PRE-QUALIFICATION AND PREFERENCE IN PUBLIC PROCUREMENT: A CRITICAL REFLECTION ON MINISTER OF FINANCE V AFRIBUSINESS NPC

Abstract

The ruling by the Constitutional Court in Minister of Finance v Afribusiness NPC sounded the death knell for the 2017 Preferential Procurement Policy Framework Act (PPPFA) regulations. By a narrow majority, the Court dismissed an appeal by the Minister against a ruling by the SCA which declared the regulations invalid. This article offers a critique of both the majority and minority judgments. It calls into question the fundamental premise on which the majority’s reasoning was based, namely, that the Minister acted in breach of s 2(1) of the PPPFA which granted authority to organs of state (not the Minister) to determine their own preferential procurement policies. The article also criticizes the majority for not having used the opportunity to deal decisively with the question of pre-qualification criteria in tender processes. In his critique of the minority judgment, the author submits that the PPPFA and its regulations cannot be “rescued” through a strained interpretive process. The more candid approach is to acknowledge that the framework created by the PPPFA falls far short of the standard envisaged in s 217(2), and that it should be replaced as a matter of urgency. The article concludes that, while the PPPFA is in force, organs of state should exercise caution before incorporating prequalification criteria in their procurement policies. The author argues that whilst there is no constitutional problem with the use of prequalification criteria based on race or gender per se, this cannot be attained through a moribund piece of legislation, such as the PPPFA. New legislation is needed, which harmonizes the principle of legality with the imperative of remedial equality.