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Labour Dept ICT and data cost R2-billion

The SA Department of Labour spent R2-billion on an information and communication technology public private partnership with Siemens in ten years up to 2012.

During the DOL and Siemens ICT partnership, general administration capacity and service delivery at the South African Compensation Fund (CF), Unemployment Insurance Fund (UIF), Inspection and Enforcement Services (IES), as well as legislative functions declined, requiring major restructuring that started in 2012.

The SA DOL Siemens public private partnership ends in November 2012. Service transfer handover starts in September 2012, with some functions set to remain with Siemens.

The DOL Siemens ten year contract was valued at R1.2-billion, however by 2012 the cost had increased to R1.9-billion, “factoring in the consumer price index and expenditure on additional services”, reported DOL to parliamentary structures during its annual review in Muldersdrift, near Mogale City in Gauteng.

SA Labour ICT “would have to improve operational efficiency of the DOL, including its public entities like the Unemployment Insurance Fund and Compensation Fund… the strategy would also have to contribute to cost effectiveness of doing business [in South Africa] while assisting the DOL to become a paperless operation and environmentally friendly.”

DOL building internal IT capacity in 2013

DOL ICT “intends to establish internal ICT capacity and to outsource IT data work only when necessary.” It appears that the decade of partnership with Siemens did not result in technology transfer or IT data capacity transfer to the Department of Labour.

The Labour department launches a hybrid information communication technology (ICT) model in 2013 as it winds up it’s the R2-b 10-year contract with Siemens.

DOL information officer Thabo Sefali told a state Labour workshop in Muldersdrift, attended by members of the state Portfolio Committee on Labour and Select Committees on Public
Enterprises and Labour, that a number of options were considered for 2013 onward.

The department’s hybrid ITC approach includes;
• retaining all current staff
• invoking a concession option with Siemens
• service requests for tenders and contracts to the IT industry as required.

The Labour Department is “working against time, and had opted to use all options available… we are optimistic that after a slow start to the exit and transfer strategy, the process was on schedule to be completed in November.

“We have started a project management office as part of the transition phase… the new ICT strategy will be concluded in July 2012”, said DOL at its annual policy and strategy review workshop.

The Siemens exit process at operational level was overseen by several work streams operating under an ICT Exit and Transfer Steering Committee.

PHOTO; Labour Minister Mildred Oliphant presides over transition of the department’s massive ICT contract with one supplier, to a series of concessions, tenders and contracts, while building internal ICT capacity in 2013.

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