In a virtual meeting, the Committee met with the State Information Technology Agency (SITA) to be briefed on its repurposing strategy, and with the Department of Communications and Digital Technologies (DCDT) to be briefed on the ratification of the World Radiocommunication Conference (WRC).
SITA’s presentation highlighted that it was focusing on key areas of service delivery and governance. There had been issues with the service delivery of the entity that had resulted in it being excluded by departments from advising or even procuring information and communications technology (ICT) services. Progress was being made in that regard, with SITA engaging with key clients to regain their trust in the capability of the entity to provide those services. It had also made progress in filling executive vacancies, with only one position remaining vacant. The financial sustainability of the entity was improving, with revenue increasing in the past year. Issues of irregular expenditure and consequence management were being addressed. The entity had focused on ensuring that SITA developed its internal capacity to move from being only a procurer of external ICT services for government, to providing those services itself and using local resources. SITA had to digitise government systems itself.
SITA also responded to unanswered questions from the previous meeting, and said that the entity was assisting other entities in the sector.
The DCDT update highlighted that spectrum had been allocated for usage in high frequency bands, with fifth generation (5G) one of the main allocations. Further, the WRC-19 had allocated spectrum for many other applications, which would enable the country to enhance its overall network connectivity and reduce the potential for harmful interference between service centres. One main aspect was the development of high altitude platform stations (HAPS), which would allow for network connectivity in rural areas. The DCDT was requesting Parliament to ratify the Final Acts, with the reservations that had been made by the Minister, which had been determined to be in line with domestic laws and international obligations.
Members were appreciative of the work that both SITA and the DCDT were doing. They felt that SITA was making good progress with its turnaround strategy, and that it would not be an entity that relied on government bailouts. SITA had to aim to be involved in any manner in all ICT-related issues in the government. They asked if the bursaries issued by SITA contained service obligations. On the ratification, they wanted to know if the DCDT had vetted all officials working with spectrum and if the internal capabilities of the country to implement the Final Acts provisions were adequate. They commended the resolution to ensure gender equality in the sector.
The Chairperson welcomed the Members and executives from the State Information Technology Agency (SITA) to the meeting. He apologised for the delay to the meeting. There had been an issue with the Zoom link. He greeted all who were, or would be, watching the Portfolio Committee on various applications. He acknowledged Ms Pinky Kekana, Deputy Minister of Communications and Digital Technologies, and welcomed her to the meeting. He reminded everyone of the rules of engagement.
The Committee Secretary said that apologies had been received from the Ms Stella Ndabeni-Abrahams, Minister of Communications and Digital Technologies, who was attending a Cabinet meeting, as well as Mr W Madisha (COPE). Ms N Khubheka (ANC) had indicated that she would have to leave the meeting at 09:25. Mr T Gumbu (ANC) had indicated that he would be late to the meeting.
The Chairperson noted the apologies and accepted them. He asked if there had been any apologies that had not been placed on the record.
Mr C Mackenzie (DA) tabled an apology for Ms P van Damme (DA). He also noted that the Portfolio Committee on Communications was hardly ever broadcasted on Parliament’s YouTube channel, so he was unsure how people would be watching the meeting. He asked if the Committee Secretary or staff could address this with someone who managed the YouTube channel, as the Committee was very important, and its meetings should be broadcasted.
The Chairperson noted Mr Mackenzie’s point, and said it should be attended to. He also noted the apology.
He asked the Deputy Minister to briefly address the Members. SITA would have 30 minutes to present their turnaround strategy and answer the questions which they had previously committed to respond to. The Department of Communications and Digital Technologies (DCDT) would have 20 minutes to present on the ratification of the World Radio Conference. The Deputy Minister then would speak for ten minutes. Thereafter, the Members could engage the presentations and be responded to.
Deputy Minister Kekana said that she was accompanying Mr Luvuyo Keyise, Executive Caretaker, SITA, and Ms Nonkqubela Jordan-Dyani, Acting Director-General (DG), DCDT. Mr Keyise would take the Committee through the repurposing of SITA, in terms of its financial sustainability, and whether there was human resource capacity equal to the task of executing the turnaround strategy. Mr Keyise would also share the areas of focus during the repurposing, which were e-governance, cyber-security, innovation and localisation, and the information technology (IT) services that SITA gave in supporting national and provincial government.
State Information Technology Agency (SITA) briefing
Mr Keyise took the Committee through SITA’s repurposing status report.
The repurposing of SITA was in line with the Presidential Review Commission (PRC) of all state-owned enterprises (SOEs). The PRC had called for a continued in-depth micro-assessment of the SOEs to assist in the merging of many entities. The National Development Plan (NDP) had sought a review of the market structure. The state-owned companies (SOCs) in the information and communications technology (ICT) space had to be rationalised and aligned in order to ensure that they achieved the developmental mandate of the country. SITA fitted within that broader review and alignment.
Organisational status upon appointment as Executive Caretaker
Mr Keyise indicated that when he was brought in to lead the process of repurposing SITA, it was clear that the entity had performance management challenges. It had to be ensured that as the entity was repurposed, the basics were fixed, to be able to instil a culture of good performance, attract key management personnel, and retain the critical skills required for the digitisation of the country and the implementation of Fourth Industrial Revolution (4IR) technologies.
