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Industry bodies react to Sanral’s preferential procurement policy move

Home Infrastructure Construction & Civils Industry bodies react to Sanral’s preferential procurement policy move

BOTH the South African Institution of Civil Engineering (SAICE) and Consulting Engineers South Africa (CESA) reacted favourably to the South African National Roads Agency’s decision to withdraw its new preferential procurement policy adopted by the board on May 23, 2023.

SAICE said it welcomed Sanral’s decision to withdraw its proposed preferential procurement policy and associated tender scoring system. “We commend both the industry’s steadfastness on this issue and Sanral’s demonstration of prudence in the best interests of the nation,” it said.

Acknowledging Sanral’s decision, CESA’s CEO Chris Campbell said: “We believe this move reflects a commitment to advancing our nation’s infrastructure development endeavours. It is imperative that we collectively strive for progress in this sector, as it directly correlates with reducing unemployment and enabling the essential growth of our economy.”

SAICE said that it recognised the substantial efforts needed to drive economic recovery in our country. “We strongly support this decision. The negative impact of the proposed Preferential Procurement Policy on the civil engineering industry, the economy, and the South African population cannot be overstated.”

SAICE represents approximately 15,000 members in the civil engineering community and CESA has slightly more than 600 member firms employing a total of 17,000 staff across the country.

Both bodies welcomed future consultations. SAICE said: “We are dedicated to collaborating with Sanral and the industry to find mutually beneficial solutions. We welcome any opportunity for engagement with SAICE representatives who can support the strategic redevelopment of the final policy.”

Campbell said that CESA remains committed to working collaboratively with Sanral and other industry partners to achieve a thriving and inclusive infrastructure landscape across South Africa.

Campbell said that CESA is confident that other public entities, which have followed a similar path in altering bid criteria, will consider this development and follow suit.

“The transformational journey pursued by all stakeholders aligns with the principles outlined in the Broad-Based Black Economic Empowerment (B-BBEE) legislation and the various Sector Codes. It is crucial that we view this legislation in its entirety, rather than focusing solely on ownership, as this broader perspective will help to mitigate issues such as fronting and ensure widespread benefits for all stakeholders,” Campbell said.

Sanral’s board chairperson, Themba Mhambi says the decision to withdraw the new preferential procurement policy (PPP) was taken by the board after careful consideration of developments since it was adopted.

“Following our adoption in May 2023 of a new PPP for Sanral, there have been a number of legal challenges to the policy which were launched by construction companies in various courts across the country,” said Mhambi. “The legal challenges to the new PPP have regrettably resulted in Sanral being prevented from proceeding with the processing of close to 80 tenders worth billions of rands, with significant negative consequences for the fulfilment of the constitutional and statutory mandate of Sanral.

“The board of Sanral has adopted the decision to withdraw the new PPP because of the negative impact these court challenges have, including the fact that we anticipate that the lengthy court processes will cause significant delays to the work of Sanral.”

Sanral said it’s advised by senior legal counsel that in light of the change in the scoring formula, it is necessary to commence the tender process afresh. Sanral will therefore be cancelling all existing advertised tenders that have not yet closed, issue new tender adverts, and subsequently adjudicate all tenders within the confines of the interim policy. Sanral intends to expedite the re-advertisement of tenders and processing thereof within this current financial year.

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