City of Cape Town ready to square off against National Government over Public Procurement Act

IOL News

19-07-2025

Mayor Geordin Hill-Lewis
Image: Supplied
The Constitutional Court has opened the ring for a sparring match between the City of Cape Town and National government, by granting the City direct access to challenge the controversial Public Procurement Act, a case with potentially far-reaching consequences for the autonomy of municipalities and the future of local service delivery across South Africa.
The case, which now heads to the country's highest court, revolves around both procedural and substantive concerns: that the Act was passed unlawfully, and that its implementation would severely constrain municipalities' ability to respond quickly to critical infrastructure needs.
Chief Justice Mandisa Maya issued directions on 14 July, giving national government until 8 August to file its answering affidavit. The City has until 22 August to respond.
The Presidency has confirmed it will make its position clear in those legal filings. Presidential spokesperson Vincent Magwenya told Weekend Argus: 'Our responses will be contained in our papers, which will be made known against the court set deadline.'
For the City of Cape Town, the case is not merely a legal formality.
Mayor Geordin Hill-Lewis described the court's decision to grant direct access as a crucial development.
'We welcome the Concourt granting direct access to hear this vital matter.
'We believe the Act was passed unlawfully, with fatal shortcomings in public participation and parliament's procedures.'
The City's application contends that the National Council of Provinces (NCOP) vote that passed the Bill was flawed because seven of nine provincial delegations did not have valid final mandates. This alone, the City argues, is grounds for the legislation to be invalidated.
However, Mayor Hill-Lewis emphasised that beyond procedural defects, the impact of the law on everyday service delivery is at the heart of their opposition.
'Beyond these issues, the Act will slow down local service delivery and make it much harder for municipalities to procure quickly in response to local needs.
"Local government must be able to act swiftly to resolve urgent water, sanitation, electrical, waste, and environmental issues. Instead, this bill will slow down municipalities via a massive new red tape burden and interference from other spheres of government. This is unconstitutional, and undermines local government's direct accountability to serving residents.'
The Constitutional Court made a ruling this past week
Image: File
In a comprehensive set of written responses to Weekend Argus, the City expanded on specific operational concerns.
These include restrictions on municipalities' ability to procure emergency services without central approval, and the creation of a single national Public Procurement Office (PPO), which will assume oversight of municipal procurement systems.
'Specialised services or goods might be needed for urgent repairs to water, sewer or electricity infrastructure that may pose serious environmental risk or danger to residents. In these cases for example, municipalities will no longer have the power to lawfully deviate from procurement regulations for urgent service delivery without centralised approval via the centralised national Public Procurement Office (PPO).'
The City warned that if the PPO database fails or is delayed, procurement for urgent services at municipal level could grind to a halt across the country. Added to this, the legislation prevents municipalities from maintaining their own supplier databases or making payments outside the central system.
These concerns are amplified by the cost and complexity of implementing the law. While the Act is not yet fully operational, the City says National Treasury is still in the process of establishing the necessary regulations and systems.
'The Act is not yet in full effect as the necessary regulations and systems are still being established by National Treasury.'
Even so, the City is already anticipating the financial and bureaucratic burden that will follow if the legislation stands.
'Yes because there will likely be human resource costs and other operational expenses required to cope with the major new red tape and compliance burden.'
The legislation introduces 36 new regulatory requirements still to be promulgated.
Municipal officials warn these changes will create delays, legal uncertainty, and reduced flexibility to deal with time-sensitive contracts. One such example is the potential for long and complex appeals against tenders — which, under the Act, would block the finalisation of contracts until the appeals process concludes.
The City says this will discourage public-private partnerships and hinder investment in infrastructure, particularly in fast-growing urban areas.
Cape Town has not stood alone in its opposition. The City maintains that it has engaged every possible forum to raise its objections, including public participation processes, submissions to the South African Local Government Association (SALGA), and intergovernmental meetings.
'The City has opposed the legislation at every stage including via public participation and SALGA channels. The City is acting in the interests of all municipalities.'
At the heart of the City's legal argument lies a constitutional principle: that local government is not merely a service provider for national mandates, but a constitutionally distinct and autonomous sphere with direct accountability to residents.
'As a starting point, local government has constitutional autonomy and direct obligations to residents which the bill unconstitutionally infringes, aside from any and all further negative impacts.'
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Weekend Argus