Follow-up meeting on IFMS SIU investigations & National Treasury progress; with Deputy Ministers

Meeting report

Opening remarks

The Chairperson welcomed the Members to the meeting, and highlighted the amount of work the Committee still had outstanding before the end of the term, and how much they had to get done before the end of the Sixth Parliament. He welcomed the Deputy Minister of Finance, the Deputy Minister of Communications and Digital Technology, the Deputy Minister of Public Service and Administration, and the respective Directors-General (DGs) from the departments. He also welcomed the delegation from the Special Investigating Unit (SIU), led by its Chief Executive, Adv Andy Mothibi, to the meeting.

On 13 September 2023, the Committee was briefed by the SIU, the Department of Public Service and Administration (DPSA), National Treasury and the State Information Technology Agency (SITA) on the status of investigations and the implementation challenges of the Integrated Financial Management System (IFMS). The Committee would receive a progress report on the outcomes of the SIU investigations and a status and progress report on the IFMS implementation from National Treasury since the last meeting in September 2023. The broader question was on the projected completion of the implementation of the IFMS, because there were a lot of challenges -- money was continuously being spent on it, and it was consistently under audit.

The Chairperson noted how the IFMS process had started over 20 years ago when he was still a matriculant, and exclaimed that something had got to give. The meeting should close with a clear direction on the next steps in implementing the system. The meeting had been postponed three weeks ago because of consultations that needed to take place amongst the departments and stakeholders, so that was enough time to have the departments update the Committee. 

Deputy Ministers’ opening remarks

Dr David Masondo, Deputy Minister of Finance, said part of the reason that the Minister of Finance and the other Ministers from the other departments could not attend the meeting was because there was a Cabinet meeting. He thanked the Committee for allowing the departments to provide a progress report on what had happened since the last meeting. He said the Director-General of the National Treasury would provide the necessary details.

Mr Philemon Mapulane, Deputy Minister of Communications and Digital Technology, said he would not say much because the primary custodian of the project was National Treasury, which the Department of Communications and Digital Technology (DCDT) was happy to support.

Dr Chana Pilane-Majake, Deputy Minister of Public Service and Administration, said she appreciated the opportunity to speak before the Committee, and noted that her Department would also not say much in the meeting, although they would also provide a brief presentation on their involvement in the IFMS project.

National Treasury presentation

Dr Duncan Pieterse, Director-General, National Treasury (NT), said that on 13 September 2023, the SIU had presented a draft report to the Standing Committee on Public Accounts (SCOPA) on the investigation into IFMS in terms of Proclamation No. R40 of 2020. The SIU had agreed that the NT may submit representations to the SIU by 22 January 2024. NT had appointed Senior Counsel to prepare representations to the SIU in response to the draft report. On 22 January, it had submitted its representations to the SIU. Its representations covered various procedural and substantive aspects raised in the SIU draft report, and these were shared with the South African Police Service (SAPS), the National Prosecuting Authority (NPA) and the Presidency. On 26 February, the SIU confirmed that the procedure to consider NT’s representations was still underway, and the Presidential Report would be submitted on or before 31 March.

Regarding National Treasury’s engagement with the DPSA on implementing the human resource (HR) modules, he said the DPSA had expressed the need to implement a centralised eRecruitment Module for the public service outside the scope of IFMS. NT had agreed with DPSA that a separate but interoperable HR module would be the best way forward so that the requirements of DPSA were not delayed by the ongoing uncertainty over IFMS due to the SIU investigation. Engagements were underway to determine the scope of the implementation and the impact on the integrated system, in support of the request.

On implementing the IFMS, he said completing the SIU report would inform the way forward for the IFMS. Implementation activities were on hold to await the outcome of the SIU investigation and the subsequent processes that may follow. Negotiations with Oracle for the implementation of a cloud solution had been put on hold pending finalisation of the SIU report. Engagements were underway with various international and domestic experts to harness global lessons learnt, and to guide implementation strategies and plans. Given the challenges experienced in the IFMS implementation, following the conclusion of the SIU investigation, it was possible that NT may pursue a new direction for IFMS implementation, building on the various lessons learned throughout the process and global best practice. 

