MITA Annual Report 2010 by MITA

MITA

ANNUAL REPORT

2010

We shall be the central driver in the evolution of Malta into a world class information society and economy, nurturing the growth of a strong global knowledge workforce and transforming public services through innovation within an incessant aspiration for excellence. MITA Mission Statement

MITA ANNUAL REPORT 2010

Message from Chairman Message from CEO

Index 6

MITAâ&#x20AC;&#x2122;s Objective

strategic priorities

2010 in Numbers

malta government network

2010 Highlights and Achievements

1. ISO27001 Accreditation

2. Malta declared european leader in egovernment services

3. Better care through the intelligent application of ICT

4. Biometric passports for Maltese citizens

5. Enterprise Information as a resource for Government

6. Bandwidth speed for Government and students doubled

7. Setup of eSkills Alliance Malta

8. Launch of Second Step Training Programme

9. Next Generation eGovernment Framework

10. Facilitating the non-disruptive use of Open Source Software

11. New Corporate Data Centre

12. Latest computing equipment across Government

13. Facilitating outsourcing to the private sector

Corporate Social Responsibility

(i) Digital Inclusion

(ii) Environment

(iii) Community

Puttinu Cares

Board membersâ&#x20AC;&#x2122; report

independant auditors report

Financial Analysis

Human Resources in 2010

Financial Statements

MITA ANNUAL REPORT 2010

MES SAGE F R O M Th e

CHAIRMAN Our mission is to enable Government to deliver efficient and effective public services and to spearhead the take-up of technology in our society and economy. MITA has been entrusted by Government to drive its transformation into a citizen-centric joined-up organisation existing to serve its citizens. On the other hand, MITA is mandated to nurture, expand and enable the growth of our local ICT eco-system: from providing leading-edge e-Government services to promoting the take-up of the services by citizens and businesses; from outsourcing its own requirements to the local industry to ensuring that the supply of ICT skills is adequate and timely. Our strategy is clear, set and unequivocal. It is not about technology, but about the needs of whom we serve and how technology can be applied to best serve those needs. Every day we strive to improve on the service we delivered the day before and ultimately this is all about taking challenging and important decisions, with each decision reflected in how we trigger positive changes in the way Government operates and delivers its services, and in the way citizens use health, education, and transport services amongst others, towards becoming the knowledge economy we aspire to be. Over this last year, silently but surely we have revolutionised the approach towards our strategy execution â&#x20AC;&#x201C; on the organisational plane, we took on the mandate of being the transformational leader rather than simply a software house; on the operational level we recovered from the impact of the security threats to become a beacon of service management in the sector, on an international scale, despite the constant challenges which any organisation within this sector was facing. In the context of this radical transformation, the Board and the management team have moulded the organisation to align the Agencyâ&#x20AC;&#x2122;s structure according to the responsibilities emanating from our strategic plan. We set up three new departments handling e-Government, Human Capital, and Business Clusters: in essence the three transformational drivers of the Agency. We undertook a deep soul-searching exercise to trace what is core and not to our mission, ensuring we focus on what we do best whilst leveraging on the private sector to collaborate on expanding further our activities.

MITA ANNUAL REPORT 2010

It is not about technology, but about the needs of whom we serve and how technology can be applied to best serve those needs. Whilst the Agency retained its core responsibility for serving Government’s ICT infrastructure under its operational arm, we have shifted our innovation focus and value-added towards the programme management of large-scale ICT enterprise projects across the public sector. This has triggered the Agency to explore new technologies to build an ever-more robust, resilient and secure ICT infrastructure for Government, and also to establish new and more efficient ways of procuring solutions and services. Despite the inevitable disruptive impact of this radical transformation, the Agency has maintained its delivery tempo within a very challenging scenario dictated by high expectations, mission-critical deployments and lower costbase. In 2010, attacks on our infrastructure have remained a constant threat to our operation. We remained focused and resilient and continued working consistently to improve the overall information security framework of government’s ICT infrastructure through an unprecedented investment of over €2 Million in information security tools, technologies, skills and governance measured against international benchmarks. The successful attainment of the coveted ISO 27001 security standard is a major international milestone which has been possible mainly through the outstanding commitment and capabilities of the Agency’s team working on this. The ranking of Malta as first amongst 32 EU and non-EU member states in the European Commission eGovernment Benchmarking exercise, marked the peak of our efforts in this regard. E-Government is undoubtedly the way

MITA ANNUAL REPORT 2010

We invested over €1,000,000 to enhance Government’s internet infrastructure in terms of security, capacity and high availability forward for citizens and businesses to interact with and avail of public services in an efficient, transparent and citizen-centric fashion. In 2010, we sustained our investment in the upcoming building blocks that will be forming the next generation e-Government platform we plan to commission in 2011, including eForms and myBills. We have also set out to acquire an eProcurement system that will revolutionise the method through which government manages public procurement enable all contracting authorities across Government to carry out tendering processes more effectively online, in a more open and competitive fashion. We invested over €1,000,000 to enhance Government’s internet infrastructure in terms of security, capacity and high availability. This led to the doubling of Government’s and state schools internet bandwidth comprising a total international internet bandwidth of 130Mbps and a total internet bandwidth of 50Mpbs. Furthermore, to reach expected growth objectives, MITA embarked on setting up a third Data Centre facility in Santa Venera which will be operational later in 2011. An upgrade to the Data Centre in Mater Dei was also made through the setting up of a new hosting environment to allow for high density equipment and improved redundancy. One of the Agency’s responsibilities is to improve health care service delivery through the application of ICT. eOrdering for Radiology and Laboratory Tests are now accessible over our infrastructure in various public healthcare sites. This has improved the communication and collaboration of healthcare professionals in Mater Dei Hospital and Health centres, since patients’ radiology and laboratory tests can be sent and viewed electronically between the hospital and centres. In turn, this has enabled the Medical Imaging Department at Mater Dei to schedule patients’ appointments quicker and see patients earlier. MITA is also leading the deployment of the national electronic identity programme. As part of this programme, in 2010 we have deployed a system that issues second generation biometric passports with fingerprints, thanks to which Maltese passports are now in compliance with European standards and relevant protection profiles. The same system has also been rolled out to Maltese embassies across the world. In 2010, we have also kicked off the project to introduce electronic ID cards for all citizens with a view of serving as the final element in delivering a truly complete electronic service delivery model of global repute. Another important development in 2010, is the establishment of the eSkills Alliance. The Alliance brings together key players from the public and private sectors that have an interest in the capacity building of the ICT skills sector in

MITA ANNUAL REPORT 2010

Malta. The aim of the Alliance is to address the demand and suppliy of e-skills in the ICT sector in a concerted effort to make sure ICT skills of the right quality and quantity are increasingly available to meet the demands of the future. We look forward to 2011 with confidence that we will manage to bring more positive changes in the day to day lives of citizens across society by transforming the way public services are delivered. Concretely we will work to increase further security measures to safeguard Government’s ICT infrastructure; develop further the e-Government platform to ensure all Government services are easily accessible online and life-oriented according to citizens’ needs; open and operate the new Data Centre; deploy a virtual learning environment in schools to make learning more engaging and fun for students, teachers and parents; roll out the final cornerstone of the integrated health solution that will further enable healthcare professionals to have more access to health data for better decision-making and patients to have easier access to their medical records; and strive to deliver a national e-skills Competence Framework which will enable us to match supply with the demand in the ICT industry landscape. The national ICT Strategy set out by Government established the vision for a Smart Island; our strategic plan charted the map which set out to realise this vision; executing our strategy is the collective effort of our employees. In these times of global turmoil, fiscal constraints and challenging developments successful execution is no small feat. Nevertheless, with the positive ‘can do’ attitude of our people these challenges are translated into opportunities, which I am convinced we shall pursue with enthusiasm and deliver with confidence.

Claudio Grech Chairman, MITA

MITA ANNUAL REPORT 2010

MESSAGE FROm The

CEO

2010 has seen the organisation reshaping and changing to adapt to MITA’s strategic priorities as a National IT Agency. This change has proceeded in a context of continued emphasis on structured operations around which the Agency supports over 20,000 desktops, Government’s wide area network, and a large portfolio of diverse solutions. During the year we consolidated the delivery of Information Systems and Transformation under a single organisational group, lead by a Chief Officer, and have taken major steps forward in building an exciting portfolio of major solutions with significant transformation potential for Government. In parallel we identified areas where the degree of maturity in our operations enabled the transition of our activities in software support and evolutive maintenance to be moved to the private sector. In the large solutions, MITA will direct the adaptation to ensure they remain technically current and interoperable with MITA’s Strategic Information Systems Framework. We extended the engagement with industry through discussions on the fundamental contractual model for procurement activities and set the direction for further pre investment discussions to enable more effective contracting of Government ICT. In the latter part of 2010 we achieved a significant first place in the eGovernment Rankings in the EU. Coincidentally, during the same month 20 years ago Government formed the Management Systems Unit to facilitate the transformation of the public service. The usage of the Government Network and the increasing portfolio of core solutions has contributed to a steady growth in the need for data centre space. Detailed assessment of a number of options lead to a decision to develop a new Data Centre. The site was identified in the second quarter and extensive planning and procurement was immediately stepped up to allow preparatory works to commence. The new facility is being adapted to provide a 15 to 20 year data centre capacity and will be on line in 2011. In the drive to find savings and ensure value we have continued to review our cost profile and target investment activities at reducing long term cost. We rebaselined the International Connectivity for Government, more than doubling

MITA ANNUAL REPORT 2010

We more than doubled the bandwidth and addressed the demand for discretionary browsing the bandwidth and addressed the demand for discretionary browsing as well as a quality of service for consuming cloud based services.

Additional investment

in shared storage was commissioned in 2010 to provide a broader range of cost / performance options to meet the flexible demand of Government and reduce unit storage costs. Our tempo in Human Capital programmes accelerated significantly with the formation of an eSkills Alliance to bring stakeholders from industry and education together to provide a strong and engaged consultative body. This provided the synergy of through and direction which allowed us to take the first steps in a comprehensive approach to developing ICT skills which will enable Maltaâ&#x20AC;&#x2122;s 2015 knowledge economy vision to materialise. Underpinning our operations for 2010 was the drive to achieve a certified level of capability and maturity in Information Security. With characteristic team effort the Agencyâ&#x20AC;&#x2122;s resources adopted practices and procedures to take a systemic risk based approach to Information Security. We achieved preliminary certification mid-year and by December had already extended the scope of our certification to cover all aspects of the information assets we are responsible and accountable for. During this period we also deployed new endpoint security on Government Desktops. Looking forward, by this time next year, MITA is set to consolidate the delivery of major transformational programmes in Identity Management, Education, Health and other supporting shared services. We will also take a major step ahead in enabling a citizen centric approach to the delivery of Government Services online. MITA has adopted a pace of ongoing change which has genuinely embedded a shift in mindset towards the multidimensional mandate of the Agency as opposed to the more traditional IT delivery organisation. This would not have been possible without the support and trust of the Board, as well as the commitment of all our staff, to see the Agency lead the value of ICT enabled change forwards.

