Fani Mahuntsi/Gallo Images
• Last week, Home Affairs said that it had applied for separation from SITA so that it could procure IT systems externally.
• In a statement issued on Tuesday, however, SITA said it still wanted to work with Home Affairs and defended the work it had done for the department.
• SITA is facing a crisis, with severe internal infighting, capacity shortages and procurement scandals.
MTN Uganda, the fourth-largest African market for JSE-listed MTN group by subscribers, has reported a sharp climb in first quarter profit as it benefits from a healthy economic backdrop and a surge in data revenue. MTN Uganda reported a 20.6% rise in profit to 180.9 billion Ugandan shillings (R903 million) in the three months to end March, when overall subscribers climbed 14.6% to 22.8 million, and data revenue jumped by almost a third. The group continues to expand its network, investing in further 5G sites, while its 4G coverage grew to 88% from 85.2%, but it also got a boost from macroeconomic conditions, with inflation relatively stable at 3.6%, while the Uganda shilling appreciated 5.7% against the US dollar.
Uganda, which is a low-income country, is expected to see GDP growth of above 6% this year, according to the International Monetary Fund’s latest outlook, and looks set to accelerate to above 7% next year.
It, however, has faced headwinds, with an interim industry-wide directive from last prompting a reduction in mobile termination rates by about 42%, and voice revenue only rose by 1.5%. However, the reduced pricing resulted in a 16.5% uplift in traffic which helped cushion the impact of the cuts, it said.
Earnings before interest, taxation, depreciation and amortisation (ebitda) still rose 13.7% - with its margin improved by 0.4 percentage points to 52.4%.
The proposed breakup between the State Information Technology Agency (SITA) and the Department of Home Affairs is getting messy. Home Affairs wants a divorce, while SITA wants to “re-establish strategic alignment”.
SITA issued a statement on Tuesday responding to Home Affairs’ recent announcement that it had applied for a separation from SITA so that it could source IT services from more reliable and cost-effective external providers.
Home Affairs said the announcement, which was made in its annual performance plan for 2025/26, followed long-standing frustrations with SITA regarding system downtime, delayed procurement processes, and excessive IT system costs.
SITA is the state’s IT services provider, through which government departments are currently obligated to procure “mandatory” ICT services.
Digital transformation is a key priority for Home Affairs Minister Leon Schreiber, as IT issues have been a key barrier to efficient service delivery for the department.
In its statement, SITA said that it had been blamed for almost all the department’s IT challenges, even though it claimed that only a small proportion of the ICT services at Home Affairs were being provided by SITA.
‘Convenient scapegoat’
“It is important to note that DHA consumes only 20% of its ICT services from SITA, and the majority of that spending relates to mandatory services.
“Apart from procurement delays affecting a small portion of services, SITA has delivered all agreed-upon outcomes and service milestones, many of which were implemented under significant budgetary constraints from the department,” SITA claimed.
This claim is disputed in the Home Affairs performance plan, which claims that Home Affairs is “dependent on SITA for all its IT-related needs”.
SITA also claimed that it has “consistently delivered” on its commitments to Home Affairs and listed a few projects it claimed it had successfully delivered.
“SITA has become an all-too-convenient scapegoat for project failures or inefficiencies, even in cases where we had no operational role to play. The department is currently consuming core services from SITA, at a cost of about R243 million of its R1.2 billion ICT budget allocation,” said SITA spokesperson Tlali Tlali.
The statement said that SITA “remains committed to working” with Home Affairs and other departments to improve IT service delivery challenges.
New regulations
Alongside the separation application made by the Department of Home Affairs, Minister of Communications and Digital Technology Solly Malatsi recently indicated that he was in the process of gazetting new regulations that would give departments the power to procure IT systems outside of SITA.
In a statement, he said that the regulations would allow departments to procure outside of SITA when they presented a strong business case.
Malatsi said that many departments had requested this.
SITA is in a state of crisis, with chronic infighting, severe capacity shortages, and major procurement scandals.
In its presentation to the Standing Committee on Public Accounts last month, the Auditor-General (AG) revealed that SITA had regressed from a qualified audit opinion to a disclaimer.
The AG said that SITA had incurred R2 billion in irregular expenditures for the 2023/24 financial year.
The AG also said that SITA had had five CEOs in the past five years.
Late last year, Parliament’s Portfolio Committee on Communications and Digital Technology heard that infighting at the organisation, including between the board and executive, was tearing it apart.