The Chairperson felt that what had been said in the presentation by National Treasury could have been written in a letter.

See attached for full presentation

DPSA’s presentation

Ms Yoliswa Makhasi, Director-General, DPSA, said the IFMS was intended to be the cornerstone of digital transformation in the public service. Despite extensive efforts since its inception, significant delays have been encountered, and challenges persisted in operationalising the system. The SIU investigation into the procurement process for the IFMS enterprise resource planning (ERP) solution had further delayed progress, and it was still unclear what the impact of the outcomes on the IFMS programme would be.

IFMS challenges have significantly impacted the public service and its ability to seize opportunities to digitise and automate administrative processes. The importance of modernising and digitising human resource management (HRM) practices was emphasised by the adoption of the national framework for the professionalisation of the public sector. Digital transformation held the key to unlocking greater efficiency and effectiveness in the public service and addressing the evolving demands of governance and administration.

The DPSA, as the policy owner for HRM in the public service, must lead the public service in implementing an integrated HR system so that the delays and uncertainty of IFMS did not critically impact the Department's ability to deliver on its mandate. This should be guided by a digital transformation strategy and plan. An e-recruitment module for the public service was a priority for the DPSA. It could be implemented independently and integrated later. The DPSA required dedicated resources (HR and financial) for such an undertaking, and engagements with National Treasury for allocations.

See attached for full presentation

The Chairperson said the reason he felt the presentations could have been sent to the Committee via a letter was because the three-week postponement of the meeting had given the impression that they would arrive at the meeting with a mega package containing a roadmap for the implementation of the IFMS. He said if they were still waiting for the finalisation of the SIU report, they could simply have asked for another postponement of the meeting.

SIU’s presentation

Adv Mothibi said the SIU had interacted with National Treasury, which had submitted its representations to the SIU which they felt it should consider as they continued to investigate, and would have possibly led the SIU to a different finding than it had in the beginning. He then asked the Chief National Investigating Officer who had led the investigation, to present to the Committee.

Mr Leonard Lekgetho, Chief National Investigating Officer, SIU, said the SIU had received a whistle-blower report alleging corruption and irregularities in the procurement process for the Integrated Financial Management System, which had been awarded to Oracle SA (Pty) Ltd. It was alleged that the procurement process and the award for the Tier 1 Commercial-Off-The-Shelf, Enterprise Resource Planning (COTS-ERP) solution had been irregular. There had been mal-performance and/or no performance by the service providers, professional consultants, or any other person or entity. No value for money had been received by NT. A corrupt senior official at the NT had been involved in awarding the contract to Oracle.

A hybrid architecture had been approved for the IFMS project after the Cabinet Memorandum 16 of 2005 was issued, with the subject “Integrated Financial Management Systems (IFMS) Projects”. However, after the issue of Cabinet memorandum 35 of 2013, the solution was changed from a hybrid architecture to a COTS-ERP. On 5 November 2013, Cabinet had mandated the procurement of the COTS-ERP.

On 29 January 2014, the IFMS steering committee approved that the procurement of the COTS-ERP solution was to be done through the State Information Technology Agency (SITA).

The focus areas of the SIU investigation had been to investigate the procurement of, and contracting for, the IFMS by or on behalf of NT, and payments made in respect thereof; to determine whether the proper procurement process was followed; to verify the mal-performance, and/or non-performance by Oracle or any other person or entity; to determine if value for money was received by the NT and losses incurred; and to conduct a corruption investigation (to include the profiling and lifestyle audits of officials and service providers).

The high level findings of the SIU included that irregular supply chain management (SCM) processes had been followed, as there was non-compliance with SCM policies and legislation, that there had been a conflict of interest, and that there had been fruitless and wasteful expenditure in the process.

