Safcec calls for more proficient policy alignment

The SA Forum of Civil Engineering Contractors (Safcec) has bemoaned the various different procurement policies of many public entities and called on the Procurement Office at National Treasury to compile and issue procurement standards to provide policy certainty to business. Webster Mfebe, the chief executive of Safcec, said he was concerned that there was a lot of fragmentation in terms of the procurement standards in the country. “I have concerns that there is a lack of policy alignment and therefore it affects policy certainty. The chief procurement officer should seek to standardise all procurement because it becomes difficult when each entity comes with its own standards. “We also have the construction cluster sector codes as well as the scorecard that measures the entities and when certain state institutions start to have their own it becomes policy noise and confusion,” he said.

Mfebe said the water boards, municipalities and various government departments and entities each had their own procurement requirements and “it’s just chaos across the board”. “We are the same country governed by the same national laws and National Treasury as the overarching Constitutional body with the Procurement Office under its wing should issue procurement standards. “A foreign investor coming here would not know which policies to comply with. You would have to have a Masters Degree to understand the policy regime in our country but it should not be like that. “Any serious investor would come and look and pack their bags and go to Botswana, Lesotho or Kenya where the ease of making business is highly commendable,” he said. Mfebe declined to be drawn on Safcec’s response to the draft transformation policy launched last month by the SA National Roads Agency (Sanral).

In terms of this draft policy, on capital projects Sanral would only do business with companies that were at least 51% black-owned and with a minimum broad based black economic empowerment (BBBEE) Level 2 rating while a maximum of 15 tenders a year would be issued to a single company and contractors would be required to make use  Sanral-approved sub-contractors. Sanral said the same provisions would apply for road maintenance projects to ensure the broad-based participation of local companies and communities and special attention given to the procurement of road safety material from black suppliers. The equity ownership level specified in Sanral’s draft policy is not aligned with the agreement reached between the government and seven listed construction companies in terms of the Voluntary Rebuilding Programme (VRP) agreement.

The VRP agreement included a collective payment by the seven companies of R1.5bn over 12 years to a socio-economic development trust and to undertake further transformation initiatives, including either becoming “fully transformed” with at least 40% of equity in the hands of black South Africans or commit to significant mentoring initiatives for up to three emerging black-owned enterprises. Mfebe said Sanral’s draft policy had been referred to Safcec’s contractual affairs transformation committee for a proper response. “We would not like to be impulsive about it. We would like to apply our minds and respond accordingly,” he said. Mfebe confirmed Safec would be engaging with the chief procurement officer at National Treasury and the new chief executive of Sanral on these issues. “What is very glaring is that there are various procurement standards in various state institutions, which is cause for concern,” he said.