National Treasury director-general Dondo Mogajane on March 4 indicated to business organisation Sakeliga that his circular to organs of State regarding continued black economic empowerment (BEE) pre-requirements and stopping tenders was not binding.

“This comes after a countrywide crisis was looming over the past couple of days in which virtually all government tender processes would grind to a halt because of a circular issued by Mogajane on February 25.

“Organs of State have interpreted Mogajane’s circular as an instruction not to advertise new tenders and also as allowing them to apply BEE pre-requirements to tenders that have already been advertised,” the organisation states.  

Sakeliga says that it pointed out to Mogajane this week that he did not have the authority to give such instructions to organs of State and that organs of State acting in accordance with Mogajane’s circular would render themselves liable to litigation.

“There is no reason for the advertising or awarding of tenders to be suspended, provided it is done within the ambit of the Preferential Procurement Policy Framework Act and, consequently, no BEE pre-requirements are imposed,” Sakeliga states.

The organisation also warned that the National Treasury was creating a semblance of lawfulness for the continued application of BEE-based pre-disqualification of tenders.

It adds that this is while the Constitutional Court has confirmed the invalidity of the BEE-based pre-disqualification in terms of the 2017 regulations of the Finance Minister.

“Today’s letter by the director-general to Sakeliga has removed the need for urgent litigation and means that government institutions may now proceed with procurement, regardless of the National Treasury’s view of the judgment in favour of Sakeliga handed down by the Constitutional Court on February 16,” the organisation indicates.

Regarding the Minister’s regulatory role and the internal policies of organs of State, Sakeliga says it still intends to ensure the Constitutional Court’s February 16 judgment – the first major roll-back of BEE by the Constitutional Court – will be honoured.

“Sakeliga is on standby to resort to litigation again should there be attempts by the National Treasury or other government institutions to sidestep the court’s judgment,” the organisation says.