After the SIU’s presentation to SCOPA on 13 September 2023, NT requested that they be given an opportunity to make representations with respect to the SIU findings. The SIU had agreed, and NT submitted their representations on 22 January 2024. The SIU had had an opportunity to review NT’s representation and the accompanying documentation, which were considered against the SIU’s findings. The documents provided by NT were in fact instrumental in the SIU investigation and were considered when making the findings. After a thorough review and evaluation process of the representations, the SIU advised NT on 22 March, that it still holds the same position and therefore the SIU’s findings stand.

Adv Mothibi said the status was that the investigation had been completed with the findings that were presented, and during the investigation, the SIU had gathered information that it could not unpack in the meeting, but it had the documents that supported the evidence. Regarding the execution of the outcomes, they found that the contract was irregular, and the disciplinary referrals that had been made were based on the evidence that was uncovered that indicated the role that National Treasury officials played in the process of the irregularities. The blacklisting referral was made against the service provider based on the findings that were made, and that process was expected to unfold.

See attached for full presentation

Discussion

Mr A Lees (DA) said no progress had been made in the implementation of the IFMS project, which was an important system that had been in progress for nearly 20 years. The SIU report was done, but no next steps were provided regarding the IFMS and how it would continue going forward, regardless of holding the relevant people accountable. There was information regarding implementing the DPSA system, but the big picture was still missing. In terms of the outcomes of the investigation, who were the disciplinary referrals? Assuming that the blacklisting was Oracle, was the blacklisting on the basis of malfeasance from Oracle, as opposed to National Treasury officials failing to follow procedure? What were the entities, or who were the people, involved in the five criminal matters that were referred to the NPA? 

Mr M Manyi (EFF) said he had noticed that government departments tended to sign contracts where they must pay monthly premiums, but every time there was a specific execution that needed to be done, the departments would say that was out of scope, and that would lead to contracts that had wild cost implications. With the IFMS project or any other similar projects, did National Treasury have systems in place to ensure that there was no space for out-of-scope contracts? What was the next step for the implementation of the IFMS project, because it seemed that the project was stuck in limbo?

In the last SCOPA meeting with the SIU, he asked a question regarding their investigation into the Fort Hare matter of fake qualifications and when the proclamation letter had been sent to the President. He wanted to know what had prevented the President from signing the proclamation letter. Had the other companies that the SIU investigated in the IFMS matter besides Oracle been given a clean bill of health? Did the SIU have a timeline for the submission of the final report on the IFMS investigation, and would that be before the end of the current term of Parliament?

Mr S Somyo (ANC) said the SIU investigation made National Treasury look like a crime scene. This had also engulfed the DPSA, which had to opt for an integrated HR system, while National Treasury was trying to clear itself from the SIU investigation. While the integrated HR system was a good idea, it had moved away from the original premise or intended objective of the IFMS and put Treasury in a scenario where it was soiling the intent of Cabinet when it introduced the IFMS in 2005. National Treasury expected the DPSA to await another Cabinet approval for an integrated HR system independent of the original IFMS.

Mr Somyo agreed that finding justice was one of the tedious processes affected individuals ought to pursue to gain clarity on specific things, but he wanted to know for whom National Treasury was pursuing justice. Was Treasury pursuing justice for itself as an institution that was the custodian of the Public Finance Management Act (PFMA)? The Committee had pleaded with Treasury in the last meeting to go and deal with the issues, yet the Department had still come back with no progress from their side in dealing with them. The SIU had come with its findings to say it had concluded the investigations and was going to submit a full report, but the next steps were unclear from Treasury, and they needed to be clarified.

Mr B Hadebe (ANC) said he had become worried, scared, and frustrated when listening to the presentation from the SIU, because he had started thinking about the Passenger Rail Agency of South Africa (PRASA) situation, where a contract was terminated without alternative measures in place, and that had led to the status of the rail system of the country. It would be concerning if that was the direction in which National Treasury was headed regarding the IFMS matter. Adv Mothibi had mentioned that some of the disciplinary hearings did not necessarily have to wait for the final report to the President. Was the President obliged to accept all the recommendations, or could he have a different opinion about them? And what would happen to the status of those investigations after they had been implemented?

