Blacklist Corrupt Suppliers Bill Introduced

ActionSA has today introduced the Blacklist Corrupt Suppliers Bill, a Private Member’s Bill that seeks to close one of the most significant enforcement gaps in South Africa’s public procurement system by ensuring that suppliers implicated in corruption and serious procurement misconduct are swiftly excluded from doing business with the state.

Despite years of investigations by the Special Investigating Unit (SIU), hundreds of suppliers implicated in corruption remain eligible to bid for and receive government contracts. While recent announcements by organs of state regarding supplier blacklisting are welcome, they also underscore a deeper systemic failure: South Africa’s debarment framework exists on paper but has rarely been implemented in practice. 

Last year, Parliament’s Standing Committee on Public Accounts was informed that, of the 467 suppliers and individuals recommended by the SIU for blacklisting, only one had been added to National Treasury’s Database of Restricted Suppliers. Subsequent parliamentary replies obtained by ActionSA show that the overwhelming majority of suppliers recommended by the SIU — including those implicated in State Capture, Digital Vibes and COVID-19 PPE procurement scandals — remain eligible to do business with the state.

Over the past year, ActionSA has pursued this issue through sustained parliamentary oversight. We lodged a complaint with the Public Protector regarding government’s failure to implement supplier debarment recommendations, an investigation that remains ongoing.

We exposed through parliamentary questions that none of the 207 suppliers implicated in the R2 billion Tembisa Hospital corruption scandal had been added to National Treasury’s debarment register, despite SIU recommendations. We also laid criminal charges against the eThekwini Municipal Manager over the implementation of the SIU’s findings into the Phoenix Infill Housing Programme. 

These interventions all pointed to the same conclusion: South Africa does not have an investigation problem; it has an implementation problem.

The Blacklist Corrupt Suppliers Bill therefore strengthens the existing debarment framework established by the Public Procurement Act, 2024 by introducing practical reforms that ensure findings of corruption and serious procurement misconduct lead to meaningful procurement consequences.

Among its key reforms, the Bill will:

• Introduce mandatory timeframes for the initiation and completion of debarment proceedings, preventing recommendations from languishing for months or years without action.
• Empower National Treasury’s Public Procurement Office to intervene where procuring institutions fail or unreasonably delay initiating debarment proceedings, ensuring that accountability no longer depends solely on the willingness of individual accounting officers to act.
• Strengthen transparency and accountability by requiring the prompt updating of the public debarment register and obliging procuring institutions to report annually on supplier misconduct, debarment decisions and decisions not to initiate debarment proceedings.
• Give practical effect to SIU investigations by integrating SIU debarment recommendations and Special Tribunal orders directly into South Africa’s procurement framework, ensuring they are translated into timely procurement consequences.
• Protect honest businesses and taxpayers by preventing suppliers implicated in serious procurement misconduct from continuing to compete for public contracts because of administrative inertia.

The introduction of the Bill comes at a pivotal moment as the Public Procurement Act, 2024 is being implemented and its accompanying regulations are open for public comment. While the Act establishes a modern procurement framework, ActionSA believes it will fall short of its objectives unless supplier debarment is supported by enforceable obligations, meaningful oversight and transparent consequence management. 

South Africa has made significant progress in strengthening institutions that investigate corruption. The next step is ensuring that those investigations lead to real consequences. A procurement system that allows suppliers implicated in corruption to continue doing business with the state undermines public confidence, wastes taxpayers’ money and disadvantages honest businesses that compete fairly for public contracts. The Blacklist Corrupt Suppliers Bill seeks to close that gap by ensuring that when the state identifies suppliers that should no longer do business with government, there is a legal obligation to act. 

ActionSA invites members of the public, business organisations, procurement professionals and civil society to engage with the Blacklist Corrupt Suppliers Bill. A copy of the Bill is available on ActionSA’s website or may be requested by emailing parliament@actionsa.org.za, to which comments and proposals on the Bill may also be submitted.

ActionSA Core Philosophy: Centrist, pro-capitalist, and “South Africa First.”