SITA's financial meltdown threatens government services

IOL News

01-05-2025

Sita said it struggled to attract skilled ICT professionals, with most talent opting for private sector jobs.
A VIRTUAL meeting of Parliament's Standing Committee on Public Accounts (Scopa) on April 22 heard shocking revelations about the complete breakdown of governance at the State Information Technology Agency (Sita), with the Auditor-General of SA (AGSA) painting a picture of an institution in total disarray.
The agency responsible for coordinating the government's information and communication technology systems has regressed to receiving a disclaimer of opinion — the worst possible audit outcome — with auditors unable to verify the accuracy of its financial statements due to missing records and systemic failures.
Senior Manager at AGSA, Lufuno Mmbadi, delivered the damning assessment: 'The previous qualifications audit and the current disclaimer audit meant that the key role players within the Sita accountability ecosystem had failed to provide credible financial reports that were supported by reliable information. The financial statements could not be relied upon, as they were not supported by full and proper records of the financial affairs of the entity.'
The audit regression comes despite some superficial improvements, including a reduction in irregular expenditure from R1.2 billion to R619 million. However, AGSA officials cautioned that this was largely due to multi-year contracts coming to an end rather than improved financial controls.
Shockingly, the agency's procurement system remains entirely manual, with an average turnaround time of 123 days for basic requests — more than four months to process something as simple as a laptop order.
The presentation exposed an institution in constant turmoil at the leadership level. Sita has had:
Five different chief executives in the past five years
No board for most of February 2025
An interim board appointed for just three months
60% vacancy rate at executive level
Action SA's Alan Beesley expressed the committee's frustration: 'If there was no stability at the leadership and board level, there was no chance of turning Sita around. Everything rises and falls on leadership.'
The human resource crisis extends beyond leadership. AGSA's Portia Nkuna explained that Sita struggled to attract skilled ICT professionals, with most talent opting for private sector jobs. Those who did join often left quickly due to the chaotic work environment and salary disputes.
The audit revealed that 38% of service delivery targets were missed, with critical projects delayed due to resource constraints.
Departments across government are feeling the impact:
The SA Police Service (SAPS) cannot modernise its docket system
Home Affairs struggles with IT system upgrades
Critical cybersecurity vulnerabilities remain unaddressed
The EFF's Ntombovuyo Mente-Nkuna highlighted the long-term consequences: 'More than eight years ago, Sita had been central to the procurement system failures in National Treasury and the SAPS system. Recently, the Minister of Police made a statement about making the SAPS system electronic — this same statement was made 15 years ago.'
Multiple committee members described Sita as a feeding ground for corruption. The EFF's Chumani Matiwane was particularly scathing: 'A culture of impunity persisted when it came to repeated findings, because there was no consequence management. This meant that people were encouraged to continue doing wrong things because their actions would have no consequences.'
AGSA identified two material irregularities — payments for unused software licences and services never rendered. While R50 000 was recovered in one case, disciplinary processes remain incomplete. Perhaps most alarmingly, departments are now bypassing Sita entirely, going directly to private providers for IT services, meaning the government was effectively paying twice for the same services.
In contrast to Sita's meltdown, the SA Broadcasting Corporation (SABC) showed some progress, improving from a disclaimer to an unqualified audit with findings. However, AGSA's Nathan Lawnet cautioned against optimism: 'The cost of the public mandate kept on increasing, and the SABC was not able to keep abreast with the competitive changes in the broadcasting sphere.'
Despite receiving a R3.2bn bailout in 2019 tied to a three-year turnaround strategy, the state-owned broadcaster remains financially precarious:
R2bn in unresolved irregular expenditure (some dating back six years)
Only R687m of R4bn in TV license fees deemed recoverable
Failure to meet digital transformation targets, including website upgrades
Scopa chairperson Songezo Zibi expressed particular concern about the SABC's inability to secure broadcasting rights for major sporting events, leaving millions of South Africans without access: 'The SABC's financial sustainability is precarious. It's losing bids for major sports events, and its digital transition is lagging. We cannot continue with business as usual.'
Faced with this crisis, Scopa resolved on several drastic measures:
Summoning current and former Sita leadership to account for years of failure Calling the Communications Minister and the Deputy Minister to explain the recovery plans Launching a forensic investigation into multi-year contracts Considering a complete overhaul or possible closure of Sita
As the meeting concluded, AGSA's Madidimalo Singo offered a sobering perspective on the broader implications: 'The functioning of Sita was not only about sustainability, but also the overall functioning of the government. There were policy outcomes that the government had committed to. When Sita fails, service delivery fails.'
With government departments increasingly bypassing the broken agency and critical IT systems left vulnerable, the clock is ticking for decisive action. The question now is whether Sita can be salvaged — or whether, after years of dysfunction, it is time to admit defeat and rebuild South Africa's government IT infrastructure from the ground up.