Matthew Gatt Chief Executive Officer, MITA

MITA ANNUAL REPORT 2010

MITA’s objective There is no playing with words. MITA aspires to be the backbone of a structured and consolidated ICT sector, which, integrated with an e-skills proficient workforce, will bring Malta to the forefront of the best innovation societies in the world. Such

ambitious

objective

requires continuous investment, excellent a

industry

responsive

most

all,

expertise. principles,

relations,

structure human

and,

capital

These key guiding amongst

others,

formally acknowledged within the Agency’s strategic plan, are reflected in MITA’s culture and in its way of doing business. The business for MITA is to be of service.

Service, for MITA, is

excellence.

“2010 has been a highly challenging and successful year and the Agency has attained exceptional achievements” Dr Godwin Grima – Deputy Chairperson 12

MITA ANNUAL REPORT 2010

STRATEGIC PRIORITIES In bringing all its policies and principles to life, MITA has drawn a set of specific, and measurable, Strategic Priorities:

1 2 3 4 5

To lead ICT strategy development and drive the deployment of an effective ICT Governance Framework within the public sector To deliver and sustain a robust, resilient and secure ICT infrastructure and IT services to Government

To transform public service delivery through the application of ICTs

To enable the growth of the knowledge economy through the engendering of a life-long ICT learning framework

To deliver quality of life improvements through innovative citizen-centric application of ICTs The Strategic Priorities serve as a roadmap for MITA, and whatever the agency performs and achieves has a direct effect towards the attainment of these priorities.

More specifically, each Strategic Priority, has been

subdivided into strategic coverages, further specifying targets and tasks.

â&#x20AC;&#x153;During 2010 MITA carried out the groundwork necessary to ensure the attainment of all the key deliverables within its strategic plan.â&#x20AC;? Joanna Genovese - MITA Board Member MITA ANNUAL REPORT 2010

INTRODUCING TOMORROW The Agency has the challenging task of changing what tomorrowâ&#x20AC;&#x2122;s public services would look like, and what new needs and challenges government and citizens will encounter. Continuous, rapid advances in technology also imply that not to lose momentum, we must invest wisely in technology as a means not as an end, applying it consistently in the way government operates and citizens interact with it. MITA has the responsibility to enable the next generation public services where government is ultimately more efficient and the citizensâ&#x20AC;&#x2122; quality of life is constantly enhanced.

338

professionals employed by MITA, handling:

2010 in numbers 14

MITA ANNUAL REPORT 2010

27,292 15,679 450 internet accounts

Over

email accounts

21,183 workstations

2,700

kilometers of network cable

263 websites hosted

eGovernment services

600,000

emails tagged as spam per day 450 Terabytes in Storage Capacity. 200 Terabytes were added in 2010.

1st

Malta placement in the EU eGovernment Benchmarking

Attained the international ISO 27 001 information security standard ICT students given job opportunities and experience through the Student Placement Programme

200

citizens receiving an ICT diploma training for free through the Second Step Programme

emails received per day through MITA’s servers

users spread in 600 sites across Government.

ONE MILLION

28,000

routers

1600 switches

network points

servers were discarded, generating a net saving of €30k per annum

117

virtualised servers

423 physical servers

5,000,000 hits on Government websites per week

€

transactions processed through the online Government Payment Gateway with a value of over

51 million 67 tenders published amounting to a total worth of approx FOUR - FIVE million EUROS

3,000

user enquiries for support addressed per week, 76% of which are directly tackled and solved by first-line customer care support

€18m

EU co-financing through EU Cohesion Fund, 2007-2013 Operational Programme MITA ANNUAL REPORT 2010

ThE MAlTA GOvERNMENT NETWORK

I NTE l ro t orn) c r e te e lay

iM(esecur r pe

InTerneT servIce sTrucTure

server farM redundant core vpn infrastructure

gattard house corporate data centre

Mater dei hospital corporate data centre

redundant fibre ethernet netWork connecting 129 governMent departMents and Ministries through vpn technology

fibre connected sites Magnet fibre site

MITA ANNUAL REPORT 2010

pe riM et

R N ET

er co l a nt y

(se cu re

er )

pe riM et

ro l

eMbassy

er co l a nt y

(se cu re

er )

voice and data netWorks connected through vpn technology

ro l

105 schools

6mbs dsl / cable 10 / 100 mbITs

438

1 gIgabIT

hoMe users

Magnet broadband

adsl and cable ModeM connected sites connected through vpn technology technology

local councils

police stations

health centres

governMent business sites

area offices (social security)

17 MITA ANNUAL REPORT 2010

2010 Highlights and Achievements

ISO27001 Accreditation The Agency’s drive for excellence requires that high

continuous

risk

identification

and

standards are maintained at all times. Early in 2009, in

control. Bi-yearly surveillance visits

parallel to spearheading security solution investments of over

are carried out by the external

€1 million, MITA embarked on a project to certify its core

auditors to confirm the effectiveness of

operations against the ISO27001 security standard.

this cycle. The first surveillance visit following the ISO27001 accreditation was held in December

The accreditation process required an in-depth analysis of

2010 where the auditor not only re-confirmed MITA’s

all systems and processes, during which the team identified

adherence to the ISO27001 requirements, but successfully

operational risks and implemented the necessary controls to

extended the ISO27001 certification to a number of additional

mitigate the risks.

core processes in line with MITA’s drive to seek agency-wide accreditation against this international benchmark.

The 133 controls forming part of the ISO 27001 standard, were successfully implemented and a strict risk management

To complement this accreditation, in January 2010, MITA

framework was created to identify, prioritise and address

launched an awareness campaign targeting public officers.

security risks related to the three main aspects of information

The objective of this campaign was to educate users about

security - confidentiality, integrity and availability.

identifying and protecting their computer equipment from potential security risks. In the meantime the Agency also

In July 2010 core services were accredited with the ISO

invested in new advanced virus and malware protection

27001 standard. The accreditation came after AFAQ-EAQA

systems on all Government computers..

- a UK certification body forming part of the AFNOR Group - conducted an intensive five-day audit on MITA’s core processes. ISO27001 accreditation requires an ongoing demonstration by the teams within scope of abidance to the principle of

MITA ANNUAL REPORT 2010

“ISO 27001 accreditation is not a one off project but requires the ongoing assessment of the security risk posture of the agency and ensuring that appropriate security controls are implemented to treat the risk in line with the agency’s risk appetite.” Rodney Naudi – Information Security Department Manager

MITA ANNUAL REPORT 2010

Malta declared European leader in eGovernment services In what was yet another confirmation of Governmentâ&#x20AC;&#x2122;s transformation and increased efficiency and sophistication in delivering its services online, in December 2010, Malta was acclaimed as the European leader in eGovernment services. The European Commission (EC) revealed the findings of its ninth e-Government Benchmarking Report, which measures public sector e-Government services performance within 32 European countries, including the 27 member states as well as Croatia, Iceland, Norway, Switzerland and Turkey. The report measured performance by analysing the progress achieved in six core indicators. Malta is the only country amongst the EU27+ accomplishing a 100% score in five of these six core indicators, followed by Ireland which managed to score 100% in three.

Core Indicator Traditional Indicators User Experience

Maltaâ&#x20AC;&#x2122;s Score

Fully online availability

100%

Online Sophistication

100%

Of 20 basic eGovernment services

100%

Of the national portal (.gov.mt)

100%

Availability

100%

Pre-Award

76%

eProcurement

MITA ANNUAL REPORT 2010

Malta is the only country which scored 100% in the traditional indicators for two consecutive years. For the first time, the 2010 report included User Experience indicators, in which Malta excelled. The report also presents the opportunity of identifying areas which require further attention. The eProcurement Pre-Award indicator, the only one in which Malta didn’t obtain full score, confirms that MITA’s commitment in working with the Department of Contracts to deploy a nationwide eProcurement solution was a step in the right direction. The e-Government Benchmarking study has been annually prepared since 2001, and in 2010 was compiled by Capgemini, Sogeti, IDC, RAND Europe, and the Danish Technological Institute for the EC Directorate General Information Society. Malta first participated in such benchmarking research in 2004 and since then it has significantly improved its performance year after year.

“The proactive approach adopted by the Agency is clearly serving as a benchmark in itself for other similar agencies across Europe.” John Aquilina - MITA Board Member

MITA ANNUAL REPORT 2010

Better care through the intelligent application of ICT Governmentâ&#x20AC;&#x2122;s vision of eHealth is to use ICT to attain an effective and integrated, yet sustainable, healthcare system focused on its patients. The agency is establishing an endto-end integrated eHealth system that offers anywhere, anytime access to relevant health information for healthcare professionals and patients, while interconnecting the health sector more effectively thus enabling easier sharing and access to health related information. Progress has already been registered in the set up of the integrated eHealth system. For instance, through access to the eOrdering System, data such as radiology and laboratory test

Laboratory test processed through

results, which are critical for circumstances of precarious surgical operations, are already

the Laboratory

available at Mater Dei Hospital, Sir Paul Boffa Hospital and in a number of public healthcare

Information System

sites. Through the use of latest imaging equipment, x-ray tapes and film have been eliminated

(iLab) during 2010

and replaced by electronic images. Apart from reducing recurrent costs, this system has improved the quality of images and reduced the need of repeated examinations therefore

by the Laboratory

avoiding unnecessary further x-ray exposure for patients. Besides the leap in quality of X-ray

Department at

images, access to this system for all departments across Mater Dei Hospital and public health

Mater Dei Hospital:

care centres enables healthcare professionals to view the results instantaneously so that they take necessary medical decisions and, if necessary, schedule appointments for patients.

â&#x20AC;&#x153;In 2010 we extended the benefits of the IT investment made at Mater Dei Hospital to various hospitals and health centres. We have also laid the foundation for the next leap forward, extending these benefits to medical professionals and patients in the community.â&#x20AC;? Ray Navarro - Department Manager, Business Cluster Department

Number of The way healthcare data is managed, shared and accessed is progressively improving through

patients served

the eHealth programme that MITA is programme managing. In 2010, the implementation of

by the Medical

the Pharmacy of Your Choice system at all Gozo pharmacies and a number of localities in

Imaging Department

Malta was implemented. Further improvements in the integrated health information system are expected with the procurement of a health vault and health portal. These are aimed to enable the citizen to take a more active role in the health care service cycle. In practice, citizens will be able to have access to their own health record and input data, have access to preventive health care information online, receive hospital appointment alerts, book hospital appointments online and view waiting lists.

MITA ANNUAL REPORT 2010

at Mater Dei Hospital during 2010:

Biometric passports for Maltese citizens The Agency is responsible for leading a complete change of the business and technical architecture of the focal systems which administer the Government’s identity mechanisms for citizens, and other individuals, who either cross the border

5,194,479

into the country or are granted residence in Malta. Ultimately, this programme will result in every citizen possessing an electronic identity card that is secure, can be authenticated, provides reliable identification for the online world and allows one to make easy and secure online transactions. The electronic identity programme which the Agency is managing also included the issuance of ePassports. In 2010, MITA managed the deployment of the ePassports solution which had the purpose of issuing second generation passports with fingerprint biometrics to comply with European standards with new security mechanisms for access protection. Before the deployment of the ePassports solution, MITA had issued a position document on fingerprint biometrics subsequently endorsed by the Information and Data Protection Commissioner. The ePassports solution has been rolled out at all Maltese Embassies globally and in 2010 over 17,000 second generation passports have been issued. Citizens have been very cooperative and have understood the importance of the additional layer of protection. As part of the deployment, the Malta Country Verifying Certification Authority and the Malta Document Verifier

201,420

Certification Authority have also been set up. The implementation of a set of enhancements on the National Visa and VISION Systems compliant to the new European Visa Code, and a temporary border control solution for Visa alphanumeric checks at the border, were also carried out during 2010. The systems were also migrated to a new architecture, which was specifically designed to cater for the security requirements of the storage of fingerprint biometrics.

