ANNUAL REPORT - MITA1 · PDF fileMITA ANNUAL REPORT 2010 3 ... 10. facilitating the...

MITA ANNUAL REPORT

2010

3MITA ANNUAL REPORT 2010

MITA MIssIon sTATeMenT

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.

4 MITA ANNUAL REPORT 2010


IndexMessage froM chairMan 6

Message froM ceo 10

Mita’s objective 12

strategic priorities 13

2010 in nuMbers 14

Malta governMent netWork 16

2010 highlights and achieveMents 18

1. iso27001 accreditation 18

2. Malta declared european leader in egovernMent services 20

3. better care through the intelligent application of ict 22

4. bioMetric passports for Maltese citizens 23

5. enterprise inforMation as a resource for governMent 24

6. bandWidth speed for governMent and students doubled 25

7. setup of eskills alliance Malta 26

8. launch of second step training prograMMe 27

9. next generation egovernMent fraMeWork 28

10. facilitating the non-disruptive use of open source softWare 30

11. neW corporate data centre 31

12. latest coMputing equipMent across governMent 32

13. facilitating outsourcing to the private sector 33

corporate social responsibility 34

(i) digital inclusion 35

(ii) environMent 36

(iii) coMMunity 37

puttinu cares 38

board MeMbers’ report 40

independant auditors report 48

financial analysis 50

huMan resources in 2010 53

financial stateMents 54

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 – 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 Agency’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.

MESSAGE FROM ThE

ChAIRMAN



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 cost-

base.

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

It is not about technology, but about the needs of whom we serve and how technology can be applied to best serve those needs.


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

We invested over €1,000,000 to enhance Government’s internet infrastructure in terms of security, capacity and high availability


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 GrechChairman, MITA

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

MESSAGE FROM ThE

CEO



Matthew GattChief Executive Officer, MITA

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 Malta’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

Agency’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.


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 an aMbiTious objecTive

requires conTinuous invesTMenT,

excellenT indusTry relaTions,

a responsive sTrucTure and,

MosT of all, huMan capiTal

experTise. These key guiding

principles, 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


STRATEGIC PRIORITIESIn bringing all its policies and principles to life, MITA has

drawn a set of specific, and measurable, Strategic Priorities:

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.

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

1

32

45

“During 2010 MITA carried out the groundwork necessary to ensure the attainment of all the key deliverables within its strategic plan.” Joanna Genovese - MITA Board Member


INTRODUCINGTOMORROW

2010 IN NUMbERS

The Agency has the challenging task of changing what tomorrow’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 citizens’ quality of life is constantly enhanced.

professionals eMployed by Mita,handling:338


28,000over

users spread in 600 sites across government.

27,292email accounts 15,679

internet accounts

network points

1600 sWitches

2,7

00

ON

E M

IL

LI

ON

eMails r

eceiv

ed p

er d

ay th

ro

ugh M

ita’s ser

ver

s

21,183workstations

450routers

kilometers of netw

ork cable

423

€

physical servers

117virtualised serversservers Were

discarded, generating a net saving of €30k per annuM

5,000,000 hits on government websites per week

263websites hosted

egovernment services

97

transactions processed through the online government payment gateway with a value of over

51 million600,000emails tagged as spam per day

450 TerabyTes in storage capacity. 200 TerabyTes Were added in 2010.

1stMalta placement in the eu

egovernment benchmarking

3,000user enquiries for support addressed per week, 76% of which are directly tackled and solved by first-line customer care support

attained the international iso 27 001 information

security standard

200citizens receiving an ict diploma

training for free through the second step programme

ict students given job

opportunities and experience

through the student placement

programme

67 tenders published amounting to a total worth of approx four - five Million euros

€18meu co-financing through eu cohesion fund, 2007-2013 operational prograMMe

redundant core vpn infrastructure

Mater dei hospitalcorporate data centre

gattard house corporate data centre

redundant fibre ethernet netWorkconnecting 129 governMent departMents and Ministries through vpn technology

fibre connected sitesMagnet fibre site

periMeter control

(secure la

yer)

