Suspended SARS commissioner Tom Moyane smiles during a break in the proceedings of the Nugent commission of inquiry on tax governance and administration. Picture: Masi Losi
Suspended SARS commissioner Tom Moyane smiles during a break in the proceedings of the Nugent commission of inquiry on tax governance and administration. Picture: Masi Losi

Work by consultancy Gartner, for which the SA Revenue Service paid more than R100m, was both unnecessary and damaging for the institution, the Sars commission of inquiry heard on Tuesday. 

The inquiry, chaired by retired judge Robert Nugent, heard that the effect of halting the Sars modernisation programme and Gartner's work in the information technology space at the tax agency - the backbone of its revenue collection capacity - left Sars "treading water" and heading for a "cliff" in respect of its technological capability. 

The need for the IT overhaul was identified by Bain in a document titled "Sars 2.0" presented to suspended commissioner Tom Moyane before he was appointed commissioner and before the international consultancy set foot inside Sars. 

Moyane halted the modernisation programme less than three months after taking up the post as commissioner. 

Former SARS executive for modernisation Andre Scheepers told the inquiry that Gartner's assessment of Sars's IT space was contradictory, flawed and the consultancy failed to recognise that the tax agency's core business was revenue collection and not IT.

As a result of its work, the agency's digital infrastructure was on the brink of collapse and would require about R1bn to fix. Its e-filing system faces a potential crash within two years if not fixed. 

It was also disclosed on Tuesday that Sars had not conducted a hardware refresh since 2014 — which should be done annually, and according to Scheepers, was a cause for "major concern". 

"If no major refreshes were done since 2014, Sars is heading for a cliff," he said. 

Scheepers said he would never have paid Gartner more than R100m for the work it had done, which evidence thus far shows has left Sars "treading water" in respect of its technological capacity. 

He cited a practical example of the impact of Gartner's work, using his own taxes as an example. He said in the past it took two days or less for his affairs to be dealt with — it now takes two months.

The Gartner intervention moved Sars "backward" and did not add value. 

The evidence around the work by Gartner thus far indicates that the company was paid large amounts to fix a system that was not broken, very similar to the narrative that emerged around Bain's overhaul of the Sars operating model.

Gartner is expected to respond to the criticism against it at the inquiry next week. 

MarrianN@Businesslive.co.za