“ We’re proud to have been instrumental in the successful issuance of biometric passports to citizens. In 2010 we commenced the electronic identity card project which will bring a wide range of benefits to citizens, the business community and other stakeholders.” Juan Borg Manduca - Chief Officer - Information Systems and Transformation MITA ANNUAL REPORT 2010

Enterprise Information as a resource for Government In a knowledge economy, the amount of information

searching and retrieving capabilities will confer a high-

processed by government is almost inconceivable. This

level of information access. Furthermore, it will preserve

extensive use of information brings with it substantial

information and create a secure and robust environment

challenges relating to storage, accessibility and retrieval,

which reduces the risk of losing institutional memory, and

standardisation and uniqueness, and security of this

prevents the loss due to illicit circumstances and in case

critical resource.

of disaster situations.

During 2010, MITA worked on selecting a strategic partner

The EIMS will eventually replace the traditional paper

to implement an Enterprise Information Management

records found in different types and formats to gradually

Solution (EIMS) for Government.

The EIMS is based

lead Government to become a “less-paper-based”

on the structuring of information across Government’s

administration in harmony with its green strategy. It will

Ministries and departments in a way that will allow the

decrease recurrent costs, as well as the need for long-term

effective sharing of information across the board and thus

storage space, releasing office space for more valuable

increasing the efficiency and speed of service delivery,

purposes.

whilst reducing duplication of work. Information access will be possible from various devices The EIMS will be implemented across Government over

on a round-the-clock basis. Understandably, information

a timeframe of seven years.

It aims at generating a

will not be accessible to all; the solution will balance the

Knowledge Management Culture within Government

“Right to Know” and the “Right to Protect” by complying

whereby everyone is aware, and educated, on the

with all relevant legislations including, but not limited, to

importance of the proper structuring, digitisation,

the Data Protection Act, Freedom of Information Act and

storage, retrieval, processing, updating and archiving of

the National Archives Act. Undoubtedly security features

information.

will play a most significant role in this system.

The solution will serve as a common platform for web content management systems, enabling users to access

The ultimate objective of the EIMS is to enable Government

the information through web browsing tools, thus

to adopt a suite of best practices in order to capitalise on

gaining access to an extensive variety of sources from

the use of the information. This way, the solution will be a

different ministries and departments. The solution

key enabler in transforming the way government operates

will enable interoperability and in collaboration with

and delivers its services.

“The EIMS will provide the necessary suite of policies, tools and knowledge which will sharply increase the value of information immediately available across Government.” Emanuel Darmanin - Strategy, Planning, Performance and CIO Liaison Department Manager

MITA ANNUAL REPORT 2010

Bandwidth speed for Government and students doubled

In order to meet the continuous growing demand

in Government’s smart learning strategy, now

of Internet bandwidth within Government and state

approaching completion from an infrastructural

schools, in September 2010 MITA signed a three year

standpoint.

agreement with Vodafone Malta Ltd for the provision of international bandwidth and routing services .

The bandwidth enhancement caters also for the growing number of public officers making use of the

Through this agreement, MITA doubled the internet

Internet as a business tool, hence strongly reaffirming

bandwidth in both classrooms and Government

Government’s belief that appropriate access to the

departments thus improving its service to public

Internet, at a high performance and good quality, is an

service officials and students alike, benefiting in total

enabler and an invaluable tool in today’s workplace,

over 46,000 users.

including within the public service.

MITA has been acting as Government’s Internet

This agreement also increased local Internet bandwidth

Service

and enabled faster access to Government’s portals and

Provider

(ISP)

since

the

mid-nineties,

procuring Internet bandwidth and routing services

to all eGovernment services hosted by MITA.

from local carriers, and repackaging it with value added services, such as web filters, prior to providing

This was also an important step for the implementation

it to public service users, and state school students.

and delivery of bandwidth-intensive applications within Government’s core operations. It allowed MITA

The

performance

enhancement

and

increased

bandwidth for state schools is a central element

to start laying the foundations for the rollout of a new generation of eGovernment services.

“MITA’s strategy is in sync with the European Digital Agenda as we aim to deliver economic and social benefits based on fast internet and interoperability. We aim to enhance digital literacy and ensure widespread benefits through the provision of eGovernment services.” Dr Jean Pierre Scerri - Chief Officer, Legal Risk and Compliance Department

MITA ANNUAL REPORT 2010

Setup of eSkills Alliance Malta The eSkills Alliance Malta brings together educational

forward for the development of a stronger ICT workforce that

entities, main industry players from the private ICT sector,

is capable to support the country’s current and future ICT

and Government. The Alliance members are the University of

needs.

Malta, MCAST and the Ministry for Education, Employment and the Family, as the main decision-makers in ICT

In order to address the demand for future ICT skills,

education and skills supply. The Chamber of Commerce, a

2010 saw the beginning of development work on an

handful of employers and the Malta Employers Association

eSkills Demand & Supply Monitor for Malta. This will be

are important members of the Alliance. Finally, The Malta

coupled with an eSkills Competence Framework, currently

Council for Science and Technology (MCST) and MITA are

also under development, which will enable a consistent

members given their role as Government bodies responsible

understanding of skills requirements across the industry. A

to support the development of the knowledge economy.

further initiative intended to strengthen the ICT profession, is the setting up of a National ICT Professional Body which

The Alliance was set up with the understanding that

is also in the early stages of development. Discussions have

change in the e-skills throughput from our educational

also started with the Faculty of ICT within the University of

institutions is urgently required and that no stakeholder can

Malta and the ICT Institute within MCAST for the creation

attempt to address this matter on one’s own. The Alliance

and updating of the educational programmes to fit closer to

meets regularly to discuss and determine a concerted way

the industry’s requirements.

“The ultimate goal for the eSkills Alliance Malta is to help Government, the private sector, and the educational authorities to produce and sustain a productive and competitive workforce to support both the ICT industry and those domains which require the skilled use of ICTs” Dr. Peter Xuereb – Chief Officer, Human Capital

MITA ANNUAL REPORT 2010

Launch of Second Step Training Programme With the aim of increasing the supply of students with ICT skills, in July 2010, MITA launched the Second Step Training Program. The purpose of the program is to offer free ICT National Diplomas in three areas: Information Systems, Information Technology, and Computing and Information Systems. The programme was primarily promoted to attract individuals who were either unemployed, at risk of unemployment, employed in the manufacturing industry, school leavers, those who opt to change or improve their career prospects, or women wanting to return to work. The Agency received no less than 375 applications and in January 2011 it began another similar training programme for which close to 200 more applications were recieved.. A total of 201 individuals are currently following training and successful participants will be awarded a BTEC National Diploma in their chosen area. The program spans over a period of two years and training is offered both on a full-time and part-time basis. The training program is co-financed by the European Social Funds. Second Step was preceded by First Step, a foundation ICT and soft skills training programme also co-financed by the European Social Fund, through which over 300 persons benefited.

“Through First Step and Second Step, we reached over 500 persons providing them with training worth more than €2,500 per person. Both programmes have been successful, helping people gain ICT professional skills to increase their worth in the job market place.” Joanna Azzopardi - Strategy Management Executive

MITA ANNUAL REPORT 2010

Next Generation \ eGovernment Framework As part of MITA’s continuous, fast paced effort to increase

payments was deployed in 2002. Over the past eight years

the quality of eGovernment services and to ensure that all

the number of eGovernment websites accepting payment has

Government services are accessible online, during 2010 the

increased considerably and we feel that users should be offered

Agency started re-engineering its eGovernment framework

the ability to also manage their bills online. myBills kicked

which will transform the concept of how e-Government

off with the Hosted Payment Page (HPP), which directs users

services are created and delivered.

MITA has created a

to make electronic payments through a central PCI-certified

central platform which will enable the rapid implementation

environment. By the end of 2010 93% of online transactions

of services. eGovernment will be built about the needs of their

were taking place through the HPP. The first system to fully

users and make services available from one port of call.. Work

integrate with myBills and allow users to manage and pay

was initiated on three important components forming part of

their bills online was the Local Enforcement System.2010

this framework: eForms, MyBills and eProcurement.

was also central for the progress on another eGovernment component – eProcurement.

This solution will enable the

eForms is a new platform which will allow the creation of online

use of electronic communications and transaction processing

forms. Rather than having to go to a particular department to

by the public sector, in order to purchase supplies, services,

fill in a form, or download a form which then has to printed,

or tender public works.

filled-in and sent by post or fax, eForms allows the whole

accessibility, transparency and efficiency of all public

process – from the creation of forms by the department to

procurement procedures and it also strengthens competition

the filling-in and sending process by the citizen or business

for the benefit of Government. Functionalities include

- to be done completely online in a secure environment.

eNotifications, eTendering, eAuction, eCatalogues, eOrdering,

Great attention has been given to the look and feel element

eInvoicing, and ePayments. The solution allows elimination of

of the eForms, in order to generate an excellent overall user

most of the related paperwork, hence reducing the cost and

experience of the service.

time required to process the virtual and physical procurement

eProcurement helps increase the

transaction. A substantial part of tenders and contracts issued myBills is the Maltese Government’s online billing solution.

by Government are expected to be carried out entirely online

The first eGovernment service in Malta that offered online

by the end of 2011.

“eGovernment is about us redefining public services to be completely user focused: explaining each service and its process, issuing a unique reference for tracking purposes and ensuring that all communication happens securely. Users can find all services from one port of call, on their electronic medium of choice.” Derrick Pisani, Department Manger - eGov Programme Direction Execution and Operations

MITA ANNUAL REPORT 2010

g o ve

compuTer

mobIle devIce

rM tfo rn M en t pl a

Ment d

r epa

integrated billing

all notifications and alerts

all governMent forMs

eprocureMent

dIgITal Tv

ve rn M en t

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(TrusTed InTermedIary)

MITA ANNUAL REPORT 2010

Facilitating the non-disruptive use of Open Source Software With the aim of nurturing the proliferation of open source software White Paper

(OSS) across Government, in October 2010 MITA published an Open Source Vision white paper. At the same time, Government also indicated that since the market had reached acceptable levels of maturity, it was able to take a more constructive stand towards OSS.

As a major ICT buyer in the local market, MITA’s role will be pivotal in generating discussions and actions over OSS. Earlier in 2010, the Agency published policies and directives aimed at guiding Ministries and other entities on the adoption of Open Standards and the facilitation of non-intrusive adoption of OSS

open source

vision

Nurturing the proliferation of Open Source Software

within Government. It is widely recognised that the adoption of open source software needs to be considered properly on a level playing field with proprietary software. A Malta Open Source User Group was also established, comprising of stakeholders from within Government and the private sector with the aim of raising awareness on Open Source Software and facilitating its adoption.

“The approach we have adopted is to identify respective opportunity areas in which we can consider open source whilst ensuring the necessary degree of continuity and non-intrusiveness.” Godwin Caruana - Chief Technology Officer

MITA ANNUAL REPORT 2010

New Corporate Data Centre The efficiency and availability of Government ICT services delivered by MITA depend on reliable data centre services. The servers and networks equipment within the two Corporate Data Centres are managed, monitored and maintained by the Network Operations Centre (NOC) within MITA.

