Of course, we have to accept in good faith when a trust is registered. It is the activities of that trust that can form the proper basis of legal scrutiny. So, what the B-BBEE Commissioner has done is more actively pursue cases of alleged wrongdoing of fronting and there are a number of instances where in fact I think she reports that a vast majority of complaints that she receives of contraventions of the Broad-Based Black Economic Empowerment Act constitutes instances of fronting.
We will make sure that as we implement more and more of this different programmes, that we put appropriate monitoring systems in place. But, of course, we can't do this for every tender that takes place. So, the centralisation of tenders through the development of the procurement office in National Treasury could be very helpful in giving us the tools to identify instances of fronting.
Fronting does not only take place for public procurement as hon member knows, it also takes place in instances where companies seek to take advantage of sector codes. But, it is in proper
investigation, it is in tying the detail down and it is taking people to court, it is letting the law take its course and it is that more than anything else that will dry up the supply of fronting arrangements in our economy.
So, I am really pleased that the matter received the focus it did today and I assure members that the commission tells me that they are very busy investigating fronting allegations.
Having said that, there are instances where we may need to tweak either the codes or the law itself to deal with two issues. The first area is legitimate arrangements, like these Broad-Based Black Economic Empowerment vehicles. The Kagiso Trust is an example of that, where they use the proceeds that they get out of the participation they have from the economy, to provide bursaries and support to schools in townships to lift up the teaching of maths and science. Those are good things.
They have pointed out that is has been said that they don't comply fully with the technical reading of some of the codes because the beneficiaries are not named. It is not so and so; it is an entire school with all the kids. The kids don't have identity numbers and so on. So we are going to look to see how we need to tighten the
regulations and any policy directive that I may need to issue to the B-BBEE Commission.
The second one is going to hon Rayi's question earlier that I have responded to, which is the information systems to track habitual fronters - individual who make a ... They have been called tenderpreneurs - people who don't have a legitimate business. They capture a title or a rating and they bargain with that. They go to you and say: You are a clothing manufacturer. I have got a BEE certificate. Let us do business. I will put forward the tender documentation in my name. You supply me and you cut me in.
What was very interesting is that in the Swifambo Rail Leasing (Pty) Limited v Passenger Rail Agency of South Africa court judgement, the court found that the fact that a black South African benefited, doesn't mean it is not fronting. This is because, if you get a consideration, you get a sum of money to compensate you, you are simply an agent in the fronting process. So, I think that this is a good judgement and we will heed it. Thank you very much.