SITA had had more than 15 chief executive officers (CEOs), who had lasted, on average, one and a half years each. This meant that SITA had had more than 15 different strategy ideas, with none being capable of proper implementation. The repurposing had to be done on a sound financial footing so that the entity was not dependent on government bailouts. The key concerns of the citizens and departments who received services from SITA had to be addressed. It had to be ensured that SITA focused on service delivery, and managed and resolved delays on procurement, and the irregularities of the tender processes had to be addressed. Irregularities could lead to corruption. There had to be a clear stance on consequence management and on addressing the issues that led to these problems. As part of the repurposing, these things had to be fixed.
Progress on repurposing components
The DCDT had given SITA broader areas that the repurposed entity should ensure it excelled in, from research and development (R&D), innovation and localisation, all the way down to the other components. When the SITA Act was promulgated in 1999, it was determined that SITA should be the ICT leader in the country. SITA should, in addition to selling services, advise government on ICT trends and solutions to ensure that it did not just follow trends, but set the pace for ICT developments. The question was how to build this capability that SITA had lost over the past decade.
Great strides had been made for R&D. The head of R&D had recently been appointed. SITA had finalised partnerships with all key institutions to ensure that as ICT developments were done, the mandates of these other institutions were not made redundant. Through these partnerships, SITA would focus on applied research aimed at government, and would stop being the procurer of ICT advisory services from international entities, but would produce those services itself. The basic platforms had been created to allow SITA to produce those ICT advisory services and to work with those institutions in a way that would not lead to there being irregular expenditure.
SITA had to ensure that the practical implications of digitising government were considered. Could specific workflows of key departments be changed where paper-based processes were minimised or removed? The annual performance plan (APP) had specific targets -- that the key eight government departments which were paper-based, had their processes automated by SITA by the end of the financial year. The business processes would also have to be digitised. SITA had to ensure that the cyber and informational security was at the required level to successfully execute the digitisation target. SITA was investing in this component, to protect the entity and give it the capability to assist government with cyber-security services. This would not replace the mandates of other entities, as SITA would complement the work done by those entities and focus on the security of the systems hosted by SITA or by the departments. SITA would bring in the overall security operation centres that monitor this.
In terms of procurement and industry transformation, one of the key things SITA was established for was to ensure that government no longer had to buy licences from international parties, where the ICT industry was just a reseller of international products. Real transformation of procurement had to be done, so that the expenditure could go to South African parties. For now, SITA was able to meet the basic 40% target, but there were plans to identify South African developed solutions which SITA could pilot and take to government, to be utilised by government. SITA had to work with the local industry to promote and ensure utilisation of local solutions rather than the proprietary solutions that were used by the government.
Repurposing supporting strategic focus areas
Building internal capabilities was important for the long-term growth of the organisation. SITA had made great strides in this regard. This was a critical target, as most of the entity’s top leadership was vacant. The structures below top leadership had been 90% vacant. But now, almost 80% of those positions had been filled. Only one executive position was still vacant, and the process of filling it should be finalised soon.
Measures were being implemented to ensure the financial sustainability of the entity so that it did not end up relying on government bailouts. Mr Keyise said that the Chief Financial Officer (CFO) would discuss this.
Programmes had to be implemented to improve the pressing service delivery challenges. Key clients had to be targeted to ensure that SITA provided excellent service delivery.
Mr Keyise said that these were the key issues that the repurposed SITA had to excel in, to be capable of delivering on the repurposing mandate.
Progress on key components
Work had been done on e-government. SITA had enabled government to continue business during Covid-19. For the deployment of digital solutions, more than 61 e-services had been made available. The key issue now was how SITA would be able to implement the solutions. It was now discussing how it could lead the integrated financial management system (IFMS) programme, as National Treasury had informed the entity a week before of its desire to cede the implementation of the programme to SITA. The IFMS programme was a key e-government project. Initiatives had been done for R&D, with an internal team led by Dr Busisiwe Vilakazi, Acting Executive: Corporate and Digital Strategy, SITA, being established. In addition to that, partnerships had been concluded with a number of ICT-related bodies and advisory bodies which would allow SITA to go forward.
Work was being done on localisation. For broadband rollout projects, SITA had to ensure that implementation was done using 40% local resources. On supply chain management (SCM) reforms, the backlog of 410 transactions had been resolved. SITA was now dealing with the usual delays -- for example, where in the last quarter government dumped excess money on IT. Often, in Quarter 4, there were huge procurements that came in. SITA was addressing that in order to be able to plan better, so that this did not happen. If every department was buying the same thing, was it possible for one tender to be issued? National Treasury and government had to be worked with to simplify the types of tenders issued on the market to reduce the number of tenders. There were advanced discussions on this matter.
There was good development on the ICT service component. SITA was getting some clients to return, and confidence was improving with regard to the actual delivery of the services. Investments being made in key technologies would have a direct impact on the clients. Investing was being made on cyber-security, and procurement of the necessary tools should be concluded by the end of March, to ensure that as the new financial year began, full end-to-end security operations services across the spectrum could be provided.