InTerneT servIce sTrucTure

server farM

ThE MAlTA GOvERNMENT NETWORK

INTE RNET


area offices (social security)

health centres

schools

6mbs dsl / cable

10 / 100 mbITs

1 gIgabIT

police stations

governMent business sites

periMeter control

(secure layer)

periMeter control

(secure layer) 36

105

39

81 17

438 73

7

eMbassy voice and data netWorks connected through vpn technology

local councilshoMe users

Magnet broadbandadsl and cable ModeM connected sites connected through vpn technology

technology

I NTE RNET



2010 hIGhlIGhTS AND AChIEvEMENTS

1ISO27001 AccreditationThe Agency’s drive for excellence requires that high

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

parallel to spearheading security solution investments of over

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

operations against the ISO27001 security standard.

The accreditation process required an in-depth analysis of

all systems and processes, during which the team identified

operational risks and implemented the necessary controls to

mitigate the risks.

The 133 controls forming part of the ISO 27001 standard,

were successfully implemented and a strict risk management

framework was created to identify, prioritise and address

security risks related to the three main aspects of information

security - confidentiality, integrity and availability.

In July 2010 core services were accredited with the ISO

27001 standard. The accreditation came after AFAQ-EAQA

- 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

continuous risk identification and

control. Bi-yearly surveillance visits

are carried out by the external

auditors to confirm the effectiveness of

this cycle. The first surveillance visit

following the ISO27001 accreditation was held in December

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

adherence to the ISO27001 requirements, but successfully

extended the ISO27001 certification to a number of additional

core processes in line with MITA’s drive to seek agency-wide

accreditation against this international benchmark.

To complement this accreditation, in January 2010, MITA

launched an awareness campaign targeting public officers.

The objective of this campaign was to educate users about

identifying and protecting their computer equipment from

potential security risks. In the meantime the Agency also

invested in new advanced virus and malware protection

systems on all Government computers..


“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


2Malta declared European

leader in eGovernment services In what was yet another confirmation of Government’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 INDICAToRMAlTA’S SCoRe

TRADITIoNAl INDICAToRS

Fully online availability 100%

Online Sophistication 100%

USeR expeRIeNCe

Of 20 basic eGovernment services 100%

Of the national portal (.gov.mt) 100%

epRoCUReMeNTAvailability 100%

Pre-Award 76%


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


3Better care through the

intelligent application of ICTGovernment’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 end-

to-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

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

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

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

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

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

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

care centres enables healthcare professionals to view the results instantaneously so that they

take necessary medical decisions and, if necessary, schedule appointments for patients.

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

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

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

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.

“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.”

Ray Navarro - Department Manager, Business Cluster Department

laboratory test

processed through

the laboratory

inforMation systeM

(ilab) during 2010

by the laboratory

departMent at

Mater dei hospital:

nuMber of

patients served

by the Medical

iMaging departMent

at Mater dei hospital

during 2010:


4Biometric passports

for Maltese citizensThe 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

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

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

5,194,479

201,420


5Enterprise Information as

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

processed by government is almost inconceivable. This

extensive use of information brings with it substantial

challenges relating to storage, accessibility and retrieval,

standardisation and uniqueness, and security of this

critical resource.

During 2010, MITA worked on selecting a strategic partner

to implement an Enterprise Information Management

Solution (EIMS) for Government. The EIMS is based

on the structuring of information across Government’s

Ministries and departments in a way that will allow the

effective sharing of information across the board and thus

increasing the efficiency and speed of service delivery,

whilst reducing duplication of work.

The EIMS will be implemented across Government over

a timeframe of seven years. It aims at generating a

Knowledge Management Culture within Government

whereby everyone is aware, and educated, on the

importance of the proper structuring, digitisation,

storage, retrieval, processing, updating and archiving of

information.

The solution will serve as a common platform for web

content management systems, enabling users to access

the information through web browsing tools, thus

gaining access to an extensive variety of sources from

different ministries and departments. The solution

will enable interoperability and in collaboration with

searching and retrieving capabilities will confer a high-

level of information access. Furthermore, it will preserve

information and create a secure and robust environment

which reduces the risk of losing institutional memory, and

prevents the loss due to illicit circumstances and in case

of disaster situations.

