Minister of Finance Enoch Godongwana said public procurement remains a key enabler of economic growth and development, reacting to the Constitutional Court judgment declaring the Public Procurement Act, 2024 unconstitutional and invalid.
The highest court in the country declared the Public Procurement Act unconstitutional and invalid, upholding legal challenges brought by the Western Cape Government and the City of Cape Town, handing down judgment yesterday.
The judgment relates to matters brought by the Premier of the Western Cape Government Alan Winde and the City of Cape Town against the Speaker of the National Assembly, the Chairperson of the National Council of Provinces, the Minister of Finance and others.
The applicants argued that the law rigidly centralised procurement under the National Treasury, which threatened local empowerment policies. The Act, signed into law in 2024 but not yet brought into full operation, sought to overhaul South Africa’s public procurement framework by centralising procurement oversight under a national Public Procurement Office and imposing uniform preferential procurement prescripts across all organs of state.
Godongwana said public procurement remains a key enabler of economic growth and development in a statement. However, he emphasised that this cannot be realised in a weak public procurement ecosystem that is not governed by a legislative framework designed to achieve a procurement system that is fair, equitable, transparent, competitive and cost-effective. According to him, such a system should also provide for the protection or advancement of persons, or categories of persons, disadvantaged by unfair discrimination,” he said.
“Public procurement in its current state will not realise these constitutional principles as it is fraught with challenges that include corrupt activities, fraud, financial loss, poor planning, inferior deliverables, weak institutional capacity, irregular expenditure and failure to sufficiently stimulate local industries,” he added.
Godongwana further said: “This is evident from the various reports, media exposés and Commissions of Inquiry that have taken place or are underway.”
The Court found that the National Assembly failed to fulfil its constitutional obligation to facilitate reasonable public participation after material changes were introduced to the legislation during the parliamentary process.
Also read: Constitutional Court strikes down Public Procurement Act as unconstitutional
