State Information Technology Agency (SITA): briefing

Meeting Summary

A summary of this committee meeting is not yet available.

Meeting report


8 September 1999

Documents handed out:
Introductory Remarks by Chairperson of SITA
Presidential Review Commission Report: Chapter 6 - Information Management, Systems & Technology
State of Country Infrastructure Readiness Report

The Chairperson of SITA gave a slide presentation on the background of agency, its empowerment and future integration of government IT resources. A brief overview of government's progress on Y2K compliance in its departments was given by the National Year 2000 Decision Support Centre.

State Information Technology Agency (SITA)
Mr Rasethaba (Chairperson of SITA) said that a Presidential Review Commission and the Department of Public Service and Administration had identified a shortage of Information Technology (IT) skills within governmental departments. This had lead in 1988 to the formation of SITA, a statutory body incorporating all Public Services IT resources.

One of SITA's objectives is to facilitate transformation in the IT sector of government. Another is to reduce government spending by sharing IT resources.

Board of Directors
The Board of Directors, with all directors having IT experience, was appointed by the Minister of Public Service and Administration in the first half of this year. The chairperson, Mr Rasethaba, is currently the acting Managing Director until Cabinet approves his MD position on 15 September 1999.

Corporate Governance & Reporting
A non-executive member would be appointed to SITA's Procurement Board. The Board of Directors could only advise on issues of procurement. One of the responsibilities of the Board of Directors was to appoint the MD, in consultation with the Minister. The MD, in turn, would appoint the staff of SITA.

The staff transformation plan would be implemented according to the objectives of the Employment Equity Act. This plan would be presented to the portfolio committee at a later stage.

As an aside, Mr Rasethaba informed the committee that the Auditor General's office (which works with SITA's audit committee) did not adhere to Black empowerment principles. As this is a statutory body, the committee had the power to get an explanation for this.

Mr Mailula, from the National Year 2000 Decision Support Centre, gave the committee a brief overview of the Critical Systems in government departments. Critical Systems are those systems which will be affected by the turn over to the millenium. Through the monitoring of the 36 National Departments, six have indicated that its systems are Y2K compliant. These departments are Communications, Correctional Services, Health - Information Systems, Housing, State Expenditure and Finance. Fourteen of the Departments do not have Critical Systems. The rest of the departments are in the final stages of testing.

The notion that the "weak link" exists in the local authority systems has been exaggerated. Presently less than 10% of the systems will be affected by the changeover. The Centre is presently focussing on Critical Systems which are not yet compliant.

Before questions were asked, the Chairperson, Mr Nhleko, suggested that the Y2K issue be discussed further at another meeting.

Questions by Members:
1) Mr Sikakane (ANC) asked whether SITA was a "door for Black empowerment", unlike the Auditor - General 's office. From the figures Mr Rasethaba gave, only 10% of their staff is Black.

2) Mr Mkhize (ANC) wanted to know if the previous acting Chairperson, Mr van Niekerk, received a severance package when he left SITA

3) Ms Maloney (ANC) wanted to know if a relationship existed between SITA and GCIS (Government Communication Information Systems)

4) Adv. Madasa (ACDP) asked about SITA's long term goal regarding skills from the private sector. Did SITA want to do away with their expertise. Also does SITA's skills match those in the private sector.

Answers by Mr Rasethaba
1) SITA will be setting up a Procurement Board, which will come up with a report in this regard. This will be presented to the committee in November this year. Mr Rasethaba emphasised that the committee could use their oversight function regarding the staff policy in the Auditor-General's office.

2) Mr van Niekerk did not get a severance package. SITA does not offer such packages to their staff.

3) Yes, SITA does have a relationship with GCIS.

4) A partnership with the private sector had been formed. However, the service delivered by these contractors had to be value for money. Contractors will no longer take advantage of government. The message to them was "Government is now in charge".

SITA is working on matching the skills available in the private sector. As soon as SITA was formed, employees received a 15% salary increase so that they would be on par with the private sector. Mr Rasethaba said that SITA will strive to be as competitive as the private sector with regards to remuneration and skills.

