NEDLAC publishes its Draft Report on the Public Procurement Bill


As part of its mandate under the NEDLAC Act, the Government sent the long-awaited Public Procurement Bill to NEDLAC for consultations. The Procurement Bill is meant to consolidate the fragmented legislation on procurement. The significance of this Bill cannot be overstated. Public procurement has been the epicentre of corruption, with even the whole set of the Preferential Procurement Regulations of 2017 suffering the ignominy of being declared invalid by the Constitutional Court even though this declaration was suspended for a year. These are set to be replaced by the 2022 Preferential Procurement Regulations from 16 January 2023 in line with this decision.

After Cabinet’s approval, a draft Bill was published for public comment from 19 February 2020 until 30 June 2020. National Treasury submitted the Bill for engagement at NEDLAC on 13 April 2022. A task team comprising the Government, Business and Labour was set up at NEDLAC to engage on the Bill, holding numerous meetings between 6 May 2022 and 7 October 2022. This task team then developed this NEDLAC Report, which summarises the social partners’ inputs, areas of agreement, and disagreements.

Key concerns highlighted by the NEDLAC partners include inadequate time for consultations and that the substantive framework for procurement must sit within the statute instead of within subordinate legislation. Business remained circumspect that the Bill in its current form is capable of fixing the key problems to efficient and speedy delivery of quality goods, services and, in particular, infrastructure. Business believed this would hamper the Government’s ability to meet the needs of its citizens and preferred a general rewrite of the Bill. The main concern from Labour was that anti-corruption measures in the Bill are weak. Consequently, one of their areas of disagreement is the lack of provision made in the Bill for incentivised whistle-blowing. All social partners were of the view that there was a need for stronger consequence management as a measure to combat corruption in procurement. They called for the Government to establish specialised courts for procurement corruption to negate the long and slow judicial process. This, unfortunately, is not an output which can be done through the Public Procurement Bill.

Some of the fundamental agreements are that leaders of political parties may not submit a bid in procurement, and procurement policy can be used to ensure localisation by restricting the importation of goods or services and preference for goods produced in South Africa.

The concerns of the social partners at NEDLAC have a bearing on international trade since procurement impacts significant trade policies, such as designation and localisation in general. Government must get this legislation right to facilitate its trade and industrial policy.

Public procurement is an important lever for government’s import replacement strategy. XA understands industrial policy well. Contact us on to arrange for a chat.