ATC110403: Oversight Visit of Public Administration Leadership & Management Academy (PALAMA) & State Information Technology Agency (SITA) on 3-4 August 2010
REPORT OF THE PORTFOLIO COMMITTEE ON PUBLIC SERVICE AND ADMINISTRATION’S OVERSIGHT VISIT OF THE PUBLIC ADMINISTRATION LEADERSHIP AND MANAGEMENT ACADEMY (PALAMA) AND STATE INFORMATION TECHNOLOGY AGENCY (SITA) ON THE 3-4 AUGUST 2010, AS ADOPTED ON THE 13 APRIL 2011
Section 42 (3) of the Constitution of the Republic of South Africa (1996) states that the National Assembly is elected to represent the people and to ensure government by the people under the Constitution. The National Assembly does this be choosing the President, by providing a national forum for public consideration of issues, by passing legislation, and by scrutinising and overseeing executive action.
In line with its constitutional responsibility of overseeing executive action, the Portfolio Committee on Public Service and Administration (the Committee) undertook an oversight visit of entities falling within its oversight portfolio in August 2010. The Committee decided to focus its oversight visit on two of the entities that report to the Minister of Public Service and Administration. The entities visited are the State Information Technology Agency (SITA) and the Public Administration Management and Leadership Academy (PALAMA).
The Committee undertook an oversight visit to PALAMA and SITA on the 3 - 4 August 2010. PALAMA provides training to public servants. SITA provides Information Communication Technology (ICT) infrastructure and services to all government departments of South Africa, as prescribed by the State Information Technology Agency Act, 1998.
The purpose of the oversight visit was to see the operations of SITA and PALAMA and receive a response on outstanding matters raised in the Committee’s previous engagements. The Committee wanted to get a sense of the operations of the entities and to see how they conducted their business of delivering services to government departments that support Government’s service delivery programmes.
The delegation consisted of the following members: Hon. JC Moloi-Moropa (ANC), chairperson and leader of the delegation; Hon. FC Bikani (ANC); Hon. JM Maluleke (ANC); Hon AJ Williams (ANC); Hon FC Boshigo (ANC); Hon. L Suka (ANC).
4. OVERSIGHT OF THE ENTITIES
4.1 The State Information Technology Agency (SITA)
4.1.1 Overview of SITA
SITA is mandated to provide ICT services to Government under the SITA Act, No. 88 of 1998. SITA does this by providing ICT infrastructure and services to government departments. SITA’s value proposition is that, through its countrywide infrastructure footprint, it can leverage its extensive skills base to integrate ICT, people, process and technology into highly available and cost-effective services. The purpose of infrastructure services is to deliver high quality ICT infrastructure outsourcing services at affordable prices to Government clients. It is a registered as a Schedule 3A public entity, under the Public Finance Management Act, No. 1 of 1999.
In terms of SITA’s Infrastructure service, SITA provides hosting and data centres, converged communications and has a service management centre. SITA provides dedicated hosting, service co-location, managed storage, managed backup, web hosting, backup and recovery IT continuity, high-speed printing and post-processing.
SITA’s service catalogue includes the following:
Full outsourcing: end-to-end management of IT operations to enable high performing business. This includes managed application, managed desktops and managed infrastructure services.
System integration and solution development: predictable delivery of new and existing systems infrastructure business processes and industrial solutions. This includes solution development and systems integration services.
Value Add Services: a spectrum of additional services to address professional and business requirements. This includes sourcing, IT consulting and advisory, information management and security management services.
Support and transaction services: Provisioning of support services that ensures the successful execution of IT initiatives and processes. This includes commercial printing, training, business contact centre and project management services.
SITA’s converged communications provides the following:
- Wide Area Network services
- 3200 SITA Next Generation Network (NGN) sites
- 2650 SAPS Wide Area Network sites
- 180 Department of Defence Wide Area Network sites
- Internet connectivity
- Operational Security
- External connections (foreign networks)
- Unified communications (voice, video and data)
- End-to-end-network services
Revenue made by SITA of its NGN ports has increased from R232, 23 million in 2007/08 to R297, 63 million in 2009/10, yet the number of ports installed had not increased over the same period.
SITA provides the following Service Management Centre services:
- IT Service Centres
- Business Process Outsourcing
- Service Management
- Remote support
- Customer Relationship Management
Revenue made from SITA’s Service Level Agreements with government departments for various services amount to R1,3 billion per annum. Gartner benchmark for 2009 found that SITA was 11,6% more cost efficient than their comparative peer groups.
