BALANCING INNOVATION AND REGULATION: A LOOK AT UNSOLICITED BIDS AND PROPOSALS’ POTENTIAL TO UNLOCK INNOVATION IN PUBLIC PROCUREMENT IN SOUTH AFRICA

Abstract

Public procurement generally entails that the state approach the private sector for goods and services it requires. However, in the South African context, it is recognised that the private sector can approach the public sector with unsolicited bids or proposals to address challenges that the public sector faces, such as aging infrastructure and poor service delivery. Thus, allowing the private sector to take the initiative to collaborate with the public sector, as opposed to responding to requests for proposals from the public sector, can be viewed as a reactive and restrictive approach to addressing the unique challenges that the public sector faces. This article argues that unsolicited proposals should be encouraged, provided they are regulated and there are clear guidelines to ensure compliance with the Constitution and established public procurement norms and principles. Unfortunately, the regulation of unsolicited proposals differs when it comes to ordinary procurement by the state as opposed to unsolicited offers in public-private partnerships (“PPPs”). As such, this article explores the differential treatment by National Treasury and our courts with respect to unsolicited bids in the context of ordinary procurement versus the treatment of unsolicited proposals in PPPs.  It is argued that National Treasury takes a light approach to regulating the process when unsolicited bids are received, evaluated and awarded by the public sector in cases of ordinary procurement but a heavy approach for unsolicited proposals received by organs of state where municipalities and PPPs are concerned. By referring to judgments on the subject-matter, this article considers the danger that the light approach can and has had, and ultimately argues that, going forward, National Treasury must also apply the heavier approach utilized for PPPs in the context of ordinary procurement.