Eskom admits trying to dodge procurement procedures for nuclear deal

State power utility, Eskom, says that earlier reports made by the Democratic Alliance about trying to dodge correct procedures for nuclear procurement are partially true, but stressed that it is only looking for exemption from certain areas of the process.

Earlier this week, the DA alleged that Eskom had made a direct application to the National Treasury chief procurement officer, Schalk Human, asking to be exempted from the prescribed procurement procedures for the new nuclear power acquisition.

The party stated that this was done in an apparent bid to accelerate the nuclear new build programme, “in a move that would mean that the country’s biggest ever procurement deal would not be subject to due diligence and correct procedures”.

However chief nuclear officer Dave Nicholls insisted that this wasn’t the full story.

“Eskom can confirm that during the Eskom discussions with National Treasury’s Office of Chief Procurement Officer on 28th March this year Eskom raised the areas of the current National Treasury Regulations (under the PFMA and PPPFA) which might need to be waived for the proposed Nuclear New Build Procurement (NNBP) process,” Nicholls said.

“These are related to the proposed evaluation criteria, which would include elements of localisation, the extension of the bid validity from 12 weeks to 2 years, the requirement for “self-designation” under DTI’s local content regulations as well as the SIPDM procurement gate 4 – which relates to budget and funding.”

The need for the waiver on the SIPDM gate 4 was to align the process with the Cabinet decision for the vendors’ responses to the Request for Proposals to form the basis of the funding model that had to be submitted to Cabinet by the Department of Energy, said Nicholls.

As indicated in the original report by the DA, it appears that the political party will fight the rushed process.

DA shadow minister of energy, Gordon Mackay, said that the exemption is ‘significant’ and would mean Eskom is embarking on the country’s single biggest public procurement – without fully assessing associated risks and consequences for South Africa’s economy.

All state entities are bound by specific procurement standards and requirements. These processes are vital to ensure the effective, efficient and transparent acquisition of goods and services by the State and its entities. If procurement standards cannot be met – procurement should not commence,” Mackay said.

“The DA is strongly opposed to the nuclear deal and will continue to pursue all avenues to scrutinise every process involved and to ultimately put a stop to a deal that will enslave future generations of South Africans.”

Read: Eskom has made a secret application to Treasury to bypass procedures for the nuclear deal: report

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