SITA hosts the following government transversal systems:
- PERSAL Salary System (National Treasury)
- Basic Accounting System – BAS (National Treasury)
- LOGIS System (National Treasury)
- Movement Control System (Home Affairs)
- Social Pension Administration (SASSA)
- Examination Administration (Department of Basic Education)
- Matric Certification (Umalusi)
- Deeds Registration (Rural Development and Land Reform: Deeds)
- State Land (Rural Development and Land Reform)
- Population register (Home Affairs)
- Debtors System (Agriculture, Rural Development and Land Reform)
- Radio Frequency Administration (ICASA)
- Assets and Liabilities System (National Treasury)
- Works Control System (Public Works)
- IFMS (Integrated Financial Management System)
SITA hosts the following systems for the Department of Defence:
- FMS – Financial Management system
- CALMIS – Computer aided logistical information management systems
- OSIS – Operational Support Information System
- BI - Business Intelligence
- OLCIMS – Operational Logistical Codification Information Management Systems
- Eproqure – Electronic Procurement System
- CRS –Computer Registry System Augusta
- Policy and planning
SITA hosts the following systems for the South African Police Service:
- POLFIN – Financial system
- CAS – Criminal Administration System
- CRIM – Criminal record System
- BI – Business Intelligence
- JUDISS – Optical document system
- Firearms – Firearms management system
4.1.2 Walk-about in SITA offices and Call-Centres
A) Call centres
The lifecycle of a call-centre call was explained. There were two groups of call centres supported in the first area visited, the South Africa Police Service and the Next Generation Network Call Centre. It was explained that the centre had a service level achievement of answering 80% of the calls very quickly.
The next section visited focused solely on service management and service support. The centre received an average of 11 000 calls per month. Other call centres hosted are the Presidential Hotline, the South African Social Services Association (SASSA) and other groups. SITA didn’t provide support to the Public Service Commission’s National Anti-Corruption Hot-line.
B) Operations Centre
The operations centre is the nerve centre of SITA, where all infrastructure that SITA has is monitored all the time. The technology of the nerve centre is very advanced, if compared with other emerging markets. The operations monitored in the nerve centre includes all government departments that use SITA’s infrastructure - 73 Thusong Service Centres and over a 1 000 000 I.P. addresses.
The monitoring system in place is the Compoti E-health system, which has the ability to detect faults automatically, without an end-user needing to call the call-centre to log a call. Eighty-five per cent of the faults are automatically logged. The staff in the operations centre work in shifts, which allows for the system to be monitored at all times. SITA has put in place measures to mitigate down-time of the infrastructure and speed up repairs of the Infrastructure. SITA has generators on-site for electricity blackouts and has a contract with a copper-wire supplier for replacing cable lost due to cable theft.
SITA communicates with departments’ IT personnel about the problems they are addressing, but the challenge seems to be that the departments’ IT Personnel doesn’t communicate it further with the front-line staff of the department that is encountering the problem.
C) DATA Storage Centre
Data storage is housed underground. Access is very limited to selected staff. The floor is fully air-conditioned, with only one desk in place for a service officer. Each centralised processing environment (mainframe) stores specific technical information; such as BAS, LOGIS, or IFMS data. All data on the mainframes are backed up every minute, with the backup being stored at another undisclosed location, for security purposes. The mainframe servers are able to dial out to report errors encountered. It only provides technical information to the suppliers, and not government data. The machines store all technical information. The risk of losing data is very low, due to the security steps taken by SITA.
4.1.3 Findings: SITA
Connectivity between the South African police stations was a challenge identified. If stolen goods were recovered by one police station, there was no communication between itself and other police stations, where the theft could have been reported. It was highlighted that 95% of police stations were connected to the Infrastructure SITA provided; the challenge highlighted by SITA was perhaps lack of access. It was believed that the challenge lay with the police stations and their operational processes. SITA is currently in negotiations with the SAPS for a R1,2 billion upgrade of infrastructure at the police stations.
Thusong service centres were community-orientated centres that provided government and Non-Governmental services, as demanded by the Community. SITA didn’t have direct access and was usually approached by one of the departments that was to provide services at a particular centre. Then the challenge of connectivity would only be registered. In some areas where Thusong service centres were established, there was no connectivity or infrastructure in place.
