Definitions in supply chain management

Accountability – The process via which politicians (councillors) and municipal officials are held accountable for their conduct.  Politicians and officials should be accountable in terms of the delivery against outputs, results and outcomes.

Accounting Officer – In relation to a municipality, means the municipal official referred to in S60 of the MFMA (the municipal manager); or in relation to a municipal entity, means the official of the entity referred to in S93 of the MFMA (chief executive officer). Municipal Finance Management Act 56 0f 2003 (MFMA) – S1

“B-BBEE”  – broad-based black economic empowerment as defined in section 1 of the Broad-Based Black Economic Empowerment Act;

“B-BBEE Status Level of Contributor”  – B-BBEE status received by a measured entity based on its overall performance using the relevant scorecard contained in the Codes of Good Practice on Black Economic Empowerment, issued in terms of section 9(1) of the BroadBased Black Economic Empowerment Act;

Blacklisting Authority – the Blacklisting Committee;

Blacklisting Period – the period for which the blacklisted person is barred from participation in the procuring processes of the Municipality;

Blacklisting – act of disqualifying a person or an entity from participating in or continuing to participate in the procurement process of the municipality;

Competitive bid – a bid in terms of a competitive bidding process;

Competitive bidding process – a competitive bidding process referred to in paragraph 12 (1) (d) of this policy;

Contingency – an amount included in the contract authority to cover the cost of unforeseen circumstances and must be used in line with respective industry norms and standards. This percentage must be appropriately motivated and approved at contract approval
stage via the Bid Specification Committee, or Bid Adjudication Committee(where appropriate);

Contract –  a legally binding agreement between the Municipality and the Contractor for the latter to provide goods, services, engineering and construction works, or professional services in return payment by the former;

Contract Authority – total contract award value as approved, or supported, by the Bid Adjudication Committee. This is inclusive of escalations and the normal contingency allowance for variations under the general conditions of contract, and shall be taken from the
amount approved at the Bid Specification Committee, or Bid Adjudication Committee;

Council or Municipal Council – A municipal council referred to in S 157 of the Constitution. Municipal Structures Act 117 of 1998 – S1

Delegation – In relation to a duty, includes an instruction or request to perform or to assist in performing the duty. Municipal Finance Management Act 56 0f 2003 – S1

Eligibility Documents mean:

1. A valid Tax Clearance certificate or Tax Compliance Status with a PIN number issued by the South African Revenue Service and Municipal Fee Declarations and certificates certifying that the bidder has no undisputed commitments for municipal fees due to
   any municipality or overdue for a prescribed period;
2. declarations by tenderers certifying the correctness of information and certifying validity of authority to act (Regulation 14 of the Preferential Procurement Policy Framework Act 5 of 2000);
3. certificates declaring details of Private or business interests in terms of Regulation 46(e) of the Supply Chain Management Regulations;
4. proof of registration with the CIDB (Construction Industry and Development Board), where applicable;
5. proof of Registration of a Company, close Corporation, Co-operative or any other document requiring formal registration;
6. any partnership agreement, or agreement of Joint Venture, Memorandum of Articles of A Company, Association Agreement or any other agreement establishing a business entity;
7. a statement setting out details of work undertaken in the Government/public sector/ organs of state in the past five years, including particulars of persons who assessed the work and who can be contacted to verify completion/ non completion of the contract;
8. audited financial statements where applicable, or books of account; and/ or
9. any other document prescribed by law or specifically requested by the municipality.

Formal written price quotation – quotations referred to in paragraph 12 (1) (c) of this policy and shall include any offer to purchase immovable property;

Fronting – claiming preference points, status or goals of any of the target groups listed in the municipality’s Targeted Procurement Policy and/or tendering documents where such claim is false;

Historically Disadvantaged Individuals (HDI) – HDI means a South African citizen – who, due to the apartheid policy that had been in place, had no franchise in national elections prior to the introduction of the Constitution of the Republic of South Africa, 1983 (Act 110 of 1983) or the Constitution of the Republic of South Africa, 1993 (Act 200 of 1993) (“the Interim Constitution); and/or who is a female; and/or who has a disability: Provided that a person who obtained South African citizenship on or after the coming into effect of the Interim Constitution, is deemed not to be an HDI. Preferential Procurement Regulations 2001 pertaining to the PPPFA Act No 5 of 2000

Integrated Development Plan –  A plan aimed at the integrated development and management of a municipal area. This plan must align the resources and capacity of the municipality with the implementation of the plan. The plan forms the policy framework and general basis on which annual budgets must be compiled. It must reflect a financial plan that includes a budget projection for at least three years. Municipal Structures Act 117 of 1998 – S1; Municipal Systems Act 32 of 2000 – S1

In the service of the state means:

1. a member of any municipal council, any provincial legislature or the National Assembly of the National Council of Provinces;
2. a member of the board of directors of any municipal entity;
3. an official of any Municipality or Municipal entity;
4. an employee of any national or provincial department, national or provincial public entity or constitutional institution within the meaning of the Public Finance Management Act;
5. a member of the accounting authority of any national or provincial public entity; and
6. an employee of Parliament or a provincial legislature.

Long-term Contracts – A contract with a duration period exceeding one year. LG: Municipal SCM Regulations – May 2005

Municipal Entity – Means a) a private company referred to in S86B (1) (a) of the Municipal Systems Act; b) a service utility; or c) a multi-jurisdictional service utility. Municipal Systems Act 32 of 2000 – S1

National Treasury – The National Treasury established by section 5 of the Public Finance Management Act (PFMA). MFMA – S1

Provincial Treasury – A treasury established in terms of S17 of the PFMA. MFMA – S1

Supply Chain Management – An integral part of financial management that seeks to introduce internationally accepted best practice. It bridges the gap between traditional methods of procuring goods and services and the balance of the supply chain whilst addressing procurement related matters that are of strategic importance. Policy to Guide Uniformity in Procurement Reform Processes in Government: 2003

Senior Manager – In relation to a municipality, means a manager referred to in S56 of the Municipal Systems Act; or in relation to a municipal entity, means a manager directly accountable to the CEO of the entity. MFMA – S1

Treasury regulations and guidelines – Any regulations and guidelines (including those relating to SCM) issued by the Minister of Finance in terms of S168 of the MFMA. MFMA – S168