Procurement Risk:

Moderate

Score:

51/100

Government Policy

Collapse
Q57 38/100

Does the country have legislation covering defence and security procurement with clauses specific to corruption risks, and are any items exempt from these laws?

View Question
Legal framework Score: NS / 100
This indicator is not assigned a score in the GDI. According to Interviewee 2, defence and security procurement is split into two overarching categories.…
Explore
Corruption risks Score: 50 / 100
According to interviewee 2, the DAHB 1000 and general acquisitions process is an improvement over previous acquisitions policies in terms of corruption enforcement. The…
Explore
Effectiveness Score: 25 / 100
The DAHB 1000 and the overarching acquisitions process is a new policy and thus has not had many significant tests in terms of its…
Explore
Q58 42/100

Is the defence procurement cycle process, from assessment of needs, through contract implementation and sign-off, all the way to asset disposal, disclosed to the public?

View Question
Formal procedures Score: 50 / 100
Procurement: which pertains to regular non-strategic items (eg catering, fuel, etc) is largely governed by regular government procurement legislation. This takes the form of…
Explore
Transparency Score: 25 / 100
Procurement is disclosed following the Public Finance Management Act (PFMA) and a competitive tender bidding process is generally followed, with the exception of 57C,…
Explore
Implementation Score: 50 / 100
Procurement is disclosed following the Public Finance Management Act (PFMA) and a competitive tender bidding process is generally followed, with the exception of 57C,…
Explore
Q59 100/100

Are defence procurement oversight mechanisms in place and are these oversight mechanisms active and transparent?

View Question
Independence Score: 100 / 100
The Public Finance Management Act (PFMA) legislation and Joint Standing Committee on Defence – which is an oversight mechanism including the PFMA – largely…
Explore
Effectiveness Score: 100 / 100
Procurement oversight pursues a rigorous process in investigating irregularities. The Joint Standing Committee Defence (JSCD) is able to summon expert witnesses, documents and files…
Explore
Transparency Score: 100 / 100
Activity is published by the relevant state organs, civil society watchdogs, and the media. No interference in these activities is evident. The minutes of…
Explore
Q60 63/100

Are potential defence purchases made public?

View Question
Policies Score: 75 / 100
Planning for major acquisitions (note: not procurement) is discussed and detailed through the Strategic Capital Acquisition Master Plan (SCAMP) process [1]. SCAMP is considered…
Explore
Notice of planned purchases Score: 50 / 100
According to interviewee 2, planned acquisitions were robustly discussed and debated within the defence force [1]. Media reports also show information on planned purchases…
Explore
Q61 38/100

Are actual defence purchases made public?

View Question
Comprehensiveness Score: 75 / 100
Defence acquisitions and procurement notices are made public, with the exception of sensitive or restricted items. These are listed through the Department of Defence’s…
Explore
Accessible data Score: 0 / 100
Data is released broadly via annual reports and appendices from the DoD and Armscor. Defence procurement data is regularly updated and listed via the…
Explore

Capability Gap and Requirements Definition

Expand
Q62 NEI/100

What procedures and standards are companies required to have – such as compliance programmes and business conduct programmes – in order to be able to bid for work for the Ministry of Defence or armed forces?

View Question
Formal policies Score: 50 / 100
All bidders are required to sign the General Conditions of Contract (for all tenders in South Africa)[1]. For South African National Defence Force (SANDF)…
Explore
Consistent implementation Score: NEI / 100
There is not enough information to score this indicator. It is unclear how consistently bidders/companies are held to account in terms of compliance and…
Explore
Q63 83/100

Are procurement requirements derived from a national defence and security strategy, and are procurement decisions well-audited? Are defence purchases based on clearly identified and quantified requirements?

