News

SITA audit hearing exposes institutional rot

Public Accounts

Sizwe Dlamini|Published

On the matter of R23 million spent on unused software licences, SITA disputed AGSA’s finding, leading to a referral to the SIU.

Image: AFP

THE recent hearing before the Standing Committee on Public Accounts (SCOPA) has laid bare a shocking pattern of mismanagement, institutional decay, and poor governance within South Africa’s State Information Technology Agency (SITA).

The Auditor General of South Africa (AGSA) revealed that SITA had failed to address more than R2 billion worth of irregular expenditure, continuing a long-standing cycle of financial recklessness and lack of accountability.

Despite repeated warnings from oversight bodies, SITA officials admitted that only R450 million worth of cases had been concluded, with R1bn submitted to National Treasury for condonation. The remaining R500m is either under investigation or awaiting disciplinary measures, raising serious concerns about the entity’s ability — or willingness — to enforce consequences for financial misconduct.

Chief Audit Executive at SITA, Xola Lingani, acknowledged the existence of a loss control committee composed of various executives but conceded that significant gaps remain in how findings are tracked and acted upon. “We have made progress,” he said, “but there are still areas where we need to strengthen our internal controls and consequence management processes.”

Over the past five years, SITA has cycled through six managing directors, multiple boards, and five CEOs, creating an environment of leadership instability that has crippled its ability to implement reforms or maintain strategic direction.

Sedzani Mudau, Interim Chairperson of SITA, confirmed that frequent leadership changes contributed directly to ongoing governance failures. “There was no appetite among management to implement reforms because they had never had financial issues or problems,” she explained, highlighting a culture of complacency that allowed systemic flaws to fester unchecked.

Adding to the dysfunction, the board admitted to appointing an acting Managing Director without ministerial approval — a move described as “ultra vires”. Minister of Communications and Digital Technologies, Solly Malatsi, accepted the board’s apology but condemned the breach of protocol. “This was misconduct by the board,” he said.

Nonkqubela Jordan-Dyani, Director-General of the Department of Communications and Digital Technologies (DCDT), noted that the revolving door of leadership had also affected coordination between SITA and government departments. “We bought a different team at each meeting … There was a challenge cascading information down to the executive level,” she said.

SITA’s financial credibility took another hit when it was exposed that the organisation struggled to produce reliable records during audits. Molatlhegi Kgauwe, CFO of SITA, admitted that internal systems were fragmented and outdated, making it nearly impossible to retrieve necessary documentation in time for AGSA’s annual audit cycles.

The Chairperson Sipho Zibi, of RISE Mzanzi, expressed frustration at the recurring issue. “No one can say that the time allotted for the information's availability was too short... everyone would have the same grievance.” He further said: “This is not an isolated issue.” His comments underscored a broader concern: SITA’s inability to digitise its record management system had led to chronic delays and data silos that hindered transparency and accountability.

Minister Malatsi echoed these concerns, stating that it was “unthinkable” that a government IT agency could not maintain a digitalised record-keeping system. “There was a degree of accountability deficit regarding certain aspects, especially internal controls,” he said. He warned that such deficiencies created space for opportunism and corruption, particularly in procurement and contract management.

Despite claims of investing in cybersecurity upgrades, SITA’s Acting Managing Director, Goppal Reddy, admitted that core infrastructure remained outdated. “We are playing catch-up,” he said. “Our ICT systems are antiquated and require substantial financing, which is not always available.”

While SITA has launched successful projects such as the G20 platform, e-recruitment systems in KwaZulu-Natal, and the Government Private Cloud Ecosystem, these successes are overshadowed by persistent vulnerabilities across its network and infrastructure.

Reddy outlined efforts to improve cyber resilience, including annual system updates and continuous security assessments. However, he acknowledged that fragmented governance across government departments posed a major risk. “Local area networks are managed independently by each department — this should be mandatory, not optional,” he said, pointing out that decentralisation without oversight left critical systems exposed.

SITA is losing skilled personnel due to poor incentives, high turnover, and a toxic organisational culture. Mudau confirmed that culture change was a key priority for the current board. “There was a culture element at SITA that required attention,” she said, noting that younger talent was discouraged from staying due to fixed-term contracts at HOD level.

Former board member Nolitha Petersen added that leadership instability further exacerbated retention challenges. “People don’t want to work in that kind of environment,” she said. “You end up with people who are not interested in driving performance.”

Richard Mathebula, National Treasury representative on the SITA board, warned that without proper vetting and lifestyle audits, the risks of fraud and malfeasance would persist. “Granting more authority to make decisions may lead to mischief if not balanced with automation, trust, and consequence management,” he warned.

Two major material irregularities were highlighted:

  1. R23 million spent on unused software licences: SITA disputed AGSA’s finding, leading to a referral to the Special Investigating Unit (SIU).
  2. Trade Zone contract: Vague terms led to payments for events deemed to offer no value for money. AGSA classified this as wasteful expenditure.

Ms Petersen confirmed that SITA paid R50 000 monthly settlements to resolve the Trade Zone matter after AGSA opened a case with SAPS. She said, “We believed we received value for money based on reports, but the AGSA disagreed.”

Internal investigations into these matters continue, with some cases already referred to the SIU and others undergoing disciplinary proceedings.

Action SA’s Alan Beesley delivered a blistering critique: “One of SITA’s mandates is to improve service delivery to South African residents through IT. Does the Minister and Cabinet believe SITA is delivering on this mandate, or is it harming service delivery? Maybe it’s time to close the entity.”

The Committee resolved to place SITA under strict oversight, with regular reporting mechanisms to monitor progress throughout the year. Several key issues will be added to SCOPA’s accountability dashboard:

  • Review of SITA’s governance structure
  • Progress of SIU and Public Protector investigations
  • Risk management and lifestyle audit protocols
  • Performance against financial and operational targets
  • Audit readiness and MIS reform

Zibi issued a stern warning: “If next year’s audit does not show marked improvement, we will have to ask tougher questions — including whether SITA deserves to exist in its current form.”

As the session concluded, the message was clear: SITA is at a crossroads. Reform or collapse. Transparency or disgrace. The nation is watching.