Government will revise procurement legislation, regulations and practices to enable the designation of large, strategic and repeat or ‘fleet' procurements in a range of sectors. This will aim to sequentially increase competitive local procurement and supplier development opportunities, minimise ‘leakages' from the domestic economy, and support meaningful Broad Based Black Economic Empowerment (B-BBEE) in all 3 spheres of government and in SOE's.
So sayeth Rob Davies Minister of Trade and Industry on February 18 2010 - as quoted by Politicsweb. This speech was at the launch of the 2010/11 - 2012/13 Industrial Policy Action Plan (IPAP).
The actual plan is not something that I will comment on, but I am interested in the harmonisation of government procurement, BEE and the stimulation of local industry. I've always felt that the codes are a lone voice with very little backing. If Rob can pull this off then he will be a very successful minister of trade and industry indeed.
I speculated a while ago that RDP goals would be included in the final PPPFA regulations and now it seems that local content will be rewarded too. The question is whether it will make its way via the PPPFA or the actual supply chain rules will be changed to award points for local manufacture out of the 80 or 90 points. I would suggest that if Rob is serious then that is where the points should come in.
Rob also went through the types of fronting that he doesn't like (including blackwashing).
One of the big problems with black economic empowerment is that companies tendering for state contracts profess to be empowerment groups while they are not.
He says there are three types of malpractices.
- One is where a company misrepresents itself as a black company in order to get contracts.
- Another way is via the so-called tender entrepreneur. Davies explained that this type of company pursues tenders but, because the tender field is not its area of specialisation, white companies are contracted to do the actual work.
- The other method is where an empowerment company applies for a tender and then imports the goods instead of manufacturing them locally.
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