The Gauteng Provincial Government, Department of Land affairs, the Department of Justice and Department of Agriculture all have access to the transversal systems of SITA, but use their own systems instead. The transversal system is one of the ‘must services’, as outlined in the SITA Act, 1998. The challenge faced, according to SITA is access for staff.
SITA has regional offices. The regional offices were split into three clusters. Policies for regional operations were under review, as part of the review of the turnaround strategy.
SITA’s prices were bench-marked; but the challenge was that services they provided were unique. SITA is a captive supplier, since it is mandated by legislation to provide services to all of government. The more departments are on SITA’s infrastructure, the cheaper the unit costs for SITA services will be for the individual departments. The main challenge with pricing was the procurement of infrastructure. SITA indicated that they would be addressing procurement as part of the turnaround strategy.
The Minister was accountable for the outstanding vacancy of the Chief Executive Officer. The draft SITA turnaround strategy was with shareholders, and would be presented to the Committee in September 2010. The turnaround strategy was to be incorporated into the SITA amendment bill that would be tabled in Parliament in 2011. Other vacancies in SITA would be addressed when the board has been fully constituted. When the turnaround strategy has been approved, then decisions could be taken on which vacancies should be filled, as it would be based in the priorities of SITA. The turnaround strategy was to be discussed with the Committee at a later stage.
SITA’s audit report indicated that SITA had an unqualified audit report and a matter of emphasis. The matter of emphasis was related to the unsigned service level agreements with government departments. The SITA Board had set up two bodies that deal with Service Level Agreements with government departments. The bodies are the Stakeholder and Government Relations Unit, and the Procurement Committee. SITA was in the process of addressing the matter through the two bodies established.
An audit report in Parliament on the Department of Home Affairs’ “who-am-I-online” programme showed that there was an irregular tender process undertaken. The matter was sub judice and could not be discussed further. The Smart-Card system was new and, due to SITA’s vigilance, the tender was stopped. The investigation was completed. The negative cloud over SITA had decreased since its board was fully constituted. The quality of services needed to improve. Enforcement of the culture of accountability was also to be promoted.
The issue of the negative publicity was an area where SITA felt that the Committee could assist it. SITA requested to present to a joint meeting with the Committee on Public Service and Administration, the Portfolio Committee on Home Affairs, the Portfolio Committee on Police and other relevant committees. The purpose would be for SITA to address some of the matters previously raised and introduce its turnaround strategy. It was highlighted that it was good to correct the challenges of the past, but that advocacy was also necessary. SITA had spare capacity on its infrastructure which could be utilised by Government departments that would save the departments’ public funds. The public funds could thus be spent on service delivery.
Although SITA provided the infrastructure and the software, it was not always responsible for the challenges experienced. An example was made of the South African Police Service, where human input was the underlying error, yet SITA was blamed for the challenges experienced.
The biggest challenge for SITA was that all decisions taken with regard to ICT procurement was done by Accounting Officers of government departments, and not by the Chief Information Officers. It was believed that some of the decision-making required should be left to the Chief Information Officers.
The Auditor-General’s reports look specifically at compliance with the Public Finance Management Act. It was recommended that the SITA Act be included for review of compliance by the Auditor-General.
The turnaround strategy was mentioned several times during the year and during the oversight visit; it had also been requested from SITA and the Minister of Public Service and Administration. It was mentioned that it was a draft document that was not ready for public scrutiny, yet the draft state of the document did not stop SITA from giving the impression that it was a strategy that was being implemented, due to the continuous referral to it by SITA Board members and staff, when presenting to the Committee.
SITA was well-resourced, and was spending monies, as the assets on the ground reflect. The challenge it experienced may be one of capacity. The challenge with compliance to the signature of service level agreements should be related to SITA’s marketing strategy. The committee should get a copy of SITAs marketing strategy.
The delegation was disappointed since it was felt that SITA was not being honest about the challenges it experienced. The delegation indicated that their ability to conduct oversight over SITA was limited, since it was felt that SITA was not being open and honest with the delegation. The delegation expressed disappointment as it wasn’t sure it could trust the new board.
4.2.1 Overview of PALAMA
The South African Management Development Institute (SAMDI) was established by Section 197(1) of the Constitution, 1996. It was a Schedule 1 Department in terms of the Public Service Act of 1994, as amended by the Public Service Act 5 of 1997.
