Make value-for-money procurement the centrepiece of your upcoming provincial budgets.
This is the message the Institute of Race Relations (IRR) is conveying this week to the Finance MECs of Gauteng, North West, Northern Cape, KwaZulu-Natal, and Limpopo.
The IRR says in a statement: “At the heart of the IRR’s proposal is the Value For Money Bill, a draft law that gives decisive effect to section 217 of the Constitution by making value for money the determining standard in all public procurement. The Bill prohibits points-based award systems that allow government to overpay for goods and services and replaces them with an objective, transparent, cost-effective framework.
“BEE premiums, the mark-ups paid by government for the same goods and services, currently amount to more than R100 billion per year. According to research contained in the IRR’s award-winning Blueprint for Growth papers, eliminating these premiums would generate sufficient savings to reduce VAT from 15% to 11.5% – without cutting a single rand from frontline service delivery.”
Says Hermann Pretorius, IRR Head of Strategic Communications: “South Africans are being forced to pay more so that government can pay more. Value for money is not an ideological slogan – it is a constitutional obligation. If provinces stop overpaying for contracts, they can save billions, protect frontline services, and give real tax relief to households without raising a single additional cent.”
By ending procurement overpayments and prioritising life-cycle cost, quality, and integrity, the IRR points out, provinces can redirect billions from waste and crony pockets back to taxpayers and essential services.
The IRR urges provincial treasuries to seize this opportunity: spend better, save billions, and deliver real relief to South Africans.
[Image: Nattanan Kanchanaprat from Pixabay]