As the broader repurposing strategy was executed, the basic governance mechanisms had to be put in place to ensure that SITA had sustainable governance. SITA had to become a customer-centric organisation, from which departments procured services because they trusted the ability of the entity. How the services were being delivered, including the pricing model for some of the services, was being reviewed. The cost of network connectivity had been reduced drastically. This was all to ensure that SITA became a relevant organisation. This was the first year of the turnaround strategy, so the focus was on key clients which dealt with the entity’s greater revenue. Mr Keyise confirmed that great progress had achieved in improving the required service delivery of all of SITA’s key clients. There had been monthly service-level agreement (SLA) meetings.
Mr Molatlhegi Kgauwe, Chief Financial Officer (CFO), SITA, said that the financial position of SITA had improved over time. From Quarter 3 of 2019 to Quarter 3 of 2020, the available cash of the entity had increased from R325.1 million, to R845.1 million. The position had improved even further post-Quarter 3. The outstanding debt for these two periods was almost in line, at about R1.4 m, but it was slightly less in Quarter 3 of 2020. This was a result of the billing that took place in Quarter 3 of 2020. Generally, all of the interventions that had been put in place to ensure financial sustainability were bearing fruit.
Overall, the revenue for 2019/20 was about R5 bn. The revenue for the full financial year of 2020/21 was estimated to be about R5.4 bn, which would be an increase of 9.35% year on year. The nominal value increased by about R464 m per year. The main contributors to this growth, for the clusters, were the South African Police Service (SAPS) and the Department of Defence (DOD), and for the provinces, it was Gauteng and the Eastern Cape. There had been a material decline in revenue in Limpopo and the Justice, Crime Prevention and Security Cluster (JCPS). The overall picture showed growth. The areas of concern were being attended to.
Strategic focus areas
Mr Keyise said that the decline in revenue had to be looked into to identify if the issues were of reprioritisation in those provinces, or challenges of service delivery, to ensure that they could be addressed. Interventions were being put in place, including those from a ministerial level, to ensure that SITA became more customer-centric. On resource capacitation, 27 out of 32 Head of Department positions had been filled. 75% of employees below the Head of Department level had been placed in the revised structures. There was only one vacancy at the executive level, and that should be finalised within two weeks.
Courses were being offered to improve the skills of personnel. Bursaries in excess of R30m per year were being offered. 188 of these bursaries had been issued. These bursaries would ensure that SITA had a pool of young, talented people who could be employed by the entity.
Performance management had improved, with 89% of employees having signed their performance contracts. The focus was not just on numbers, but on whether client-specific performance targets could be met, including procurement, SCM and irregular expenditure. So even if overall performance was fluctuating, these key targets had to be met. The entity had been brought back to the basics. The lack of a performance management culture was being addressed. By the end of Quarter 1, everyone had to have signed their performance management contracts and every individual’s performance should be reviewed monthly and quarterly. The DCDT was also engaging with SITA on a monthly and quarterly basis to understand performance challenges and predict the kind of support that it would have to provide to SITA.
Key internal controls had been put in place, with an audit action plan having been developed to ensure proper monitoring, so that the regression in the last financial year did not occur again. The 22 key audit findings would be focused on through monthly reporting to the executive and the board committee on audit and risk. There would also be quarterly reporting to the board and the DCDT. Work was also being done on implementing clear remedial action.
The repurposing business case for SITA had been completed by the DCDT and SITA. The DCDT was finalising internal consultation with the ministry and related parties. Various engagements would be concluded so that the work on drafting the bill for a repurposed SITA was expected to continue from Quarter 2. My Keyise said that more information could be provided to the Committee on this.
Issues from previous meeting
On the collaboration with other departments, it could be confirmed that SITA was assisting the South Africa Post Office (SAPO), the Universal Service and Access Agency of South Africa (USAASA), and the Film and Publication Board (FPB). A chief information officer (CIO) had been tasked with assisting those entities. SITA was helping those entities with infrastructure, as part of their information communication technology (ICT) infrastructure was outdated. SITA was migrating some of their data to SITA’s cloud environment. It was also trying to assist USAASA with the rollout of its initiatives, including a voucher system which it was developing for USAASA to use for people to redeem the digital televisions. SITA was providing the FPB with a CIO. It was engaging with all other entities, including the South Africa Broadcasting Corporation (SABC).
In response to Mr Mackenzie’s question as to why SA Connect was still installing ten megabit per second (Mbps) lines, it could be confirmed that from 1 April, SA Connect’s policy would be revised to require the installation and connection of minimum lines of 100 Mbps. The speeds of those lines would then be able to be increased on the basis of an available budget. As a result, there may be fewer sites connected due to a limited budget, but this potential implication was being addressed.
Department of Communications and Digital Technologies (DCDT) ratification
Deputy Minister Kekana said that the World Radiocommunication Conference (WRC) dealt with amendments to the radio regulations, which was an international treaty that governed the administration of the radio-frequency spectrum and the geostationary-satellite and non-geostationary-satellite orbits, as contained in the WRC Final Acts.
Governments had engaged each other in managing this important global resource. Of more interest was how spectrum was allocated globally. This matter was shared by member states at the WRC. Once that was done, Cabinet had to approve the Final Acts, which also had to go through the Portfolio Committee, as well as the National Assembly (NA) and National Council of Provinces (NCoP). The Acting DG would take the Committee through what would be submitted to the NA and the NCoP, through the Committee.
