It is interesting to note that Consulting Engineers South Africa (CESA) has made an application to the Department of Trade and Industry (DTI) for engineering consulting services to be given ‘designated’ status under government’s preferential procurement rules.

Under newly introduced regulations, the DTI has the authority to stipulate that government departments, agencies and Stae-owned corporations (SoCs) procure designated products and services from local manufacturers or providers.

The aim of such designations is to use public-sector procurement to support the reindustrialisation of the domestic economy, in line with the New Growth Path and the Industrial Policy Action Plan.

In December, the first designations were identified as being power pylons, railway rolling stock, buses, canned vegetables, clothing, textiles, footwear and leather products, as well as set-top boxes. However, Trade and Industry Minister Dr Rob Davies has indicated that other products and services could be added to the list over time.

CESA president Naren Bhojaram argues that the designation of consulting engineering services has the potential to stimulate additional work for the industry, which, in turn, could support job creation and an enlargement of South Africa’s cadre of professional engineers. CESA has nearly 500 member firms that together employ some 20 000 people earning a yearly fee income of R17-billion.

However, CESA believes that the designation is not the only change that needs to be made to the Preferential Procurement Policy Framework Act (PPPFA) rules.

The organisation is deeply distressed that certain SoCs, including Eskom, Transnet, Airports Company South Africa and the water boards, have received exemption from the new PPPFA regulations, which came into force on December 7.

In fact, Bhojaram has described the decision as a “bombshell”, which could dilute the effectiveness of the PPPFA, while creating confusion in the market.

It also wants quality considerations to be integrated into the pricing dimension of public-sector adjudication processes when consulting engineering services are being procured.

Currently, the rules stipulate that price be given a 90% weighting and preferential-policy considerations 10% when large purchases of goods and services are being made by the public-sector – an 80:20 ratio could be applied for smaller projects.

But CESA argues that the model is inappropriate for the procurement of professional services, where experience and quality are often as important as the final price. Therefore, CESA would like the 90% price consideration to be adjusted to cater for the experience of the service provider and the quality of the service provided.

“In procurement of professional services, we believe that the element of quality must be brought into the procurement regulations in a single process,” Bhojaram adds.

He acknowledges that this would result in the introduction of subjectivity to the adjudication, but says this could be overcome through the inclusion of technical professionals in bid evaluation committees. CESA members are required to have a quality management system as a condition of membership.

It will be fascinating to see how the DTI and the National Treasury respond to CESA’s well- considered requests and whether other services sectors follow suit in seeking to massage the rules in a way that could suit them just a little bit better.