A quarter of SITA's procurement bids led to deviations - Scopa

Cape Town – The State Information Technology Agency (SITA) has been grilled by Parliament's Standing Committee on Public Accounts (Scopa) over the procurement deviations and expansions it sought from National Treasury.

SITA appeared in the national legislature on Tuesday to account for its expansions and deviations – the systems in place to allow for exceptional circumstances in procurement.

As the state's software and electronic data service agency, SITA is tasked with leading the automation and digitisation of various sets of government information.

Accounting officer and CEO Setumo Mohapi was not present at the Scopa hearing, having said through correspondence with Scopa chair Themba Godi that he was recovering after running the Comrades Ultra-Marathon.


According to regulations, departments and entities must apply to National Treasury if they wish to deviate from procurement guidelines, which include going out to tender and allowing for an open bidding process.

They must also seek Treasury approval when a project is set to exceed the planned procurement scope in terms of cost or duration.

These regulations aim to ensure transparent procurement and prevent tender rigging.

Departments and entities may only deviate from procurement guidelines or tender processes, or expand on the scope of a contract's cost or duration, in exceptional circumstances – such as emergency procurement or if they are dealing with a sole supplier.

In the 2017/18 financial year, a quarter of SITA's total bids led to deviations from procurement guidelines.

In one instance, the entity sought to deviate from procurement practice to award a contract for the provision of a high-speed broadband service to Broadband Infraco to the value of R1.9bn, citing that they were the only supplier.

National Treasury declined the application and directed the entity to go to private tender.

Death threats

SITA chair Zukile Nomvete said paper supply for the Beta Printing Centre, by Ubuntu and fellow service provider LIPP, was approved by the accounting authority, but should have gone to National Treasury. It was valued at R9.2m, but because Treasury did not approve it, it would be reflected as irregular expenditure.

"In one instance, National Treasury approval was not sought timeously and work had commenced. This was for a forensic audit after death threats were received by SITA management to the value of R9.6m (sic). Consequence management is underway," said Nomvete.

In their submission to Scopa, SITA said out of 83 deviations in the 2017/18 financial year, 35 were sought due to various issues including the beneficiary being the sole supplier of said service, intellectual property of systems being procured, client architecture and original equipment manufacturer status.

The agency said 16 of the deviations sought involved original equipment manufacturers directly. Three deviations were sought over concerns of possible corruption, while the rest were sought because of factors including consequence management gaps, process failures and a lack of market intelligence.

SITA said it introduced corrective actions to ensure compliance, including starting the automation of supply chain management, intellectual property retention and ensuring consequences for mismanagement in the procurement space.

SITA said forensic investigation into supply chain management saw nearly half of the agency’s procurement division leaving the organisation.

The head of SITA’s Concom division has been removed from officer pending investigation, the agency said.

* 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 only R75 per month, you 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.
Subscribe to News24
Brent Crude
All Share
Top 40
Financial 15
Industrial 25
Resource 10
All JSE data delayed by at least 15 minutes Iress logo
Company Snapshot
Voting Booth
Please select an option Oops! Something went wrong, please try again later.
Yes, and I've gotten it.
21% - 1273 votes
No, I did not.
51% - 3158 votes
My landlord refused
28% - 1704 votes