1 / 17

October 2013

KZN Provincial Treasury. Provincial Supply Chain Management Unit. A Discussion of Recent SCM Court Cases. October 2013. Programme. Introduction Legislative Framework Governance in Local Government The roles and responsibilities of stakeholders in local government

karen-nichols
Download Presentation

October 2013

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. KZN Provincial Treasury Provincial Supply Chain Management Unit A Discussion of Recent SCM Court Cases October 2013

  2. Programme • Introduction • Legislative Framework • Governance in Local Government • The roles and responsibilities of stakeholders in local government • The role of Council in SCM • Legislated SCM Reporting requirements

  3. INTRODUCTION

  4. KZN Provincial Treasury – Provincial SCM Unit Introduction The cornerstone of successful implementation of SCM by an organ of state rests with complete and absolute compliance and adherence to the legislation which governs it. Supply Chain Management is governed by : Section 217 of the Constitution of the RSA Chapter 11 of the MFMA Preferential Procurement Policy Framework Act and Regulations Broad Based Black Economic Empowerment Act

  5. THE LEGISLATIVE FRAMEWORK • The Constitution • The MFMA • The Municipal Systems Act • Other relevant legislation

  6. KZN Provincial Treasury – Provincial SCM Unit The Legislative Framework • The Constitution (s 217) • All organs of state must implement a procurement system that is fair, transparent, equitable, competitive, and cost-effective. • The Municipal Finance Management Act (MFMA) (chapter 11) • Improvement of financial governance through separation of roles and responsibilities • Linkages within the entire financial management value chain • Approval of financial management policies (incl. SCM Policy)

  7. KZN Provincial Treasury – Provincial SCM Unit The Legislative Framework • The Municipal Systems Act • Council to play executive role and responsible for the enforcement of laws and policies • Council has duty to ensure that municipal resources are utilised optimally • The Municipal Structures Act • Legislative basis for the establishment of governance structures; • Promotion of Administrative Justice Act • The award of a tender contract by an organ of state constitutes administrative action’ within the meaning of the PAJA Act 3 of 2000. Therefore all applications for the review and setting aside of tender contracts should be brought in terms of s6 of the PAJA Act

  8. The Legislative Framework

  9. PERTINENT CASE LAW • Disclosure of Documents • Application of the PPPFA • Issues around Functionality • Application of PAJA • Cancellation of Bids • Composition of Bid Committees

  10. KZN Provincial Treasury – Provincial SCM Unit Disclosure of Documents Case:Tetra Mobile Radio (Pty) Ltd vs MEC for Department of Works and four others (SCA) 2006 482 Issue: The appellant sought an application compelling the KZN Department of works to disclose details of other bidders in order that they may suitably prepare for an appeals process. Court Ruling: The appellant was entitled to the court documents that would allow it to prepare for the appeal before the Bids Appeals Tribunal. Impact for SCM: SCM practitioners are to ensure that all documents are in correct format and where required are appropriately disclosed to bidders. The court further ruled that where certain documents are confidential, same must be marked as “Confidential“ and the attorneys must be informed of confidential and may not even be shared with their clients.

  11. KZN Provincial Treasury – Provincial SCM Unit Correct Application of The PPPFA Case: Viking Pony Africa Pumps (Pty) Ltd vs Hydro Tech Systems (Pty) Ltd and City Of Cape Town(CCT) 2010 21 Issue: The appellant sought leave to appeal agaist the decision of the SCA on an issue that hinges around the correct application of the PPPFA.A proper determination of the meaning of the word “detect” and “act against” in terms of Reg 15(1) of the PPPFA. Court Ruling: The city of Cape Town failed to act appropriately to investigate alleged fronting irregularities detected by the Hydro Tech. The CC said it did not have any jurisdiction and neither did the High Court to compel the City to act against as the allegations had not been substantiated. The CC felt that s217(2)(ii) gave the City sufficient basis to act against the appellant. Impact for SCM: SCM practitioners are to ensure that where allegations of fronting are reported, sufficient action is taken to investigate the allegations and to act accordinglingly in terms of such allegations.

  12. KZN Provincial Treasury – Provincial SCM Unit Issues around Functionality Case:Loliwe CC t/a Vusumuzi Environmental Services vs City of Cape Town, Chairperson of the BAC and three others (HCT) 2012 3791 Issue: The appellant was appealing the award of a bid to the 4th and 5th respondent. The City averred that due to its incompletion of the pricing schedule, it was unable to assess the functionality of the appellant. Court Ruling: The court ruled that the City should have highlighted that the full completion of the pricing schedule was required for the full completion of the document and on this basis dismissed the appeal. The court dismissed the appeal due the public interests outweighing the interests of the appellant but noted that the process was flawed. Impact for SCM: SCM practitioners are to ensure that all documents appropriately indicate relevant sections which require full completion, particularly in instances of functionality.

  13. KZN Provincial Treasury – Provincial SCM Unit Application of PAJA Case:Moseme Road Construction CC and others vs King Civil Engineering Contractors (Pty) Ltd and Another 2010 (4) SCA 3 ALL SA 549 Issue: this case involved a review and set aside process. Court Ruling: The court said that where it is not in the public interests to set aside a process, the court should refrain from doing so. This would be in terms of Section 8 of the PAJA, which allows the court to make a decision which is just and equitable. The courts therefore must establish that is just and equitable to do so. .

  14. KZN Provincial Treasury – Provincial SCM Unit Application of PAJA Case:Millenium Waste management (Pty) Ltd vs Chairperson of the Tender Board Issue: The Appellant sought a review and set aside of the Award of a medical waste bid on the basis that the appellant’s disqualification had been a violation of its right to procedural fairness. Court Ruling: The courts upheld the appeal and request the Department to reevaluate the bid, including the appellant. Impact for SCM: Where requirements deemed administrative are excluded by a bidder, all steps should be taken to attain the said requirements prior to excluding the bidder.

  15. KZN Provincial Treasury – Provincial SCM Unit Cancellation of Bids Case:Indiza Airport Management vsMsunduzi Municipality Issue: The issue before the court was whether to set aside a decision by a Municipality to cancel and re-advertise a bid in an instance where an appeal committee had recommended that the bid be referred back to the BEC for evaluation. Court Ruling: The court set aside the decision of the Municipality to cancel and readvertise and ordered that it make the award to the applicant as the BEC had originally recommended on re – evaluation. Impact for SCM: Arbitrary cancellation and readvertisement of bids will be deemed as procedurally unfair, arbitrary and materially influenced by error of fact and therefore tantamount to an irrational decision. Organs of state must utilise public funds in a manner that is responsible, fair and transparent manner at all times.

  16. KZN Provincial Treasury – Provincial SCM Unit Composition of Bid Committees Case:Actaris South Africa (Pty) Ltd vs Sol Plaaitjie municipality and Another 1357 (2007) 2008 ZANHC Issue: The Appellant sought a review and set aside of the Award of a bid on the basis of S (2) (1) of the PPPFA. Court Ruling: The courts upheld the appeal and request the Department to reevaluate the bid, including the appellant. Impact for SCM: As far as possible, Municipalities are to ensure that there is strict compliance with the Regulations with respect to the composition of Bid Committees and where appropriate must ensure that user departments are included in the committees. Consultants should therefore be eliminated from the committees.

  17. KwaZulu-Natal Provincial Treasury – SCM Support Unit Thank You!

More Related