Before the meeting was adjourned, the Chairperson said that the Auditor-General would be invited to the committee to give an explanation on staff policy.

Appendix 1:
Introductory Remarks by Chairperson of SITA

Mr Nkosinathi Nhleko MP
Chairperson: Portfolio Committee on Public Service and Administration


Your letter dated the 2nd September 1999 has reference.

1. Brief background on the situation which gave rise to the need for the establishment of SITA

A study on the creation of a State Information Technology (IT) Agency began as early as 1995 and the study addressed the following:

- A statutory body incorporating all Public Service IT Resources

- Transformation of all Public Service IT Resources into a State Company

- A merger of all Public Service IT Resources into a Statutory Body, including Infoplan

- A merger of Public Service IT Resources with Infoplan into a new State owned company

The Department for Public Service and Administration (DPSA) requested by means of cabinet memorandum No. 22 of 1998 "approval in principle of Cabinet for the addressing of the current problems in the Public Service by establishing a State IT Company outside the Public Service that will provide IT related services to the Public Service with guaranteed performance levels".

Cabinet Memorandum dated 18-02-98 confirms that Cabinet approves in principle:

- the formation of a State IT Agency (SITA) in terms of the Companies Act to provide IT related services exclusively to the Public Service with guaranteed performance agreements

- restructuring of the IT function be phased in

- that an implementation team of about eight (8) persons, represented from all the core departments involved in the process, and initial participating departments as needed, be put in place to investigate all relevant practical matters

Cabinet Memorandum dated 24-06-98 requested approval for the restructuring of the IT function of the State in order to address:

- the recruitment,

- retention of personnel,

- deployment,

- transformation and

- service delivery problems of the IT function in the Public Service.

Cabinet approved that:

- the draft State Information Technology Agency Bill, 1998 be submitted to Parliament for consideration during 1998.

- the sub cluster on IT discusses the implementation of the Bill and that emphasis be placed on the various components of the State owned IT Agency as well as related efforts and initiatives within the government, and to report to Cabinet. The Minister of Defence was to be included.

The State Information Technology Agency Act, Act 88 of 1998, was approved on 16-10-98 and published in the Government Gazette.

The following drivers led to the creation of SITA


- Skills shortage in Government and SA

- Ineffective resource deployment

- Over-dependence on contractors


- Improve service delivery

- Reduce costs

- Transformation

- Single window concept

The following core SITA services and objectives were defined


- Data processing services

- IT and IS training

- Software development and maintenance

- Provide advisory service: technical, functional and business

- IT and IS management services

- Procurement agency


- Provide the services specified by the Act.

- Facilitate empowerment in the IT sector

- Promote effective utilisation if IT within Government

2. Logistics of establishing SITA

2.1 Macro project plan

A macro project plan was compiled and submitted to the SITA Steering Committee for approval on 14-02-98 that describes the critical elements and milestones in operationalising SITA.

Table: Critical elements and milestones (planned and actual)

Critical element



Appoint Interim Board of Directors

Oct 98


Appoint Permanent Board of Directors

Jan 99

Feb 99




Appoint Interim MD and Management Team

Oct 98

Apr 99

Appoint Permanent MD and management Team

Feb 99





Registration of SITA as a Company

Oct 98

Dec 98




Negotiate Short Term Loan

Oct 98





Availability of Startup Funds from DPSA

Dec 98

Mar 99




Approval of Conditions of Service by the DoD

Nov 98

Feb 99




Approval of the Company Structure by the Board of Directors

Nov 98

Feb 99




Design Cost Centre Structure

Nov 98

Mar 99




Basic Administrative Technical Infrastructure in Place

Jan 99

Jul 99




Offers to Personnel

Dec 98

Feb 99

Acceptance of Offers

Feb 99

Apr 99

2.2 Appointment of the Board of Directors (BoD)

The members of the BoD are appointment in accordance with the SITA Act. The permanent members were appointed by Feb 99 and the new chairperson appointed by May 99.