View Question
Procurement requirements Score: 100 / 100
All armament acquisitions within the Department of Defence (DoD) are required to go through numerous review and assessment steps, with the requirement being validated…
Explore
Scrutiny Score: 50 / 100
There are overlapping responsibilities within the DoD to audit acquisition projects. The Inspector-General of the Department of Defence (IG-DoD) conducts both quinquennial large-scale planned…
Explore
Purchases Score: 100 / 100
According to interviewee 2, all acquisitions since the 1999 Arms Deal have been conducted in line with first DAP 1000 and its successor Defence…
Explore

Tender Solicitation, Assessment and Contract Award

Expand
Q64 NEI/100

Is defence procurement generally conducted as open competition or is there a significant element of single-sourcing (that is, without competition)?

View Question
Open competition Score: NEI / 100
In terms of both Defence Acquisition Handbook DAHB 1000[1] (for acquisitions) and the Public Finance Managing Act (PFMA) and National Treasury instructions (for procurement)[2],…
Explore
Scrutiny of single/restricted competition procedures Score: 100 / 100
Deviations from standard multi-source procurement and acquisition are subject to audit oversight by the secretary for defence and auditor-general [1] along with parliamentary oversight…
Explore
Q65 88/100

Are tender boards subject to regulations and codes of conduct and are their decisions subject to independent audit to ensure due process and fairness?

View Question
Conflicts of interest Score: 75 / 100
Regulation 16A8.4 of the Public Finance Management Act (PFMA) states that if any supply chain management official, or any role player, close family member,…
Explore
Audit Trail Score: 75 / 100
Under National Treasury regulations relating to the Framework for Supply Chain Management, bid evaluation and bid adjudication committees are required to maintain complete records…
Explore
Transparency Score: 100 / 100
All tender-related regulations and codes of conduct are made publicly and easily available by National Treasury [1].
Explore
Scrutiny Score: 100 / 100
The auditor-general is tasked with this role of conducting external audits/verification of tender processes/awards [1]. They are considered to be generally robust.
Explore
Q66 75/100

Does the country have legislation in place to discourage and punish collusion between bidders for defence and security contracts?

View Question
Legal framework Score: 100 / 100
The following text is included as part of the Certificate of Independent Bid Determination (Standard Bidding Document 9) [1], it is included in every…
Explore
Sanctions Score: 100 / 100
The Prevention and Combating of Corrupt Activities Act 12 of 2004 and Competition Act 89 of 1998 set out clear guidelines for remedies and…
Explore
Enforcement Score: 100 / 100
Collusion between companies is investigated by the Competition Commission of South Africa [1], which can refer cases to the Competition Tribunal for prosecution, The…
Explore
Training Score: 0 / 100
The Competition Commission is able to identify collusion patterns and refer possible malpractice to the Competition Tribunal for investigation. These officials are not specifically…
Explore

Contract Delivery and In-Service Support

Expand
Q67 50/100

Are there mechanisms and procedures that ensure that contractors meet their obligations on reporting and delivery?

View Question
Reporting policies & procedures Score: 100 / 100
The Defence Acquisition Handbook (DAHB) 1000 [1] provides a detailed process for monitoring and assessment of supplier obligations and meeting specifications (for acquisitions) [2].…
Explore
Transparency Score: 50 / 100
Contracts are made publicly available via the Armscor tender bulletin. They include details on the contractor award date, but they do not strictly name…
Explore
Monitoring Score: 50 / 100
For acquisitions, contract monitoring is undertaken and the relevant reports are produced, including performance appraisals. Procurement, however, is less reliable, and largely similar in…
Explore
Enforcement Score: 0 / 100
Broader issues of fraud and corruption are detailed in terms of specific cases prosecuted and their results through the Department of Defence (DoD) Annual…
Explore
Q68 58/100

Are there mechanisms in place to allow companies to complain about perceived malpractice in procurement, and are companies protected from discrimination when they use these mechanisms?