Ms Jordan-Dyani said that the ratification was last brought in 2016. This was done after each WRC that took place, in accordance with the Constitution of the Republic of South Africa and the Convention of the International telecommunication Union (ITU). The DCDT was requesting Parliament to assist with the ratification, in line with section 231(2) of the Constitution. The Minister exercised her function in line with section 34(1) of the Electronic Communications Act (ECA) (Act 36 of 2005), whereby she had to represent the Republic in respect of international allocation, coordination, and approval of spectrum plans.
Spectrum was a critical national interest and a scarce resource that required its utilisation to be streamlined. A number of sectors used spectrum. It had to be ensured that spectrum covered the universal broadband and broadcasting rollouts and satellite communication services. Other industries also had to be serviced, such as aircraft, maritime programmes, environmental protection, and disaster relief and emergency services, which included security services. The DCDT had to ensure that spectrum was allocated in terms of other future programmes as well, to support economic transformation and the technological developments in order to realise the national development plan (NDP) and medium-term financial strategy (MTFS) objectives.
This time, the ratification sought to serve and benefit South Africa. It had to be ratified, as the Minister signed the Final Acts with reservations, subject to approval by Parliament. These reservations had been checked and were in accordance with all of South Africa’s domestic treaties and international obligations, as per the legal opinions from State Law Advisors at the Department of Justice and Constitutional Development (DoJ&CD) and the Department of International Relations and Cooperation (DIRCO).
Ratification ensured protection of the resource in the country’s territory, as there was an overlap with neighbouring countries. All signatories envisaged coordination of the radio-frequency spectrum, geo-stationary satellite, and non-geostationary satellite orbits, as well as approval and coordination of regional radio-frequency plans. The Regulator and DCDT officials were engaging nationally and within the Southern African Development Community (SADC).
The DCDT wanted to ensure that the revised radio regulations and international treaties governing the use of spectrum and the orbits were approved. Following approval, the DCDT would update the National Radio Frequency Plan (NRFP).
WRC-19 Strategic outcomes
The WRC-19 had 22 agenda items and 11 issues covering all radio services. Certain key strategic outcomes which impacted South Africa’s national policies and the NRFP included mobile broadband, broadcasting-satellite services (BSS), Maritime Distress and Safety System (GMDSS), Earth exploration-satellite (EESS) service, WiFi networks, railway radio communication systems between train and trackside (RSTT), and Intelligent Transport Systems (ITS).
Additional frequency bands
For the high-speed mobile broadband communications, the WRC agreed on the allocation of additional global harmonised frequency plans for IT services, including fifth generation (5G) network deployments. The additional allocation would facilitate diverse usage to enhance mobile broadband, massive machine-type communications, and ultra-reliable communication services.
High Altitude Platform Station (HAPS) programme
Additional frequency bands were allocated for HAPS. The WRC agreed to identify additional radio-frequency bands for HAPS. This would enable the provision of universal and uniform connectivity to benefit today’s digital economy. The HAPS would assist in providing connectivity to underserved and remote communities. These balloon-based technologies would ensure the delivery of broadband applications for broadband connectivity and disaster communications.
Science and space research
The WRC-19 ensured the continuation of the protection of the EESS, as well as the meteorological and other satellite services, in terms of their adjacent bands. These space services would assist in enhancing research and ensuring monitorisation of the earth and its atmosphere. The meteorological and climatological satellite services were intended to safeguard human life and natural resources.
The WRC-19 allocated spectrum for broadcasting services, with a new orbital slot for these services opened up. This provided developing countries the opportunity to regain access to spectrum orbital resources.
Non-geostationary satellite deployment
The WRC-19 defined a framework for the equitable allocation of mega-constellations in low-earth orbit. This would ensure the fair and non-discriminatory launch of the non-geostationary satellite orbital and mega-constellations through the milestone-based regulatory procedures. These procedures would provide an affordable means for the increased connectivity to citizens of all countries. The targeted services included extensive low-latency broadband coverage, remote sensing, space and upper atmosphere research, and support for the meteorological, astronomical and technological demonstrations. This would enhance the education system.
Earth stations in motions (ESIM)
Spectrum was allocated for ESIM to provide reliable and high-band internet services to moving targets, whilst ensuring protection from harmful interference, nationally and across borders. This would ensure that there was enhanced broadband communication connectivity on planes, ships and land vehicles. ‘
Regulatory provisions had been revised to accommodate the indoor and outdoor usage of WiFi, and the growth in demand for wireless access systems, including radio local area networks (RLANs) for end-user connectivity. This would ensure that private and public core networks had better connection, while limiting their interference to existing satellites.
As a country, South Africa faced numerous railway challenges. Spectrum was allocated to enhance the network and connection between the trains and trackside. There was a new resolution on harmonising spectrum for improved railway traffic control, safety, and security.
Intelligent Transport Systems (ITS)
The ITU recommendation was approved for the integration of ICT in evolving ITS to connect vehicles, improve traffic management, and assist in safer driving.
One important resolution from the WRC-19, of which the Deputy Minister was a champion, was to ensure greater participation and the empowerment of women. The WRC-19 confirmed a commitment for the sector to ensure gender equality and balance, by encouraging member states to increase the number of female engineers and the participation of women in spectrum management and planning. The DCDT had recruited, at a directorate level, a very experienced woman. The Regulator was also moving towards this target.
