MFMA
municipalMunicipal Finance Management Act
The MFMA is the municipal equivalent of the PFMA, governing financial management and supply chain management in all 257 South African municipalities and municipal entities. It establishes rules for budgeting, procurement, asset management, and financial reporting at the local government level. The MFMA requires municipalities to adopt and implement a supply chain management policy that complies with prescribed regulations. It also establishes Municipal Public Accounts Committees (MPACs) for oversight.
Municipal SCM Policy
Each municipality must adopt and implement an SCM policy consistent with MFMA regulations (Section 111).
Competitive Bidding
All procurement above a prescribed threshold must go through a competitive bidding process (Section 112).
Contracts and Deviations
Strict rules on contract management and limited grounds for deviations from competitive bidding (Section 116-117).
Supply Chain Management Unit
Municipalities must establish a dedicated SCM unit separate from other functions to ensure segregation of duties.
- Confirm municipal SCM policy is adopted and compliant with MFMA regulations
- Ensure all procurement above threshold follows competitive bidding process
- Maintain segregation of duties within the SCM unit
- Document all deviations from competitive process with proper approvals
- Submit quarterly SCM reports to relevant oversight structures