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Newsletter No. 29 / 7 Aug 2020
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PPE scandal highlights need to modernise public procurement – National Treasury By Terence Creamer
The National Treasury has halted the emergency procurement of personal protective equipment (PPE) and reverted to open procurement processes amid a normalisation of supply and growing allegations of corruption, which Finance Minister Tito Mboweni acknowledged on Wednesday had led to a breakdown of trust. Addressing lawmakers virtually, Mboweni said that it had become clear that processes had to be tightened immediately and greater transparency introduced. He indicated he would be insisting that the identities of all beneficiaries of PPE contracts be published, together with the reasons for their selection and with the names of losing bidders. “We will also be interested to know the age of the companies that received contracts and when were they formed . . . and what was the case with politically exposed people (PEPs), we would like to know and deal with that.” He did not provide a timeline for when the lists of successful bidders would be published, but described it as something that should be done “urgently”. He added that the lists should include the names of the shareholders of the winning bidders. National Treasury director-general Dondo Mogajane announced that, from now onwards, PPE procurement should be compliant with all the existing normal instructions for procurement. The National Treasury would also place a “lock” on absolute prices for all PPE and listed protective clothing and those seeking to buy such products at higher prices would have to seek permission. National and provincial procuring institutions would also be required to provide the National Treasury with the names of all PPE and protective clothing appointed service providers for publishing on the National Treasury’s website. Besides procurement instruction notes, the Auditor-General South Africa and the National Treasury would also be publishing ‘Preventative Control Guides’, to provide those officials responsible for procurement with a “toolkit” for identifying the risk of misappropriation, fraud and corruption ahead of a transaction. Automation & Modernisation Mogajane said the problems that had emerged with the PPE contracts had highlighted the need for the public procurement system to be urgently reviewed and modernised. He said the process of drafting a new Procurement Bill was under way and appealed for lawmakers to expedite its passage through to legislation. In addition, the Public Finance Management Act and the Municipal Finance Management Act would be reviewed, including the procedures for emergency procurement and how to strengthen the accountability of accounting officers. In parallel, however, public procurement had to be modernised, including through automating systems in a way that enhanced due diligence and increased efficiency in the processing of requests. He also indicated that it might be necessary to centralise future PPE procurement and facilitate such purchases by creating an information communication technology (ICT) platform that improved pricing visibility across all spheres of government. Discussions on the introduction of such solutions were still to be held with the Department of Health, however. The public sector, which procured more than R1-trillion of goods and services yearly, also had to draw in lessons from the way private companies went about their procurement. “Automating and modernising our procurement system must be done urgently, and we are putting all efforts as National Treasury to design and develop, with the assistance of the private sector, an integrated ICT solution.” Continuous information exchange between those responsible for prevention, investigation and prosecution was also required so that future preventative measures were informed by investigation lessons learnt and prosecution outcomes. “What we can no longer keep quiet about is the participation of PEPs in public procurement. This will require a more stringent review, including the type of service being provided, the age of the business and what the business is all about.” He said that it was time to “think outside the box” to ensure the public procurement system was made “fraud-proof”. EN Procure garments, textiles from domestic firms: Ghana President
Ghanaian President Nana Addo Dankwa Akufo-Addo recently directed all public agencies to procure garments and textiles from domestic producers. At a recent event, he said one of the key objectives of his government was to use the pandemic challenge as an opportunity to inspire the expansion of domestic capabilities and deepen self-reliance. “To win, we want to rely on the things we make and grow, not on the things we import. Indeed, the pandemic has disrupted the global supply chain, but it is also opening up opportunities for us to enhance our industrial, productive capacity, increase our agricultural output to engender our food security, and, generally, boost Ghanaian exports to markets in the continent and beyond,” he said. “With the support of the government, our, hitherto, dormant domestic garment factories have, over the past few months, been revived, and have been able to produce, currently, fifteen million face masks and other personal protective equipment (PPEs) for frontline health workers, and for all those, i.e. students, teaching and non-teaching staff, involved in the partial reopening of our junior and senior high schools, universities and other tertiary institutions,” he was quoted as saying by an official release. This has saved the nation millions of dollars in foreign exchange, and, at a time of job losses, has created jobs for thousands of people, especially young people, he added. F2F
Retirement Notice – George Zondagh
