Cape Town’s Public Procurement Bill Challenge

The Constitutional Court has granted direct access to hear the City of Cape Town’s bid to invalidate the Public Procurement Act, which the metro warns will slow down local service delivery and undermine the constitutional autonomy of local government. Mayor Geordin Hill-Lewis confirmed receipt of directions issued by Chief Justice Mandisa Maya on 14 July, instructing national government to file papers by 8 August and the City to respond by 22 August. The City’s full Concourt application is available here: Public Procurement Bill Application.

‘We welcome the Concourt granting direct access to hear this vital matter. We believe the Act was passed unlawfully, with fatal shortcomings in public participation and parliament’s procedures.

‘Beyond these issues, the Act will slow down local service delivery and make it much harder for municipalities to procure quickly in response to local needs.

‘Local government must be able to act swiftly to resolve urgent water, sanitation, electrical, waste, and environmental issues. Instead, this bill will slow down municipalities via a massive new red tape burden and interference from other spheres of government. This is unconstitutional, and undermines local government’s direct accountability to serving residents,’ said Mayor Hill-Lewis.

The City’s application points out that the adoption of the Bill was unlawful due to various problems with public participation and parliamentary processes, including that seven of nine provinces did not have lawful final mandates to vote on the bill in the NCOP.

The City has wide-ranging concerns about new red tape introduced in the Bill, including:

• Municipalities won’t be able to maintain their own database of accredited suppliers, and payments to suppliers will need to be integrated with a national database
• Centralising all national procurement via a Public Procurement Office (PPO) further runs the risk of nationwide disruptions to municipal procurements if the central system goes offline
• Municipalities will no longer have the power to lawfully deviate from procurement regulations for urgent service delivery without centralised approval via the PPO
• Spurious tender appeals may hold up service delivery as the Bill limits the ability to conclude contracts while tender awards are reviewed

Mayor Hill-Lewis said that the Bill will also undermine infrastructure investment by making public private partnerships too complex and time-consuming.

The City is further concerned that around 36 elements of the Bill require new regulations, exposing local government to hidden cost implications and red tape burdens. Further, the Bill positions the National Finance Minister as a regulatory authority over local government, which is inconsistent with the Constitution, Municipal Systems Act and the Municipal Finance Management Act.