The Final Acts came into force on 1 January, but it still needed to be ratified. The DCDT, together with the Regulator, had embarked on a process of updating the National Radio Frequency Plan (NRFP) in line with the WRC-19, as well the process of identifying those outcomes which impacted South Africa, to ensure the protection of the security service spectrum and the spectrum set aside for government in line with section 34 of the ECA. Parliament was being asked to ratify the Final Acts. Thereafter, the Minister would approve the revised NRFP.
There had been collective participation from both government and the industry. There was a national working group on spectrum, comprising of these stakeholders, which was very active in ensuring the equitable distribution of the allocation, and that the essential services were given the adequate spectrum. In line with Chapter 11 of the Constitution, the security services and also other state services had been engaged in the approval of this.
Key national objectives met at the WRC-19
Mr Tinyiko Ngobeni, Deputy Director-General (DDG): ICT Infrastructure Support, DCDT, said that 5G would become much more embedded in critical applications, such as autonomous vehicles, or in the medical sphere in conducting remote procedures. For such applications to take place, the technology had to be reliable and have low-latency, which required additional frequency bands and spectrum. The additional spectrum that had been allocated would assist in the acceptable development of these technologies.
Weather stations received very low signals for weather prediction services. Other radio-based services using spectrum which generated lots of power, could cause harmful interference for the weather prediction services, which would impact on the accuracy of these services. A decision was made to create a mechanism that could better protect these observation services from interference.
The additional frequency bands would also be able to be utilised by HAPS, which were cost-effective and floated about 20 kilometres above the ground to provide broadband services in remote areas in a reliable manner. HAPS could also be used for disaster and emergency relief communications, where existing communication systems had been damaged by a disaster. The HAPS could be quickly launched to assist in providing better connectivity and communication capacity. Additional spectrum had had to be identified for these services.
There were more than 10 000 non-geostationary satellites coming from a single operator. The biggest concern was that some of those providers could use the process to create a monopoly and prevent others, especially developing countries, from accessing the orbital slot and launching satellites. The process for launching a satellite was to first go to the ITU, and request coordination so that all global providers could see the request for access and what the implications would be on the existing systems. To combat this, a milestones-based procedure was created, where targets had to be met for the continued use of the orbital zones. Where targets were not met, the zones would be made available for additional spectrum services.
In providing broadband services on high-speed mobile targets, such as ships, trains or planes, there was the potential for harmful interference to stationary stations or areas, and an impact on the connectivity or data being used or received in the stationary zones. The new resolution enabled the boosting of deployment of ESIM to provide better broadband connectivity, whilst limiting harmful interference.
The GMDSS services were almost monopolised, so a framework had been created to allow for South Africa and other countries in the southern hemisphere to provide these services and not rely on a single global player.
Radio astronomy stations would be protected from harmful radio interference from other space stations or satellite systems in orbit. New orbital slots had been opened for broadcasting satellites, which provided developing countries which previously did not or could not apply, to gain access to the orbital zones as the process changed from first-come first-serve to the milestones-based procedure. A special dispensation had to be created so that developing countries which were previously unable to launch, could now launch satellites. This once-off provision allowed developing countries to jump the queue, and was a huge success.
The WRC-23 agenda
The agenda for the WRC-23 was adopted during the WRC-19 to allow for research to be conducted by the interested parties to finalise positions and be prepared for future developments. The agenda was focused on four main themes. Firstly, there was consideration for more frequency bands for International Mobile Telecommunications (IMT) below 10.5 gigahertz (GHz) and re-opening the debate on the broadcast services using bands below 700 megahertz (MHz). Secondly, spectrum for maritime and aeronautical would be discussed. Thirdly, there would be additional scientific allocations. Fourthly, five separate satellite issues would be examined.
Ms Jordan-Dyani said that the DCDT was asking Parliament to consider ratifying the Final Acts.
Ms P Faku (ANC) appreciated the presentations. She said that the Committee had at least to be happy with the progress made by the DCDT and SITA.. She congratulated Mr Keyise and said that he was doing a very good job in leading the repurposing of SITA. She was very excited that he was able to respond to some of the questions from the previous meeting. SITA had had serious challenges with customer delivery, but improvements could be seen, especially with major revenue being brought in by the SAPS and DOD.
She asked for clarity and specification on any challenges with the JCPS, as the revenue from that cluster had been decreasing. She was happy with the IT modernisation, as she had attended an international workshop which made it clear that digitisation would reduce corruption and crime. SITA’s clients, especially SAPS, would benefit from the IT modernisation and digitisation. There had been many issues with the deoxyribonucleic acid (DNA) testing of SAPS. The Committee would have to meet with SITA and SAPS on that issue to discuss the way forward.
Overall, the projected revenue was improving, so SITA would not be needing government bailouts. In terms of recruitment, as there was only a 25% vacancy left at the level below the Head of Departments, so when Mr Keyise left, at least the skills would have been transferred. There was a new CFO, so management positions were being filled. The issue of performance management contracts not being done had been resolved. Some of SITA’s challenges had to do with wrongdoings regarding the tender processes. Maybe the Committee needed a progress report from SITA on the consequence management being implemented to deal with that issue. However, it was apparent that there was now good leadership and good internal capacity was being built.
On the DCDT presentation, she asked what the impact of spectrum was on the outcome of rural coverage. What would be the impact of the court interdict on the rollout? When would the 5G spectrum stemming from the WRC-19 be allocated? If spectrum was critical, were he officials who were dealing with it vetted by state security? She knew that Ms Jordan-Dyani was passionate about this, and the DCDT was doing good work.