In 1989 we opened the doors to Beaches Clothing with 2 employees, epic dreams and enormous passion! Since that day our company has grown to where we now employ over 200 loyal staff. Beaches today, is recognized as the pre-eminent swimwear manufacturer in South Africa. The success of the company is largely attributed to being able to live up to our mission statement “to consistently, design, manufacture and deliver top quality swimwear to the market”. Our commitment, dedication and attention to detail over the years has allowed Beaches to proudly maintain a market-leading position. Many top management books recommend that when a founder eventually hands over control of their company, the question asked should be ‘when’, as opposed to ‘why’. With that in mind, I am confident that now is the right time. As the company transitions into new Directorship I am excited to see how the new BBBEE plan under the expert stewardship of my long-standing business partner, Matthew Jones and a very strong management team, will influence the long-term success of the company. With age comes reflection, and I have come to realize just how fortunate I am to have been an integral part of this Company which I started 31 years ago. It has been a privilege to work with you all, our Customers, Suppliers and Financial partners over the years. In your own way, you have contributed to the growth of Beaches. I want to express my sincere gratitude for the amazing support that you offered me over the years. The new Management and Team will look forward to ongoing mutual growth and prosperity, with the support of all the role players. Wishing you rich blessings and every success in your future. Cheers to Life
George Zondagh
Mr Price – appointment of a non-executive director The Group is pleased to announce the appointment of Lucia Swartz as an independent non-executive director to the board of directors (“Board”), with effect from 1 August 2020. Her appointment comes as the Board continues to maintain a composition that is relevant and supports the creation of value and seeks to boost its culture and human resources skills. TFG – board changes Graham Davin, currently an independent non-executive director, has been appointed as the Lead Independent Non-Executive Director with effect from 1 August 2020. Change in classification Changes to committees Audit Committee Risk Committee Nomination Committee Pepkor – disposal announcement Pepkor shareholders are hereby advised that the Company has entered into a sale and purchase agreement with Cashbuild Ltd. (“Cashbuild”), for the disposal of the entire issued share capital of Pepkor’s wholly owned subsidiary, TBC, subject to the conditions precedent set out in paragraph 3.2 below (“the Proposed Transaction”). Shareholders are referred to the earlier announcement made today by Cashbuild. Purchase price The total consideration payable by Cashbuild on closing of the Proposed Transaction will be R1 074 700 000 (the “Purchase Consideration”) subject to: – an escalation rate of 5.5% per annum from 1 January 2021 until the Proposed Transaction closing date; and – the sum of the Purchase Consideration and the total escalation not exceeding R1 119 700 000. Conditions precedent The implementation of the Proposed Transaction is, subject to the fulfillment of, inter alia, the following principal conditions precedent: – Regulatory approvals, including Competition Authorities, being obtained; and – Cashbuild’s debt financing agreements being duly executed and becoming unconditional. Massmart – shareholder engagement session With reference to the results of the Company’s annual general meeting announced on 21 May 2020, Massmart wishes to engage its shareholders on the non-binding advisory resolution regarding the endorsement of Massmart’s Remuneration Implementation Report. The Remuneration Implementation Report fell 0.3% short of the 75% of votes required by the King IV Report (“King IV”) on Corporate Governance for South Africa, 2016 and paragraph 3.84(k) of the Johannesburg Stock Exchange Ltd. Listings Requirements (“JSE LR”). It should be noted, however, that the non-binding advisory resolution on the endorsement of Massmart’s Remuneration Policy was approved by more than the requisite 75% majority of shareholder votes as previously announced on 21 May 2020. In the context of the Remuneration Implementation Report vote, the Chairman of Massmart’s Remuneration Committee, Ms. Phumzile Langeni, and the chairman of the board, Mr. Kuseni Dlamini therefore wish to engage those shareholders who cast dissenting votes as well as other interested shareholders. Interested shareholders are invited to attend a virtual engagement session with the Chairman of the Remuneration Committee and the Chairman of the board. Should you wish to raise any concerns or have any further recommendations for the Remuneration Committee regarding its Remuneration Policy and practices, please submit your feedback in writing to info@massmart.co.za by no later than 17H00 on 5 August 2020. Details of the shareholder engagement session Please register to attend the session first by emailing info@massmart.co.za thereafter, you will be emailed a meeting request for the session to be convened via Zoom. Once you register you will receive a passcode to attend the session on the date above. Please do not share the passcode. You are liable for your own costs to connect to the session. Massmart will not be accountable in the case of loss of network connectivity or other network failure due to insufficient airtime, internet connectivity, internet bandwidth and/or power outages which prevents any shareholder from participating or attending the aforementioned session. PicknPay – report on proceedings at AGM Shareholders are advised that the Annual General Meeting (AGM) of Pick n Pay was held on 4 August 2020 and all the ordinary and special resolutions proposed at the AGM were approved by the requisite majority. The following information is provided: Total issued number of ordinary shares: 493 450 321 Number of B ordinary shares that could have been voted at the meeting: 259 682 869 Percentage of ordinary shares represented at the meeting: 81.98%
Little Women (and Little Men) Kid’s fashion is a booming industry, but before the 19th century—that is, long before Osh Kosh B’Gosh and other children’s clothing retailers—children were dressed the same as adults, only in miniature. Kids would wear roughly the same styles and fabrics as their parents |
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