The members of the BoD are:

Mr S.M. Rasethaba - Chairperson appointed by the Minister

Mr T. Nkone - Member, representing DPSA

Mr C. Gassiep - Member, representing DSE

Mr J. Grundling - Member appointed by the Minister

Dr S. Khotu - Member appointed by the Minister

Rev L.W. Mbete - Member appointed by the Minister

Mr A. A. Ngcaba - Member appointed by the Minister

Acting Company Secretary

Mrs H.F.S. Fouche'

2.3 Appointment of the MD

In accordance with the SITA Act the Company will be "under the charge and general management of a Managing Director (MD) that will be responsible for the day to day operations".

The interim MD is Mr S.M. Rasethaba that was appointed as the Acting MD, with full delegation of authority, by the Minister of Public Service and Administration. His acting appointment came to affect on 01-07-99.

The process of selecting the permanent MD is in progress and it is envisaged that the appointment will be made shortly.

2.4 Personnel transfers

The following personnel have already been incorporated:

Infoplan: 751 members + 306 contractors

CCS/SAPS: 850 members + 140 contractors

2.5 Transfer of State Assets

2.5.1 Employee Benefits Pension Fund

The ex-Public Service personnel are still under the GEPF whereas the ex-Infoplan personnel and newly appointed members are with the Denel Retirement Fund.

An investigation is currently under way to determine a common scheme for SITA members. Medical Aid

Members incorporated into SITA have a choice among three medical schemes:



Medi Help

2.5.2 Technical Infrastructure

The process of transferring infrastructures to SITA is still in progress and the conditions of the transfers are incorporated into Business Agreements that are presently being negotiated. The transfer of the Infoplan building from Denel is in the final stage.

It is envisaged that the transfer of the State building from PWD will be affected by the financial year-end.

2.5.3 Location of SITA offices and organisational structures

The SITA head office is currently situated in the ex-Infoplan building in Pretoria. Regional offices have been established in most of the main centres but have not been consolidated yet. SITA presently utilises a system of regional coordinators to coordinate activities prior to integration and consolidation.

Presently SITA is still operating in an interim structure (silo type structure).

3. Practical example

Utilisation of SITA's Services

- the transfer of all IT functions en masse to SITA

e.g. SAPS and DoD

- the phased transfer of IT functions to SITA

e.g. Data processing and Network Management from DSE and most national departments and provinces to SITA through the transfer of CCS

- ad hoc consulting in response to requests prior to the transfer of IT functions

e.g. reviewing State Tender Board's IT tenders, assisting NIA with drafting security policy and assisting DPSA with drafting if IT structure policy

4. SITA coverage and plan

Change management process is in place with the first step of refining the strategy Bain & Company/XKMemani, Ruiters & Associates appointed to address:

- SITA's overall strategy and business plan

- Transformation and integration of current SITA silos

- Strategy and plan for the integration of new departments/functions

Recommendations are expected in November 1999

The future integration and outlook are as follows:


- Department of Minerals and Energy Affairs

- KwaZulu-Natal

5. Corporate governance and reporting

SITA complies with:

- The Public Finance and Management Act

- The King's report on corporate governance

- The Companies Act

Progress on governance

- Declaration of interest in contracts signed

- Declaration of Directorship signed

- SITA Procurement Board being established

- Clear division of responsibilities between MD, Executive Committee, Board of Directors and Minister for Public Service and Administration

6. Conclusion

I hope that this covers to a large extent all requested items. I will further clarify some of the issues and respond to any questions during my presentation to you on Wednesday.




Appendix 2:

State of Country Infrastructure Readiness Report

DATE: 31 AUGUST 1999


The National Year 2000 Decision Support Centre is monitoring government and other key-infrastructures, on progress made on Critical Systems. The characteristics of Mission Critical Systems, as seen by the NYDSC, is as follows:

  1. Systems that will cause death in the event of failure or malfunction. An example of this is the "Admission & Release" system of the Department of Correctional Services or Health equipment in hospitals.
  2. Systems that will cause production/service delivery to fail or slow down tremendously. An example of this is the "PERSAL" system of the Department of State Expenditure.
  3. Systems that can cause financial losses. An example is a creditor being paid R10,000.00 instead of R 1,000.00.
  4. Systems that support service delivery or production and do not have any Contingency Planning. An example of this is the "Deeds Registration System" of the Department of Land Affairs.