Mr C Mackenzie (DA) asked what percentage of total government procurement was going through SITA at the moment. He said that at one stage, there was conflict between SITA and the Department of Home Affairs (DHA) over issues with the systems in place. Could Members be given an indication of that particular SLA and how it had been performing recently?
He asked if benchmark tests were done against the general ICT industry on the pay of, and benefits to, SITA’s staff. Were tertiary level students who received bursaries obliged to work for SITA for a number of years after they graduated? Were there similar conditions attached to the bursaries given to internal staff members who wanted to go and study further?
He asked if SITA had engaged with the Department of Public Service and Administration (DPSA) on the turnaround strategy. Could the Members be given an indication of whether there had been that engagement, and what content had been discussed?
He said that one sub-department that had also excelled was the team involved in the international telecommunications fora. He congratulated the DCDT, and the people involved in that team and people from the private sector in that regard. It was abundantly clear that the skills, expertise and knowledge in the DCDT was great, as could be seen from the benefits that would be placed on the country by the WRC-19 Final Acts.
Mr Z Mbhele (DA) said that he was on a bit of a back foot, as he was a new Member to this Portfolio Committee, but he had some understanding from being on other Portfolio Committees that had dealt with SITA in some way, especially the Portfolio Committee on Police. He echoed Ms Faku’s question on the reason for the revenue decline obtained from government clients.
He asked what the unique value add of SITA was in public sector ICT. His general understanding of SITA’s role as an umbrella entity coordinating with different departments was to achieve economies of scale for the procurement of technology. Was that the essence of SITA, or was there another basis on which public sector ICT would fall under the SITA’s purview? Where SITA had been involved in ICT issues, for example, with the DNA database of SAPS, it had always been deemed to be a problem factor around case administration. Databases would be installed at a police station at ground level, but there would not be the bandwidth to transfer the case files to the broader network in real time. Similarly, there were issues with the firearms registry, and SITA was cited as the problem factor. Conversely, where SITA would be expected to play a significant part, it was not involved. He wanted clarity on this, as it guided the strategic thrust of the repurposing of the entity. It had to be ensured that the repurposing was done in a genuine and strategic manner.
Ms A Mthembu (ANC) applauded SITA for its improvement in sustainability. She applauded the DCDT for the WRC-19 declaration on gender equality and balance. She said that that was significant.
Mr Keyise responded to Mr Mbhele’s question, saying there were key ICT initiatives that SITA should be driving but was not involved in, even though the SITA Act was clear on the initiatives that fell under the purview of the entity. Where there was a deliberate disregard for the Act, SITA would subsequently get involved, even legally, to ensure that it was involved in the future. This could be seen in the Eastern Cape, where SITA did not get involved only to read the Riot Act, but also to say that the services procured in that matter were not of the best value, and assisted in that regard.
He said that some departments did not involve SITA at a strategic level, as the entity had failed them in the past. As part of getting back to basics, SITA had been having SLA engagements with departments and had been trying to understand why SITA was not being involved. Serious engagements were being done with key clients that had not involved SITA. This would also allow the critical evaluation of the role of SITA, as some departments were moving on, as the entity was failing to be a good advisor for ICT strategies. Some of the key focus around R&D and innovation was to bring in top leadership to improve the provided services.
Responding to Mr Mackenzie’s questions, he said the DHA system kept slowing down and shutting down, especially during the October to January period, because it had been hit by a virus. There were two things. Firstly, the system was a legacy structure that had not been upgraded by the DHA, against the advice that had been given by SITA. If more services were put online, the infrastructure had to be upgraded to handle the volume of data. Secondly, the virus hit the system in November 2020. On that issue, SITA had been able to deal with it externally, but if the issue got to the internal area network, SITA would not have been involved.
When companies asked SITA to publish tenders, part of the trend that the entity was trying to reverse with government was that SITA was not involved. When the companies with which the departments contracted did not deliver adequate services, SITA did not even have a view of the contract that was signed, and as such could not play its role of helping to ensure that the company did deliver adequate services. In its engagements, SITA had made it clear that it did not intend to take over all ICT services and establish a monopoly, but wanted to be involved to ensure that private companies delivered on their contracts with departments.
This was what had happened with the DHA. In January, the Telkom providers had networks go down, as did Broadband Infraco (BBI), which had affected the DHA systems. The same thing happened with SAPS, where there were challenges with the DNA and other systems that had been installed by external service providers. SITA’s relationship with the DHA and SAPS had improved, with the entity now assisting by providing advisory services, even on contracts which SITA was not a party to.
At the relevant time, SITA would brief the Committee on the rumours in the media on these issues. SITA’s role was to ensure that the intellectual property sat with the state and that these departments were assisted in building internal capacity to develop and modernise internal solutions and systems so as to not depend on external providers. Due to that dependency, when business processes were affected, so too was service delivery. It could be confirmed that there were engagements and relations from the ministerial level and from SITA with all key clients, including the provinces, to ensure that SITA provided advisory services.
In response to Ms Faku, he said the loss of revenue from the JCPS cluster was due to budget cuts within the cluster. The budget of SAPS alone was not severely cut, and that was why the revenue from that cluster was growing. More resources and services were being provided to SAPS.
