The award of government tenders

The award of government tenders forms the basis of the process known as public procurement. This is an important part of government and ensures that a department or a municipality obtains the goods and services needed for effective public administration and the welfare of the community.

It is also a vital source of business for the private sector. Firms and individuals depend hugely on public procurement opportunities to supply anything from computers to paper clips, accounting expertise to cleaning services. The South African government spends, as an estimate, almost 23% of its GDP on public procurement.

The process of public procurement is heavily regulated. The department or municipality that needs the goods or services in question must be careful to ensure compliance with a wide range of legal principles. Any failure to comply can render the entire process unlawful. A key set of legal principles is usually contained in the procurement or supply chain management policy of the public entity involved.

Briefly, a typical public procurement process in South Africa will follow the following sequence: (a.) specifications are prepared for the goods or services required; (b.) the tender is advertised in a newspaper or online; (c.) a committee evaluates the bids received to check whether they meet certain basic requirements; (d.) a different committee adjudicates the qualifying bids and either makes an award or makes a recommendation to a higher authority; and (e.) after the award is made, the public entity and the successful bidder enter into a contract for the goods or services to be supplied.

A bidder should be meticulous when preparing a bid. By reason of the applicable laws and the way in which the courts have interpreted the relevant legal principles, the smallest example of non-compliance can easily disqualify a bidder from adjudication.

Sometimes, however, the disqualification of a bid is unfair. Or the award of a tender is not transparent. Or there are aspects of the public procurement process that are simply not competitive or cost-effective.

We offer assistance to public entities to ensure that their procurement of goods and services is lawful. We also offer assistance to bidders where they feel that an unlawful process was followed.

If you need further information about the award or non-award of a tender or any other aspect of public procurement, then please contact our offices.