Introduction
Section 217 of the Constitution of the Republic of South Africa requires an organ of state to contract for goods or services in accordance with a system which is fair, equitable, transparent, competitive and cost effective. The policy of the Auditor-General has been developed to give effect to the enabling legislation as outlined in the Preferential Procurement Policy Framework Act, 2000 (Act 5 of 2000) and the Preferential Procurement Regulations, 2001.
It is against this background that the Policy has been developed and distributed to guide the procurement activity throughout the AG in accordance with sound business practices.
The AG’s policy is to procure in accordance with the Five Pillars of Procurement:
Value for Money, Open and Effective Competition, Ethics and Fair Dealing, Accountability and Reporting as well as Preferential Procurement.
This becomes apparent in the AG’s Procurement Policy where it has committed to fostering a procurement system that is fair, equitable, transparent, competitive and cost effective. The Policy aims to ensure that all its procurement activities occur taking into account the above mentioned as well as the best overall value.
Types of Procurement
Currently the procurement function as carried out in the AG is based on these two types of procurement.
General Procurement:
This type of procurement gives support to the functions of the Auditor-General at large. This will include all procurement that encompasses the planning and management of all activities involved in the sourcing and logistics management of goods and services for various areas of the Auditor-General to enable it to function as a business on a day-to-day basis.
Contract Work Procurement:
This type of procurement gives support to the audit business unit. The purpose is to contract-out work to audit firms on behalf of the Auditor-General and to contract-out firms an open tender process is followed, which currently is issued once in two (2) years.
Supply Chain Management Office
The Supply Chain Management Office of the Auditor-General has been established to ensure that it effectively manages the activities within the supply chain, with the sole and deliberate goal to increase effectiveness and efficiency of the business units and to ensure that the process is streamlined, effective, transparent, fair and equitable.
Our understanding of the Supply Chain:
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Demand Management
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Acquisition Management
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Logistics Management
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Disposal Management
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Identify requirements
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Procurement process
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Inventory management
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Removing products in the most economical way
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Preferential Procurement Policy
Introduction
It is aimed at increasing the volumes of purchases from targeted categories of society and to foster the development and utilization of such enterprises. Goods and services will be sourced from targeted categories of society with a deliberate view of equalizing market accessibility of the previously marginalized groups and thus ensure that they have a meaningful role in the development of our economy.
The Policy is also intended to be consistent with the objectives of the Broad Based Black Economic Empowerment Act, 2003 (Act 53 of 2003) promoting the principles of the Reconstruction and Development Programme as well as the government’s policies relating to socio-economic objectives.
The Auditor-General aims to facilitate and contribute to BBBEE and capacity building in the financial management of the public sector. Thus the AG will procure goods and services based on the appropriate criteria stated in the categories listed in the Policy as per appropriate.