Close Menu
TechCentralTechCentral

    Subscribe to the newsletter

    Get the best South African technology news and analysis delivered to your e-mail inbox every morning.

    Facebook X (Twitter) YouTube LinkedIn
    WhatsApp Facebook X (Twitter) LinkedIn YouTube
    TechCentralTechCentral
    • News
      Anthropic's Mythos is the cyberthreat every CISO feared

      Anthropic’s Mythos is the cyberthreat every CISO feared

      9 April 2026
      Why South Africa's EV market is going nowhere slowly

      Why South Africa’s EV market is going nowhere slowly

      9 April 2026
      Africa switches on as Europe dims the lights

      Africa switches on as Europe dims the lights

      9 April 2026
      Major boost for Starlink

      Major boost for Starlink

      9 April 2026
      MVNOs take centre stage in legislative shake-up - Dominic Cull

      MVNOs take centre stage in legislative shake-up

      8 April 2026
    • World
      DeepSeek V4 to run on Huawei silicon as China builds its own AI stack

      DeepSeek V4 to run on Huawei silicon as China builds its own AI stack

      4 April 2026
      Amazon in talks to buy satellite operator Globalstar

      Amazon in talks to buy satellite operator Globalstar

      2 April 2026

      Apple plans to open Siri to rival AI services

      27 March 2026
      It's official: ads are coming to ChatGPT

      It’s official: ads are coming to ChatGPT

      23 March 2026
      Mystery Chinese AI model revealed to be Xiaomi's

      Mystery Chinese AI model revealed to be Xiaomi’s

      19 March 2026
    • In-depth
      The biggest untapped EV market on Earth is hiding in plain sight

      The biggest untapped EV market on Earth is hiding in plain sight

      1 April 2026
      The R18-billion tech giant hiding in plain sight - Jens Montanana

      The R16-billion tech giant hiding in plain sight

      26 March 2026
      The last generation of coders

      The last generation of coders

      18 February 2026
      Sentech is in dire straits

      Sentech is in dire straits

      10 February 2026
      How liberalisation is rewiring South Africa's power sector

      How liberalisation is rewiring South Africa’s power sector

      21 January 2026
    • TCS
      TCS+ | Vodacom Business moves to crack the SME tech gap - Andrew Fulton, Sannesh Beharie

      TCS+ | Vodacom Business moves to crack the SME tech gap

      7 April 2026
      TCS | MTN's Divysh Joshi on the strategy behind Pi - Divyesh Joshi

      TCS | MTN’s Divyesh Joshi on the strategy behind Pi

      1 April 2026
      Anoosh Rooplal

      TCS | Anoosh Rooplal on the Post Office’s last stand

      27 March 2026
      Meet the CIO | HealthBridge CTO Anton Fatti on the future of digital health

      Meet the CIO | Healthbridge CTO Anton Fatti on the future of digital health

      23 March 2026
      TCS+ | Arctic Wolf unpacks the evolving threat landscape for SA businesses - Clare Loveridge and Jason Oehley

