, “Even if Treasury issues “Instructions” to organs of state within the next two weeks, it can’t replace the Regulations, which were declared as invalid by the Court when it ruled that each organ of state must draft its own Preferential Procurement Policy”.
To read the full statement from National Treasury on this matter visit, our web site and you’ll find it at the bottom of the home page: www.taranis.co.za
Contact: Gerrit Davids. Lead Advisor | TaranisCo Advisory CC Mobile. +27 (0) 82 496 1657 E-mail: gerrit@taranisco.co.za for more details.
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