Halting IT modernisation took SARS backwards, Nugent Inquiry hears

The Nugent Commission of Inquiry on Tuesday sought to understand why the modernisation of the SA Revenue Service's IT system was halted and if the multi-million rand technology strategy overhaul by consulting firm Gartner that succeeded it was a necessary expenditure.

The IT modernisation project, viewed as a critical element for the agency's online revenue collection system and its security, was halted in late 2014 after the arrival of now suspended SARS commissioner Tom Moyane. Later in 2015, Moyane participated in the appointment of Gartner to design an IT strategy for the tax agency, in a contract said to be worth R200m.

The inquiry heard from Andre Scheepers, a former executive in the IT division, that the work provided by Gartner did not add any value to SARS, and the global advisory firm did not consult with executives in charge of technology.

“We spent much lesser amounts on investments that had considerable advantages for SARS,” said Scheepers when Professor Michael Katz asked him about the value of Gartner's work. 

“It moved us backwards," he said.

According to an investigation by the Daily Maverick's investigation unit, Scorpio, Gartner reportedly subcontracted 40% of its work to Rangewave Consulting, a company owned by Patrick Monyeki, who is alleged to be Moyane’s friend. The investigation by Scorpio further alleges that Moyane made it clear Gartner must appoint Rangewave or forfeit the contract.

Top secret document

Scheepers said he only saw parts of the first phase of the Gartner assessment which was produced in April 2015.

“It was shared in snippets,” he said, adding that they were not allowed to even keep copies shown to them, which he said was strange.

“When I raised objections I was told … you are not allowed to change this,”  he said.

Asked what changes he would recommend to restore the integrity of the institution, Scheepers, who quit his job in 2016 said: “Stop the bleeding, fix the leadership, fix the broken operational system.”

Sello Mtshali, who also gave evidence before the inquiry, stated that the IT strategy has not been implemented. Mtshali, who is an executive in charge of the tax agency's IT strategy, was subpoenaed to give evidence. "There is a document called SARS IT Strategy, but our day to day activities are not driven by that strategy," he said.

He said that the implementation of the Gartner strategy appeared "not to be a priority" and had been kept secret until this year.

* Sign up to Fin24's top news in your inbox: SUBSCRIBE TO FIN24 NEWSLETTER

We live in a world where facts and fiction get blurred
In times of uncertainty you need journalism you can trust. For 14 free days, you can have access to a world of in-depth analyses, investigative journalism, top opinions and a range of features. Journalism strengthens democracy. Invest in the future today. Thereafter you will be billed R75 per month. You can cancel anytime and if you cancel within 14 days you won't be billed. 
Subscribe to News24
Rand - Dollar
15.80
+1.1%
Rand - Pound
19.39
+1.0%
Rand - Euro
16.67
+0.8%
Rand - Aus dollar
10.97
+0.4%
Rand - Yen
0.12
+1.3%
Gold
1,826.32
+0.2%
Silver
21.14
+0.9%
Palladium
1,880.00
+2.0%
Platinum
911.50
+0.2%
Brent Crude
110.05
-1.5%
Top 40
59,993
+1.6%
All Share
66,349
+1.6%
Resource 10
64,422
-0.2%
Industrial 25
76,590
+2.6%
Financial 15
15,623
+1.9%
All JSE data delayed by at least 15 minutes Iress logo
Company Snapshot