DEPARTMENT OF HOME AFFAIRS

PRESENTATION TO THE PORTFOLIO COMMITTEE ON WHO AM I ON LINE

(WAIO)

29 June 2011

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TABLE OF CONTENTS

1. BACKGROUND

2. TENDER PROCESS

• SIGNING OF THE CONTRACT

4. PROJECT APPROACH

5. PROBLEM STATEMENT

6. INTERVENTIONS

7. SETTLEMENT

8. FORENSIC AUDIT

9. PROGRESS

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BACKGROUND

1. The Department of Home Affairs envisaged changing the manual processes where paper forms are

used as a main interface with its clients and systems to a total paperless environment where all transactions

are committed online and real-time.2. The WAIO project was to supply a “turn-key”

solution for an integrated core system based on the General Live Capture Concept (GLCC).

3. The proposed design of the system consisted of Integrated Core Business Application (ICBA), a set of Integrated Client Services Consoles (ICSC) for the DHA front offices locally and internationally.

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BACKGROUN CONT…

4. In summary, the system was to provide solution for both Immigration and Civic services by integrating the National Population Register (NPR), National Immigration Information System (NIIS) and Movement Control System (MCS).

5. Furthermore, Home Affairs National Identity System (HANIS )and Integrated Electronic Document

Management System (IEDMS) were to be interfaced into the core system.

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TENDER PROCESSSCOPE

The Department published a tender in April 2006 through SITA for the design of an integrated core business system with the following deliverables:

• Implement Online Registration: Photo, Fingerprints, Signature and Voice Demographics and Supporting Documents

• Introduce an integrated core business system (incorporating civics and immigration with a single logical database of all persons);

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TENDER PROCESS CONT…SCOPE: Key benefits

1. Eliminate manual and tedious processes; 2. Reduce the vast amounts of paper; 3. Ensure acceptable fingerprints quality at offices of application; 4. Improve Turnaround Times for “enabling documents”

applications;5. Eradicate future “Back Record Conversion”; 6. Improve Overall Security;

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TENDER PROCESS CONT…SCOPE: Key benefits

7. Improve agility through the use of workflow and compliance to Service Oriented Architecture;

8. Improve integrity through the enforcement of business rules;

9. Introduce the General Live Capture Concept (GLCC) with Highly Configurable Counters housing Integrated Client Service Consoles (ICSC) backed by Fault-tolerant Controllers for offline processing at any office in order to address the office counters, queuing and ‘look & feel’.

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TENDER PROCESS CONT…EXCLUSIONS

1. Bill of Material/quantities of software licenses

2. Bill of Materials/quantities integrated core system hardware

3. Business architecture and operational Costs

( Assumption was that the Department will provide the above mentioned services through other means)

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TENDER PROCESS CONT…AWARD OF THE TENDER

• The tender was awarded, a year later, to GijimaAst on 22nd October 2007 at 1,9 billion, although per tender documents the service provider was to conform to the following high level project schedule:

1st July 2006:supplier onsite 23 August 2006:1st iteration testing -Head Office 1st November 2006:2nd iteration testing -Kimberly 1st February 2007:3rd iteration testing- all offices 24 May 2007:Certified solution 25 May 2007:Commence worldwide rollout 31st March 2009:Complete and sign - off rollout

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TENDER PROCESS CONT…AWARD OF THE TENDER

• The letter of award prioritised modules within WAIO that are relevant to 2010 programme, namely;

VISA; PERMITS; and Movement Control Systems.

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SIGNING OF THE CONTRACT

1. The contract was signed on the 31st December 2007, for a period of 5 years, however including software licences, core hardware and requirements finalisation, which were excluded in the awarding of the tender.

2. This resulted in increase of the tender value to R4,535 billion

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SIGNING OF THE CONTRACT

3. The contract was signed as an operational lease although it met the requirements of a finance lease in terms of accounting standards.

4. On submission of the Business Case in February 2009, an amount of R 2,3 billion was requested for approval, which was approved in principle.