The EIMS will eventually replace the traditional paper

records found in different types and formats to gradually

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

administration in harmony with its green strategy. It will

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

storage space, releasing office space for more valuable

purposes.

Information access will be possible from various devices

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

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

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

with all relevant legislations including, but not limited, to

the Data Protection Act, Freedom of Information Act and

the National Archives Act. Undoubtedly security features

will play a most significant role in this system.

The ultimate objective of the EIMS is to enable Government

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

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

key enabler in transforming the way government operates

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

25

6Bandwidth speed for

Government and

students doubledIn order to meet the continuous growing demand

of Internet bandwidth within Government and state

schools, in September 2010 MITA signed a three year

agreement with Vodafone Malta Ltd for the provision

of international bandwidth and routing services .

Through this agreement, MITA doubled the internet

bandwidth in both classrooms and Government

departments thus improving its service to public

service officials and students alike, benefiting in total

over 46,000 users.

MITA has been acting as Government’s Internet

Service Provider (ISP) since the mid-nineties,

procuring Internet bandwidth and routing services

from local carriers, and repackaging it with value

added services, such as web filters, prior to providing

it to public service users, and state school students.

The performance enhancement and increased

bandwidth for state schools is a central element

in Government’s smart learning strategy, now

approaching completion from an infrastructural

standpoint.

The bandwidth enhancement caters also for the

growing number of public officers making use of the

Internet as a business tool, hence strongly reaffirming

Government’s belief that appropriate access to the

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

enabler and an invaluable tool in today’s workplace,

including within the public service.

This agreement also increased local Internet bandwidth

and enabled faster access to Government’s portals and

to all eGovernment services hosted by MITA.

This was also an important step for the implementation

and delivery of bandwidth-intensive applications

within Government’s core operations. It allowed MITA

to start laying the foundations for the rollout of a new

generation of eGovernment services.

MITA ANNUAL REPORT 2010

“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


7Setup of eSkills Alliance MaltaThe eSkills Alliance Malta brings together educational

entities, main industry players from the private ICT sector,

and Government. The Alliance members are the University of

Malta, MCAST and the Ministry for Education, Employment

and the Family, as the main decision-makers in ICT

education and skills supply. The Chamber of Commerce, a

handful of employers and the Malta Employers Association

are important members of the Alliance. Finally, The Malta

Council for Science and Technology (MCST) and MITA are

members given their role as Government bodies responsible

to support the development of the knowledge economy.

The Alliance was set up with the understanding that

change in the e-skills throughput from our educational

institutions is urgently required and that no stakeholder can

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

meets regularly to discuss and determine a concerted way

forward for the development of a stronger ICT workforce that

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

needs.

In order to address the demand for future ICT skills,

2010 saw the beginning of development work on an

eSkills Demand & Supply Monitor for Malta. This will be

coupled with an eSkills Competence Framework, currently

also under development, which will enable a consistent

understanding of skills requirements across the industry. A

further initiative intended to strengthen the ICT profession,

is the setting up of a National ICT Professional Body which

is also in the early stages of development. Discussions have

also started with the Faculty of ICT within the University of

Malta and the ICT Institute within MCAST for the creation

and updating of the educational programmes to fit closer to

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


8Launch of Second Step

Training ProgrammeWith 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


9Next Generation \

eGovernment FrameworkAs part of MITA’s continuous, fast paced effort to increase

the quality of eGovernment services and to ensure that all

Government services are accessible online, during 2010 the

Agency started re-engineering its eGovernment framework

which will transform the concept of how e-Government

services are created and delivered. MITA has created a

central platform which will enable the rapid implementation

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

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

was initiated on three important components forming part of

this framework: eForms, MyBills and eProcurement.

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

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

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

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

process – from the creation of forms by the department to

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

- to be done completely online in a secure environment.

Great attention has been given to the look and feel element

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

experience of the service.

myBills is the Maltese Government’s online billing solution.