      TCS+ | Arctic Wolf unpacks the evolving threat landscape for SA businesses

      19 March 2026
    • Opinion
      The conflict of interest at the heart of PayShap's slow adoption - Cheslyn Jacobs

      The conflict of interest at the heart of PayShap’s slow adoption

      26 March 2026
      South Africa's energy future hinges on getting wheeling right - Aishah Gire

      South Africa’s energy future hinges on getting wheeling right

      10 March 2026
      Hold the doom: the case for a South African comeback - Duncan McLeod

      Apple just dropped a bomb on the Windows world

      5 March 2026
      R230-million in the bag for Endeavor's third Harvest Fund - Alison Collier

      VC’s centre of gravity is shifting – and South Africa is in the frame

      3 March 2026
      Hold the doom: the case for a South African comeback - Duncan McLeod

      Hold the doom: the case for a South African comeback

      26 February 2026
    • Company Hubs
      • 1Stream
      • Africa Data Centres
      • AfriGIS
      • Altron Digital Business
      • Altron Document Solutions
      • Altron Group
      • Arctic Wolf
      • Ascent Technology
      • AvertITD
      • BBD
      • Braintree
      • CallMiner
      • CambriLearn
      • CYBER1 Solutions
      • Digicloud Africa
      • Digimune
      • Domains.co.za
      • ESET
      • Euphoria Telecom
      • HOSTAFRICA
      • Incredible Business
      • iONLINE
      • IQbusiness
      • Iris Network Systems
      • Kaspersky
      • LSD Open
      • Mitel
      • NEC XON
      • Netstar
      • Network Platforms
      • Next DLP
      • Ovations
      • Paracon
      • Paratus
      • Q-KON
      • SevenC
      • SkyWire
      • Solid8 Technologies
      • Telit Cinterion
      • Telviva
      • Tenable
      • Vertiv
      • Videri Digital
      • Vodacom Business
      • Wipro
      • Workday
      • XLink
    • Sections
      • AI and machine learning
      • Banking
      • Broadcasting and Media
      • Cloud services
      • Contact centres and CX
      • Cryptocurrencies
      • Education and skills
      • Electronics and hardware
      • Energy and sustainability
      • Enterprise software
      • Financial services
      • HealthTech
      • Information security
      • Internet and connectivity
      • Internet of Things
      • Investment
      • IT services
      • Lifestyle
      • Motoring
      • Policy and regulation
      • Public sector
      • Retail and e-commerce
      • Satellite communications
      • Science
      • SMEs and start-ups
      • Social media
      • Talent and leadership
      • Telecoms
    • Events
    • Advertise
    TechCentralTechCentral
    Home » Sections » Public sector » Worries over austerity and government IT spending

    Worries over austerity and government IT spending

    Some in government say ICT spending will not be reduced, despite the parlous state of the country’s finances.
    By Nkosinathi Ndlovu6 December 2023
    Twitter LinkedIn Facebook WhatsApp Email Telegram Copy Link
    News Alerts
    WhatsApp

    Finance minister Enoch Godongwana presented the grim reality of South Africa’s poor fiscal position in his medium-term budget speech last month, announcing spending cuts of R200-billion over the next four years.

    These austerity measures will likely have an impact on government IT spending, although there has been no formal directive in this regard. With the potential for less spend on ICT, the industry could feel the impact of the austerity measures — particularly those companies that have a large reliance on public sector contracts.

    “Total ICT spend for South Africa is estimated at US$30-billion for next year. Government is only second to the financial sector as the biggest spender in the industry,” said Mark Walker, associate vice president for sub-Saharan Africa at International Data Corp (IDC).

    The projects that give the best value for money and the most benefit to society should take priority

    “If government cuts spending, there will definitely be knock-on effects downstream that will affect IT service providers as well as hardware and software vendors,” Walker said. He added that government is going to have to be prudent in how it goes about cutting costs. “The projects that give the best value for money and the most benefit to society should take priority.”

    But eliminating one project over another is not the only way the state can reduce spending on technology. In certain instances, money can be saved by rooting out inefficiencies. In a recent interview with TechCentral, BCX CEO Jonas Bogoshi highlighted some of the positive aspects that reduced spending may have on government’s IT function.

    “Depending on how we look at it, it may actually be the right thing for government today because typically when you buy your own infrastructure you create inefficiencies. You most likely use only 80% of what you paid for because you have to overbuild just in case you need it,” said Bogoshi.

    Government IT spending

    Part of the solution, he said, is for government’s on-premises IT function to be migrated to the cloud. BCX has already deployed on-premises solutions to about 70 municipalities that it now wants to move to the cloud. If that happens, these municipalities will have less need to spend money on hardware, while the staff complement required to manage their systems will be reduced as well.

    “Cloud is a different ballgame because you don’t have to procure or manage physical infrastructure, so the costs are much lower. We are partnering with government to develop a model where we can work within the constraints of the fiscus.”

    Government has the potential to realise significant longer-term savings if it chooses to focus on a state-wide cloud migration effort. However, hardware vendors are likely to suffer if this happens.

    Read: South Africa’s ‘no good news’ mini budget

    “Many hardware vendors might be expecting state entities to replenish ageing equipment bought before or during the Covid-19 pandemic,” said Walker. On the other hand, software vendors, consultants and cloud solutions providers will be needed to implement the modernisation effort since government does not have the capacity to implement these projects itself, he added.

