SUPPLY CHAIN MANAGEMENT POLICY …

1 0 SUPPLY CHAIN MANAGEMENT POLICY JOHANNESBURG DEVELOPMENT AGENCY (JDA) 1 Date of adoption: The JDA Board of Directors resolves in terms of section 111 of the Local Government: Municipal Finance MANAGEMENT Act 56 of 2003, as amended, to adopt the following as the SUPPLY CHAIN MANAGEMENT POLICY of the JDA. APPROVED: _____ _____ JDA Exco Date APPROVED: _____ _____ JDA Audit Committee Date APPROVED: _____ _____ JDA Board Date 2 1. PURPOSE The purpose of this document is to set forth the POLICY of the Johannesburg Development Agency with respect to SUPPLY CHAIN MANAGEMENT processes and procedures, as well as related contractual agreements entered into by all business units, and ensure the efficient and uniform acquisition of works, goods, services, and other products with natural and/or legal entities; and to provide for the documentation to support such decisions.

2 2. POLICY STATEMENT It is the Johannesburg Development Agency s POLICY to seek out and procure suitable quality products and services in a competitive, fair, transparent, equitable and cost effective manner, and to select service providers consistent with applicable legislation, including but not limited to the following: (i) Constitution of the Republic of South Africa; (ii) Preferential Procurement POLICY Framework Act (PPPFA); (iii) Municipal Finance MANAGEMENT Act (MFMA); (iv) Construction Industry Development Board Act (CIDBA); (v) Broad-based Black Economic Empowerment Act (BBBEE); 3.

3 POLICY OBJECTIVES The main objectives of this POLICY are to: (i) Comply with the provisions of the MFMA and other applicable legislation; (ii) Ensure goods and services are acquired competitively, fairly, transparently; equitably and cost effectively; (iii) Promote the empowerment of previously disadvantaged enterprises, including SMMEs; (iv) Minimize fraud and corruption and encourage accountability; (v) Is consistent with the enterprise development programmes as approved by the City which are not limited to Expanded Public Works Programme (EPWP), Jozi@work, Enterprise Development Programme and Corporate Social Investment job pathway and other policies and programmes that seeks to aggressively advance the empowerment of the SMMEs and previously disadvantaged communities; (vi) Is consistent with the Preferential Procurement Regulations 2011.

4 4. PRINCIPLES FOR MEASURING SUCCESS The guiding principles for measuring the success of the SUPPLY CHAIN MANAGEMENT objectives are the: (i) preservation of the highest standard of ethical behaviour; (ii) selection of suppliers through a process that is competitive, fair, transparent and cost effective; 3 (iii) empowerment of SMMEs and enterprises that comply with the provisions of Broad-Based Black Economic Empowerment and codes of good practice; (iv) creation of employment and skills development opportunities; and (v) improvement of stakeholder value.

5 (vi) Ensure goods and services are acquired competitively, fairly, transparently; equitably and cost effectively; 4 Table of Contents Part 1 Definitions and Background .. 6 1. Definitions .. 6 2. Regulatory Framework .. 10 3. Applicability of the SUPPLY CHAIN MANAGEMENT POLICY .. 10 4. Adoption and Amendment of this POLICY .. 11 5. Oversight Role of the Board of Directors .. 11 6. Responsibilities of the Accounting Officer .. 13 7. Responsibilities of JDA Officials.

6 13 8. Responsibilities of Bidders .. 14 9. Delegation of SUPPLY CHAIN MANAGEMENT Powers and Duties .. 15 Part 2 Acquisition MANAGEMENT .. 16 Section A: General .. 16 10. Range of Procurement Goods .. 16 11. General 16 12. Lists of Accredited Prospective Providers .. 17 13. Panel of Consultants .. 18 14. General Procurement Procedures for Written and Verbal Quotations .. 18 Section B: Quotation System (R2,000 R200,000) .. 19 16. Written or Verbal Quotations .. 19 Section C: Competitive bids (>R200,000).

7 20 17. Bid Documentation for Competitive Bids .. 20 18. Public Invitation for Competitive Bids (Advertisements) .. 21 19. Procedure for Handling, Opening and Recording of 21 20. Committee System for Competitive Bids .. 22 21. Bid Specification Committees .. 22 22. Bid Evaluation Committees .. 23 23. Bid Adjudication Committees .. 24 Section D: Competitive bids Other matters .. 25 24. Negotiations with Preferred Bidders .. 25 25. Two-Stage Bidding Process / Pre-Qualification of Bidders .. 25 26. Procurement of Banking Services.

8 26 5 27. Procurement of Construction Contracts .. 26 28. Procurement Under Contracts Secured by Other Organs of State .. 26 29. Procurement of Goods Necessitating Special Safety Arrangements .. 26 30. Appointment of 27 31. Unsolicited Bids .. 27 32. Design Competition .. 28 33. Extension of Contracts, Variation Orders and Month-to-Month extensions .. 28 Part 3 Other Stages of Procurement Process .. 29 34. System of Demand MANAGEMENT .. 29 35. Logistics MANAGEMENT .. 29 36. Asset Disposal MANAGEMENT .

9 29 37. Risk MANAGEMENT .. 30 38. Performance MANAGEMENT .. 31 39. Deviation from, and Ratification of Minor Breaches of Procurement Processes .. 33 40. Combating of Abuse of SUPPLY CHAIN MANAGEMENT system .. 33 Part 4 Miscellaneous Matters .. 35 41. Proudly SA 35 42. Prohibition on Awards to Persons in the Service of the State .. 35 43. Awards to Close Family Members of Persons in the Service of the State .. 36 44. Ethical Standards .. 36 45. Inducements, Rewards, Gifts and Favours to Municipal Entities, Officials and Other Role Players.

10 37 46. Sponsorships .. 37 47. Objections and Complaints .. 37 48. Resolution of Disputes, Objections, Complaints and queries .. 38 49. Contracts Providing for Compensation Based on Turnover .. 39 50. Commencement .. 39 Annexure A: Code of Conduct for SUPPLY CHAIN MANAGEMENT Practitioners and Other Role Players .. 40 Annexure B: Code of Ethical Conduct for SUPPLY CHAIN MANAGEMENT Practioners and Other Role Players 6 Part 1 Definitions and Background 1. Definitions In this POLICY , unless the context otherwise indicates, a word or expression to which a meaning has been assigned in the Act has the same meaning as in the Act.