Compliance / Legal

What is the true cost of unethical conduct?

XavierGreyling.jpg'Procurement irregularities' has taken 3rd place on Corruption Watch SA's Corruption Report 2017 (CRW2017). Coming in at 12% of the reported types of corruption, procurement irregularities trails bribery as the most common form of reported corruption (27% of cases).

However, CRW2017 does not define 'procurement irregularities', which caused Xavier Greyling (MCIPS) to question if procurement irregularities do in fact account for only 12% of the reported cases, and, faced with the possibility of a far higher figure - what role does procurement play in what is lost to corruption every day?

Influence of procurement departments on marketers

 

JohannaMcDowell.jpgAgencies working – or hoping to work – on major corporate accounts in the advertising, marketing and communications industry can no longer ignore or misunderstand procurement departments and their importance in winning both government and corporate clients.

Johanna McDowell, Independent Agency Search & Selection Company (IAS) managing director, warns that the B-BBEE Amended Codes of Good Practice released by the Minister of Trade and Industry in mid 2016 are designed to ensure that procurement is taken seriously by companies that intend to survive, in this month’s SmartProcurement.

Gauteng uplifting SMMEs through procurement

 

MEC_BarbaraCreecy_SPW.jpgRecent studies by Stats SA indicate that the face of poverty in South Africa remains black, female and that of children below the age of 17. Furthermore, more than one in every two SA citizens can be officially classified as poor, said Gauteng Finance MEC Barbara Creecy at the Smart Procurement World conference in Johannesburg.

“[Stats SA’s] Poverty Trends Report shows that by 2015, approximately 33% of Gauteng’s citizens were living in poverty. Although this is lower than most of the country, it is not a cause for celebration. One in three Gautengers go to bed without a meal. The situation was further worsened by the province losing 146 000 jobs during the last financial quarter,” said MEC Creecy.

The most direct and effective route to address these socio-economic challenges is a programme of transformation, modernisation and re-industrialisation. Gauteng’s provincial government is currently implementing such a programme in partnership with the private sector, organised labour and civil society, said MEC Creecy.

When does labour become a commodity to be procured?

 

Commoditised_Labour.jpg

Mluleki Ntlemeza, a supply chain consultant wonders if there is point at which labour should be procured by procurement, and not through traditional HR processes, in this month’s SmartProcurement.

What if procurement savings didn't matter?

Madeleine_Tewes.jpgMost say that savings are just one component of this value proposition and that we need to look outside of savings into other areas of value, like stimulating innovation, supporting the organisation’s corporate social responsibility goals and reducing risk throughout the supply chain. Everyone agrees with these articles and, as we map out KPIs for our procurement department or individuals, we ensure savings is just one, albeit important, metric that their value will be evaluated on.

What happens, though, when you remove the value of savings altogether from a procurement department and its individual members? Even from the offerings of procurement consultancies that often focus on savings as a way of convincing CPOs to accept their services? asks Madeleine Tewes, Project Manager.

Cost-cutting drive has pitted Treasury against government departments

 

Ralph_Mathekga_.jpgTreasury’s cost-cutting drive has pitted it against other government departments.

Chief Procurement Officer Kenneth Brown has drawn criticism from politicians who are unhappy with his investigations of procurement, said Ralph Mathekga, a political analyst at the Johannesburg-based research group, the Mapungubwe Institute of Strategic Reflection.

In September the Treasury said it rejected a request from Home Affairs Minister Malusi Gigaba for his staff to fly in business-class seats and it turned down appeals from state power utility Eskom for company credit cards.

Open tender process shines light on procurement

 

tenders.jpgThe Gauteng provincial government (GPG) hosted its first open tender seminar showcasing the progress the province has made in rolling out its open tender project over the past two years. The event was also aimed at encouraging other provincial governments and municipalities to adopt the process.

 “We took the decision in 2014 that it was imperative to find ways to restore confidence in the public procurement process,” said finance MEC Barbara Creecy, who was the programme director for the day.

It is vital that citizens see how their money is being spent, said finance minister Pravin Gordhan, delivering the keynote speech at the seminar.

"We need to ensure that we get value for money from the taxes of the public and the borrowings we make on that money. I congratulate GPG on its determination to make procurement more transparent. The greater the spotlight that shines on procurement, the better.”

ZUMA - Major BEE procurement shake-up

 

JacobZuma.jpgThe government’s procurement policy will be overhauled in a bid to support black and small businesses, said President Jacob Zuma.

