At the pinnacle of transformation in South Africa, the Auditor-General of South Africa (AGSA) is committed to supporting and accelerating transformational developments. The AGSA recognises that the implementation of a broad-based black economic empowerment (BBBEE) strategy is an essential mechanism in its efforts to meet the objectives as set out in the BBBEE Act to achieve sustainable and inclusive economic development, social stability and labour-absorbing economic growth. The transformation objectives and goals will therefore enable the AGSA to fulfil its leadership role and have the intention of leveraging all aspects of AGSA activities to support the economic policy objectives of BBBEE.
Preferential procurement has been identified as an instrument to create and increase opportunities for BBBEE enterprises and address social economic issues such as:
· Making business opportunities available to groups of individuals that were previously denied business opportunities.
· Promoting economic activity in a particular region, e.g. local development.
· Promoting job creation.
· Promoting a particular method in the delivery of required services.
The recommended approach assumes that preferential procurement is a strategic intervention in the procurement value chain. The understanding is that preferential procurement is about changing the behavioural patterns, processes and procedures that have hitherto been in practice, resulting in the disproportionate award of procurement rands and contracts, skills and technology transfer against black people and black designated groups.
It is with this view that the AGSA has identified procurement as one of the instruments that may be used to create and increase opportunities for BBBEE enterprises. In line with the applicable and relevant legislations, namely the Public Audit Act (PAA), BBBEE and Preferential Procurement Policy Framework Act (PPPFA), the AGSA has developed a BBBEE strategy and the Procurement Policy that incorporates the preferential procurement component. The AGSA’s preferential procurement objectives seek to achieve a certain level of its procurement expenditure with BEE enterprises. We however recognize that to realize these objectives there are certain improvements to the current processes, policy and procedures that should be instituted within the organization.
AGSA is committed to strengthening the democracy of SA and through our various programmes on BBBEE we will prioritize our preferential procurement interventions.