The cost of fixing South African Revenue Services’ (Sars) information technology (IT) infrastructure backlog has deepened after the head of digital and IT services at Sars acknowledged that the revenue service would need over R2-billion “to keep the lights on” in her division.
On Wednesday, Mmamathe Makhekhe-Mokhuane told the Nugent commission that over the next five years, Sars would need an estimated R2.16-billion to do necessary hardware IT infrastructure refreshes, and to procure services and skills in the digital division.
This plan does not include money needed to take Sars into the future of digital innovation.
Makhekhe-Makhuane told the commission — headed by retired Judge Robert Nugent — that her division was not able to keep Sars’s IT systems running and stable due to huge budget cuts.
The commission was set up by President Cyril Ramaphosa to look into issues of tax administration and governance at Sars. This week, the focus has been on Sars’s IT modernisation programme that was brought to a halt by suspended commissioner Tom Moyane shortly after his arrival in 2014.
Moyane then contracted global advisory firm Gartner to review Sars’s IT strategy, a move which Sars officials have called a waste of money, which contributed to the degeneration of Sars’s IT systems.
Makhekhe-Makhuane — who started working at Sars in May 2017 — was responsible for ensuring that the IT division supports Sars’s objectives of revenue collection, educating taxpayers and ensuring compliance in addition to approving decisions on procurement.
She said her division was not given even half of the money that they had requested to fulfil its duties and “keep the lights on”.
“While we were in the midst of this journey then we experienced huge budget cuts and we had to go back to the drawing board. Part of what I had prepared is that this is the strategy that we wanted to implement and in March 2018, when we went back to exco, we said this is what we are going to need to keep the lights on this are the projects at a minimum we are going to need R377-million and we were given R88-million”.
“When the budgets are cut you have to live with what you have,” said Makhekhe-Makhuane.
Since 2014, Sars has not had annual IT hardware upgrades and have also not consistently maintained their digital infrastructure which is now at the risk of collapsing, the commission heard this week.
“We have got notifications from people like IBM who have said this particular technology that you have is not going to be supported. We have had situations where part of our software is on extended maintenance because we didn’t have budget to do ABCD,” Makhekhe-Makhuane added.
She said when she first joined Sars, her office “was like a casualty” where people brought her papers to sign off to fix IT emergencies. “If you don’t sign it’s like everything is dying.”
She furthered explained — after a broad analysis of the lifespan of Sars’s infrastructure — her division was able to identify fully depreciated assets that were “running through God’s grace”.
Makhekhe-Makhuane continued, saying this analysis enabled them to issue the executive committee with a plan indicating how much they would need in resources.
“We have been allocated budget now. We are going to be looking at the [parts of the infrastructure] that are high risk across the country. Those are the ones that we are going to prioritise.”