Based on the growing demand forecasts projected by MITA, during 2010 the Agency started work on a third Corporate Data Centre. A related project blueprint as well as detailed financial analysis were concluded and Government allocated a site in Santa Venera for the housing of a custom built Government Data Facility.

MITA, in

consultation with local and foreign experts, executed preliminary engineering design blueprints and during 2010 issued a number of tenders for the accomplishment of various works.

“The efficiency and availability of Government ICT services depend on reliable data centre services. During 2010 we started work on a custom built Corporate Data Centre that will provide the necessary hosting capabilities for the solutions identified in Government’s Smart Island Strategy.” Robert Galea - Systems Management Department Manager

The design and scale of the new Data Centre were done according to the projected needs in view of future growth and the introduction of new technologies. The design comprises of modular, independent, and segmented computer rooms, and a TIER III Classification based on TIA 942 standards to address business continuity requirements. The infrastructure in itself will also allow easier adaptation for specific and custom requirements. MITA’s plans have been drafted with constant and strong considerations for energy efficiency in line with the European Union Code of Conduct on Data Centres.

MITA ANNUAL REPORT 2010

Latest computing equipment across Government The PC leasing programme, which allowed MITA to continuously provide up-to-date computer equipment to all users across Government, was completed during 2010.

The programme,

initiated in 2008 has also managed to reduce related maintenance costs.

During 2010 the remaining units within Government were replaced with Leased Machines. This meant that a total of 7,687 PC’s and 1,503 laptops were deployed across Government departments. This deployment included the leasing exercise within the Police Force. By end December 2010 a total of 400 computers were ordered and 80% of them were deployed at the General Head Quarters, as well as in various police stations across Malta and Gozo.

In total,

6,827 PC’s and 3,890 laptops were deployed within Government schools during 2009 and 2010. Over 2,000 workstations collected from Government departments

“The Desktop leasing programme was an enabler for the deployment of around 20,000 desktops in less than two years. Tight standardisation also meant efficient desktop support services to Government.” Ian Bonello, Department Manager -

have been refurbished and distributed to various beneficiaries, such as church schools and local NGO’s. Amongst the refurbished equipment distributed, there were PC’s, laptops, and monitors.

Networks and Service Management Department

PC Leasing Programme

PCs 14,514 MITA Call Centre Service

Laptops 5,393 Year 2006

2007

2008

2009

2010

Incidents Logged

57,679

71,133

93,904

108,609

98,100

Tasks Logged

26,311

36,688

46,148

56,076

56,933

SCC Remote Resolution Annual Average Percentage

45%

66%

72%

76%

MITA ANNUAL REPORT 2010

Facilitating outsourcing to the private sector As part of its commitment in building excellent relations

public service delivery through technology, while allowing

with the industry, during 2010 MITA announced its intention

MITA to focus on other key projects with the aim of improving

of adopting an aggressive outsourcing policy framework and

the quality of life of citizens.

programme, wherein the industry’s capabilities will be used to the largest extent possible.

This is also happening at a time in which ICT remains at the centre of Malta’s future economic growth.

The EU2020

The Agency set up an Outsourcing Framework allowing it to

strategy adopted by the European Commission re-affirms the

outsource a number of functions to the private sector. The

importance of this sector for the creation of sustainable jobs.

framework was developed in collaboration with the private

Besides this framework, MITA had already entrusted the

industry and is a transparent and effective strategy of engaging

private industry with the outsourcing and leasing of the

the private industry to support Government operations.

desktop services of schools and public service. Through the framework, in which a total of 12 suppliers are

This is yet another milestone for the Agency as the process will

participating, a number of contracts for software development

eventually strengthen Government’s vision of transforming

and operational support have already been awarded.

“This framework is a statement from Government which confirms the trust in the capabilities of the private sector.” Victor Camilleri - Sourcing and Vendor Management Department Manager.

Number of suppliers

participating in MITA’s Outsourcing Framework

MITA ANNUAL REPORT 2010

corporate social responsibility MITA recognises its responsibility to generate a better quality of life and consequently has a strong commitment to being a responsible corporate citizen. In respect to this commitment, the Agency is constantly searching for methods to make a significant contribution towards the fostering of (i) digital inclusion, (ii) the environment and (iii) the community at large.

MITA ANNUAL REPORT 2010

(i)

Digital Inclusion

In paving the way towards Malta truly becoming a knowledge society, the Agency has placed digital inclusion as a priority in its programmes and initiatives. Since 2001, MITA (formerly as MITTS) has been a founding partner of the Foundation for Information Technology Accessibility (FITA), supporting FITA financially with the main aim of increasing ICT accessibility for disabled persons. During the year, MITA was also key in the provision of basic ICT training for inmates attending the Substance Abuse Therapy Unit (SATU) to provide them with some foundation employability skills which they can find useful once they complete their therapy and return to work. Besides initiatives aimed at the local society, the Agency has also opted to share its knowledge, findings, and experience through participation in various workshops to support developing Commonwealth countries who, in some cases, are still in the initial stages of building their own information society.

MITA ANNUAL REPORT 2010

(ii)

Environment

The protection of the environment is now being taken into consideration in every programme, service or system which MITA deploys. Throughout the years, the Agency has put into action various measures and today, respect for the environment is an instilled cultural behaviour within the entire Agency. On a wider scale, the Agency:

Introduced a shuttle passenger service which reduced MITAâ&#x20AC;&#x2122;s car fleet by 65% Promotes re-use and recycling Contributes heavily to a practical teleworking concept on a national scale Replaced bulbs to energy-saving ones and fitted lightning cut-off sensors Introduced common multi-purpose network printers/copiers to reduced the number of stand alone printers by 90% Requests green procurement measures in all its tenders Planted a number of trees within the Tree For You programme

MITA also adopts a vigilant approach when it comes to reducing the carbon footprint of its corporate data centres. Between 2009 and 2010, the Agency undertook a server consolidation exercise resulting in the replacement of old equipment with energy efficient devices. Furthermore, the Agency managed to decommission 74 physical servers indicating the use of less servers, lower power consumption, lower carbon emissions, and lower costs. Locally it is assumed that a typical server has an average energy consumption of 300 watts resulting in approximate 0.875 tonnes of CO2 emissions per year.

With the decommissioning of servers MITA reduced its carbon footprint by over tonnes of CO2 per year

170 36

MITA ANNUAL REPORT 2010

(iii)

Community

A generous share of MITA’s work is driven by its commitment towards the community. Along the years the Agency has introduced various initiatives aiding young people to develop the needed skills in order to succeed in a dynamic ICT era.

Provided technical assistance for the extension of the local area network at Dar Tal-Providenza Participated in the, ‘Me too!’ ESF co-funded programme managed by Aġenzija Sapport, ETC and KNPD by providing a work experience to three individuals for a period of 1820 weeks For the second consecutive year sponsored the worldwide Imagine Cup Competition organised by Microsoft, in which local students compete with thousands of students from over 100 countries for the most innovative ICT project Helped a local company, BIZcon, in organising an Open Source event. This international event presented attendees with the opportunity to hear and share experiences with a number of foreign and local experts Supported the BCS Malta Section in its drive to bring awareness to IT standards, methods and application Organised a blood donation drive and raised awareness about blood donation amongst its employees

The Agency also organises an annual, end of year, Community Day whereby all employees are involved. All proceeds from the 2010 Community Day were donated to Suret il-Bniedem, Sorijiet tal-Bon Pastur, and the Missionaries of Charity (Little Sisters of the Poor).

MITA ANNUAL REPORT 2010

puttinu cares In 2010 MITA embarked on a project, using its expertise and contacts for the benefit of patients being helped by the Puttinu Cares organisation. In a tailor made program, specifically created for the direct benefit of the children and their relatives, the Agency succeeded in creating a concentrated effort with excellent results. Together with the support of the Ministry for Infrastructure, Transport and Communications (MITC), Malta Communications Authority (MCA), Ministry of Education, Employment and the Family (MEEF), Cisco, Go plc, Jos Vincenti & Co Ltd, IMS Ltd, ICT Solutions, Smart Technologies Ltd and 2i Ltd, MITA implemented the following initiatives:

â&#x20AC;&#x153;Families of children undergoing cancer treatment are concerned that their children get isolated from their peers and lack the necessary education. MITA has worked with Puttinu Cares to buy the necessary equipment for education, entertainment and socialising purposes. Aside from the best level of treatment and support, it is also important that patients get a home-like environment and good education. This was made possible with the support of MITA and other sponsors.â&#x20AC;? Angele Cuschieri & Rennie Zerafa - Puttinu Cares

MITA ANNUAL REPORT 2010

Laptops: Young patients, whose families cannot afford to purchase a PC received a free new laptop. Children can now use their laptop anywhere, whether receiving treatment in Malta or the UK, and are able to keep in touch with family and friends. PCs and WI-FI: The rooms at the Rainbow ward were already wellequipped with technology, except for the playroom. MITA and MCA donated and installed four refurbished PCs in the Playroom to facilitate group activities. In addition, GO plc provided internet connections to allow patients to surf the internet and communicate with their family and friends. Furthermore, ICT Solutions set up WI-FI access throughout the ward. Interactive Whiteboard: Jos Vincenti & Co Ltd donated an interactive whiteboard to the Rainbow Ward which was installed in the playroom. Interactive Whiteboards allows integration of audio, video, graphics, text, and animation thus enabling fun-filled and engaging interactive learning and group activities. WeDo Construction Set: IMS Ltd donated a WeDo Construction Set. This enables children to build and program simple LEGO models which are plugged into a computer And thus promotes various key learning values including designing and making, brainstorming to find creative alternative solutions, and learning to communicate, share ideas and work together. Video-Conferencing

facilities:

Cisco

provided

video-conferencing

facilities between the Rainbow Ward in Malta and the flats in London for young patients during their stay with family member/s while receiving treatment in the UK (sometimes for 6 months, or longer). Besides nurses and doctors, the relatives and friends of the children are able to visit the ward in Malta and use these facilities to interact live with the young patients in the UK. A new website: MITC and 2i developed a new website for Puttinu Cares which is now being used as an effective portal for the communication of events and information to the public. ICT Training and Fun activities: On a voluntary basis, employees from MITA teach children and their families how to use the computer and Internet to keep in touch. The volunteers also organise fun filled activities, using both educational software and computer games and non-ICT activities such as crafts, story-telling and cooking. The e-Learning Centre within the Ministry for Education, Employment and the Family provided the software as well as â&#x20AC;&#x2DC;train the trainerâ&#x20AC;&#x2122; sessions for volunteers.

MITA ANNUAL REPORT 2010

Board membersâ&#x20AC;&#x2122; report The board members present their second report and the audited financial statements for the year ended 31 December 2010.