The first eGovernment service in Malta that offered online

payments was deployed in 2002. Over the past eight years

the number of eGovernment websites accepting payment has

increased considerably and we feel that users should be offered

the ability to also manage their bills online. myBills kicked

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

to make electronic payments through a central PCI-certified

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

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

integrate with myBills and allow users to manage and pay

their bills online was the Local Enforcement System.2010

was also central for the progress on another eGovernment

component – eProcurement. This solution will enable the

use of electronic communications and transaction processing

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

or tender public works. eProcurement helps increase the

accessibility, transparency and efficiency of all public

procurement procedures and it also strengthens competition

for the benefit of Government. Functionalities include

eNotifications, eTendering, eAuction, eCatalogues, eOrdering,

eInvoicing, and ePayments. The solution allows elimination of

most of the related paperwork, hence reducing the cost and

time required to process the virtual and physical procurement

transaction. A substantial part of tenders and contracts issued

by Government are expected to be carried out entirely 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.”

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10Facilitating the non-disruptive

use of Open Source SoftwareWith the aim of nurturing the proliferation of open source software

(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

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

1

Nurturing the proliferation of Open Source Software

White Paper

opensourcevision


11New 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 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.

“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


12Latest 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

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.

PC LEASInG PrOGrAMME

MITA CALL CEnTrE SErvICE 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% 76%

“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 -

Networks and Service Management

Department

5,393Laptops

14,514PCs


13Facilitating outsourcing

to the private sectorAs part of its commitment in building excellent relations

with the industry, during 2010 MITA announced its intention

of adopting an aggressive outsourcing policy framework and

programme, wherein the industry’s capabilities will be used to

the largest extent possible.

The Agency set up an Outsourcing Framework allowing it to

outsource a number of functions to the private sector. The

framework was developed in collaboration with the private

industry and is a transparent and effective strategy of engaging

the private industry to support Government operations.

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

eventually strengthen Government’s vision of transforming

public service delivery through technology, while allowing

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

the quality of life of citizens.

This is also happening at a time in which ICT remains at

the centre of Malta’s future economic growth. The EU2020

strategy adopted by the European Commission re-affirms the

importance of this sector for the creation of sustainable jobs.

Besides this framework, MITA had already entrusted the

private industry with the outsourcing and leasing of the

desktop services of schools and public service.

Through the framework, in which a total of 12 suppliers are

participating, a number of contracts for software development

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.

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12


CORPORATE SOCIAlRESPONSIbIlITyMITA 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.


(i) Digital InclusionIn 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.


(ii) EnvironmentThe 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:

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.

Introduced a shuttle passenger service which reduced MITA’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

With the decommissioning of servers

MITA reduced its carbon footprint by over

170 tonnes of CO2 per year


(iii) CommunityA 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.

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).

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 18-20 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


puttinu caresIn 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:

“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.”

Angele Cuschieri & Rennie Zerafa - puttinu Cares


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 well-

equipped 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 f lats 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 ‘train the trainer’ sessions for volunteers.


bOARD MEMbERS’ REPORTThe board members present their second report and the audited financial statements

for the year ended 31 December 2010.


IntroductionThe 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.


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


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 inf luence 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 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.


Organisational

DevelopmentThe 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

GovernanceMITA 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 MITA’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.


Board membersThe 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.


The financial statements of Malta Information Technology Agency for the year

ended 31 December 2010 may be made available on the company’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 Agency’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


INDEPENDENT AUDITOR’S REPORTTo the board members of Malta Information Technology Agency

Report on the Financial StatementsWe 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 statementsAs 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.


Auditor’s responsibilityOur 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.

OpinionIn 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

11 March 2011

Fredrick Muscat Bonnici Partner


FINANCIAl ANAlySIS

54% GrOWTH In THE DESKTOP LEASInG FOr GOvErnMEnT

16% InCrEASE EGOvErnMEnT AnD CITIZEn CEnTrIC InITIATIvES FUnDED

+5% ExPAnSIOn OF SErvICES FUnDED BY THE COrE SErvICES vOTE

an InvesTmenT of €265,895 for a more robusT underlyIng securITy

€306,776 To Improve The daTa cenTres aT mdh and gozo

€1.4m To Increase The hosTIng capacITy on The consolIdaTed envIronmenT.

