The South African National Roads Agency Limited (Sanral) has withdrawn its new Preferential Procurement Policy (PPP), which was adopted by the agency's board in May, and will cancel all advertised tenders that have not yet closed.
Since adopting the PPP, Sanral has faced numerous legal challenges instituted by construction companies.
"The legal challenges to the new PPP have regrettably resulted in Sanral being prevented from proceeding with the processing of close to 80 tenders worth billions of rands, with significant negative consequences for the fulfilment of the Constitutional and statutory mandate of Sanral," chairperson Themba Mhambi says.
“Road and rail infrastructure are the lifeblood of our economy and, as such, any disruption to its maintenance, as well as any disruption to our extensive programme of new infrastructure projects, is a threat to our country’s economic growth.
“A protracted legal battle between Sanral and the construction industry would have dire consequences not only for Sanral’s projects, which run into billions of rands, but would also be detrimental to the entire economy. Clearly, it is not in the interest of Sanral, nor is it in the national interest, to delay our infrastructure build programme," adds Sanral CEO Reginald Demana.
While Sanral plans to soon start fresh engagements with the construction industry and relevant stakeholders to formulate a new procurement policy, it will, in the interim, adjudicate all tenders in accordance with an empowerment scorecard.
The cancelled advertised tenders will be readvertised and adjudicated in line with the interim policy.
"In taking the decision to adjudicate tenders in accordance with interim measures, Sanral hopes and trusts that all construction companies, and indeed all our stakeholders, shall work together with us to ensure that we are able to continue with the procurement of services and to meaningfully transform the construction industry,” says Demana.