South African government CPO will lead procurement 'transformation'

28 February 2013

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28 February 2013 | Anna Reynolds

The South African government’s new chief procurement officer will set fair prices for goods and services and transform purchasing programmes across departments.

Finance minister Pravin Gordhan said the appointment of the CPO, which was announced last year, would be revealed soon, as he presented the government’s 2013 budget in the National Assembly.

“Procurement transactions take place at too many localities and the contracts are short term,” he said. “Consequently there are hundreds of thousands of transactions from a multitude of centres. There is very little visibility of all these transactions.”

The CPO will oversee the long-term modernisation of the entire procurement system and standardise the procurement of critical items across all government departments. One of the CPO’s first tasks will be to improve the existing price referencing system for goods and services. It will also be responsible for leading pilot transformation programmes in health and public works procurement.

His speech also touched on allegations of corruption in procurement. “National Treasury is currently scrutinising 76 business entities with contracts worth R8.4 billion (£625 million), which we believe have infringed the procurement rules, while the South African Revenue Service is currently auditing more than 300 business entities and scrutinising another 700 entities.”

He added the Financial Intelligence Centre (FIC), which oversees compliance with financial obligations, has referred over R6.5 billion (£483 million) of contracts for investigation linked to corrupt activities.

Gordhan said that he fully supported calls for curbs on government officials doing business with government and to help this the Public Finance Management Act would be aligned with the Public Service Act.

Meanwhile, special measures are being taken worldwide to oversee the expenditure of what have become known as “politically exposed persons” politicians, public representatives and senior officials.

“I have asked that the FIC should explore how we might bring South Africa into line with these international anti-corruption and anti-money laundering standards,” Gordhan said.

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