MITA ANNUAL REPORT 2010

Introduction The Malta Information Technology Agency (MITA) was set up following a Government decision to provide an administrative permanence to the drive to implement the National IT Strategy. MITA published a Strategic Plan (2009-2012) setting out its priorities and work programmes till December 2012. The Plan was supplemented by a Business and Financial Plan (2009-2012) that provided specific deliverables, associated resource (financial and human) requirements and business and operations model to be adopted in implementing the plan. In 2010, MITA accelerated the implementation of its strategy by laying the groundwork for the key deliverables. To this effect, MITA issued and awarded various Tenders and Requests for Quotations for projects/services which will be implemented during 2011 and beyond. The main tendering activities related to the new Enterprise Data Centre, the Integrated Health Information Systems Phase 2, the eProcurement Solution, the e-Learning Solution, the eForms Solution and the Enterprise Information Management Solution (EIMS) for Government. Concurrently, MITA re-dimensioned the execution of the technology operations, where open standards are now the common technological denominator both at policy and operational levels. The Agency published policies and directives aimed at guiding ministries and other entities specifically on the adoption of Open Standards. In its role as the primary guardian of public data held within Government, MITA continued to pursue the most rigorous standards of information security. In fact, last year the Agency attained and retained the globally recognised ISO 27001 security accreditation. While capitalising on the Internet penetration in households and business, MITA continued to deliver and support first-class electronic services. This was recognised by the European Commission (EC) in its 9th e-Government Benchmarking Report, where Malta was ranked as the best performing country by achieving 100% in five of the six core indicators measure.

MITA ANNUAL REPORT 2010

Core ICT Services to Government Throughout 2010, the provision of Core ICT Services to Government detailed by means of a contractual agreement between MITA and the Ministry for Infrastructure, Transport and Communications, continued to provide the basis for the provision of the core ICT infrastructure to Government. Key Performance Indicators for the services indicate a tight management of costs and some positive variations over previous years, both in terms of actual resolution of individual support calls as well as the overall service level availability of the distinct services. As an integral part of the review of its software solution and support portfolio, MITA selected a number of private sector providers to provide maintenance and support services on a number of solutions, enabling a gradual shift to a core transformational focus within the Agency.

Projects and Programmes The delivery of specific projects and programmes provided the remaining significant portion of the Agency’s business during the year. Specific programmes and deliverables included: • Malta is the EU Leader in e-Government. The 9th e-Government Benchmarking Report, released by the European Commission (EC) shows Malta as the best performing country by achieving 100% in five of the six core indicators measure, effectively establishing it as the European leader in e-Government. The report measures six core indicators and through a ranking system, it shows the best performing countries that have implemented the most mature e-Government services. Malta was the only country amongst the EU27+ which managed to score 100% in five of these six core indicators. • Open Source Vision. MITA presented an Open Source Vision white paper which has the aim of nurturing the proliferation of open source software. MITA

MITA ANNUAL REPORT 2010

established the Malta Interoperability Centre (interop.intra.gov.mt) to set-up a focal and collaborative environment for national interoperability initiatives among Government, the business community and the general public. This includes the representation of the key national interoperability framework and the proliferation of Open Standards within Government. • ICT Governance. MITA published an ICT Governance Framework and a GMICT Policy Roadmap for 2010-2012. Furthermore, as part of the overall ICT Governance Framework, MITA has also launched a new GMICT Policy Portal available at http://ictpolicies.gov.mt. This portal provides a central point for all policies and directives. It also enables the participation through feedback from direct and indirect stakeholders. • Establishment of HP Education Centres. In December 2010, a collaboration agreement was signed between the MITA, the Malta College of Arts, Science and Technology (MCAST) and Hewlett-Packard (HP) for the establishment of an HP Education Centre at MCAST. At MCAST, lecturers will be able to receive training on the latest HP technologies and in turn deliver such courses to the students. An agreement was also concluded between MITA, the University of Malta and HP for the establishment of another HP Education Centre at the University. HP will also establish an Education and Research Centre at the University under the scope of the ‘HP International Institute of Technology Programme’. • ISO 27001 security accreditation. In 2010, MITA attained the globally recognised ISO 27001 security accreditation. • New eMall portal. In October 2010, MITA launched a new online shopping mall, TrolleyMania.com. This portal is aimed at all local businesses which want to venture into the world of e-commerce and start selling their products online. There are currently 58 shops online and a further 10 are currently setting up. • eSkills Alliance Malta. As part of MITA’s Human Capital programme, the eSkills Alliance Malta was launched in October 2010. The eSkills Alliance will act as a link between local ICT industry, academia and Government, who have a direct influence on the development of the ICT sectors’ Human Resource requirements. • Internet Bandwidth in Classrooms and Government. MITA entered into a three-year agreement with Vodafone Malta Ltd for the provision of Internet bandwidth and routing services to meet the continuous growing demand of Internet bandwidth within Government and state schools. • Second Step Training Programme. MITA organised the ‘Second Step Training Programme’, which enables participants to achieve a diploma in ICT for free.

MITA ANNUAL REPORT 2010

MITA received a total of 375 applications for this programme through which participants will achieve a BTEC National Diploma in Information Systems, Information Technology, or Computing and Information Systems. • Integrated Health Information Systems Phase 2. In September 2010, MITA issued a tender for the procurement of a number of operational systems including the replacement of the PAS; 2 citizen facing applications, Health Vault and eHealth Portal, together with the implementation, programme and project management and training services. The maintenance and support contract will run for 7 years. • eProcurement Solution. The eProcurement tender was awarded in December 2010. This solution will streamline public procurement processes and encourage the aggregation of procurement across entities, resulting in lower costs to the Government through higher volume contracts. It will also facilitate the implementation of the concept of one Government. • e-Learning Solution. A tender for an e-Learning Solution was issued on 23 July 2010. This tender is expected to be awarded by February 2011. Deployment of the e-learning solution will begin towards the end of Quarter 1 2011 and will be completed by the end of Quarter 3, 2013. A tender was also issued for the procurement of 1,876 interactive whiteboards. This is due to be awarded by February 2011. • eForms Solution. A tender for the provision of an eForms solution has been published and awarded to Tecserv (a consortium made up of Loqus and Systec). The eForms solution will enable citizens to submit applications related to Government services electronically. • Enterprise Information Management Solution (EIMS) for Government. MITA issued a notification of award, for the Provision of an EIMS for the Government of Malta, on the 14 December 2010. During the first quarter of 2011 MITA will engage with the preferred bidder to conclude the contracting stage. • Smart ID Card. In October 2010, Government has signed a contract with De La Rue for the provision of a solution which issues eID cards. The eID Card shall hold an authentication certificate and a signing certificate capable of producing qualified electronic signatures. • ePassports. Government has completed both phases of the ePassports project and is currently issuing second generation passports, that is passports containing facial and fingerprint biometrics of the holders. The ePassport is protected by means of the Basic (BAC) and Extended Access Control (EAC) protection mechanisms.

MITA ANNUAL REPORT 2010

Organisational Development The development of MITA Organisational structures went through a number of significant changes during the year. The engagement of Chief Officers to handle the major delivery areas in Information Systems and Transformation, Human Capital, and Legal, Risk and Compliance contributed to the consolidation of the organisation. During the year, significant training initiatives were taken forward to provide a broader enabling skill set in Business Analysis and Public Procurement as well as a range of technical and certification training programmes. MITA renewed its commitment to individual professional development through an open scheme for sponsoring graduate and post graduate studies.

Corporate Governance MITA Corporate Governance during 2010 was carried out through the control departments/units that is the Internal Audit Office (IAO), ICT Compliance and the Information Security Department. During the latter half of 2010 the Internal Audit Office was staffed by an assistant auditor pending the identification and engagement of a new Internal Auditor. In this period the Board also maintained an audit oversight given that the majority of the Board Members also constitute the Board Audit Committee. The ICT Compliance function aims to provide effective assurance that MITA and the Public Sector comply with established (GMICT & MITA internal) policies. These Audits and spot checks focus on MITA specific processes against the requirements of ISO 9001 and ISO 27001. Together these units ensure that MITAâ&#x20AC;&#x2122;s internal controls are strong and reliable, that its reporting arms are accurate, ethics are maintained, oversight is effective, risks are mitigated and investments are protected.

MITA ANNUAL REPORT 2010

Board members The board members of the Agency who held office during the period were: Claudio Grech

Chairman

Dr. Godwin Grima

Deputy Chairman

John Aquilina Joanne Genovese Juan Borg Manduca

resigned on 25 May 2010

The board members were appointed on 2 July 2008 up to 30 June 2011 by the Minister for Infrastructure, Transport and Communications. The Agency’s statute specifies that they may be reappointed upon expiration of their term of office.

Statement of board members’ responsibilities for the financial statements

The board members are required by the Agency’s statute to keep proper books of accounts and other records and to prepare accounts that shall be subject to audit. The board members have decided to prepare financial statements which give a true and fair view of the state of affairs of the Agency as at the end of each reporting period and of the profit or loss for that period in accordance with International Financial Reporting Standards as adopted by the EU. In preparing the financial statements, the board members are responsible for: • ensuring that the financial statements have been drawn up in accordance with International Financial Reporting Standards as adopted by the EU: • selecting and applying appropriate accounting policies; • making accounting estimates that are reasonable in the circumstances; • ensuring that the financial statements are prepared on the going concern basis unless it is inappropriate to presume that the Agency will continue in business as a going concern. The board members are also responsible for designing, implementing and maintaining internal control relevant to the preparation and the fair presentation of the financial statements that are free from material misstatement, whether due to fraud or error and that comply with IFRSs as adopted by the EU. They are also responsible for safeguarding the assets of the Agency and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

MITA ANNUAL REPORT 2010

The financial statements of Malta Information Technology Agency for the year ended 31 December 2010 may be made available on the companyâ&#x20AC;&#x2122;s website. The board members are responsible for the maintenance and integrity of the financial statements on the website in view of their responsibility for the controls over, and the security of, the website. Access to information published on the Agencyâ&#x20AC;&#x2122;s website is available in other countries and jurisdictions, where legislation governing the preparation and dissemination of financial statements may differ from requirements or practice in Malta.

On behalf of the board members

Claudio Grech

Dr Godwin Grima

John Aquilina

Chairman

Deputy Chairman

Board Member

MITA ANNUAL REPORT 2010

Independent auditor’s report To the board members of Malta Information Technology Agency

Report on the Financial Statements We have audited the financial statements of Malta Information Technology Agency on pages 55 to 76 which comprise the statement of financial position as at 31st December 2010, the statements of comprehensive income, changes in accumulated fund and cash flows for the year then ended and a summary of significant accounting policies and other explanatory information.

Board members’ responsibility for the financial statements As explained more comprehensively in the Statement of board members’ responsibilities for the financial statements on page 46, the board members are responsible for the preparation of financial statements that give a true and fair view in accordance with International Financial Reporting Standards (IFRSs) as adopted by the EU, and for such internal control as the board members determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud of error. The board members are responsible for the preparation and fair presentation of these financial statements in accordance with International Financial Reporting Standards (IFRSs) as adopted by the EU. As described in the statement of board members’ responsibilities on page 46, this responsibility includes designing, implementing and maintaining internal control relevant to the preparation and fair presentation of financial statements that are free of material misstatement, whether due to fraud or error; selecting and applying appropriate accounting policies; and making accounting estimates that are reasonable in the circumstances.

MITA ANNUAL REPORT 2010

Auditor’s responsibility Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with International Standards on Auditing. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance whether the financial statements are free of material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the board members, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion In our opinion the financial statements give a true and fair view of the financial position of the Agency as at 31st December 2010, and of its financial performance and its cash flows for the year than ended in accordance with IFRSs as adopted by the EU.

