The Democratic Alliance (DA) has received information from a former senior employee at the South African Revenue Services (SARS) detailing a series of problems with the management of the institution. The insight is particularly relevant following allegations in the media concerning tender irregularities at SARS. The Revenue Service has enjoyed praise and the public's trust due to its efficiency and good work over the past few years, however, the information received paints a worrying picture of a growing culture of mismanagement, leading to wasteful and fruitless expenditure at an institution at the centre of government finances. This includes:

The purchase of 60 four-wheel-drive vehicles for the use of custom officials, left unused for months due to a lack of qualified drivers.
A visit to China customs by SARS officials, the merits of which were never discussed within the executive committee.
The termination of an IT contract in the middle of programme development which was then awarded to a lesser known firm of consultants.
The abandonment of the development of two performance management systems, despite payments to consultants to put these in place.
The lack of rigorous processes for making property investment decisions.
The lack of transparency and the restriction of the executive committee to procurement procedures for IT, resulting in the acquisition and abandonment of several systems, and the ballooning of costs (in one instance from R100 million to R500 million) from poorly constructed contracts.

Also revealed, is the failure of SARS to perform its oversight duties at border posts as entries are stamped by customs with no knowledge of what is actually on the trucks. The rate of cargo examinations at large ports is less than 2%. Even worse, the hit rate for anti-smuggling and post-clearance audits is at less than 20% - which means that SARS stops the wrong consignment and audits the wrong trader in eight out of ten cases.

SARS has increasingly experienced the creeping scourge of fraud and corruption, which was recently further hinted at by reports of tender rigging to the tune of millions of rands. Given that problems at SARS affects the government coffers and the country's fiscal security, South Africa simply cannot afford for SARS to become yet another failed state institution. The information received sets out very concerning failures and serves as an early warning that political will and dedicated management can stop the creeping rot. The DA will pursue these matters through questions in Parliament and by addressing the issues in the Portfolio Committee on Finance to ensure that the crucial role SARS plays within our economy is not compromised.