On bursaries, SITA had been giving bursaries in excess of R30m per annum, without any obligations of service. Those obligations were now being put into the bursary contracts. The type of bursaries that were being provided was for people doing degrees in non-technological fields. That was an issue, as those people would not assist SITA in developing skills for digital transformation. Now bursaries were being prioritised for students doing Masters, Honours and PHDs in technological fields. For undergraduates to obtain the bursary, they had to truly excel in fields that were related to the transformation of SITA. The bursaries given to internal staff members also contained this obligation.
He said the Committee would be given a full report on the consequence management that had been implemented on irregular expenditure. National Treasury had condoned almost R400m of irregular expenditure, as SITA had implemented the eight required consequence management steps to resolve those issues and hold people accountable. This was being reported every quarter to the board, the audit committee and the DCDT. SITA would also provide the Committee with full details of all consequence management that had been taken in terms of irregular expenditure.
On engagements with the DPSA, it could be confirmed that the DCDT had engaged with the DPSA on the repurposing of SITA. The draft repurposing document had been finalised. A further engagement by the DCDT with the DPSA and National Treasury was planned for Quarter 1. SITA had also engaged with government chief information officers (CIOs) on the repurposing of SITA, as they were the representatives of the entity’s main clients. SITA wanted to ensure that the repurposing addressed the key issues of service delivery.
The Chairperson reminded Mr Keyise of Mr Mackenzie’s question on the estimated government spend on SITA.
Mr Keyise said that in terms of ICT market share, it had been 53.5% in the last financial year, and SITA anticipated about 57% in this financial year. Regarding the ICT values on the basic accounting system (BAS), SITA was working with National Treasury to clean up the data on the BAS. For example, SAPS would put R2.5bn on BAS, but the real SITA services paid for would be only R1.7bn. There had to be better data to find out what was happening to the excess money. The Committee could then be updated on these variances.
Ms Jordan-Dyani responded to Ms Faku’s questions. On the impact of spectrum on rural connectivity, she said the priority for the DCDT when issuing the policy directions was to focus on covering rural connectivity. The policy directions of 2019 had been intended for that, and broader participation and the transformation of the sector. There was also the deployment of alternative technologies, such as the HAPS and the WiFi rollout.
The impact of the court interdict was a grave matter. The DCDT was hoping to resolve it quickly, as it meant not only a delay in the current high demand spectrum, but also the Wireless Open Access Network (WOAN), and the connectivity during Covid-19. There were talks and interventions under way in terms of mediation.
On the 5G spectrum allocation, the DCDT’s annual performance plan (APP) had intended to finalise the 5G spectrum before December 2021. Under the MTFS, the licensing of the 5G target would be moved forward from 2024, based on the key deliverables that 5G could realise for the society and the economy.
The officials working with spectrum were a small team. In the DCDT, there were four people in the infrastructure unit, of which two were dedicated. One of them was female, and there was one director and an intern. The Regulator had 11 people, of which four were female, and there was one councillor. At the last WRC, there was participation by the three females and the councillor. Strides were being made on the gender equality target. Because spectrum was so critical, and due to all the required engagements, the DCDT ensured that the officials were vetted by state security.
Mr Ngobeni said that on 5G, the DCDT was working on a 5G policy direction, which would also flow from the NRFP, as it was also informed by the ratification of the Final Acts. The court case did have an impact on the policy direction. A way had to be found to achieve the national objectives to utilise spectrum
He said the HAPS were prototype technologies. The process contained the development of the prototype technology, whereafter the representatives would go to the ITU and try to secure spectrum. If spectrum was then secured, it would be available for these applications. After the conclusion of the WRC-19, more work would be done on the HAPS, and after that they would become available for deployment.
High-speed WiF was recognised as one of the older technologies. As the 5G would be implemented, it had to be ensured that the WiFi in local areas had the capacity to handle such high-speed broadband connectivity. That was being studied and would be finalised in the coming years.
Mr Mbhele asked if SITA could indicate to what extent the entity was involved, at present and going forward, in the Integrated Criminal Justice System (ICJS) projects. The ICJS was the grand vision of the criminal justice system value chain of forensic evidence management, to prosecutions, to correctional services, becoming a seamless digitised system linked to the DHA, amongst other departments. Was that something to that to SITA’s knowledge was still on the cards and to what extent was SITA involved in that process?
The Chairperson said he wanted confirmation on whether the Committee could see the implementation of SITA’s repurposing strategy before the end of Mr Keyise’s term. This was important, as part of problem in the SAPO was the many turnaround strategies that had been put in place, with implementation not being capable of being concluded. Could SITA speak to that, as it would help to look at the future when a permanent board was in place? He wanted Mr Keyise to respond on the capacity of the executive to implement its strategy and the decision-making of board.
It would be important to confirm to the Committee, on the issue of spectrum, if the DCDT could answer the question of developing the necessary internal capacity to properly implement the resolutions. He asked if that could be answered with regard to the unit that dealt with international relations in the DCDT, as that would answer the question as to whether, when the WRC-19 Final Acts was ratified, the capacity of the country to implement the regulations had been considered. Could the DCDT also inform the Committee on the matter of assisting Palestine?
