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Procurement compliance in South Africa means running your supply chain management (SCM) function so that every purchase, tender and contract meets the legal framework governing public spending — principally the PFMA, the PPPFA preference-point system, Treasury regulations, and now the Public Procurement Act 28 of 2024. For public-sector, SOE and supplier-side buyers, getting this right protects budgets, audit outcomes and reputations.
If you run an SCM unit in a department, municipality, state-owned entity (SOE) or a company bidding into government, the rules are not optional and they are changing. This guide sets out the framework your staff need, where the biggest compliance risks sit, and how targeted training closes the gap. It is general guidance, not legal advice — confirm specifics with your own specialist or the relevant organ of state. It sits within our Supply Chain & Procurement Training cluster; for broader context, see What a Supply Chain Management Course Covers.
Why public-sector procurement compliance matters
The Auditor-General reports on irregular expenditure every year, and SCM non-compliance is one of the most common drivers of qualified audits and disclaimers. For accounting officers the consequences are personal: the PFMA and MFMA impose duties — and financial-misconduct liability — on the individuals responsible. Weak procurement compliance shows up as:
- Irregular, fruitless and wasteful expenditure flagged by internal audit and the AGSA.
- Set-aside or cancelled tenders after a successful challenge by an aggrieved bidder.
- Reputational damage and, in serious cases, investigation by the Public Protector, SIU or law-enforcement.
- Disrupted service delivery when contracts are halted or re-run.
Most of these failures are avoidable. They stem not from corruption but from staff who do not know the rules well enough to apply them consistently under deadline pressure.
The PFMA framework: the foundation of public SCM
The Public Finance Management Act (PFMA) is the backbone of financial governance for national and provincial departments, public entities and SOEs. (Municipalities follow its sister legislation, the MFMA.) It requires every department and public entity to have an SCM system that is fair, equitable, transparent, competitive and cost-effective — the five constitutional pillars from section 217 of the Constitution. It places the duty for that system on the accounting officer or accounting authority, who must prevent irregular and fruitless/wasteful expenditure. National Treasury regulations, SCM instruction notes and practice notes give it operational detail, setting thresholds for quotations versus competitive bids, bid-committee structures (specification, evaluation, adjudication), and deviation reporting.
In practice, PFMA SCM compliance is where most day-to-day risk lives: choosing the correct procurement method for the value band, constituting bid committees correctly, documenting deviations, declaring conflicts of interest, and keeping an audit trail that can survive AGSA review. Staff who understand the framework — not just the templates — make far fewer of the errors that become audit findings.
The PPPFA and the preference-point system
The Preferential Procurement Policy Framework Act (PPPFA) governs how preference is awarded when an organ of state evaluates competing bids. Under the Preferential Procurement Regulations 2022 (in force 16 January 2023), the mechanics are:
| Contract value (rand) | Preference-point split |
|---|---|
| R30,000 up to R50 million | 80/20 — 80 points for price, 20 points for specific goals |
| Above R50 million | 90/10 — 90 points for price, 10 points for specific goals |
A few points staff frequently get wrong:
- The preference points are awarded for “specific goals”, which the regulations tie to historically-disadvantaged individuals (HDI) — ownership defined by race, gender and disability — and to Reconstruction and Development Programme (RDP) objectives. They are not simply a score for the bidder’s generic B-BBEE level — a common and costly misconception.
- Functionality (quality) is a separate gate. Each organ of state decides per tender whether functionality is evaluated, the criteria, and the qualifying threshold. It is not part of the 80/20 or 90/10 split; price and specific goals are scored only after a bid passes the functionality threshold.
- Below the R30,000 floor the preference-point system does not apply and procurement runs through the relevant quotation process.
A misapplied points calculation is exactly the kind of error that gives an unsuccessful bidder grounds to challenge an award. For the bidder’s side, see our guides on responding to a government tender and bid and proposal writing for tenders.
The shift to the Public Procurement Act 2024
The biggest change on the horizon is the Public Procurement Act 28 of 2024, which repeals and replaces the PPPFA and consolidates the public-procurement framework. The headline features to plan for:
- Set-asides (pre-qualification / reservations): the Act expressly enables bids to be reserved for designated categories — for example Black-owned, Black-women-owned, women-owned and persons-with-disability-owned enterprises, as well as small enterprises. This is a structural shift beyond the points-based preference of the PPPFA.
- A consolidated framework with a Public Procurement Office in National Treasury and provisions on transparency, debarment of errant suppliers, and dispute resolution.
- Phased implementation through 2025/26: the Act and its regulations are coming into force in stages, so during the transition staff must understand both the outgoing PPPFA regime and the incoming rules, and know which applies to a given procurement.