PALAMA was reconstituted from SAMDI as an Academy for the Public Service. In 2007, the Minister of Public Service and Administration approved the strategy and implementation of the move from SAMDI to PALAMA. The Academy’s main mandate is to ensure the necessary provision of high quality practical management training for junior and middle managers in all three spheres of government across the whole of the Public Service.
The delegation undertook a visit to the Public Administration Leadership and Management Academy campus to see how they conduct their operations and discuss outstanding matters.
PALAMA presented the following to the delegation:
- financial performance for 2009/10 of the parliamentary vote and training trade account;
- organisational performance for the 2009/10 financial year against the 3-year strategic plan;
- feedback o n Auditor-General’s audit and management report for 2009/10;
- PALAMA’s further transformation update outcomes for the Misty Hills Planning Session;
- further transformation update outcomes of the Lesedi Planning Session; and
- Public Service cadre development programme.
4.2.2 Tour of PALAMA offices
The delegation undertook a quick tour around the PALAMA offices and interacted with staff of the different units.
The Budget Vote expenditure on personnel increased by R6,429 million for the 2009/10 period, as a result of filling of vacancies. The number of permanent staff increased from 44 to 54 people from 2008/09 – 2009/10. The vacancy rate for the 2009/10 period was 42%. The information about the vacancies was taken from the PERSAL system.
PALAMA had employed the services of a Mr. Swartz as an Individual Independent Consultant that was contracted to PALAMA for several years. Mr. Swartz was responsible for the preparation of the financial statements of PALAMA for several years. He had also assisted in setting up the current financial systems of PALAMA. He was brought on board again to transfer skills to the person acting in the managerial position in the PALAMA’s finance department. The position was to be advertised. The CFO, Mr. Venter was not staff of PALAMA but has been placed with PALAMA due to PALAMA’s contract with Delloitte and Touche. It was highlighted that although reference was made to particular individuals, the challenge lay in PALAMA’s organisational culture not to employ persons, but to sub-contract them. This arrangement seemed contrary to National Treasury regulations that stipulate that government departments should use companies, while individuals should be employed and not sub-contracted.
PALAMA has a deficit of R1,5 million since its expenditure was more than its income. PALAMA’s current building costs R1,2 million per month to lease. The operational costs are approximately R1 million a month too. These operational costs include peripheral costs such as S&T and travel costs. There was a plan to move offices to Government buildings after the lease has expired.
PALAMA is a training institution, but, since it outsourced the training, it was difficult to see the value of PALAMA. Training facilities were available on PALAMA’s campus, but it charged facilitators a fee for using these training facilities to conduct training it outsourced to them. The tariff charged for venue-hire was in line with the rate determined by National Treasury.
It was ironic that PALAMA arranged the training conference for trainers each year, which hosted 400 -500 trainers, yet did not have any trainers itself. PALAMA was established as a training academy specifically for public servantsbut outsourced training of public servants to service providers.
There were training programmes being formulated for Members of Parliament (MPs). The programmes for MPs were arranged in consultation with the Speakers’ Forum. There were challenges with implementing the training programmes. The training programme would include an introductory module and five other core modules. The programme would run over four years. When these modules were completed, it would be equivalent to a post-graduate qualification. A challenge that existed was that the current Members of Parliament have already completed 16 months of their term. If the course was to be introduced, the current MPs would not be able to complete the course.
The Oversight visit was meant to allow the committee to do oversight of SITA and PALAMA’s operations, to allow for evaluation of their operations and to receive responses on matters that had been raised with the Committee previously. Not only were the original aims of the oversight visit achieved, but knowledge was gained on the transversal systems and other ICT infrastructure which SITA hosts on behalf of government and the call centres. PALAMAs realignment towards their established mandate was also welcomed.
The following were proposed during the oversight visit:
1) The Committee and PALAMA should engage further on the transformation of PALAMA. It was highlighted that PALAMA should move towards giving certification of skills acquired for training undergone, instead of only certificates of attendance for students that enrol in their training.
2) PALAMA’s cadre development programme would require a Committee workshop for the Committee to deal with the matter. It was highlighted that the more straightforward the curriculum was, the better it would be implemented.
3) PALAMA should partner with SITA regarding the development of a Public Servants’ skills database and other ICT matters.
Report to be considered
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