The Chairperson wanted to know the implications of the SIU having identified irregular SCM processes that Treasury had followed. National Treasury had said it was waiting for the SIU processes to conclude, but what exactly were they waiting for, because the SIU had said it had conclusively arrived at findings and that the representations provided by Treasury did not materially change the outcomes of the findings. What were the implications of the irregular SCM processes, and what were the recommendations arising from them? Did the recommendations include termination or regularisation?

Mr Manyi wanted to know what had happened in the debacle between National Treasury and the Auditor-General of South Africa (AGSA), where the matter had even gone to court and needed a political intervention. What was the final agreed categorisation of that issue? Who was right and who was wrong, and what were the consequences?

The Chairperson said in the 2020/21 financial year report, it was stated that the Department had made a payment fee of R67.6 million for technical support and maintenance of a software licence for the IFMS, and the issue of fruitless and wasteful expenditure for the IFMS software licence was under dispute. The disclosure of the fruitless and wasteful expenditure of the previous and current financial years did not necessarily mean that National Treasury management had agreed and accepted such payment as fruitless and wasteful expenditure, so the status of that dispute was important. It was important for the Committee to hear what was happening with the maintenance of the IFMS software, especially because the DG had said no payments were made. Had the maintenance of the IFMS software continued, and if it did not continue, would this not incur more expenditure down the line? Would the Department not be delaying the inevitable if it was not paying for the maintenance of the IFMS?

NT’s response

Dr Pieterse said part of the reason everyone was unsatisfied with the situation was because Treasury had a legally binding contract with the IFMS service provider until the status of that contract changed. He and the Accountant General had looked at how they could renegotiate the contract so that they could at least allow the matter to move forward and ensure that the IFMS was implemented. Following the first report that was received from the SIU, they had decided that it was not prudent for them to continue to move along those lines. They had sought legal advice in that regard, because they did not want to renegotiate the contract just to get value for money or try to enter discussions with the supplier when the contract could have been invalid and unlawful. The process that Treasury followed was to wait for the SIU process to be completed and then they would move on from there. They were waiting for the final report from the SIU before they could move forward.

Treasury had submitted its representations to the SIU on 22 January, and wrote to the SIU on 25 March to ask for an update so that they could take the matter forward. The SIU said it would table its final report in the SCOPA meeting. It was important for Treasury to wait for that final report, whether it would be submitted to the President or to them, and once that was tabled, Treasury would seek advice from counsel on how to proceed. In its representation to the SIU, Treasury indicated that it disagreed with the SIU's finding that the contract was irregularly awarded and submitted every procurement step, outlining why they believed they did not contravene the SCM processes. Treasury had also disagreed that there was fruitless and wasteful expenditure, and had explained why they disagreed and made a comprehensive submission of about 75 pages to the SIU.

This process had put Treasury in a bind in terms of continuing with the implementation of the IFMS, which was why they had decided not to delay the DPSA process and, depending on the legal advice that they would receive, they would decide how to proceed with the process despite the legally binding contract and the representations that they wanted to formalise further. The procurement and contractual system worked in a way that proceeding outside the scope of a contract immediately became irregular, which was why as soon as there was a deviation from an original contract, that must follow its own process and must be provided for in the SCM policy of the relevant institution.

Mr Shabeer Khan, Accountant General, National Treasury, said the dispute with the AGSA had started when Treasury received a qualified audit report in the 2021/22 financial year concerning the maintenance and support of around R67 million. There was a subsequent qualified audit report in the 2022/23 financial year, and although there was no expenditure in that financial year, the qualification was related to a comparative number in the annual financial statement. That qualification related to the expenditure that occurred in the 2021/22 financial year.

In the 2023/24 financial year, there were engagements with the AGSA in terms of what that meant for the audit outcome in relation to the IFMS, and it was clarified that from an audit perspective, Treasury would no longer be qualified on its accounts in relation to the IFMS. The reason for this was that the actual expenditure had happened in preceding years and the comparative number was no longer a matter that was subject to a dispute, so for the current financial year, it was highly likely that Treasury would receive an unqualified audit report.