Mr Keyise said that SITA was fully participating in the modernisation of the ICJS. The process was driven heavily by the ICJS cluster, rather than the SAPS. SITA was working on the architectural design. There was also an acting chairperson of the ICJS that had been appointed. The Commissioner of SAPS was frustrating the appointment of a permanent CIO who would lead this initiative. SITA was involved in that process, and hoped that there would be a permanent CIO in place at the SAPS by the end of April.
On the pay and benefits, a benchmark analysis had been done, and it had been determined that SITA was relatively below what the market provided. SITA was going through the process to find solutions to this. SITA was planning to take it down to all the management levels in Quarter 1 of the next financial year. This was to understand the affordability of it and the impact it might have on retention strategies. There needed to be stability in leadership.
On the broader implications of the repurposing, and whether SITA would be implementing its strategies when he left, he said that SITA was already doing that, as part of its five-year strategy was to implement its key focus areas that did not require legislative amendments. It had to be ensured that there was continuous implementation. Practically, SITA was investing in infrastructure which would impact on the type of services provided to government.
On the digitisation of government, investments were being made in digitising government processes. SITA had spent about R100m of its own money to build systems to digitise the paper-based departments, and in building components to integrate systems. The entire consultation and Cabinet approval for the repurposing case would be done by June 2022. Beyond that, other reforms would be implemented from that process. There was the advantage that by that time, all executives needed for the implementation would be in place. Once the business case was approved at all levels, the DCDT would also consider establishing a permanent board to ensure there was a smooth handover once his term was completed. SITA was working with the shareholders to have a smooth and efficient handover. There was a meeting of the minds of SITA and the DCDT that was focused on implementation and sustainability. He was happy with the technical team which had led the building of the internal capacity of the institution for the future.
Ms Jordan-Dyani said the DCDT was working with SITA on its repurposing, and was working on the necessary bills and the revision of legal instruments. This was being done in collaboration with National Treasury and the broader government.
On the building of international capacity, the council representative from Geneva was present. She said the DCDT was happy to have someone who had experience and background on engineering who could advance the programme. South Africa also served in various portfolios representing Africa. On the policy position of assisting Palestine, this was in line with the policy directions.
Mr Ngobeni spoke of the DCDT’s capacity to implement the WRC-19 Final Acts. He said that when the Final Acts were published at the start of 2020, the DCDT had undertaken a detailed analysis and made a report which it had shared with the Independent Communications Authority of South Africa (ICASA). The DCDT had also engaged with government and the security cluster to share the outcomes, check if there were areas of concern, and to say that as the Final Acts were incorporated into the NRFP, the issues or the needs of government services had also been factored in. ICASA had put in place a plan to review and finalise the implementation of the Final Acts with government.
Palestine was an old issue. This had manifested itself in the ITU as resulting in spectrum being unable to be used in Palestine due to its relationship with Israel. As spectrum did not recognise boundaries, it was necessary to coordinate with neighbouring territories. Without coordination, there would be harmful interference, as was happening in Palestine. The DCDT was working on this with DIRCO in this engagement. Palestine had requested South Africa to intervene and assist in enabling Palestine to use spectrum. In some areas, Palestine could rely only on second generation (2G). The DCDT had been assisted by other member states in reaching the conclusion for Palestine to use spectrum.
Deputy Minister Kekana said that the position SITA was taking would take the country to the next level. Based on what Mr Keyise had said, the support of the Committee was needed during this time, as Covid-19 had shown the importance of connectivity. The DCDT could not afford tension between the entities and provinces. These two parties should always work together and help each other. There were issues in the Eastern Cape and Limpopo, but SITA, the Minister and the Premiers were working to resolve that.
Going forward, the district development model and the support to municipalities by SITA would be essential. The DCDT wanted to make the provision of WiFi and Fibre in households a basic service. SITA was helping the DCDT in this regard. Access to the internet was no longer a luxury. No child could be left behind. Thus, the DCDT wanted to work with the Committee to support the entities to help provinces and municipalities eliminate the tension.
The DCDT hoped it was on the right path in terms of the ratification of the WRC-19 Final Acts. The DCDT was ready, and the Minister was going to ensure that the whole ratification process would occur. The Department would then, through ICASA, ensure that what was required of South Africa was done accordingly.
The Chairperson said that there was a great sense of appreciation for the work being done at SITA. The main thing was to support SITA to deliver on what they had put together in a way that ensured there would be no regression. This would include transitional management to move from an Executive Caretaker to a board.
For the Committee to trace implementation, a report indicating progress on the implementation of what was contained in the repurposing strategy, over and above the performance targets, would be appreciated. The Committee would await the report on consequence management.
There was also appreciation for the work done by the DCDT, and the capacity that had been put together to look at the international obligations and the country’s capability to implement spectrum. The Committee agreed with the recommendations on the ratification as presented, and would take those recommendations to the House. He noted what Mr Mackenzie said on the reservations.
Mr Mbhele said that it was matter of convention that the Democratic Alliance (DA) would ask for the minutes and the record to reflect that the DA reserved the right to vote on the matter, as it needed to obtain a caucus mandate to declare its support.
The Chairperson told the Members that they had not yet formally confirmed with the SAPO that it should brief the Committee next week, but had applied for that meeting to take place on 16 March, as a Committee report also needed to be adopted. He would also interact with the staff on the issues with the link.
The meeting was adjourned.
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