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

€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

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.


EU FUNDED CONTRACTS

ACCESSIBILITY FOr ELEArnInG, EFOrMS AnD EID SOLUTIOnS PrOjECTS €17M

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,

ref lecting 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 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 employmenT and relaTed

cosTs for The year reached

€9,985,691

mITa overheads cosTs Increased

by only 2.5%, reachIng

€2,470,727


hUMAN RESOURCES IN 2010The 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.

2007

under 30 30 to 50 50+age differential since 2007

2008 2009 2010

70 179 41 93 175 37 113 186 32 118 194 26

2007

Male feMalegender differential since 2007

2008 2009 2010

226 234 246 244

64 71 85 94

78% 77% 74% 72%

22% 23% 26% 28%

24.14% 30.49% 34.14% 34.14%

14.14% 12.13% 9.67% 7.69%

61.72%57.38%

56.19% 57.4%

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.


FINANCIAlSTATEMENTS


STATeMeNT of fINANCIAl poSITIoNAs at 31 December Notes 2010 2009

€ €

ASSeTS

Non-current assets

Property and equipment 4 5,202,144 4,327,149

Investment in subsidiary 5 33,776 33,776

Total non-current assets 5,235,920 4,360,925

Current assets

Inventories 6 32,353 37,169

Trade and other receivables 7 2,386,335 3,481,853

Short term deposits 8 11,465,875 9,965,875

Cash and cash equivalents 9 2,044,983 3,184,261

Total current assets 15,929,546 16,669,158

Total assets 21,165,466 21,030,083

fUNDS AND lIABIlITIeS

fund

Accumulated fund 2,096,002 833,020

Non-current liabilities

Finance lease liabilities 10 1,247,797 1,071,119

Deferred taxation 11 439,711 335,607

Total non-current liabilities 1,687,508 1,406,726

Current liabilities

Trade and other payables 12 15,928,416 17,840,091

Finance lease liabilities 10 1,013,047 618,190

Current taxation 440,493 332,056

Total current liabilities 17,381,956 18,790,337

Total liabilities 19,069,464 20,197,063

Total funds and liabilities 21,165,466 21,030,083

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


STATeMeNT of CoMpReHeNSIVe INCoMeNotes 2010 2009

Year ended 31 December

2010

Period from 18 August

2008 to 31 December

2009

€ €

Revenue 13 26,519,693 25,341,569

Cost of sales 14 (18,989,362) (18,583,829)

Gross profit 7,530,331 6,757,740

Administrative expenses 14 (6,031,347) (5,393,978)

operating profit 1,498,984 1,363,762

Finance income 16 180,964 166,803

Finance cost 17 (4,266) (4,862)

Profit before tax 1,675,682 1,525,703

Tax expense 18 (412,700) (692,683)

profit for the year/period – total comprehensive income 1,262,982 833,020

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 1,262,982

Balance at 31 December 2010 2,096,002




STATeMeNT of CASH flowSNotes Year ended

31 December 2010

Period from18 August

2008 to 31December

2009

€ €

Cash flows from operating activities

Cash generated from operations 19 3,210,697 5,732,456

Interest received 16 180,964 166,803

Interest paid 17 (4,266) (4,862)

Tax paid (358,699) (25,019)

Net cash generated from operating activities 3,028,696 5,869,378

Cash flows from investing activities

Purchase of property and equipment 4 (3,239,538) (1,090,575)

Proceeds from disposals of property and equipment 29 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)

Cash flow from financing activities

Finance lease 571,535 (861,728)

Net movement in cash and cash equivalents 10 (1,139,278) 2,420,443

Cash and cash equivalents at beginning of year/period 3,184,261 763,818

Cash and cash equivalents at end of year/period 9 1,687,508 3,184,261



Notes to the financial statements

1. Summary of significant accounting policiesThe 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.


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 20-33⅓

Furniture, fixtures and fittings 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 ref lected 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).


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 f lows 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 asset’s

carrying amount and the present value of estimated future cash f lows discounted

at the financial asset’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 lease’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.


