Navigating the complex world of public-sector travel
1 Jul 2019 - by Kim Cochrane
THERE is still huge scope for educating travel industry parties on the true complexities of public-sector travel and only once everyone involved understands these, will a clear path toward transformation in the TMC space be possible.
This is the opinion of independent business travel consultant, Merrill Isherwood.
It’s becoming more prevalent, she says, where travel management tenders for public-sector accounts with a contract value over R30m have clauses stipulating that a minimum of 30% of the business must be outsourced by the successful TMC to exempted micro enterprises (EMEs) or qualifying small enterprises (QSEs).
This is in accordance with National Treasury’s Supply Chain Management regulations of 2017, as per Government Gazette No. 40553 dated January 2017, section 9, which outlines the changes to the PPPFA (Preferential Procurement Policy Framework Act: 2000).
“If subcontracting does take place, it allows smaller enterprises to understand the processes and systems while also benefiting from training and infrastructure to which they may otherwise not be exposed.”
She says the challenge is also that certain online travel agencies (OTAs) are not aware of Iata regulations and other travel regulatory requirements (i.e. Iata licences, BSP and preferably Asata membership) because they are not actively involved in the administration of these processes, which are frequently fully handled by the ticketing TMC.
Procurement and supply chain veteran, Alan Reid of PSCM Solutions, cautions that a travel agent appointed by government at any level needs to be cognisant of the applicable rules to avoid being dragged into a mess (financial or political) when abuses are discovered.
Legacy Hotels group sales manager, Hara Jackson, agrees that it can be difficult for travel agencies or PCOs to apply for government tenders in SA because the gazetted requirement by National Treasury is that the majority of their shareholders need to be South African and the business must have a B-BBEE certificate.
Nwabisa Gqodi, business development specialist at WingsNaledi, believes that every TMC claims to provide a superior quality of service. “This only gets you so far in today’s procurement environment.”
WingsNaledi understands the business-critical nature of government travel, she adds. Consultants go through a rigorous training process to ensure they meet the standards for understanding the intricacies and fluidity of this niche travel market.
“Furthermore, it is technology that also gives us the ability to simplify complexities and reduce total cost of ownership, enabling us to communicate the intelligence of travel.”