IMPLICATIONS OF IMPLEMENTING CENTRAL DATABASE FOR SUPPLIERS Institute of Municipal Finance Officers amp Related Professions A uniform SCM system for government is essential to optimize the efficiency of service delivery ID: 528450
Download Presentation The PPT/PDF document "Institute of Municipal Finance Officers ..." is the property of its rightful owner. Permission is granted to download and print the materials on this web site for personal, non-commercial use only, and to display it on your personal computer provided you do not modify the materials and that you retain all copyright notices contained in the materials. By downloading content from our website, you accept the terms of this agreement.
Slide1
Institute of Municipal Finance Officers & Related Professions
IMPLICATIONS OF IMPLEMENTING CENTRAL DATABASE FOR SUPPLIERS
Slide2
Institute of Municipal Finance Officers & Related Professions
A uniform SCM system for government is essential to optimize the efficiency of service delivery
Suppliers currently registered on the database of any organ of state will be automatically transferred to the CSD by March 2016.
New suppliers can use the self-registration portal from 1 September 2015
There will be an interface with SARS to enable tax clearance verification
Also interface with Companies and Intellectual Property Commission (CIPC) for vetting business registrations and ownership
NATIONAL TREASURY CENTRAL SUPPLIER DATABASESlide3
Institute of Municipal Finance Officers & Related Professions
Single source of supplier information - thus no multiple registrations
Reduce and eliminate duplication of supplier registration effort
Available to National, Provincial and Local governments
Automated distribution of supplier information
Standardised
vetting of supplier:
- tax clearance status
- business registration and ownership
- bank account and account holder
- citizen identity number
- BBBEE
- government employee verification
- blacklisting - register for tender defaulters and database of restricted suppliers
NATIONAL TREASURY CSD: INTENDED BENEFITSSlide4
Institute of Municipal Finance Officers & Related Professions
Accordingly, will result in lower costs – reduced procurement processes, compliance requirements, payment processes, audit processes, and maintenance of registration information
Greater efficiency – single, electronic system
Greater value-for-money – better prices can be negotiated – economies of scale
Benchmarking of prices
Specialisation
– tenders pooled
Category management
No need for blacklisting in municipalities
NATIONAL TREASURY CSD: INTENDED BENEFITSSlide5
Institute of Municipal Finance Officers & Related Professions
Who will take accountability for the accreditation of suppliers?
What reliance will the Auditor-General place on information on the CSD? On whose audit report will issues relating to the CSD be included? Will it be a municipality finding or National Treasury issue?
What will happen to existing municipal databases?
The IT cost implications of implementing – hardware and software
Compatibility to existing databases. Can the CDS interface with all the disparate GL systems and Accounts Payable systems of municipalities across the country.
Whose banking details will be used?
NATIONAL TREASURY CSD: ISSUESSlide6
Institute of Municipal Finance Officers & Related Professions
NATIONAL TREASURY CSD: ISSUES
Downtime of databases when updating company details, especially CIDB. Responsiveness of the system and system failure will have consequences on local government and awarding of contracts
How will the process be managed?
What will the impact of opening new district offices (as per the proposal) be?
Incorrect capture of company information may delay tenders
Conflict of interest issues – how will the CSD system interface with the disparate HR systems of municipalities across the country
SCOA issues – will the CSD be SCOA compliant to be able to interface with municipal GL systems? Slide7
Institute of Municipal Finance Officers & Related Professions
NATIONAL TREASURY CSD: ISSUES
SCM Regulation 14 requires municipalities to maintain a list of accredited prospective service providers. We are bound by this. What is the timeframe to amend the Regulations and rollout of the CSD?
The timeframe for the project has already been changed. It was announced that CSD would commence on 1 April 2015, but the date then changed to 1 September 2015.
There was a lack of consultation with municipalities on the system specifications. For example, municipalities should have been taken through the system to better understand the benefits, challenges, timeframes, and impacts before any announcements were made.Slide8
Institute of Municipal Finance Officers & Related Professions
NATIONAL TREASURY CSD: ISSUES
Several municipalities have their own electronic quote management systems. What impact does the CSD have on this? What are the transitional arrangements?
A major concern is the potential negative impact on SMME’s who may only be able or want to work within their local areas. This also has a negative impact on local economic development (LED) Slide9
Institute of Municipal Finance Officers & Related Professions
Had three different address books: Corporate, Accounts Payable and Water
Resulted in duplication of orders, payments,
etc
Lack of efficiency, effectiveness and value-for-money
Consolidated all three into one address book
Matching – parent-child approach used
When new creditor created no child record created
FP Lite and Ellipse used – currently preparing for move to JDE (financial & GL system) Address Book
ETHEKWINI : CONSOLIDATION OF ADDRESS BOOKSSlide10
Institute of Municipal Finance Officers & Related Professions
Helped avoid duplication of orders
Helped avoid duplication of payments
Easier accessibility of the system for suppliers
Work flow not delayed
Reduced queries
Improved service delivery
Allows for rotation of suppliers
Payment terms in line with policy
Developmental objectives
Use of ward based suppliers
ETHEKWINI : BENEFITS – CONSOLIDATED ADDRESS BOOKSlide11
Institute of Municipal Finance Officers & Related Professions
At the outset, it is desirable to have a single, centralized supplier database for the country that adds value in terms of:
-
benchmarking of prices
- blacklisting
- better prices – economies of scale
However, there are 278 municipalities in South Africa, each with their own disparate systemsTo have a CSD, you need systems that can interface with regard to:
-
e-procurement
- accounts payable
- accreditation of suppliers
CONCLUSIONSlide12
Institute of Municipal Finance Officers & Related Professions
CONCLUSION
Other key issues include:
- accountability for accreditation and audit issues
- cost implications
- system downtime
Accordingly, we need to carefully look at the impact of moving towards a CSD and proceed with caution
We must ensure that we do hamper the progress already made by municipalities with regard to centralization of their supplier database
In view of the
aforegoing
, a phased approach is suggested. In the first phase, municipalities should consolidate their own supplier address books.Slide13
Thank You!
Institute of Municipal Finance Officers & Related Professions