Part of the proposed changes is the framework guiding government entities on how they should plan the tendering process when looking to acquire goods and services. It also reinforces the evaluation methodology of functionality and how bidders should be excluded from a tendering process when failing to meet the minimum compliance levels of the stipulated specifications.
The draft proposals also recommend increasing the 80/20 preference point system from R1 million to between R10-R50 million, with the 90/10 preference point system increasing the price from R1 million to above R50 million respectively. A new proposed category, the 50/50 preference point system will be applicable to tenders with a projected value of less than R10 million.
Whereas the 80/20 and the 90/10 preference point systems award points for Price and the B-BBEE Status of the bidder, the 50/50 preference point system will award points for 'Specific Goals' such as race, female ownership, ownership held by people with a disability, SMME status and the bidders contribution to Local Economic Development (LED).
As with the existing tendering regulations, it will also be compulsory for government entities to apply the rules pertaining to 'Local Content' and a new element has been introduced to consider tenders on 'Fair and Reasonable Pricing'. The proposals also include a mechanism for government to consider entering into 'Negotiations' with 'preferred bidders' prior to awarding the tender. The aspect of 'Deviation' is also proposed, allowing government entities to 'procure goods and services' without having to follow due tender processes. A special section focusing on "Conditions" applicable to the tender process will also instruct bidders on how to submit a tender under a Joint Venture arrangement.
In essence, the 50/50 point system will favour a black, female and disabled owned SMME to that of a company with a higher B-BBEE status. Despite serious objections to these new proposals, people bidding for government contracts, especially those tendering for contracts below R10 million in value, are best advised to make a study of the criteria to be applied for 'Specific Goals' and to consider aligning their businesses in order not lose out on future tenders.
For further details on the proposed changes and how to implement an effective strategy to continue to be considered for tenders, go to www.taranis.co.za.