Because the Act changes the legal basis for preference and introduces new instruments such as set-asides, this is the moment to retrain SCM staff: policies, templates, evaluation matrices and bid-committee briefs all need updating, and the people using them need to understand why. Treat the specifics here as general guidance and confirm the current commencement and regulation status with National Treasury or your legal specialist before changing your processes.
Why your staff need SCM-compliance training
Procurement compliance fails at the desk, not in the statute book. The framework can be perfectly sound while an evaluation is still scored incorrectly, a deviation goes undocumented, or a conflict of interest goes undeclared. SCM compliance training targets that gap with practical, role-relevant capability:
- SCM practitioners and buyers — correct procurement method per threshold, accurate 80/20 and 90/10 splits, and a defensible audit trail.
- Bid-committee members (specification, evaluation, adjudication) — compliant committees, correct scoring of functionality and specific goals, and proper minuting.
- Finance and internal-audit staff — recognising irregular, fruitless and wasteful expenditure early and reporting it correctly.
- Managers and accounting officers — their PFMA/MFMA duties and oversight responsibilities.
Ready to close the compliance gap? Request a quote or book a 15-minute callback for in-house PFMA/PPPFA and Public Procurement Act training delivered on-site in Johannesburg, Cape Town, Durban or Pretoria — or live online for distributed teams.
How BOTI delivers public-finance and SCM-compliance training
BOTI is a South African corporate training provider running over 450 programmes, with clients including Sasol, Glencore and the City of Johannesburg. Our public-finance and SCM-compliance training is a practical, facilitator-led skills programme; delegates receive a BOTI certificate of completion (this is not an accredited qualification). It is built for the way your organisation actually buys: in-house, on-site or live-online and scheduled around your operational calendar so service delivery is not disrupted; practical and current, with worked examples on PFMA SCM processes, PPPFA preference-point calculations and Public Procurement Act 2024 transition planning; role-tailored for buyers, bid-committee members, finance and internal audit, and accounting officers; and set in a South African context throughout — drawing on BBBEE and Treasury instruction notes. Need accredited training? Ask about BOTI’s QCTO/SETA-accredited programmes in related areas such as Project Management.
For programme structure and entry requirements, see Supply Chain Course Cost, Requirements & Where to Study, and for contract-specific upskilling see Tender & Contract Management Training.
Frequently asked questions
What is procurement compliance in South Africa?
It is running public-sector supply chain management so that every purchase, tender and contract complies with the governing framework — the PFMA (or MFMA for municipalities), the PPPFA and its 2022 regulations, National Treasury instruction notes, and the incoming Public Procurement Act 2024 — producing spending that is fair, equitable, transparent, competitive and cost-effective, with a defensible audit trail.
What is the difference between the PFMA and the PPPFA?
The PFMA sets the overall financial-governance and SCM framework for departments, public entities and SOEs, and places duties on accounting officers. The PPPFA is narrower: it governs how preference is awarded when bids are evaluated. The PFMA sets the system; the PPPFA governs the scoring of preference within it.
How does the PPPFA preference-point system work?
Contracts from R30,000 to R50 million are scored 80/20 (80 points price, 20 points specific goals); above R50 million it is 90/10. The “specific goals” points relate to historically-disadvantaged ownership (race, gender, disability) and RDP objectives — not a bidder’s generic B-BBEE level. Functionality is assessed separately, per tender, as a qualifying threshold. This is general guidance; confirm specifics with the relevant organ of state.
What changes under the Public Procurement Act 2024?
Act 28 of 2024 repeals the PPPFA, consolidates the procurement framework, and introduces set-asides — bids reserved for designated groups such as Black-owned, Black-women-owned, women-owned, persons-with-disability-owned and small enterprises. It is being implemented in phases through 2025/26, so staff need to know both regimes during the transition. Confirm current commencement and regulation status with National Treasury before changing processes.
Who should attend SCM-compliance training?
SCM practitioners and buyers, bid-committee members (specification, evaluation and adjudication), finance and internal-audit staff, and managers or accounting officers with oversight duties. Training works best when it is role-tailored, so each group focuses on the decisions it actually makes.
Train your team before the rules change
The transition from the PPPFA to the Public Procurement Act 2024 is the most significant change to public procurement compliance in years. Upskilling your SCM staff now — before the new instruments are fully in force — protects your audit outcomes and your service delivery.
Request a quote or book a 15-minute callback for in-house PFMA/PPPFA and Public Procurement Act compliance training, delivered on-site nationally or live online.
Free download: Grab our Corporate Training Provider Comparison Checklist + sample RFP to evaluate providers and brief your own procurement of training with confidence.
To plan a full upskilling pathway, return to the Supply Chain & Procurement Training pillar.
This article is general guidance for South African public-sector and supplier-side buyers and does not constitute legal advice. Confirm the current status of the PPPFA regulations and the Public Procurement Act 2024 with National Treasury or your own legal specialist before changing your procurement processes.