Civil Engineering April 2022 | Vol 30 No 3

Civil Engineering April 2022 45 CESA welcomes Gauteng budget, calls for tighter tendering processes C ommenting on the announcement of the Gauteng provincial budget, the CEO of Consulting Engineers South Africa (CESA), Chris Campbell, welcomed the budget’s focus on critical infrastructure spend, but called for urgent attention to address issues within tender processes. “CESA, which is an engineering industry association consisting of 580 companies, is delighted that the provincial budget placed such an emphasis on social development and critical infrastructure spend over the next three years, to the tune of some R36 billion. We do, however, urge the government to work at addressing im- portant challenges inherent in the current tender processes, or efforts and funds are likely to be wasted,” says Campbell. “According to the recent CESA Bi- annual Economic and Capacity Survey (BECS), there is a 20% cancellation rate of tenders, which is way too high and ultimately represents a considerable waste of resources and effort, and in some cases can even impact the sustainability of those companies that deliver on projects.” TENDERING & PROCUREMENT Campbell pointed out that while there is considerable expertise within the Gauteng government, there are many capacity challenges within its procurement depart- ments – project and technical procurement requiring a high level of specific expertise that is currently lacking. This results in numerous complex problems with the tendering process itself and some major bottlenecks in awarding technical tenders as well as in the effective execution of projects. “One consequence of this deficiency in capacity is that many engineering projects are not adequately scoped and they lack the necessary definition. This can result in a whole range of problems, as engineering firms are not always sure how to develop an appropriate tender and may not be clear on what exactly is required to undertake the project. Poor scoping can also make it tricky for adjudicators to identify the best supplier to execute the project,” explains Campbell. “Some of the complexities in this area are also around how long it takes for these tenders to be adjudicated, and sometimes the validity dates for the project expire after continuous extensions and poten- tially result in cancellation as well. “In addition, these challenges may in some cases be compounded by a lack of necessary skills among those officials who have to adjudicate these highly technical tenders. This can result in all kinds of problems, including the selection of the most appropriate supplier and even in the correct and best execution of a particular project,” he continues. PAYMENT & CAPACITY According to the BECS, notwithstanding Treasury regulations, late payments also continue to be an issue for the sector. Campbell said the Gauteng Provincial Government is quite often guilty of late payments to the suppliers of infrastructure. This can have dire consequences for the sustainability of some of those suppliers and needs to be urgently addressed, he added. Asked how capacity challenges could be addressed, Campbell says: “Procurement staff directly involved with infrastructure related procurement within government should have an engineering background and a high level of technical knowledge. This should go a long way to addressing problems with scoping and the adjudication process that will follow. It is imperative to have sufficient experience and knowledge to know what professional services should cost so that you can be assured of the requisite quality of services. The notion that least cost will be equal to a high quality of professional services is counterintuitive if you hope to be offered the optimal solution to what are often complex infrastructure problems.” Campbell believes that the procurement system requires careful refining. “There are also too many current unknowns, for example, the case with the illusive Public Procurement Bill, which has been in development since 2013, raised its head again in 2020 but has since disappeared from the public radar screen. This legisla- tion was meant to distinguish between procurement of general goods and services, generally regarded as commodities, from that of infrastructure related services, both professional and construction related. What is desperately needed now is certainty and clarity on the procurement regime,” he adds. The CESA CEO went on to note that the landscape for implementation is not only difficult for the private sector, but also for the officials within government who have the exceedingly difficult task of ensuring that fruitless and wasteful expenditure can be eliminated from the system. “Such knowledgeable persons should be both accountable and empow- ered to be able to make decisions that are, in total, consistent with the Constitution. Currently the ‘cost effective’ component in Section 217, subsection 1 is generally misinterpreted to mean least cost,” he adds. “The Gauteng government has come up with a magnificent infrastructure budget and spend, but there are a lot of highly complex elements that are going to make it difficult to effectively execute some of the projects. Nevertheless, we are confident that these challenges can be overcome with a united effort between government and the construction sector.”  CESA is happy with Gauteng's infrastructure budget but warns of difficulties in executing projects