167, Merchants Street Valletta Malta

Fredrick Muscat Bonnici Partner 11 March 2011 MITA ANNUAL REPORT 2010

Financial Analysis in the

desktop

ment n r e r Gov fo g n leasi

nded ves fu itiati ric in t n n ce citize d vote nt an me n ices r v e r v se eGo core ease r the c by 16% in nded fu rvices of se n pansio x e % +5 rowth 54% g

MITA Financial Statements for the year ended 2010, showed revenue reaching

An Investment of €265,895 for a more robust underlying security

€26,519,693, an increase of 5% from 2009 results. This was mainly driven by growth in the desktop leasing for Government (+54%), eGovernment and citizen centric initiatives funded under the subvention vote (+16%) and the expansion of services funded by the core services vote (+5% over 2009). During 2010, MITA together with MITC managed to secure various EU funded contracts, including eServices – Accessibility for all project (comprising an eLearning, eForms and eID solutions) - €17m, Second Step Training Programme - €1m and Pooling for Clusters - €100k. The funds will complement the ICT budget for the period 2010-2012 and also towards the implementation of the MITA

€306,776

to improve the data centres at MDH and Gozo

strategic plan. In 2010, MITA continued with the implementation of its strategy by laying the groundwork for the key deliverables.

To this effect, MITA invested €265,895

in order to obtain a more robust underlying security infrastructure, €306,776 to improve the data centres at MDH (Mater Dei Hospital) and Gozo, and €1.4m to increase the hosting capacity on the consolidated environment.

€1.4m to increase the hosting capacity on the consolidated environment. 50

MITA ANNUAL REPORT 2010

MITA overheads costs increased by only 2.5%, reaching €2,470,727 Accessibility for eLearning, eForms and eID solutions projects €17m

eu funded contracts Second Step Training Programme - €€1m and Pooling for Clusters - €100k

During 2010, MITA also signed a contract to replace the Government Payroll system and started to issue and award various tenders for projects and services which will be implemented during 2011 and beyond. These relate to the new Enterprise Data Centre, IHIS Phase 2, eProcurement solution and an Enterprise Information Management Solution (EIMS) for Government. MITA employment and related costs for the year reached €9,985,691, reflecting an increase of €712,857 (+7.6%) over the previous year. Average headcount increased by 16, reaching 324 full timers by end of 2010. These additional resources were required to aid in the transformation of MITA and to fulfil operations.

MITA employment and related costs for the year reached €9,985,691

MITA continued its efforts to manage and contain costs. Despite the increase in the spectrum of operations and in the human resource complement over previous year,

MITA overheads costs increased by only 2.5%, reaching

€2,470,727. This increase was mainly driven by higher consultancy costs required for the preparation of the new data centre, and slightly higher costs of insurance and internal PC Leasing. Overall 2010 was a good financial year for MITA, with accumulated surpluses after accounting for tax reaching €1,262,982.

MITA ANNUAL REPORT 2010

Human Resources in 2010 The Agency aims to be a leading employer of choice, providing an exciting place to work at and excellent exposure for employees to develop their knowledge and skills and advance in their careers.

During 2010: 12 – the amount of average training days per employee; 45 – the amount of overseas activities attended overall by a number of employees; 31 – the amount of employees sponsored for their post-graduate studies; 11 – the amount of employees sponsored for their industry certifications; 17 – the amount of University and MCAST ICT students given the opportunity to work at MITA during summer.

Gender differential SINCE 2007 78%

77%

226

22%

MALE FEMALE 74%

234

23%

2007

72%

246

26%

2008

244

28%

2009

94 2010

Age differential SINCE 2007

UNDER 30 30 TO 50 50+

56.19%

57.4%

57.38% 61.72% 24.14%

30.49%

14.14%

179 2007

34.14%

12.13%

175 2008

34.14%

9.67%

113

186 2009

7.69%

118

194

2010

MITA ANNUAL REPORT 2010

Financial statements

MITA ANNUAL REPORT 2010

Statement of financial position As at 31 December

Notes

2010

2009

â&#x201A;Ź

ASSETS Non-current assets Property and equipment

5,202,144

4,327,149

Investment in subsidiary

33,776

5,235,920

4,360,925

Total non-current assets Current assets Inventories

32,353

37,169

Trade and other receivables

2,386,335

3,481,853

Short term deposits

11,465,875

9,965,875

Cash and cash equivalents

2,044,983

3,184,261

Total current assets

15,929,546

16,669,158

Total assets

21,165,466

21,030,083

2,096,002

833,020

1,247,797

1,071,119

FUNDS AND LIABILITIES Fund Accumulated fund Non-current liabilities Finance lease liabilities

Deferred taxation

Total non-current liabilities

439,711

335,607

1,687,508

1,406,726

Current liabilities Trade and other payables

15,928,416

17,840,091

Finance lease liabilities

1,013,047

618,190

440,493

332,056

17,381,956

18,790,337

19,069,464

20,197,063

21,165,466

21,030,083

Current taxation Total current liabilities Total liabilities Total funds and liabilities

The notes on pages 58 to 78 are an integral part of these financial statements. The financial statements on pages 55 to 76 were authorised for issue by the board members on 23 February 2011 and were signed on its behalf by:

Claudio Grech

Dr Godwin Grima

John Aquilina

Chairman

Deputy Chairman

Board Member

MITA ANNUAL REPORT 2010

Statement of comprehensive income Notes

2010

2009

Year ended 31 December 2010

Period from 18 August 2008 to 31 December 2009

€

Revenue

26,519,693

25,341,569

Cost of sales

(18,989,362)

(18,583,829)

7,530,331

6,757,740

(6,031,347)

(5,393,978)

1,498,984

1,363,762

Gross profit Administrative expenses

Operating profit Finance income

180,964

166,803

Finance cost

(4,266)

(4,862)

1,675,682

1,525,703

(412,700)

(692,683)

1,262,982

833,020

Profit before tax Tax expense Profit for the year/period – total comprehensive income

The notes on pages 58 to 76 are an integral part of these financial statements.

Statement of changes in accumulated fund Accumulated fund € Comprehensive income Profit for the period – total comprehensive income

833,020

Balance at 31 December 2009

833,020

Balance at 1 January 2010

833,020

Comprehensive income Profit for the year – total comprehensive income Balance at 31 December 2010

The notes on pages 58 to 76 are an integral part of these financial statements.

MITA ANNUAL REPORT 2010

1,262,982 2,096,002

Statement of cash flows Notes

Year ended 31 December 2010

Period from 18 August 2008 to 31 December 2009

â&#x201A;Ź

Cash flows from operating activities Cash generated from operations

3,210,697

5,732,456

Interest received

180,964

166,803

Interest paid

(4,266)

(4,862)

Tax paid

(358,699)

(25,019)

Net cash generated from operating activities

3,028,696

5,869,378

(3,239,538)

(1,090,575)

Cash flows from investing activities Purchase of property and equipment

Proceeds from disposals of property and equipment

2,160

Movements in short term deposits

(1,500,000)

(1,498,792)

Net cash used in investing activities

(4,739,509)

(2,587,207)

571,535

(861,728)

(1,139,278)

2,420,443

3,184,261

763,818

1,687,508

3,184,261

Cash flow from financing activities Finance lease Net movement in cash and cash equivalents Cash and cash equivalents at beginning of year/period Cash and cash equivalents at end of year/period

The notes on pages 58 to 76 are an integral part of these financial statements.

MITA ANNUAL REPORT 2010

Notes to the financial statements 1. Summary of significant accounting policies The principal accounting policies adopted in the preparation of these financial statements are set out below. These policies have been consistently applied to the period presented, unless otherwise stated. 1.1 Basis of preparation These financial statements have been prepared in accordance with International Financial Reporting Standards (IFRSs) as adopted by the EU. The financial statements are prepared under the historical cost convention. The MITA statute was enrolled in the Public Registry by virtue of a notarial deed on 18 August 2008 and on 1 January 2009, the Agency acquired the net assets of MITTS Ltd (see note 23). The Agency acquired the investment in MECS Limited from MITTS Limited. The financial position of this subsidiary as at 31 December 2010 and 2009 is insignificant and accordingly no consolidated financial statements are being presented for the year ended 31 December 2010. The preparation of financial statements in conformity with IFRSs as adopted by the EU requires the use of accounting estimates. It also requires board members to exercise their judgement in the process of applying the Agency’s accounting policies (see Note 3 – Critical accounting estimates and judgements). Standards, interpretations and amendments to published standards that are not yet effective Certain new standards, amendments and interpretations to existing standard have been published by the date of authorisation for issue of these financial statements, that are mandatory for the Agency’s accounting period beginning after 1 January 2010. The Agency has not early adopted these revisions to the requirements of IFRSs as adopted by the EU and the Agency’s board members are of the opinion that there are no requirements that will have a possible impact on the Agency’s financial statements in the period of initial application. 1.2 Foreign currency translation (a) Functional and presentation currency Items included in these financial statements are measured using the currency of the primary economic environment in which the Agency operates (‘the functional currency’). The euro is the Agency’s functional and presentation currency. (b) Transactions and balances Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in profit or loss.

MITA ANNUAL REPORT 2010

1.3 Property and equipment Property and equipment comprising leasehold improvements, furniture, fixtures and fittings, and IT and office equipment are stated at historical cost less depreciation. Depreciation is calculated on the straight line method to write off the cost of the assets to their residual values over their estimated useful life as follows: % IT and office equipment Furniture, fixtures and fittings

20-33⅓ 10

Leasehold property and improvements are depreciated on the straight line basis over the period of the lease. An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater than its estimated recoverable amount. Gains and losses on disposals of property and equipment are determined by comparing the proceeds with carrying amount and are recognised in profit or loss. 1.4 Investment in subsidiary Investment in subsidiary is accounted for by the cost method of accounting. Provisions are recorded where, in the opinion of the board members, there is an impairment in value. Where there has been an impairment in the value of an investment, it is recognised as an expense in the period in which the impairment is identified. The results of the subsidiary is reflected in these financial statements only to the extent of dividends receivable. On disposal of an investment, the difference between the net disposal proceeds and the carrying amount is charged or credited in profit or loss. 1.5 Financial assets 1.5.1 Classification The Agency classifies its financial assets in the loans and receivables category. The classification depends on the purpose for which the financial assets were acquired. Management determines the classification of its financial assets at initial recognition. Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. They arise when the Agency provides money, goods or services directly to a customer with no intention of trading the asset. They are included in current assets, except for maturities greater than 12 months after the reporting date. These are classified as non-current assets. The Agency’s loans and receivables comprise ‘trade and other receivables’, ‘short-term deposits’ and ‘cash and cash equivalents’ in the statement of financial position (notes 1.8, 1.9 and 1.10).

