Eskom welcomes the Treasury’s relaxation of some Procurement and Supply Chain Management constraints as contained in Instruction 3 of 2021/22
13 May 2022
Eskom welcomes the relaxation and exemption by National Treasury on some key principles of the Public Finance Management Act (PFMA) supply chain management processes as contained in the PFMA SCM Instruction Note No 03 of 2021/22, which came into effect during April 2022. The new instruction note will assist in providing agility and control in the procurement and supply management process to Eskom, which will assist in unlocking some of the bottlenecks in our attempts to speedily resolve some of the pressing operational challenges.
The amendment allows Eskom to approve contract variations without National Treasury approval and to engage directly with the original equipment manufacturers (OEMs) and maintenance suppliers of the most critical equipment and services required in the process of generating electricity. The amendments also provide Eskom with flexibility and agility over expansions, deviations and handling of urgent matters in its procurement processes.
The overall intent of the relaxation is to ensure the swift and flexible implementation of the procurement processes in a way that takes into account the core principles of the PFMA while ensuring fairness in the procurement processes. Eskom will continue to maintain the principles of Section 217 of the Constitution in that competitive bidding be the usual mechanism for procurement, and deviations seen as an exception rather than the norm.
In the plan to drive efficient procurement and engaging with OEMs and maintenance suppliers, this measure supports the efforts for Eskom power stations and operating units to work faster and more efficiently on procurement of what they need at an operating level.