PROCUREMENT POLICY AND PROCEDURES 24 MAY 2013

1. PROCUREMENT POLICY AND PROCEDURES 24 MAY 2013

2. PROCUREMENT POLICY

3. PRESENTATION CONTENT • Procurement Ethics; • Methods of Bids Solicitation; • Expression of Interest for Contractors; • Request for Proposals - Consultants; • OPEN Tender Process; • Adverts – newspapers, websites, iTenders, etc; • Issue of Tender Documents; • Compulsory Site Briefing Meetings; • SMME Participation and Involvement; • Lodging / Receiving of Tender documents;

4. PRESENTATION CONTENT (Cont.) • Closing of Bids; • Evaluation of Bids and Scoring Process; • Appointment of Preferred Bidders; • Conclusion;

5. PROCUREMENT POLICY • CDC adheres to five Procurement Pillars:- • Fairness; • Equitable; • Transparency; • Competitiveness; and • Value for Money • CDC Policy is aligned with:- • The Constitution Act No 106; • PPPFA of 2011 • BBBEE Act; • PFMA Act of 1999; • CIDB Act 2000; and • National Treasury Regulations

6. PROCUREMENT ETHICS • Declaration of Interest and Management of Conflict of Interest; • Canvassing, Corrupt and Fraudulent Practices; • Confidentiality; • Staff Code of Conduct; • Code of Conduct – SP and Third Parties; • Always comply with PFMA, PPPFA, BBBEE, CIDB, National Treasury Regulations and Practice Notes etc; • In conducting CDC Procurement Process – Honesty, Integrity, and Openness are integral and utmost important

7. METHODS OF BID SOLICITATION

8. CLOSED TENDER PROCESS • Services or Goods from R 500k – R 1m (Incl. VAT) • CDC Database must be utilised to source service providers • Procurement Plan Submissions must be prepared and approved by the Bid Specification Committee (BSC) • Supply Chain representative must always be involved in the process • Procurement Submissions must be prepared and the Procurement Committee (PC) shall approve the service provider;

9. OPEN TENDER PROCESS • Services or Goods in excess of R 1m (90:10); • Bids must be advertised in Public; • Full Procurement Process must be followed • Supply Chain representative must always be involved in the process • Procurement Plan Submissions must be submitted to Bid Specification Committee (BSC) prior advertising • Procurement Submissions must be submitted to Procurement Committee (PC) • See PROCUREMENT HANDBOOK

10. EXPRESSION OF INTEREST • Implemented for sourcing Contractors especially – repetitive projects such as Early Childhood Dev. Centres, ELSEN, etc; • The scope is not fully defined; • Creation of Pool of Preferred Contractors; • Mandatory Requirements are the guiding Principles; • Pre Qualified Contractors are given Tender Documents to Price; • Duration of a Service Provider in a pool is one to two years with option of one year extension (not more)

11. REQUESTS FOR PROPOSALS • Normally Implemented on Professional Consultants e.g Architects, Placement Agents, Auditors, etc; • The scope is defined and known; • Bidders may submit prices / fee – 90:10; • Evaluation of bids is based is based on PRICE and BBBEE; • Minimum threshold may be defined on highly specialised contracts < 60%

12. OPEN TENDER PROCESS

13. TENDER OPPORTUNITIES (Adverts) • All tender opportunities are advertised – local and / national newspapers; • KNZ = ILANGA, ISOLEZWE and The Mercury (on Thursdays) • EC = The Herald and Daily Dispatch (on Monday or/and Friday); • National – Sunday Times; • CDC Website – www.coega.com/tenders; • CIDB - iTenders; • Government Tender Bulletin;

14. TENDER DOCUMENTS ISSUE • Tender documents must be collected BEFORE Briefing Meeting; • Ensure complete Document Issue Register; • NO CASH is accepted; • No documents are issued at Site Briefing Meetings

15. SITE BRIEFING MEETING • Procurement Manager will chair / lead the meeting; • Ensure Briefing Meetings are INFORMATIVE; • CDC will ensure there is Agenda, Attendance Register, Site Plans/ Presentations; • Consultants will present Scope of work / Technical requirement in detail • Contractors must send Technical Personnel; • Contractors must try locate the Site beforehand; • Once the meeting is closed – no signing of attendance registers.

16. SMME TARGET • CDC has set a Corporate Target of 35%SMME involvement on all Projects, • Communication to all bidders at Briefing Meetings, • SMME Target must be documented on Tender Documents • Consultants will identify SMME Packages in each Project; • Project Managers will assist in monitoring achieved thereof; • Monthly SMME achievements must be reported; • Breaking down BIG/MEGA Projects into smaller Projects

17. LODGING OF BID DOCUMENTS • Receiving bids • Bids must be submitted in sealed envelopes, • Complete Lodging Register (audit requirement); • To be deposited into CDC Tender Box, • Bids received by Telegram, fax or email will not be considered (unless stipulated in quotes), • Late bid submissions will not be accepted; • Bids are open in public and prices posted in the CDC Website;

18. CLOSING OF TENDERS • CDC Tenders CLOSE at our offices – Tender Box; • Closing Date, Venue and Time – confirm with Advert and Tender Document; • LATE Bids will not be accepted;

19. EVALUATION OF BIDS

20. SCM COMMITTEES • Bid Specification Committee • Bid Evaluation Committee • Bid Adjudication Committee

21. PROCUREMENT STRUCTURES

22. THREE STAGE EVALUATION APPROACH

23. ADJUDICATION OF BID SUBMISSIONS

24. ADJUDICATION OF BID SUBMISSIONS BBBEE Empowerment Scoring • 90:10

25. APPOINTMENT OF PREFERRED SP • Letters of Regrets will be sent out to unsuccessful SP; • Letter of appointment will be sent to successful Bidder; • Form of Offer and Acceptance is signed off; • Maximum of two active projects per contractor • Tender Queries = KZNTenders@coega.co.za

26. CONCLUSION • Supply Chain Unit will ensure at all times that Procurement Process and Procedures are in FULL compliance with Legislations; • Procurement Manager will endeavour to maintain high integrity, procurement ethics and fairness when awarding bids; • CDC is fully committed in ensuring that Socio Economic Imperatives, such as Job Creation, SMME involvement, Health and Safety, are achieved; • Any queries relating to the Bids must be addressed with the Procurement Manager or Supply Chain Manager;

27. Thank You