Out of the 36 National Departments, 14 do not have Mission Critical Systems. Six Departments have indicated the completion of their Y2K Projects. They are:

  1. Communication
  2. Correctional Services
  3. Health - Information Systems
  4. Housing
  5. State Expenditure
  6. Finance

Some of the National Departments, indicated as not having Mission Critical Systems, have however gone through the Y2K process and showed themselves to be Y2K ready. Examples of this are the Department of Arts, Culture, Science and Technology and the Department of Constitutional Development.

The NYDSC is also concerned about the departments that are still busy with the remediation phase. These are strategic departments and the NYDSC is making a close follow-up on the establishment of a proper Contingency Plan.

  1. Labour
  2. Land Affairs
  3. Public Works
  4. Transport

The NYDSC applauds the Department of State Expenditure for having attained full compliance of the Transversal Systems.

The remaining departments e.g. Education, Foreign Affairs, Home Affairs, NIA, SA Police Services, Department of Defence, Agriculture, Trade and Industry, Justice, Welfare and SA Revenue Services are on the testing phase or final user acceptance.


The only concern noted on Provincial Administrations, are the compliance of hardware, software and procedures to interface with the Transversal Systems (PERSAL, FMS, BAS, LOGIS). There is also a concern with regard to the compliance of the hardware, software and procedures to interface with the systems maintained by the National Departments e.g. SOCPEN, NATIS, EDUCATION etc.

The latter part of this year should be dedicated to finalizing compliance of Mission Critical Systems as well as establishing Contingency Plans for these systems. The NYDSC has noted that the test phase of some Critical Systems will go beyond January 2000. For these systems, proper and well-defined Contingency Plans should be put in place. It is however important to note, that Contingency Plans for day to day failures, will have to be modified to cater for the Y2K phenomenon.


Government systems are on track and have so far not encountered any serious glitches caused by the Y2K bug. The NYDSC is embarking on a process of conducting quality assurance in both National and Provincial Administrations.

State of Country Readiness Report

The attached schedule provides a high-level overview of the activities of the Public Sector in South Africa aimed at preparing Government for the Year 2000 computer phenomenon.

The Public Sector information is a graphic summary of questionnaire-based research among:

- 36 National Government Departments/Institutions

- All 9 Provincial Governments

The report is based on a six-phase model of Y2K project management activity. If the final phase has been marked, this may mean that either activities are still underway or that all work has been completed.

State of Country Infrastructure Readiness Report

National Government Departments as at 31 August 1999

Management Activity Measurement - Mission Critical Systems

Country: South Africa

Date prepared: 31 August 1999


Management Phase

Government Department








External testing








Arts Culture Science & Technology

No mission critical systems













Constitutional Development

No mission critical systems






Correctional Services





















Environmental Affairs & Tourism

No mission critical systems













Foreign Affairs








No mission critical systems







(Information Systems)







Home Affairs














Independent Complaints Directorate

No mission critical systems















Management Phase

Government Department








External testing








Land Affairs







Mineral & Energy

No mission critical systems






National Intelligence Agency







Office for Public Enterprise

No mission critical systems






Office of the Presidency

No mission critical systems






Public Service and Administration

No mission critical system






Public Service Commission

No mission critical system






Public Works







SA Police Service







SA Revenue Service







SA Secret Service

No mission critical systems






Safety and Security

Refer to SAPS






Sport & Recreation

No mission critical systems






Statistics SA

No mission critical systems






State Expenditure







Trade & Industry















Water Affairs & Forestry

No mission critical systems












Note: Please be advised that the responsibilities of the SA Management Development Institute (SAMDI), has merged with the Department of Public Service and Administration.

State of Country Infrastructure Readiness Report

Provincial Governments as at August 1999

Management Activity Measurement - Mission Critical Systems

Country: South Africa

Date prepared: 31 August 1999


Management Phase









External testing

Eastern Cape







Free State

no mission critical systems







no response


(NYDSC to follow up)


















Northern Province








North West Province







Northern Cape

no mission critical systems






Western Cape

13 Systems

(Not Started)







16 Systems







42 Systems







35 Systems









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