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 asset’s carrying amount and the present value of estimated future cash f lows,

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 f lows, 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


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 outf low 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 ref lects 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

Agency’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 f low to the

entity and when specific criteria have been met for each of the Agency’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.


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 f low 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.


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:

(b) Market risk

(i) Cash f low interest rate risk

In general, the Agency’s exposure to risks associated with the effects of f luctuations

in the prevailing levels of the market interest rates on its financing position and

cash f low 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.

31 DeCeMBeR 2010

A to A-€

B to B-€

Unrated€

Total€

Receivables

Trade and other receivables 1,473,553 128,208 - 1,601,761

Short term deposits 11,000,000 - 465,875 11,465,875

Cash and cash equivalents 2,043,751 - 1,232 2,044,983

Assets bearing credit risk 14,517,304 128,208 467,107 15,112,619

31 DeCeMBeR 2009

A to A-€

B to B-€

Unrated€

Total€

Receivables

Trade and other receivables 2,338,502 - - 2,338,502

Short term deposits 9,500,000 - 465,875 9,965,875

Cash and cash equivalents 3,181,539 - 2,722 3,184,261

Assets bearing credit risk 15,020,041 - 468,597 15,488,638


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 short-

term 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

(b) Market risk - continued

The Agency’s interest bearing assets are as follows:

2010€

2009€

Assets at floating interest rates – short-term deposits 11,465,875 9,965,875

Assets at floating interest rates – short-term cash and cash equivalents 2,043,751 3,181,539

Total 1,232 2,044,983


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

leaseholdproperty and

improvements€

furniture,fixtures and

fittings€

IT andoffice

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

Accumulated depreciation (209,943) (602,507) (8,568,722) (9,381,172)

Additions 1,369 132,646 956,560 1,090,575

Disposals - (1,728) (424,894) (426,622)

Depreciation charge (11,811) (170,134) (2,182,340) (2,364,285)

Depreciation released on disposals 129,854 32,564 531,884 694,302

Closing net book amount 44,251 649,785 3,633,113 4,327,149

At 31 December 2009

Cost 259,111 1,373,937 13,254,159 14,887,207


net book amount 44,251 649,785 3,633,113 4,327,149

Year ended 31 December 2010

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)

Depreciation charge (11,811) (170,134) (2,182,340) (2,364,285)

Depreciation released on disposals 129,854 32,564 531,884 694,302

Closing net book amount 122,202 1,001,341 4,078,601 5,202,144

At 31 December 2010

Cost 219,019 1,863,063 15,350,103 17,432,185


net book amount 122,202 1,001,341 4,078,601 5,202,144

2010€

2009€

Cost – capitalised finance lease 6,017,614 4,635,615

Accumulated depreciation (3,100,103) (1,965,868)

Net book amount 2,917,511 2,669,747

IT and office equipment includes the following amounts where the Agency is a lessee

under a finance lease:

The Agency took over assets from MITTS Ltd at the net book value and continued

to account for the original cost and accumulated depreciation.


5 INVeSTMeNT IN SUBSIDIARY2010

€ 2009

€

period ended 31 December

Opening net book amount 33,776 -

Additions acquired on transfer of operations (note 23) - 33,776

Closing net book amount 33,776 33,776

At 31 December

Cost and net book amount 33,776 33,776

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

Company Registered office Class of shares held percentage of shares held

Malta Electronic Certification

Services Limited

Gattard Housenational roadBlata L-Bajda

Malta

Ordinary shares 2010 2009

100% 100%

6 INVeNToRIeS2010

€ 2009

€

Inventories held for resale 23,804 27,490

Other inventories 8,549 9,679

32,353 37,169

The amount of € Nil (2009: €3,417) representing write-downs of inventories is

recognised as an expense during the period.

7 TRADe AND oTHeR ReCeIVABleS2010

€ 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

8 SHoRT TeRM DepoSITS2010

€ 2009

€

Deposits held with bank 11,465,875 9,965,875

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.