It was important not to isolate the dispute as only an IFMS matter -- the reason it was a big matter of contention had broader public interest considerations. In the Zondo Commission of Inquiry into state capture, it was seen that there was a lot of risk averseness by accounting officers and officials in making decisions. The reason why Treasury wanted to ensure that it got this principle correct was because it did not hamper decision making by the state, so as part of that process, they had engaged with the AGSA and legal counsel, not necessarily to litigate against the AGSA, but partly because the SIU also had findings on whether it was fruitless and wasteful expenditure.

There was still fundamental disagreement on whether that expenditure was fruitless and wasteful, but it went back to the underlying principle for having a valid, binding contract, and one was obliged under that contract to pay maintenance support. Trying to unpack that principle using the PFMA was where the heart of the dispute was. The matter was still ongoing, and it would not have an adverse impact on the audit outcome.

Mr Khan assured the Committee of the cordial working relationship between the AGSA and Treasury, commenting that they were working together to try and resolve the matter.

Deputy Minister Masondo said that besides the issue of the implementation of certain modules such as the eRecruitment by the DPSA, with which they wanted to proceed outside of the IFMS, there seemed to be a clear way forward, but other issues were contingent on two issues. The first issue was that the SIU report must still consider the representations that National Treasury had made, and if they responded to the representations favourably to Treasury, then their findings would have to be reconsidered, and if that did not happen, it would need to be ventilated at a Tribunal, where the outcome could either be that the contract was valid, or it was not. There was also the risk of the service provider taking Treasury to court for terminating their contract illegally. If the contract was declared invalid and both Treasury and the service provider agreed to appeal the issue, it could still take a long time.

He said the meeting would not help them to come up with a clear way forward, because there were a lot of dependencies, and the way forward would be determined by how they dealt with the issues he had raised. The different state organs must find a way to proceed.

SIU’s response

Adv Mothibi said various legal variables could be considered to assist the process legally going forward. The consequence of the finding that the correct SCM process was not followed was that the SIU would institute civil proceedings to cancel the contract and recover the money. The DG had mentioned the legal status, but the legal status in the country was that a contract remained valid until it was cancelled and set aside. However, in these circumstances, Treasury disagreed that the contract was entered into irregularly and would not issue a process to terminate the contract.

In other instances where the SIU had made a similar finding and a state department agreed with them, above the SIU starting civil proceedings, the department would start the contractual provisions to terminate the contracts. The SIU would proceed with its civil proceedings and there would be court papers or special tribunal papers in which Oracle would be cited, and they would all argue their cases, but that did not mean the possibilities mentioned by the Deputy Minister would not be done to assist the operations of Treasury.

He said the SIU would not be able to mention the names of the Treasury officials involved in the disciplinary proceedings until the criminal process took its course and they had been charged. The blacklisting was based on the malfeasance from Oracle, and the SIU had made a finding of conflict of interest between an official or some of the officials and Oracle, which would be unpacked when the case was argued. There were no other companies that were investigated besides Oracle, but if other companies were alleged to be involved in any wrongdoing and they were investigated, they would have been informed. The report to the President should be finalised before the end of April.

He said the Fort Hare investigation was ongoing and had its own findings, and after the interdict was obtained, they could not investigate the masters' degrees. The court had indicated that the scope of the Proclamation did not cover the masters’ degrees, and had intimated that the SIU needed to get an amendment of the Proclamation. The SIU had prepared the amendment and submitted it to the Department of Justice on 7 July 2023 for the Proclamation to be processed.

When the SIU investigates and gathers information, such as in the IFMS situation, they institute action to have the illegal contracts cancelled through the special tribunal, so when they submit the report to the President, they indicate the status of those investigations. The President respects the legal, due process and does not interfere in the outcomes.  

Follow-up discussion

The Chairperson said it seemed that National Treasury was prepared to "die on the hill," insisting that they did not enter the contract illegally because, in July 2015, its audit committee had requested the internal audit unit to perform a review of the IFMS payments for the 2014/15 financial year. The internal audit investigation revealed a total of 54 findings, of which 49 had catastrophic risk ratings and five had high risk ratings. The investigation indicated weaknesses in internal controls to mitigate the risks and weak monitoring systems. The internal audit investigations indicated that internal controls could not be relied on.

