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Draft Public Procurement Bill on Track

November 8, 2019

The Presidency

8 November 2019

The Draft Public Procurement Bill is on track.

President Ramaphosa, during remarks at the SMME programme of the Second South Africa Investment Conference, announced that the proposed legislation will be finalised soon.

He added that, in terms of the draft bill, organs of state will be required to subcontract SMMEs to a minimum of 30% of the value of the contract for contracts that are above R30 million.

“Whoever receives a tender must sub-contract a minimum of 30% of the value of the contract to SMMEs that are at least 51% black owned.”

Monitoring and compliance will be strengthened via the Office of the Chief Procurement Officer.

The president declared that compliance with the 30-day payment period plays a key role in ensuring the operational sustainability of SMMEs.

“Therefore, organs of state will be closely monitored on their compliance with the 30-day payment period and any non-compliance is viewed as financial misconduct and will be dealt with accordingly.”

Earlier this year, treasury indicated that, once cabinet has approved the draft bill, it will be released for comment.

Other steps government is taking to support SMMEs includes simplifying the tax regime for small business, enhancing the venture capital company tax regime to encourage investment in small businesses and junior mining companies, the Competition Amendment Act that will increase access to the economy for small, medium and black-owned businesses, expanding incubators and digital hubs to townships and rural areas and ensuring that SMMEs benefit from spatial interventions like industrial parks, business centres and special economic zones.

The president also highlighted that the Township Entrepreneurship Fund is being finalised by the small business development minister, Khumbudzo Ntshavheni.

Meanwhile, in a statement, the presidency announced that the Presidential Commission on the Fourth Industrial Revolution (4IR) has presented a draft Diagnostic Report on 4IR to president Ramaphosa.

The Commission was set up in April 2019.

In an earlier statement, the presidency indicated that the Commission will “assist government in taking advantage of the opportunities presented by the digital industrial revolution”.

The Commission, chaired by president Ramaphosa, is tasked with identifying relevant policies, strategies and action plans to boost South Africa’s competitiveness in the 4IR.

The setting up of the Commission was announced during the State of the Nation Address in Parliament in February 2019.

According to the presidency, the Commission is focused on “eight work streams dealing with the impact of technological advancement on human capital and the future of work as well as social and economic development”.

The Commission’s final report is expected to be drawn up by February 2020 and tabled in cabinet for consideration.