”The buying power of the state is a powerful economic tool. It can and must be used to advance black economic empowerment, ” said Zuma, speaking at a Black Business Council dinner in September.

Failed supply chain policies led to Eskom's Tegeta payments - Corruption Watch

 

BenNgubane.pngEskom failed to follow its own supply chain policies, the PFMA and Section 217 of the Constitution when making pre-payments to the Gupta’s Tegeta exploration and resources to secure coal supply, said Corruption Watch in a statement.

“We are concerned about the nature and scale of procurement irregularities at Eskom,” said Corruption Watch’s executive director, David Lewis.

G20 Summit: supply chains disrupted for clear blue skies

 

SupplyChainSummit.jpgIn preparation for the upcoming G20 summit in China this September, the Shanghai Environmental Protection Bureau (SEPB) issued an order for an estimated 1 000 factories within a 300-km radius of Shanghai to cut down production.

This measure was enacted to reduce pollution before world leaders arrive for the event. So how will this affect global supply chains?

This year, China hosts its first-ever G20 summit in Hangzhou, a city situated 240 kilometres south-west of Shanghai, where significant industrial, construction and residential emissions affect the air quality of its neighbouring cities.

Understanding policies underpinning the creation of black industrialists

 

MsMaisela.jpgBlack industrialists have a responsibility to maintain black ownership of their businesses. Failure to do so can set back government’s transformation efforts.

As a black industrialist it means that one has to be involved in the running of the business on daily basis and according to the BEE act, a black industrialist cannot sell/resell shares to a white counterpart as that would be diluting those [black ownership] shares,” said Nomumelelo Maisela, Deputy Director: Black industrialist, Department of Trade and Industry (dti).

“That particular act regresses government and takes it back in terms of transformation,” said Maisela who was speaking at the Smart Procurement World conference in KwaZulu Natal in June.

Cleaning up SA's R500bn tender machine

 

KennethBrown.jpgPolicing South Africa's R500-billion supply chain management system was an enormous task involving more than 20 000 staff and 220 000 suppliers, Treasury chief procurement officer Kenneth Brown said.

The supply chain management system, in which tenders are often rigged by officials doing business with the state, lies at the heart of huge corruption in the country. The Treasury established the national procurement office three years ago in an attempt to get to grips with the problem and modernise the system.

Ghanaian parliament approves procurement bill

 
A proposed law to modernise public procurement in Ghana, bringing it closer in line with international best practice, is one step closer to becoming a reality.

 

The Public Procurement Amendment Bill 2015 was passed by the country’s parliament and now needs to be signed by Ghana president John Dramani Mahama to bring it into force.

The bill introduces sustainable public procurement framework-contracting and electronic procurement in Ghana. It would also bring about a more transparent and accountable procurement system, the country’s government said.

PPPFA : #80/20PrinciplesMustFall

 

Legislation_Panel_Discussion_969x768.JPGSouth Africa currently faces many problems and government must stop applying quick fixes and actually investigate the root of the problem and address it. This was the consensus at a Smart Procurement World Western Cape panel discussion.


“PPPFA must not fall, but the principles of 80/20 and 90/10 must fall, simply because the framework is wrong. This kind of framework is costing government a lot of money that it does not have” said Kamogelo Mampane, Chief Executive Officer, TK Global Experts.

Corruption & irregular expenditure: is zero tolerance by 2030 a realistic ambition?

 

corruption.jpgThe National Development Plan envisions zero tolerance for corruption in South Africa by the year 2030. With 14 years to go, can a country that has a history of high-profile corruption cases break the repetition? Rudi Kruger, General Manager of Governance, Risk & Compliance at LexisNexis South Africa, poses the question in this month’s SmartProcurement.


“While there have been numerous public enterprises and municipalities declaring a clampdown on corruption in the past year, Transparency International’s recently-released African edition of the Global Corruption Barometer points to a despondent nation, with four out of five South Africans believing that corruption is in fact on the rise,” said Kruger.

Black empowerment groups call for change to preferential procurement law

 

PROC LAW.jpgLobbying organisations promoting black empowerment are calling for the Preferential Procurement Policy Framework Act (PPPFA) to be repealed because it places too much emphasis on price.


The Progressive Professionals Forum (PPF), which lobbies to address socio-economic disparities and promote broad-based black economic empowerment (B-BBEE), says the law prioritises competitiveness and cost-effectiveness.


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