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DETAILED SPLIT OF R1,915, R4,535 AND R2,337DESCRIPTION AMOUNT AT 2006

R1,915

AMOUNT AT 2007

R4,535

AMOUNT AT 2009

R3,967

Pricing of the Integrated Core System (Part A) 573 1,058 1,509

Pricing of the Core System Hardware – Part A 80 0 0

Pricing for a period of 5 years on a principle of SEAT MANAGEMENT for leasing (Part B)

1,179 1,426 346

Pricing of the Graphical Monitoring and Management Information Tool (Excl licensed software) - Part B

37 0 0

Pricing of Professional Services (Part A & B) 46 341 482

Sub-total 1,915 2,825 2,337

Bill of Material/quantities of software licenses – Part A & B

914

Bill of Materials/quantities integrated core system hardware (Part A)

263

Equipment Refresh 365

Operational Costs 687

Other Scope changes e.g. Workflow hardware & software, business architecture

166 943

TOTAL 1,915 4,535 3,967

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PROJECT APPROACHThe implementation of the Project was reprioritised into three phases with an undertaking from the service provider to complete phase 0 and 1 prior the commencement of the soccer world cup

PHASE 0Full needs analysis around the requirements of the prioritised scope.

PHASE 1

Three key ICT functions were identified for the 2009/2010 event to be delivered by 31 March 2009;

The Movement Control modulesThe Visa Application modulesThe Permits Administration modules

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PROJECT APPROACH CONT…

PHASE 2CIVIC SERVICES:•Birth registration module•Personal amendments module•Marriage registration module•Death Administration module•Travel document module•SA Citizenship module•ID Card Identification moduleIMMIGRATION SERVICES:•Refugee Processing Affairs module•Deportation module•Inspectorate services module

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PROJECT APPROACH CONT…

• Due to increased fraud in the processing passports, the Department requested the service provider to move forward the passport live capture, which was part of phase 2.

• It was therefore agreed to roll out the solution to 58 offices by 30th November 2009

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PROBLEM STATEMENT

1. Non readiness of WAIO to deliver systems with regard to hosting of 2010 FIFA World cup and Passport live capture solution.

2. The capital value delivered to the project amount to R1,414billion split below as follows:

Phase 0 – R210m Phase 1 – R1,150m Phase 2 - R54m

(The Department to date has paid GijimaAst R391m )

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PROBLEM STATEMENT CONT….

3. The Department signed a contract amounting to R4,535 billion whereas the Business case approved in principle by National Treasury amount to R2,234 billion.

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INTERVENTIONS

1. After careful consideration of the implications for the non delivery of the solution to the entire hosting of the 2010 FIFA World cup, the Department after evaluating progress made by GijimaAst decided to develop an alternative system.

2. The Department consulted the Minister of Finance to assist in the development of the system, since SARS is also operating in the Ports of entry.

3. In this regard, SARS together with the Department developed and implemented the new movement control system.

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INTERVENTIONS CONT….

4. The Department further informed Gijima that it regarded the purported contract signed between the parties as well as IBM and HP as invalid , however this repudiation was disputed.

5. To avoid indefinite delays to the project by costly and lengthy litigation, the Department entered into negotiations to amicably resolve the dispute and allow for the urgent completion of the project in line with the original requirements.

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SETTLEMENT

Spending against the contract• Paid up to the 31 March 2010 - R391 million. This amount constitutes R177

million paid to Gijima and R214 million to HP and IBM for lease payments (both capital and interest amounts).

• Committed up to settlement:

Activities Committed Amount

Invoices received up to 31 March 2010 R 469 million

Capital lease amount (no interest included) R 945 million

R 1.414 billion

Less: Paid by 31 March 2010 R 0.391 billion

Committed amount before settlement R 1.023 billion

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SETTLEMENT CONT….

Total Project CostActivities Amount

Paid to date R 391 million

Outstanding lease payments (Paid to IBM & HP) R 815 million

Total costs to date R1 206 billion

Costs to completion R1 283 billion

Total cost of project R2 489 billion

Therefore loss to DHA is R389 million (which is R2.489 billion less R2.1 billion).

Gijima and Partners loss was interest on lease payments and anticipated profit of R389 million.

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SETTLEMENT CONT….

• The settlement represents a potential R2 billion savings to Government as against R4.5 billion estimated cost to complete the project.

• During the month of April 2011, the Department settled the lease payments.

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FORENSIC AUDIT

• A report was received from the forensic auditor on the 26 June 2011.The recommendations will be discussed with the Minister for further processing and the Committee will be kept informed.

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PROGRESS IMPLEMENTATION WAIO

• The Department is finalising the scoping of its IT modernisation project, however the following are the priorities:– Live capture functionality( Id and Passport)– New National Population Register– Core Systems Integration –Civics and IMS– Visa and Permitting system– Roll out of the new Movement Control System– Pilot of the Smart Card project

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THANK YOU