The SA National Roads Agency (Sanral) will be issuing tenders worth about R28bn in the first six months of 2024, giving a much-needed boost to the construction industry.
The agency, which is responsible for the construction and maintenance of the national road network, said in a statement that at least 30% of the tenders would be allocated to smaller black-owned construction companies. This is in line with its interim preferential procurement policy.
“Through these contracts, Sanral aims to ensure that small businesses graduate to become major construction companies,” the agency said.
Sanral CEO Reginald Demana said it planned to put out at least another 70 tenders to market in the next couple of weeks, which will bring the value of tenders advertised in the 2023/24 financial year to end-March to R28bn.
However, some of the tenders advertised in 2023/24 will only be closed towards April, at the beginning of the new financial year.
The agency closed 77 tenders worth R6.43bn in December.
Demana stressed that the work Sanral has put out to market is spread across the entire country. The Western Region (Western Cape and Northern Cape) will get contracts worth R600m; the Southern Region (Eastern Cape) will get contracts worth R2.8bn; the Eastern Region (Free State and KwaZulu-Natal) will get contracts worth R2.1bn; and the Northern Region (Gauteng, Limpopo, Mpumalanga and North West) will get contracts worth more than R500m.
“The Eastern and Southern regions are allocated much bigger portions as they encompass significant infrastructure projects such as the N2/N3 expansion in KwaZulu-Natal and N2 Wild Coast project in the Eastern Cape,” he said.
“The full rollout of the additional contracts that we are going to issue will include dividing the R28bn across the entire country, in all provinces. We try to make sure that we are distributing work and tenders equitably so that we don't leave any part of the country feeling that we are not looking after the national road network in their area,” said Demana.
Demana said Sanral has a mandate that sees the value from its projects flowing through to small, medium and micro enterprises (SMMEs), local contractors and local communities.
However, News24 reported in November that Sanral had awarded three of the four biggest road-building contracts in the country to Chinese firms, despite many of the large SA construction firms being black-owned and having a high BEE rating. The reason was that the bids by the Chinese firms were substantially lower than those of SA firms.
It was also reported that Sanral had only spent half of its non-toll road budget in the last four years, had only achieved half of its road targets and had had to cancel 80 tenders in 2023 at an estimated value of R9.3bn, after construction firms challenged its preferential procurement rules, which would have advantaged 100% black-owned firms. The policy was retracted.
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.