    BCX CEO Jonas Bogoshi

    But some in government are adamant ICT spending will not be reduced, despite the parlous state of the country’s finances. The department of public service & administration (DPSA), which houses the Government IT Officers Council, or Gitoc, told TechCentral that there is “currently no specific policy or directive in place to decrease government ICT spending”.

    “There is no decision to slow down government spending on ICT,” said Moses Mushi, director of communications at the DPSA. “Any cost containment measures taken are temporary and align with broader spending and austerity measures in government.”

    The State IT Agency, which is responsible for a significant amount of public sector IT procurement, did not respond to multiple requests for comment.  — © 2023 NewsCentral Media

    Get breaking news alerts from TechCentral on WhatsApp

    Follow TechCentral on Google News Add TechCentral as your preferred source on Google


    BCX Gitoc IDC Jonas Bogoshi Mark Walker
    WhatsApp YouTube
    Share. Facebook Twitter LinkedIn WhatsApp Telegram Email Copy Link
    Previous ArticleThe case against bitcoin
    Next Article Jens Schulte-Bockum to step down at MTN

    Related Posts

    AI complexity is crippling IT departments - Thomas Meyer

    AI complexity is crippling IT departments

    2 March 2026
    African firms are all in on cloud and AI - on paper, at least

    African firms are all in on cloud and AI – on paper, at least

    24 February 2026
    Telkom tops 25 million mobile subscribers as data growth surges - Serame Taukobong

    Telkom tops 25 million mobile subscribers as data growth surges

    16 February 2026
    Company News
    Modernising legacy systems - without the downtime - BBD Software

    Modernising legacy systems – without the downtime

    9 April 2026
    M-KOPA's 2025 impact: women at the heart of digital inclusion

    M-KOPA’s 2025 impact: women at the heart of digital inclusion

    9 April 2026
    The new storefront is a conversation - conversational commerce - CM.com

    The new storefront is a conversation

    8 April 2026
    Opinion
    The conflict of interest at the heart of PayShap's slow adoption - Cheslyn Jacobs

    The conflict of interest at the heart of PayShap’s slow adoption

    26 March 2026
    South Africa's energy future hinges on getting wheeling right - Aishah Gire

    South Africa’s energy future hinges on getting wheeling right

    10 March 2026
    Hold the doom: the case for a South African comeback - Duncan McLeod

    Apple just dropped a bomb on the Windows world

    5 March 2026

    Subscribe to Updates

    Get the best South African technology news and analysis delivered to your e-mail inbox every morning.

    Latest Posts
    Anthropic's Mythos is the cyberthreat every CISO feared

    Anthropic’s Mythos is the cyberthreat every CISO feared

    9 April 2026
    Modernising legacy systems - without the downtime - BBD Software

    Modernising legacy systems – without the downtime

    9 April 2026
    Why South Africa's EV market is going nowhere slowly

    Why South Africa’s EV market is going nowhere slowly

    9 April 2026
    M-KOPA's 2025 impact: women at the heart of digital inclusion

    M-KOPA’s 2025 impact: women at the heart of digital inclusion

    9 April 2026
    © 2009 - 2026 NewsCentral Media
    • Cookie policy (ZA)
    • TechCentral – privacy and Popia

    Type above and press Enter to search. Press Esc to cancel.

    Manage consent

    TechCentral uses cookies to enhance its offerings. Consenting to these technologies allows us to serve you better. Not consenting or withdrawing consent may adversely affect certain features and functions of the website.

    Functional Always active
    The technical storage or access is strictly necessary for the legitimate purpose of enabling the use of a specific service explicitly requested by the subscriber or user, or for the sole purpose of carrying out the transmission of a communication over an electronic communications network.
    Preferences
    The technical storage or access is necessary for the legitimate purpose of storing preferences that are not requested by the subscriber or user.
    Statistics
    The technical storage or access that is used exclusively for statistical purposes. The technical storage or access that is used exclusively for anonymous statistical purposes. Without a subpoena, voluntary compliance on the part of your Internet Service Provider, or additional records from a third party, information stored or retrieved for this purpose alone cannot usually be used to identify you.
    Marketing
    The technical storage or access is required to create user profiles to send advertising, or to track the user on a website or across several websites for similar marketing purposes.
    • Manage options
    • Manage services
    • Manage {vendor_count} vendors
    • Read more about these purposes
    View preferences
    • {title}
    • {title}
    • {title}