View Question
Complaints mechanisms Score: 100 / 100
The Department of Defence (DoD) actively creates awareness and training on reporting malpractice in all aspects of fraud and corruption. A DoD whistle-blowing hotline…
Explore
Effectiveness and Accessibility Score: 50 / 100
The complaints mechanisms are generally cost-free, at least in initial tip-offs or lodging of official grievances. Litigation and post-complaint consequences, however, are rather costly.…
Explore
Retaliation Score: 25 / 100
As mentioned above, the effectiveness of these mechanisms is undermined by a general reluctance to report malfeasance if it causes a negative backlash on…
Explore
Q69 58/100

What sanctions are used to punish the corrupt activities of a supplier?

View Question
Sanctions Score: 75 / 100
Suppliers and their directors that have been convicted of corruption under the Prevention and Combating of Corrupt Activities Act, No 12 of 2004 [1]…
Explore
Undue influence Score: 25 / 100
There is a very low conviction rate under the Prevention and Combating of Corrupt Activities Act, with only 135 convictions were secured out of…
Explore
Application of sanctions Score: 75 / 100
A conviction under the Prevention and Combating of Corrupt Activities Act can result in severe fines, imprisonment of company directors, and exclusion from future…
Explore

Offset Contracts

Expand
Q70 13/100

When negotiating offset contracts, does the government specifically address corruption risk by imposing anti-corruption due diligence on contractors and third parties?

View Question
Legal framework Score: 0 / 100
According to a 2013 article written by Peter Platzgummer, the usage of arms trade offsets to bribe public officials has been one – if…
Explore
Due diligence Score: 25 / 100
The most recent, large-scale example of due diligence measures enacted during offset negotiations on offsets is the Strategic Defence Procurement Packages, or “Arms Deal”.…
Explore
Q71 58/100

How does the government monitor offset contracts?

View Question
Policies & procedures Score: 75 / 100
There are formal policies and procedures outlining reporting and delivery obligations for offset contract – these are found in the 2013 revised National Industrial…
Explore
Transparency Score: 50 / 100
Contracts are actively listed on the Armaments Corporation of South Africa (Armscor) Tender Bulletin, with National Industrial Participation Programme (NIPP), and Defence Industrial Participation…
Explore
Monitoring Score: 50 / 100
National Industrial Participation Programme (NIPP) guidelines clearly state performance reviews and constant updates are required as part of the programme. “The parties must hold…
Explore
Enforcement Score: NEI / 100
It is unclear from the National Industrial Participation Programme guidelines policy document whether action is taken in the event of a breach of contract…
Explore
Q72 50/100

What level of competition are offset contracts subject to?

View Question
Score: 50 / 100
Offset contracts through both the National Industrial Participation Programme (NIPP) and the Defence Industrial Participation Programme (DIPP) are subjected to the same levels of…
Explore

Agents / Brokers

Expand
Q73 0/100

How strongly does the government control the company’s use of agents and intermediaries in the procurement cycle?

View Question
Policies Score: 0 / 100
For both procurement and acquisitions, there appears to be little control over agents and intermediaries. Third-party private agents and even the military attache and…
Explore
Enforcement Score: NA / 100
Agents face no real restrictions, as such this indicator is scored ‘Not Applicable’
Explore

Financing Package

Expand
Q74 0/100

Are the principal aspects of the financing package surrounding major arms deals, (such as payment timelines, interest rates, commercial loans or export credit agreements) made publicly available prior to the signing of contracts?

View Question
Score: 0 / 100
The only arms acquisition of the past twenty years to have been financed with commercial loans or external credit agreements was the 1999 Strategic…
Explore

Seller Influence

Expand
Q75 NS/100

How common is it for defence acquisition decisions to be based on political influence by selling nations?

View Question
Prevalence: selling nations Score: NS / 100
This indicator is not assigned a score in the GDI. There are credible claims that substantial political pressure, particularly by the British government, was…
Explore
Justification Score: NS / 100
This indicator is not assigned a score in the GDI. The most recent major acquisition, Project Biro for offshore patrol vessels, was strongly justified…
Explore
Prevalence: domestic pressures Score: NS / 100
This indicator is not assigned a score in the GDI. There is a lack of evidence showing any acquisitions undertaken as a result of…
Explore