The audit committee had presented the report to the then Accounting Officer in National Treasury in March 2016, and formally requested an independent forensic investigation. Deloitte was awarded the tender on 1 October 2015, and found no wrongdoing by National Treasury’s officials working on the IFMS project, but the only conclusion that was made was that the lack of human resources was partly to blame for the adverse findings on the internal audit investigation. The audit committee rejected the forensic report by Deloitte, and a new tender was issued for the forensic investigation, and Nexus was awarded the contract on 1 February 2018. Nexus completed the investigation, and the report was submitted to National Treasury on 28 August 2018 with the following findings:

• Irregular expenditure to the tune of R273 million.
• Non-compliance with SCM processes.
• Poor documentation of crucial contract information.
• Lack of project management controls.
• Payment of licences for licences not being used (fruitless and wasteful expenditure).
• Weaknesses in internal controls.
• Lack of formal business case for the IFMS project.
• Insufficient resources to fully implement the IFMS project.

The SIU had said the contract with Oracle for the IFMS project was irregular, and Treasury had disagreed, meaning everyone else was wrong and Treasury was the only one that was right. All these investigations came out of the processes from National Treasury, and they simply chose to reject the outcomes because they did not like them. These were investigations that National Treasury had insisted upon, so the revolving door that Treasury had on everyone was unacceptable. Something must give, because the IFMS had become an albatross to the fiscus.

Mr Hadebe said procedural technicalities were delaying the Committee because the SIU said it had completed its report, but it had not submitted a final report to the President, while Treasury said it was waiting for that final report, yet it was clarified by the SIU that the contents of the report would not change. What would happen when the President received the report? Was he expected to study and accept or reject it, for it to be accepted as the final product? How soon would the report be tabled to the President, and what would the process be thereafter?

The Chairperson said that the SIU’s presentation stated that after a thorough review of the representations, it had advised National Treasury on 22 March that it still held the same position, and that its findings stood.

Mr Somyo said the outlook was worrisome, and Treasury’s functionality also needed some scrutiny because they had presented the IFMS project to Cabinet in 2005 and it was approved. In 2013, it presented a revised approach to the IFMS to Cabinet, and Cabinet approved it. The SIU had come with a gazetted proclamation on 31 January in 2020 to investigate the process, and the second point of the SIU investigation was Treasury’s failure to produce what it had presented to Cabinet in 2005, which was already 15 years with no results. Treasury’s failure to implement the IFMS also affected other departments, as the DPSA also said it needed an integrated HR system. Was there any way that Treasury could prove that it had acted against the failure to implement the IFMS system for 15 years, even before the SIU started its investigations? In its role as an accounting officer, what was Treasury taking responsibility for on the matters presented before them?

Mr Manyi said he was referring to something out of scope when it should be in scope. For example, some of the IT-related problems could not be anticipated, but now and then they did need to be sorted out by government departments, and sometimes that could be done out of scope. He said the Committee was dealing with an "animal farm" issue, where an arrogant department decided to be a law on its own and did not want to be held accountable by anyone. The Committee must find a way to deal with the rogue behaviour from Treasury.

NT’s response

Dr Pieterse said the legal advice they received had been clear -- that they should not do anything until they had a final report that was submitted to the President, and once that happened, then the various options could be discussed.

On the actions taken on the IFMS, last year Treasury embarked on a process to renegotiate the IFMS contract so that it could move forward. The renegotiation process involved an initial investment into IFMS to get better value for money from it, and the negotiation centred on recouping the investment in the form of a credit from the service provider to deal with the challenge of the outlay that was happening at a time when there was no progress in implementing the system.

Treasury had also started discussions with the service provider around how they could shift to a cloud-based solution that could get them better outcomes and better value for money. The challenge arose from the investigation of the SIU and what that meant for their contract with the service provider, where the legal advice received informed Treasury not to proceed with those negotiations until the SIU investigations were finalised. The Treasury team was also thinking about what the IFMS would look like after the investigations, because they wanted to learn from the lessons of the past years and be able to implement the system to replace the legacy systems.