MITA ANNUAL REPORT 2010

1.5.2 Recognition and measurement The Agency recognises a financial instrument in its statement of financial position when it becomes a party to the contractual provisions of the instrument. Loans and receivables are initially recognised at fair value plus transaction costs. All regular way transactions in assets classified in the loans and receivables category are accounted for using settlement date accounting, i.e. on the date an asset is delivered to or by the entity. Loans and receivables are subsequently carried at amortised cost using the effective interest method. Amortised cost is the initial measurement amount adjusted for the amortisation of any difference between the initial and maturity amounts using the effective interest method. Financial assets are derecognised when the rights to receive cash flows from the financial assets have expired or have been transferred and the Agency has transferred substantially all risks and rewards of ownership or has not retained control of the financial assets. The Agency assesses at the end of each reporting period whether there is objective evidence that a financial asset or a group of financial assets is impaired. If there is objective evidence that an impairment loss on loans and receivables has been incurred, the amount of the loss is measured as the difference between the assetâ&#x20AC;&#x2122;s carrying amount and the present value of estimated future cash flows discounted at the financial assetâ&#x20AC;&#x2122;s original effective interest rate. Impairment testing of trade receivables is described in note 1.8. 1.6 Inventories Inventories are stated at the lower of cost and net realisable value. Cost is determined by the firstin first-out method. Net realisable value is the estimate of the selling price in the ordinary course of business, less the costs of completion and selling expenses. 1.7 Leased assets The Agency leases certain property and equipment. Leases of property and equipment where the Agency has substantially all the risks and rewards of ownership are classified as finance leases. Finance leases are capitalised at the leaseâ&#x20AC;&#x2122;s commencement at the lower of the fair value of the leased property and the present value of the minimum lease payments. Each lease payment is allocated between the liability and finance charges so as to achieve a constant rate on the finance balance outstanding. The corresponding rental obligations, net of finance charges, are included in other long-term liabilities. The interest element of the finance cost is charged to profit or loss over the lease period so as to produce a constant periodic rate of interest on the remaining balance of the liability for each period. The property and equipment acquired under finance lease is depreciated over the shorter of the useful life of the asset or the lease term. Leases of assets under which all the risks and benefits of ownership are effectively retained by the lessor are classified as operating leases. Payments made under operating leases are charged to profit or loss on a straight line basis over the period of the lease.

MITA ANNUAL REPORT 2010

1.8 Trade and other receivables Trade receivables are amounts due from customers for merchandise sold or services performed in the ordinary course of business. If collection is expected in one year or less (or in the normal operating cycle of the business if longer), they are classified as current assets. If not, they are presented as non-current assets. Trade and other receivables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method, less provision for impairment. A provision for impairment of trade and other receivables is established when there is objective evidence that the Agency will not be able to collect all amounts due according to the original terms of the receivables. Significant financial difficulties of the receivable, probability that the receivable will enter bankruptcy or financial reorganisation, and default or delinquency in payments are considered indicators that the receivable is impaired. The amount of the provision is the difference between the assetâ&#x20AC;&#x2122;s carrying amount and the present value of estimated future cash flows, discounted at the original effective interest rate. The carrying amount of the asset is reduced through the use of an allowance account, and the amount of the loss is recognised in profit or loss. When a receivable is uncollectible, it is written off against the allowance account for trade and other receivables. Subsequent recoveries of amounts previously written off are credited in profit or loss. 1.9 Short-term deposits Short term deposits held with banks or credit institutions are stated at face value. 1.10 Cash and cash equivalents Cash and cash equivalents are carried in the statement of financial position at cost. For the purposes of the statement of cash flows, cash and cash equivalents comprise cash in hand and deposits held at call with banks. 1.11 Trade and other payables Trade payables are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Accounts payable are classified as current liabilities if payment is due within one year or less (or in the normal operating cycle of the business if longer). If not, they are presented as non-current liabilities. 1.12 Current and deferred tax The tax expense for the period comprises current and deferred tax. Tax is recognised in profit or loss, except to the extent that it relates to items recognised directly in equity. In this case, the tax is also recognised in equity. Deferred tax is recognised, using the liability method, on temporary differences arising between the tax bases

MITA ANNUAL REPORT 2010

of assets and liabilities and their carrying amounts in the financial statements. However, the deferred tax is not accounted for if it arises from initial recognition of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting nor taxable profit or loss. Deferred tax is determined using tax rates (and laws) that have been enacted or substantially enacted by the end of the reporting period and are expected to apply when the related deferred tax asset is realised or the deferred tax liability is settled. Deferred tax assets are recognised only to the extent that it is probable that future taxable profit will be available against which the temporary differences can be utilised. Deferred income tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets against current tax liabilities and when the deferred income taxes assets and liabilities relate to income taxes levied by the same taxation authority on either the taxable entity or different taxable entities where there is an intention to settle the balances on a net basis. 1.13 Provisions Provisions are recognised when the Agency has a present legal or constructive obligation as a result of past events, it is probable that an outflow or resources embodying economic benefits will be required to settle the obligation, and a reliable estimate of the amount of the obligation can be made. Provisions are measured at the present value of the expenditures expected to be required to settle the obligation using a pre-tax rate that reflects current market assessments of the time value of money at the risk specific to the obligation. The increase in the provision due to passage of time is recognised as interest expense. 1.14 Borrowing costs Interest costs are charged against income without restriction. No borrowing costs have been capitalised. 1.15 Revenue recognition Revenue comprises the fair value of the consideration received or receivable upon delivery of products or performance of services in the ordinary course of the Agencyâ&#x20AC;&#x2122;s activities. Revenue is shown net of value-added tax, returns, rebates and discounts. The Agency recognises revenue when the amount of revenue can be reliably measured, it is probable that future economic benefits will flow to the entity and when specific criteria have been met for each of the Agencyâ&#x20AC;&#x2122;s activities. Revenue from project contracts is recognised under the percentage of completion method. Revenue is generally recognised based on the services performed to date as a percentage of the total services to be performed.

MITA ANNUAL REPORT 2010

Subventions from Government are recognised at their fair value where there is a reasonable assurance that the subventions will be received and the Agency will comply with all attached conditions. Government subventions relating to costs are deferred and recognised in profit or loss over the period necessary to match them with the costs that they are intended to compensate. Interest income is recognised as it accrues, unless collectability is in doubt. Grants receivable relating to property, plant and equipment are included in deferred income and are credited to the statement of comprehensive income on a straight-line basis over the expected lives of the related assets.

2. Financial risk management 2.1 Financial risk factors The Agency’s activities potentially expose it to a variety of financial risks: credit risk and market risk (including cash flow interest rate risk). The Agency’s overall risk management focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the Agency’s financial performance. The board members provide principles for overall risk management, as well as policies covering risks referred to above. (a) Credit risk Financial assets which potentially subject the Agency to credit risk consist principally of cash at bank and trade and other receivables. As a general rule, the Agency has policies in place to assess and monitor credit exposures and risk thresholds. The Agency’s cash is placed with quality financial institutions and as such, does not consider credit risk in this respect to be significant. As part of its credit risk management, the Agency assesses the credit quality of its customers, taking into account the financial position, past experience, and other factors. It has policies in place to ensure that sales of services are affected to customers with an appropriate credit history. The Agency monitors the performance of these financial assets on a regular basis to identify incurred collection losses, which are inherent in the Agency’s receivables taking into account historical experience in the collection of accounts receivable. The Agency manages credit limits and exposures actively in a practicable manner such that past due receivable from customers are minimized at the reporting date. The Agency’s trade and other receivables are presented net of an allowance. The provision as at the end of the reporting period covers the extent of impaired debtors. As at the end of the reporting period impairment of trade receivables amounted to €69,888 (2009: €107,536) and trade and other receivables which were past due but not impaired amounted to €850,821 (2009: €764,221). The remaining trade and other receivables, which are not impaired financial assets, are principally in respect of transactions with customers for whom there is no recent history of default and were regular payments and set-offs are being affected by these clients. The board members do not expect any material losses from nonperformance of these customers.

MITA ANNUAL REPORT 2010

The Agency is exposed to concentration of credit risk with respect to its trade and other receivables since €777,047 are due from four customers representing 49% of the total amount due (2009: €1,370,126 are due from two customers representing 61% of the total amount due). The following table illustrates the assets that expose the Agency to credit risk as at the reporting date and includes the Standard & Poor’s (or equivalent) composite rating, when available. Assets bearing credit risk at the reporting date are analysed as follows: 31 DECEMBER 2010 A to A€

B to B€

Unrated €

Total €

Receivables Trade and other receivables Short term deposits

1,473,553

128,208

1,601,761

11,000,000

465,875

11,465,875

2,043,751

1,232

2,044,983

14,517,304

128,208

467,107

15,112,619

Cash and cash equivalents Assets bearing credit risk

31 DECEMBER 2009 A to A€

B to B€

Unrated €

Total €

2,338,502

9,500,000

465,875

9,965,875

3,181,539

2,722

3,184,261

15,020,041

468,597

15,488,638

Receivables Trade and other receivables Short term deposits Cash and cash equivalents Assets bearing credit risk

(b) Market risk (i) Cash flow interest rate risk In general, the Agency’s exposure to risks associated with the effects of fluctuations in the prevailing levels of the market interest rates on its financing position and cash flow are not deemed to be substantial by the board members in view of the nature of the assets. Notes 8, 9 and the following table incorporate interest rate risk and maturity information with respect to the Agency’s assets.

MITA ANNUAL REPORT 2010

(b) Market risk - continued The Agency’s interest bearing assets are as follows:

Assets at floating interest rates – short-term deposits Assets at floating interest rates – short-term cash and cash equivalents Total

2010 €

2009 €

11,465,875

9,965,875

2,043,751

3,181,539

1,232

2,044,983

Up to the reporting date, the Agency did not have any hedging policy with respect to the exposure of interest rate risk. The maturity of the floating interest bearing assets is short-term and hence the interest rate risk is not deemed to be significant by the board members. (c) Foreign exchange risk Foreign exchange risk arises from the possibility that fluctuations in foreign exchange rates will impact on the amounts that are paid to settle liabilities and on the amounts that are realised from the Agency’s assets. Such risk is not considered significant in relation to liabilities and assets since most of the Agency’s liabilities are in euro and are therefore not subject to currency risk. 2.2 Fair value estimation At 31 December 2010 and 2009, the carrying amounts of cash at bank including shortterm deposits, receivables, payables and accrued expenses approximated their fair values due to the short term maturities of these assets and liabilities.

3. Critical accounting estimates and judgements Estimates and judgements are continually evaluated and based on historical experience and other factors including expectations of future events that are believed to be reasonable under the circumstances. In the opinion of the board members, the accounting estimates and judgements made in the course of preparing these financial statements are not difficult, subjective or complex to a degree which would warrant their description as critical in terms of the requirements of IAS 1 (revised) except for the application of critical judgement in applying the Agency’s accounting policy on leased assets. Finance leases The Agency follows IAS 17 in relation to the accounting for lease agreements in line with its accounting policy. IAS 17 defines a lease as being an agreement whereby the lessor conveys to the lessee in return for a payment, or series of payments, the right to use an asset for an agreed period of time. In determining the classification of leased assets as finance leases, significant judgement is required. In making this judgement, the Agency evaluates, among other factors, the risks and rewards of ownership. The MITA ANNUAL REPORT 2010

Agency entered into a lease agreement in relation to property and equipment and it was considered that substantially all risks and rewards arising from this agreement belong to the Agency and accordingly classified the assets as a finance lease.

