Hon Deputy Speaker, the question makes reference to whether there are measures in place to ensure that service providers and directors of companies who defraud the state are blacklisted.
There are basically two provisions under which such activities can be undertaken by the National Treasury, and I am going to outline them briefly.
The first is section 28 of the Prevention and Combating of Corrupt Activities Act of 2004, which prescribes that, when a court convicts a person of an offence in respect of corrupt activities relating to contracts, or to the procuring and withdrawal of tenders, the court may rule that the name of such persons, directors or other persons who wholly or partially exercise control over the enterprise, be endorsed on the Register for Tender Defaulters.
The National Treasury must determine the period - which may not be less than five years and not more than 10 years - for which the particulars of the convicted persons or enterprises must remain on the Register for Tender Defaulters. During such period, the public sector may not conduct business with such a person.
The second instance arises from the Preferential Procurement Regulations, as well as the general conditions of contract. This empowers an accounting officer or authority to restrict an enterprise or its directors, trustees, or shareholders, for a period not exceeding 10 years, if such enterprise did not fulfil the conditions of contract, or has been engaged in corrupt or fraudulent practices, in competing for, or in executing, the contract.
In such cases, the accounting officer or authority must follow the audi alteram partem rule which, in English, means hear the other side, when informing the person of the intention to restrict him or her. The person concerned must be afforded an opportunity to provide reasons why such restrictions should not be imposed.
When an enterprise or person is restricted by an accounting officer or authority, the National Treasury must be informed accordingly and the names of the enterprises or persons are endorsed on the database of restricted suppliers, which is maintained by the National Treasury. Both the Register of Tender Defaulters and the database of restricted suppliers have been made public and are available on the National Treasury's website.
All spheres of government and Schedule 3A, 3C and municipal entities, are required to verify the status of recommended bidders, in order to ensure that no recommended bidders that are listed as companies prohibited from doing business with the public sector, do so. Adherence to this prescript also forms part of the Auditor-General's annual audit. Thank you.