Public Sector Supply Chains helping to keeping economy afloat


The IPSA/ CIPS Pan African Conference, held at Emperors Palace on 26th and 27th May, attests to the significant role that public sector supply chains are playing in ensuring the resilience of the South African economy against the worst effects of the present global downturn. In particular, the State supply chain management machine is managing many massive contracts that are keeping several sectors of the economy afloat and their balance sheets in the black.

In his presentation, Kevin Naik, Director of National Treasury’s Supply Chain Training – which is tasked to manage and oversee Public Sector Supply Chain Policy and Compliance with legislation – covered several initiatives that government is busy with to dramatically increase efficiencies and service delivery countrywide:

– Most notable of which being capacity building through the training of personnel in the new dispensation which focuses on developing skills in total SCM rather than just procurement and/ or logistics where the focus has been in the past.

– Using only accredited training providers to ensure the highest standards to establish a professional SCM cadre throughout the public service in the short- and longer term.

– Providing a framework for the ongoing assessment of the competencies and skills of personnel at all levels.

In this process, National Treasury also plays a crucial role in rolling out strategic sourcing objectives by negotiating and concluding transversal contracts, of which there are currently 53 in place, such as one for buying vehicles to a value of R3,5-billion a year, at National Department and Provincial Government level. The process analyses government spending patterns, makes informed SC decisions, maximises the leverage on Government buying, improves the quality of services downstream, optimises the supply-base for the different procurement categories and, in effect, reduces direct procurement and administration costs on an ongoing basis.

In short, by applying the specific tools of capacity building and strategic sourcing the National Treasury is enhancing efficiencies through enhancing the professionalism of the SCM cadre in government and populating it with competent people to optimise service delivery to all members of the public.

Public Sector procurement  forms the  biggest national spend and in South Africa it is decentralised within a strictly controlled legislative environment wherein processes are prescribed and the relevant norms and standards constantly monitored. Mr Naik clarified that outside of SITA, which is responsible for acquiring public IT products and services, and National treasury there are no other agencies responsible for procurement. That responsibility is vested with national departments, provinces and municipalities in accordance with the applicable laws and regulations of Parliament.

Since 1994, government has changed and broadened the national framework to include total SCM, and not just procurement which is too narrow in focus. In this time of increasing professionalism within the supply chains of the State, officials can exercise discretion within the prescribed framework, provided that they strictly adhere to the limits of their budgets.

For further insights, you can look forward to the upcoming Public Sector Supply Chain Summit, facilitated by SmartProcurement, the niche procurement media and communications service, together with Commerce Edge, the accredited Procurement Coaching and Training Provider, at Leriba Lodge in Centurion from 18 – 20 August 2009.

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