4 Property and equipment Leasehold Property and improvements €

Furniture, fixtures and fittings €

IT and office equipment €

Total €

Period ended 31 December 2009

Additions acquired on transfer of operations (Note 23) Cost

257,742

1,243,019

12,722,493

14,223,254

(209,943)

(602,507)

(8,568,722)

(9,381,172)

1,369

132,646

956,560

1,090,575

(1,728)

(424,894)

(426,622)

(11,811)

(170,134)

(2,182,340)

(2,364,285)

129,854

32,564

531,884

694,302

44,251

649,785

3,633,113

4,327,149

259,111

1,373,937

13,254,159

14,887,207

(214,860)

(724,152)

(9,621,046)

(10,560,058)

44,251

649,785

3,633,113

4,327,149

Opening net book amounts

44,251

649,785

3,633,113

4,327,149

Additions

89,761

521,949

2,627,828

3,239,538

Disposals

(129,853)

(32,823)

(531,884)

(694,560)

(11,811) 129,854

(170,134) 32,564

(2,182,340) 531,884

(2,364,285) 694,302

122,202

1,001,341

4,078,601

5,202,144

219,019

1,863,063

15,350,103

17,432,185

Accumulated depreciation

(96,817)

(861,722)

(11,271,502)

(12,230,041)

Net book amount

122,202

1,001,341

4,078,601

5,202,144

2010 €

2009 €

6,017,614

4,635,615

(3,100,103)

(1,965,868)

2,917,511

2,669,747

Accumulated depreciation Additions

Disposals Depreciation charge Depreciation released on disposals Closing net book amount At 31 December 2009 Cost Accumulated depreciation Net book amount Year ended 31 December 2010

Depreciation charge Depreciation released on disposals Closing net book amount At 31 December 2010 Cost

IT and office equipment includes the following amounts where the Agency is a lessee under a finance lease:

Cost – capitalised finance lease Accumulated depreciation Net book amount

The Agency took over assets from MITTS Ltd at the net book value and continued to account for the original cost and accumulated depreciation.

MITA ANNUAL REPORT 2010

5 Investment in subsidiary 2010 €

2009 €

33,776

Period ended 31 December Opening net book amount Additions acquired on transfer of operations (Note 23) Closing net book amount At 31 December Cost and net book amount

The investment which is unlisted at 31 December 2010 is shown below: Company

Registered office

Class of shares held

Malta Electronic Certification Services Limited

Gattard House National Road Blata L-Bajda Malta

Ordinary shares

Percentage of shares held 2010

2009

100%

2010 €

2009 €

23,804

27,490

8,549

9,679

32,353

37,169

2010 €

2009 €

Trade receivables – Gross

1,601,761

2,338,502

Provision for impairment

(69,888)

(107,536)

Trade receivables – Net

1,531,873

2,230,966

Prepayments and accrued income

854,462

1,250,887

2,386,335

3,481,853

2010 €

2009 €

11,465,875

9,965,875

6 Inventories

Inventories held for resale Other inventories

The amount of € Nil (2009: €3,417) representing write-downs of inventories is recognised as an expense during the period.

7 Trade and other receivables

8 Short term deposits

Deposits held with bank

Short term deposits have a weighted average interest rate of 1.86% (2009: 2.38%) and have an average maturity date not exceeding one year from the reporting date.

MITA ANNUAL REPORT 2010

9 Cash and cash equivalents 2010 €

2009 €

2,044,983

3,184,261

2010 €

2009 €

Amounts falling due after more than one year

1,247,797

1,071,119

Amounts falling due within one year

1,013,047

618,190

Cash at bank and in hand

Cash and cash equivalents earn interest at 0.37% (2009: 0.38%) per annum.

10 Finance lease liabilities

The lease agreement covered a 7-year period with minimum lease payments of €7,478,381. Assets were delivered in 2010 and accordingly liability was recognised. The following is an analysis of the minimum lease payments covering the whole arrangement.

Gross finance lease liabilities – minimum lease payments: Not later than 1 year

1,399,068

1,388,160

Later than 1 year and no later than 5 years

2,798,135

4,164,479

Future finance charges on finance lease

4,197,203

5,552,639

(755,496)

(999,475)

3,441,707

4,553,164

1,273,151

1,288,212

2,168,556

3,264,952

Present value of finance lease liabilities The present value of finance lease liabilities is as follows: Not later than 1 year Later than 1 year and no later than 5 years

MITA ANNUAL REPORT 2010

11 Deferred taxation 2010 €

2009 €

At beginning of year

335,607

Charge to profit or loss (Note 18)

(54,436)

335,607

Absorption of deferred tax upon transfer of operations (Note 23)

158,540

Later than 1 year and no later than 5 years Future finance charges on finance lease At end of year

2,798,135

4,164,479

4,197,203

5,552,639

439,711

335,607

Deferred income taxes are calculated on all temporary differences under the liability method using a principal tax rate of 35%. The balance at 31 December represents: 2010 €

2009 €

Temporary differences on fixed assets due to accelerated tax depreciation

464,172

373,245

Temporary differences on provisions

(24,461)

(37,638)

439,711

335,607

12 Trade and other payables 2010

2009

€

Trade payables

1,941,166

3,139,588

Other payables

288,259

797,600

50,421

5,094,497

5,253,037

705,168

144,347

7,848,905

8,455,098

15,928,416

17,840,091

Amounts owed to subsidiary Amounts owed to related parties Indirect taxation Accruals and deferred income Amounts owed to related party are interest free, unsecured and repayable on demand.

MITA ANNUAL REPORT 2010

13 REVENUE Period from 18 August Year ended

2008 to 31

31 December

December

2010

2009

€

Core services

11,455,323

10,461,588

Desktop services

5,396,757

3,750,221

Other service contracts

4,878,318

5,804,131

189,111

Total services

21,919,509

20,015,940

Projects

3,063,559

4,002,715

EU funding

Subvention

MITA ANNUAL REPORT 2010

1,536,625

1,322,914

26,519,693

25,341,569

14 Expenses by nature Period from 18 August Year ended

2008 to 31

31 December

December

2010

2009

€

Depreciation of property and equipment (Note 4)

2,364,285

1,602,549

Employee benefit expense (Note 15)

9,973,645

9,272,834

Training Costs relating to projects and services (Increase)/decrease in provision for impairment of receivables Impairment of receivables

309,558

334,852

9,882,631

11,027,664

(37,648)

45,466

21,826

362,161

361,537

Operating lease: Property Motor vehicles and equipment

225,092

206,981

Services

684,323

672,676

4,750

1,230,086

448,498

25,020,709

23,977,807

Audit fees Other expenses Total cost of sales and administrative expenses

The Agency paid insurance premium of €5,750 (2009: €5,750) in respect of professional indemnity in favour of its board members. Board members’ fees amount to €7,532 (2009: €19,800). Auditor Fees Fees charged by the auditor for services rendered during the financial periods ended 31 December 2010 and 2009 relate to the following: 2010

2009

€

Annual statutory audit

4,750

Other assurance services

2,330

1,472

71,920

66,203

80,472

73,283

Tax advisory and compliance services Other non-audit services

MITA ANNUAL REPORT 2010

15 Employee benefit expense Period from 18 August

Salaries and employment benefits Social security costs

Year ended

2008 to 31

31 December

December

2010

2009

€

9,403,806

8,745,039

569,839

527,795

9,973,645

9,272,834

2010

227

214

Average number of persons employed by the Agency during the period:

Direct Administration

102

329

313

16 Finance income Period from 18 August

Other charges

Year ended

2008 to 31

31 December

December

2010

2009

€

180,964

166,803

17 FINANCE COSTS Period from 18 August

Other charges

MITA ANNUAL REPORT 2010

Year ended

2008 to 31

31 December

December

2010

2009

€

4,266

4,826

18 TAX EXPENSE Period from 18 August

Current tax expense Deferred tax expense (Note 11)

Year ended

2008 to 31

31 December

December

2010

2009

€

467,136

357,076

(54,436)

335,607

412,700

692,683

The tax on the Agency’s profit before tax differs from the theoretical amount that would arise using the basic tax rate as follows:Period from 18 August

Profit before tax Tax on profit at 35%

Year ended

2008 to 31

31 December

December

2010

2009

€

1,675,682

1,525,703

586,489

533,996

(36,193)

(33,361)

20,944

33,510

(158,540)

158,538

412,700

692,683

Tax effect of: Income subject to tax at 15% Expenses not deductible for tax purposes Temporary differences relating to equipment

MITA ANNUAL REPORT 2010

19 Cash generated from operations Reconciliation of operating profit to cash generated from operations: Period from 18 August

Operating profit

Year ended

2008 to 31

31 December

December

2010

2009

€

1,498,984

1,363,762

2,364,285

1,602,549

229

798

(37,648)

44,764

21,826

4,816

(429)

Adjustments for: Depreciation (Note 4) Loss on sale of property and equipment (Increase)/decrease in provision for impairment of receivables Impairment of receivables Changes in working capital: Inventories Trade and other receivables Trade and other payables Cash generated from operations

1,111,340

1,636,601

(1,753,135)

1,084,411

3,210,697

5,732,456

20. Contingencies In terms of a lease agreement entered into with one of its suppliers, the Agency will be liable to termination costs if the agreement is terminated as agreed between both parties.

21 COMMITMENTS 2010

2009

€

Falling due within one year

4,819,938

4,444,768

Falling due between 2 and 5 years

11,001,640

13,778,561

189,290

369,270

16,010,868

18,592,599

1,397,624

6,685,000

420,000

134,400

Non-cancellable operating leases

Falling due after 5 years

Capital commitment Capital commitments – Authorised and not contracted for Capital commitments – Contracted for Uncalled issued share capital of MECS Limited

MITA ANNUAL REPORT 2010

22. Related party transactions The Agency conducts transactions in the normal course of business with the Government of Malta and with other state-controlled enterprises. Entities that are ultimately controlled by the Government of Malta, are considered by the board members to be related parties. The following transactions were carried out by the Agency with related parties:

22 Related party transactions

Purchases of goods and services Sales of goods and services (including recharges)

2010

2009

€

395,033

1,856,447

25,405,546

25,293,038

As at the year-end, amounts owed by related parties disclosed as trade receivables (Note 7) amounted to € 1,455,297 (2009: €2,331,435). Amounts owed to related parties amounted to € 5,363,828 (2009: €5,354,075) (Note 12). In the normal course of business, the Agency acts as an agent by re-charging related parties for services rendered by suppliers. Such services amounted to € 10,516,000 (2009: €9,100,910) and are included in turnover and cost of sales.

MITA ANNUAL REPORT 2010

23. Transfer of operations On 18 August 2008, MITA was set up by virtue of a public deed. The main objectives of the Agency is to absorb the operations of MITTS Ltd. and the range of functions previously carried out directly by the Ministry for Infrastructure, Transport and Communications. With effect from 1 January 2009, a significant part of the assets and liabilities of MITTS as at 31 December 2008 together with its operations were transferred to MITA. The assets and liabilities arising from the transaction are as follows:

23 Transfer of operations 2009 â&#x201A;Ź Property and equipment

4,842,082

Investment in subsiduary

33,776

Inventories

36,740

Trade and other receivables Short term deposits and cash equivalents Finance lease liabilities Trade and other payables Finance lease liabilities

5,163,218 9,230,901 (1,886,789) (11,502,645) (664,248) 5,253,035

Cash and cash equivalents acquired

(763,818)

Cash inflow on transfer of operations

4,489,217

In 2010 a deferred tax liability of â&#x201A;Ź158,540 was transferred from MITTS Limited to MITA.

MITA ANNUAL REPORT 2010

MALTA INFORMATION TECHNOLOGY AGENCY Gattard House National Road Blata-l-Bajda HMR 9010 Malta Tel No: (356) 2123 4710 Fax No: (356) 2123 4701

www.mita.gov.mt

August 2011