If there is one consistent feature of Zoomer's cabinet it is that he appoints people who should not allowed to maintain a scholar patrol let alone a cabinet position. Think Tina, Dina, Rob, Bloomers Motshekga, Siyabonehead Cwele, Colic Shabane and the list goes on. Malusi Gigaba, minister of public works, made an announcement today that 50% of all coal purchases will come from black owned miners. A noble idea but it is very clear that he has no lucid plan as to how to go about doing this. Oh he has a few ideas like
" we will be exploring set-asides and other mechanisms radically to accelerate the promotion of black industrialists and the entrance of youth- and women-owned businesses into the mainstream economy".
I am not going to bemoan the nobleness of this idea. What I am concerned about is this notion of set-asides. I have blogged about set-asides before (often), in each of these posts I have gone to great lengths to show that other than the fact that Treasury has outlawed them they are also a little south of what section 217 of the Constitution prescribes. There is little doubt that Malusi has got to get Treasury's permission to do this. And Treasury is not an easy nut to crack with this one because they will inevitably end up paying a premium for coal because they have to meet their set-aside targets. And we know that the ANC feels rocks when it comes to paying a premium for websites or anything when their cronies are the suppliers. But this Transnet has managed to persuade Treasury to modify their empowerment requirements, as this page explains.
A six-month battle between the Treasury and the Department of Public Enterprises over the empowerment and local content weighting in Transnet's R35bn acquisition of new locomotives has ended with the Treasury agreeing to let the tender go unchanged. The sticking point between the department and the Treasury over the tender was the weighting Transnet would be allowed to apply to evaluate the bids. Under the Preferential Procurement Policy Framework Act, state-owned companies are required to use a 90:10 ratio, with 90% of the evaluation based on price and 10% on economic development commitments. Transnet, however, had structured its bid using a formula of 60:20:20. In this formula, 60% of the competition between bidders would be on price. The other components of the evaluation criteria were for 20% of the assessment to be focused on industrial commitments, with the balance being judged on a range of broad-based black economic empowerment criteria.
Treasury's greatest concern "related in part to a fear that the state will overpay for capital goods. Another concern is that local industrial programmes, shielded by the state's purse, could spawn industries unable to compete globally on quality or price."
We all know that Zoomer is driving the country into the ground, if Mal Oosie gets his way with the set-asides we'll know that Treasury is no longer concerned about the country. It is a sign.
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