Sita investigation flags R2bn irregular spending and governance weaknesses
· Citizen
The final report on an investigation into the State Information Technology Agency (Sita) has flagged more than R2 billion in irregular expenditures and also highlighted systemic weaknesses in governance, leadership instability and procurement issues.
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Minister of Communications and Digital Technologies Solly Malatsi, along with the chairperson of the Public Service Commission (PSC), Professor Somadoda Fikeni, presented the final report into governance failures at the state-owned entity on Monday.
Sita report released on Monday
Malatsi requested that the PSC conduct an independent investigation into Sita in December 2024 for the period between 2020 and 2025.
Fikeni said the weaknesses identified in the report include inconsistent consequence management and procurement challenges.
According to the report, over R2 billion in irregular expenditure was flagged by the Auditor-General across four audited years: R819.7 million in 2020/21, R285.5 million in 2021/22, R452 million in 2022/23 and R514.171 million in 2024/25.
There was not enough proof, according to the study, that consequence management was consistently used in connection with these issues.
The investigation also found that one in four tenders analysed did not result in an award.
R2bn irregular expenditure and one in four tenders failed
Of 1 443 concluded procurement matters reviewed, 278 were withdrawn, 52 were cancelled and 34 were closed with no recorded reason, representing an attrition rate of 25.2%.
Additionally, 529 procurement matters remained open in the pipeline, with the oldest matters sitting in adjudication and contracting for an average of more than 400 days.
A total of 203 procurement matters took longer than a year from work order to outcome.
“There are issues of governance, inconsistent application of consequence management and there are challenges around procurement. More so for an institution which has a near monopoly of controlling the issues of public service for IT services,” the chairperson said.
Leadership instability
The report also highlighted the issue of leadership instability at both board and executive levels.
Fikeni said there is a need for strategic foresight and effective governance at Sita and that addressing these issues is important to ensure global competitiveness and digital transformation.
Malatsi said the investigation concluded that the weaknesses at Sita are systemic, cross-cutting and mutually reinforcing.
The minister added that the department, the PSC, the Sita board and the executive have agreed on the report’s recommendations and immediate intervention.
The recommendation includes that Sita’s board must submit a stabilisation and recovery plan, a verified procurement backlog baseline, and a governance reform plan within 30 to 60 days.
The agency must also provide quarterly governance-health reports and implement a consolidated consequence-management framework that tracks all irregular expenditure and escalates criminal matters.
Report recommendations
All reforms require independent validation, while the department leads a formal review of Sita’s mandate and operating model with the Department of Public Service and Administration, the National Treasury and the Presidency.
Malatsi and the PSC emphasised that the report doesn’t find every transaction, appointment or decision at Sita to be irregular.
However, “cumulatively, all these factors created an environment in which delays, poor decision-making and corruption risk could take root”, the minister said.
He also expressed confidence in the leadership team to lead the necessary reforms and said Sita is a key enabler of South Africa’s ICT needs.
“The task now is to rebuild Sita in a way that protects ethical employees, restores confidence among client departments and ensures that public money is managed with discipline,” said Malatsi.