The Public Procurement Bill, which was introduced in the National Assembly on 30 June 2023, aims to create a single framework to regulate public procurement by all state organs

On 22 May 2023, a Notice of Introduction of the Public Procurement Bill in the National Assembly was published in Government Gazette No. 48641. After a briefing session on 23 May 2023 by National Treasury to the Standing Committee on Finance and the Select Committee on Finance, the Bill was introduced in the National Assembly on 30 June 2023. 

The Bill is rooted in section 217 of the Constitution of the Republic of South Africa, 1996 (the Constitution), which deals with procurement. It provides, inter alia, for fair, equitable, transparent, competitive and cost-effective procurement by organs of state and institutions identified in national legislation. However, section 217 states that it does not prevent the implementation of a procurement policy providing for categories of preference in the allocation of contracts and the protection or advancement of persons, or categories of persons, disadvantaged by unfair discrimination. It also provides that national legislation must prescribe the framework for implementation of such a policy.  

Public procurement is currently regulated by various statutes, regulations and statutory instruments. Their applicability may vary, depending on the organ of state or institution involved. The preamble to the Bill recognises the following:

"that legislation regulating procurement by organs of state is fragmented and legislation regulating preferential procurement constrains justified advancement of person or categories of persons."

The preamble further provides that the purpose of the Bill is to create a single framework that regulates public procurement (including preferential procurement) by all organs of state. Section 2 of the Bill provides that the objects are, inter alia, to introduce uniform treasury norms and standards for all procuring institutions (i.e national or provincial departments or government components, constitutional institutions, municipalities and public entities in schedule 2 or 3 of the Public Finance Management Act 1 of 1999) and to determine a preferential procurement framework for all procuring institutions.

To this end, the Bill intends to repeal certain pieces of legislation, such as the Preferential Procurement Policy Framework Act 5 of 2000, the State Tender Board Act 86 of 1968 and the National Supplies Procurement Act 89 of 1970. Additionally, it seeks to amend various pieces of legislation dealing with public procurement.  

In terms of existing legislation and related statutory instruments, an aggrieved tenderer is more often than not, depending on the applicable legislation, left with no other option than to approach a court to challenge a decision to award a bid. The Bill, significantly, includes a dispute resolution mechanism. It allows for an application to be submitted to a procuring institution for reconsideration if a bidder is dissatisfied with a decision to award a bid, and establishes a Public Procurement Tribunal to, inter alia, review reconsideration decisions taken by a procuring institution. 

Click here for the Public Procurement Bill, June 2023.

Written by Rodney Africa, Partner, Adriano Esterhuizen, Partner Daveraj Sauls, Associate, Maison Samuels, Associate, Andre' Crouse, Associate & Danica Jonker, Candidate Attorney from Webber Wentzel