Definitely tell them that you'll remain interested but you will have to pursue other opportunities in the meantime. It swings both ways and they can't expect you to remain available forever!
And to be honest, would you prefer they got down to the shortlist stage then said "sorry but we've got a recruitment freeze on and can't bring anyone new on board"; or have them offer you a job, you accept it, resign from your current permanent job, then get told the day before you start that they've announced a restructure and your new job is disestablished in the new proposal?
Yes I speak from experience as this happened to me last month. On the plus side I've ended up with a promotion out of the restructure but it isn't best practice in my book. I'd rather have the situation you're in, however frustrating.