SIU’s response

Adv Mothibi said the findings made by the SIU would stand, even before the report was submitted to the President, because they had legal standing. This meant that any other decisions that must be made, would be made based on the SIU findings. There was absolutely no need to wait for the President’s report, because the findings were final, and they contained some judgments that could be made. He said they would speed up the finalisation of the President’s report, but that would not change their legal standing.

Deputy Minister Masondo said the feedback received from the Committee had been useful, and requested that Treasury be given some time to reflect and come back with a suggested way forward even before the report to the President was tabled. He felt that they needed to have an internal conversation as Treasury to decide how they would take matters forward, considering the comments from the Committee.

The Chairperson said they would engage the Presiding Officers and the House Chairperson so that they could conclude the process.

Mr Lees agreed with the Chairperson, and asked whether the Committee required Treasury to come back to it with a roadmap, considering that they knew exactly where the SIU stood on the matter.

Mr Hadebe asked how much time the Department thought they would need to ensure that they came back to the Committee with tangible information without complaining about the time they were given. 

Deputy Minister Masondo said, after consulting the DG, that they would request a maximum of three weeks.

Mr Manyi asked why it was easy to mention that Oracle was blacklisted, but not the individuals from Treasury that were implicated.

The Chairperson requested that the Department submit a written report to the Committee in 21 days so that it could have a basis on which to engage with the Presiding Officers. However, the Committee had postponed the meeting three weeks ago because Treasury needed to consult, so the sooner the response was submitted to the Committee, the sooner they could find a way forward. 

Deputy Minister Pilane-Majake appreciated the comments that had been made, that the DPSA should move forward with the processes required around its HRM system and the integrated HR system for Cabinet. This was not only an eRecruitment issue but also involved other HR-related matters such as performance management development systems, leave management systems, organisational structure, HR planning, and HR administration and operations.

The Chairperson hoped National Treasury had also heard the urgency that the DPSA was putting on the integrated HR system.

Mr Somyo said the DPSA should be able to continue with the system it wanted to implement, and it could be combined with whatever was decided once the IFMS issues were sorted out.

Deputy Minister Pilane-Majake noted the point, and suggested that perhaps their system could be costed with the assistance of Treasury.

Adv Mothibi said individual parties were mentioned when matters were already in the public domain in terms of the findings. It was already public knowledge that the contract was between Oracle and National Treasury, so there was no need to hide the name of the company.

The Chairperson said at times, the names of individuals were not revealed because the process was still in its initial phase, and one was also trying to protect the dignity of the investigation, but perhaps the names would be revealed as the reports were presented. They remained seized with the development of the reporting metrics of the SIU reports by the President, so relying on the Presidency-submitted report may be a box-ticking exercise. Treasury must avoid inviting trouble towards itself by setting precedents that would come back to frustrate them, because people tended to mirror what those in authority do. The strength of leadership -- and Treasury leads public finance -- would be to admit when they were wrong and institute corrective measures and actions.

Deputy Ministers’ concluding remarks

Deputy Minister Pilane-Majake thanked the Committee for the engagement.

Deputy Minister Mapulane said they did not have much of a role in the meeting regarding the IFMS matter, as they were spectators in the meeting. He introduced the Chairperson and CEO of SITA, who also attended the meeting. He noted the rapid pace at which technology was growing, echoing the point made by the Chairperson that government must be able to move and grow with technology.

Deputy Minister Masondo said the Treasury held itself to the highest standards in terms of governance and financial management, and they ought to be held accountable to those high standards. He thanked the Committee for reminding them of the importance of performing at the highest standards of governance and financial management, because other departments would be affected. He said the timelines given by the Committee were reasonable, and assured the Members that they would respond within the timelines.

The Chairperson thanked the Deputy Ministers, the DGs, and the SIU and SITA for attending the meeting and thanked the Members for the engagement.

The meeting was adjourned.