Despite affirmative action policies, government print tenders are still going to big companies, writes Julia Grey
If government policy were followed to the letter, small emerging black businesses should be benefiting when tendering for printing government paperwork everything from annual reports to ballot papers. In reality, few previously disadvantaged individuals (PDIs) are reaping any rewards from the affirmative procurement policy.
On a national level, Cabinet has approved that, for printing contracts valued at less than R2-million, a ratio favouring PDIs is used. The lowest quote receives 88 points; 10 points are scored for equity ownership by PDIs; and two points for equity ownership by women.
However, provincial structures procure for certain work independently under their own tender board acts.
There is no clear-cut reason for this apparent discrimination. Typically, the fact that these black-owned printers are just emerging means they have relatively small capacity, and often cannot deal with the size of the contracts. Consequently, the larger printing firms established in the apartheid era continue to win government work.
Although these large firms such as CTP and Creda do farm out business they cannot manage to smaller black businesses, Celeste Naidoo, who acts as a broker for black printers in the Western Cape, points out that PDIs end up at the mercy of the larger firms, grovelling for crumbs.
But even larger black-owned printers are struggling to get government work. Ashraf Japtha, estimator for the growing printer Formeset, says government work accounts for about 1% of its monthly business while the company could easily handle 25%. The time has come for us. We want work, but were battling to get work. There should be a slice of the pie for everyone.
Isaac Smith, head of the office of the tender board in the Western Cape, concedes there is still a long way to go to make black empowerment a reality.
While most printing work is sent to the central government printers in Pretoria, the work farmed out by the provincial tender board seldom makes its way to PDIs. Smith says one reason is that certain companies are known to the people making the decisions, and that a database of PDIs is urgently needed for this to change.
The situation in the Western Cape is exacerbated by the fact that the province has yet to enact the preference system part of the affirmative procurement policy that was implemented by national government in August last year. This, as well as the fact that the PDIs are new to the system, results in a negative effect on black printers.
Government printer Mesuli Dondolo, based in Pretoria, echoes Smith in saying that the quotes submitted by PDIs show enormous ignorance of the tendering process: some quotes are unreasonably low, others are up to 400% overpriced.
He agrees that this ignorance, as well as the limited capacity of small printers, results in their inability to compete.
But his sympathy is limited: Dondolo argues that, according to the rules of the tendering system, the government doesnt go out and look for PDIs, but expects them like everyone else to apply for work published in the government tender bulletin.
But many small black-owned printing businesses express enormous frustration with the process. Hugh Ralephata from Johannesburg-based Manthuba Business Forms, which Dondolo gave as an example of a PDI getting government work, said the company does tender, but with very little success. He argues that the government should reserve specific jobs for PDIs, because they are unable to compete with established firms.
The Eastern Cape tender board maintains it has adopted a policy intended to make sure that specifications are sensitive towards the small, micro and medium enterprises which were disadvantaged by past policy.
However, one printer in the province who declined to be named for fear of stirring up a hornets nest insisted that printing in the Eastern Cape had nothing to do with affirmative action, and that the local printing industry generally was quieter than it has been in years.
He adds that small printers are going on a major drive to try to change the situation.