More than R2-billion in irregular expenditure, a quarter of tenders that never resulted in an award and procurement matters stuck in adjudication for more than 400 days on average: that is the picture of the State IT Agency (Sita) painted by the Public Service Commission’s long-awaited investigation report, released in Pretoria on Monday.

Communications minister Solly Malatsi and PSC chairman Somadoda Fikeni jointly released the report, which examines governance, procurement, consequence management and organisational weaknesses at Sita between 2020 and 2025. Malatsi requested the investigation in December 2024 after a site visit to the agency, citing governance failures, irregular procurement and what he called “an alarming deterioration in service delivery”. The PSC agreed to the probe a day later.

“This report is difficult reading, but it is necessary reading,” Malatsi said. “Sita is the state’s central ICT engine. When Sita fails, departments wait longer for the systems they need, budgets are placed under pressure and citizens ultimately experience the consequences through poorer public services.”

The report found that Sita’s weaknesses were “systemic, cross-cutting and mutually reinforcing”: organisational instability weakened oversight, weak oversight undermined accountability, and weak accountability bred distrust and institutional paralysis. Many of Sita’s policies looked adequate on paper but failed in practice through poor implementation, incomplete records and insufficient consequence management.

Among the most serious findings is that the auditor-general flagged more than R2-billion in irregular expenditure across four audited years: R819.7-million in 2020/2021, R285.5-million in 2021/2022, R452-million in 2022/2023 and R514.2-million in 2024/2025. Notably absent is a figure for 2023/2024 – the year Sita failed to submit its annual report for tabling, a lapse Malatsi cited when he requested the investigation. The investigation found insufficient evidence that consequence management was consistently applied.

Systemic challenges

Of 1 443 concluded procurement matters reviewed, 278 were withdrawn, 52 were cancelled and 34 were closed with no recorded reason – an attrition rate of 25.2%, meaning one in four tenders analysed did not result in an award. A further 529 matters remained open, with the oldest sitting in adjudication and contracting for an average of more than 400 days, and 203 matters took longer than a year from work order to final outcome.

The report also found Sita had no reliable, integrated central register for its own contracts – expiry dates were tracked manually and value for money could not always be demonstrated – while board records were so poor, with missing meeting packs and incomplete resolutions, that Sita often could not show how major decisions were taken, when and by whom.

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Fikeni told the briefing the investigation identified six systemic challenges, including leadership churn so severe that at one point 86% of MD-level roles were filled in an acting capacity, and consequence management applied so inconsistently that it became a tool of “weaponisation” that fed insecurity among staff.

“This does not imply the organisation has collapsed – it was functioning, but limping,” Fikeni said, adding that the deeper question was whether Sita was ready for the digital revolution, including AI: “To have strategic foresight is key.”

The report does not make findings of guilt against any individual, and Malatsi stressed that “not every transaction was irregular”. But he said there were “some instances where individuals will need to answer for certain actions”, particularly in procurement. Under a consolidated consequence management framework, Sita must now register and track every irregular expenditure item and disciplinary matter, with criminal or high-value matters escalated to the authorities “without delay”. The PSC probe ran in parallel with a Special Investigating Unit investigation into Sita procurement authorised by President Cyril Ramaphosa in May 2025.

The minister and the PSC have set firm deadlines:

A board-approved stabilisation and recovery plan and a verified procurement backlog baseline within 30 business days;
A governance reform plan within 60 business days; and
Quarterly “governance health” reports.

Reforms may not be closed on management’s assurance alone but must be independently validated.

“The era of drift at Sita must end,” Malatsi said. “The board and management now have a direct mandate to stabilise the organisation, restore basic controls, clear procurement blockages and rebuild trust through evidence, not promises.”

Beyond the immediate fixes, the department is leading a formal review of Sita’s mandate and operating model with the department of public service & administration, national treasury and the presidency – a study Malatsi said could extend to “repurposing” the agency, and which builds on government’s mooted overhaul of public sector IT.

‘Stunted evolution’

The report comes after years of turmoil at Sita, from the 2023 sacking of its board – later reversed by the courts – to the auditor-general’s finding in April that the agency was a “systemic risk” to government IT, with R12.1-billion in failed state technology projects. The release follows the appointment of Sita’s first full-time managing director in five years, Magatho Mello, in December, and a permanent board under chair Stella Bvuma in May.

Malatsi backed the new leadership, saying the technical skills exist at Sita and it is the organisational environment that needs reform. “We have a very competent leadership in the new board… They have all my support,” he said.

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Mello welcomed the report. “The evolution of Sita was stunted due to the issues highlighted. So the organisation has to evolve, and do so rapidly,” he said, conceding there was room to strengthen the executive committee as well as Sita’s security and AI strategy. “But I believe Sita is still relevant to strengthen government and support its departments.”

Whether client departments agree is another matter: the report itself notes that police, home affairs and justice have sought exemptions to procure ICT outside Sita processes – dysfunction that led home affairs minister Leon Schreiber to brand the agency “an artificial construct that stands squarely in the way of technological progress”. The minister and the PSC say they will report publicly on progress against the 30- and 60-day deadlines. — © 2026 NewsCentral Media