SA is stuck – but value-for-money procurement can get us unstuck, IRR CEO tells Ramaphosa

With a week left until President Cyril Ramaphosa delivers his 2026 State of the Nation Address, many indicators of his performance over eight years in office tell a damning story. Low growth, high unemployment, poor service delivery, corruption, crime and state capture – all the things he asked South Africans to trust him to fix in his ‘thuma mina’ speech – are still with us.

In a letter to Ramaphosa this week, Institute of Race Relations CEO Dr John Endres urges the President to steer the country back on track by adopting one key policy reform that is capable of effectively and sustainably addressing all of these challenges: value-for-money in procurement.

Dr Endres invites the President to endorse the IRR’s draft Value For Money Bill, which would commit the government to spending its well over one-trillion-rand-a-year procurement budget strictly on a value-for-money basis. As the government would no longer be compelled to procure goods and services at the premium that BEE preferential procurement imposes, this would immediately end a system that compels poor people to fund the lavish lifestyles of tenderpreneurs, and shortchanges all taxpayers, entrenches corruption and deepens service delivery failure.

The Value For Money Bill demonstrates that, absent BEE premiums, the government could afford to provide tax relief to South Africans burdened with growing financial pressures. Seizing the opportunity to eliminate BEE premiums by supporting the principle of value for money in procurement would demonstrate Ramaphosa’s political willingness to implement the recommendations of the Zondo commission, which have so far been largely ignored.

It would also create more room in government budgets to the tune of between R100bn and R150bn to build more classrooms, hire more doctors in public hospitals, and spend more money on infrastructure maintenance, which would result in an overall strengthening of the country’s institutional capacity.

Dr Endres writes: “Value-for-money procurement is the fastest and fairest way to get South Africa unstuck. It empowers the poorest through better services and lower taxes, strengthens consumers by putting more money in their pockets, restores trust in government, and creates the conditions for job creation, productivity, and sustained economic growth. The only thing standing in the way of this popular pro-growth approach is political will and the strength of leadership to ensure its achievement.”

The Bill, and a petition in its support, can be found here and here.

Media contact: Makone Maja, IRR Strategic Engagements Manager Tel: 079 418 6676 Email: makone@irr.org.za

Media enquiries: Michael Morris Tel: 066 302 1968 Email: michael@irr.org.za