THE ICT CHARTER

5.5. Preferential Procurement
Overview
This indicator is critical to the success or failure of the government’s
strategy on BEE. Successfully implemented, it will ensure redistribution
of incomes, skills development and transfer, as well as job creation.
Research conducted on listed entities, reveals that of the R515 billion 9
that was targeted to reach BEE accredited companies, R500 billion 9 did
not reach them. Of this misdirected R500 billion, an estimated R200
billion 9 could have reached the pockets of black persons, either in the
forms of salaries, profits or procurement spend paid to black owners
and stakeholders.
A similar study on the potential affirmative procurement gap of JSElisted
companies in the Information Technology, Telecommunication
and Electronic sectors estimates the affirmative procurement gap in
the ICT sector to be between R 27.3 billion and R 45.6 billion 10 . Delays
in the implementation of affirmative procurement programmes across
the ICT sector resulted in an estimated R 8.3 billion to R 13.8 billion 10
being lost to black owners and employees.
This is because most procurement opportunities in the private sector
are traditionally directed to white suppliers. However, over the last ten
years, SOEs have been instrumental in spearheading preferential
procurement from black owned and empowered enterprises.
Preferential procurement has resulted in the creation of opportunities
for black entrepreneurship.
Genuine BEE procurement will only be possible when there are
sufficient, competent BEE rated suppliers of goods and services.
9 Wu,C. Jack, V. Lorio, P. Naidoo, C. and Bodigelo,S. 2004 The Affirmative Procurement Gap in the
South African Economy, Nedcor BEE Forum, 26 February 2004
10 Wu,C. and Lorio, P. 2004. An estimate of the affirmative procurement gap in the ICT Sector,
Unpublished Report, Empowerdex (The analysis is based on the procurement of all JSE listed
companies in the IT Software, IT Hardware and Electronics Sectors of the JSE)
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