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

9 CASH AND CASH eqUIVAleNTS2010

€ 2009

€

Cash at bank and in hand 2,044,983 3,184,261

10 fINANCe leASe lIABIlITIeS2010

€ 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

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)

present value of finance lease liabilities 3,441,707 4,553,164

The present value of finance lease liabilities is as follows:

not later than 1 year 1,273,151 1,288,212



11 DefeRReD TAxATIoN2010

€ 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 -


Future finance charges on finance lease 4,197,203 5,552,639

At end of year 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 pAYABleS2010 2009

€ €

Trade payables 1,941,166 3,139,588

Other payables 288,259 797,600

Amounts owed to subsidiary 50,421 50,421

Amounts owed to related parties 5,094,497 5,253,037

Indirect taxation 705,168 144,347

Accruals and deferred income 7,848,905 8,455,098

15,928,416 17,840,091

Amounts owed to related party are interest free, unsecured and repayable on demand.


13 ReVeNUePeriod 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

EU funding 189,111 -

Total services 21,919,509 20,015,940

Projects 3,063,559 4,002,715

Subvention 1,536,625 1,322,914

26,519,693 25,341,569


14 expeNSeS BY NATURePeriod from

18 August



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 309,558 334,852

Costs relating to projects and services 9,882,631 11,027,664

(Increase)/decrease in provision for impairment of receivables (37,648) 45,466

Impairment of receivables 21,826 -

operating lease:

Property 362,161 361,537

Motor vehicles and equipment 225,092 206,981

Services 684,323 672,676

Audit fees 4,750 4,750

Other expenses 1,230,086 448,498

Total cost of sales and administrative expenses 25,020,709 23,977,807

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 4,750

Other assurance services 2,330 2,330

Tax advisory and compliance services 1,472 -

Other non-audit services 71,920 66,203

80,472 73,283


15 eMploYee BeNefIT expeNSePeriod from

18 August



2010 2009

€ €

Salaries and employment benefits 9,403,806 8,745,039

Social security costs 569,839 527,795

9,973,645 9,272,834

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

2010 2010

Direct 227 214

Administration 102 99

329 313

16 fINANCe INCoMe Period from

18 August



2010 2009

€ €

Other charges 180,964 166,803

17 fINANCe CoSTS Period from

18 August



2010 2009

€ €

Other charges 4,266 4,826


18 TAx expeNSePeriod from

18 August



2010 2009

€ €

Current tax expense 467,136 357,076

Deferred tax expense (note 11) (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



2010 2009

€ €

Profit before tax 1,675,682 1,525,703

Tax on profit at 35% 586,489 533,996

Tax effect of:

Income subject to tax at 15% (36,193) (33,361)

Expenses not deductible for tax purposes 20,944 33,510

Temporary differences relating to equipment (158,540) 158,538

412,700 692,683


19 CASH GeNeRATeD fRoM opeRATIoNSreconciliation of operating profit to cash generated from operations:

Period from

18 August



2010 2009

€ €

Operating profit 1,498,984 1,363,762

Adjustments for:

Depreciation (note 4) 2,364,285 1,602,549

Loss on sale of property and equipment 229 798

(Increase)/decrease in provision for impairment of receivables (37,648) 44,764

Impairment of receivables 21,826 -

Changes in working capital:

Inventories 4,816 (429)

Trade and other receivables 1,111,340 1,636,601

Trade and other payables (1,753,135) 1,084,411

Cash generated from operations 3,210,697 5,732,456

21 CoMMITMeNTS2010 2009

€ €

Non-cancellable operating leases

Falling due within one year 4,819,938 4,444,768

Falling due between 2 and 5 years 11,001,640 13,778,561

Falling due after 5 years 189,290 369,270

16,010,868 18,592,599

Capital commitment - 1,397,624

Capital commitments – Authorised and not contracted for 6,685,000 -

Capital commitments – Contracted for 420,000 -

Uncalled issued share capital of MeCS limited 134,400 134,400

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.


22 RelATeD pARTY TRANSACTIoNS 2010 2009

€ €

Purchases of goods and services 395,033 1,856,447

Sales of goods and services (including recharges) 25,405,546 25,293,038

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:

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.


23 TRANSfeR of opeRATIoNS2009

€

Property and equipment 4,842,082

Investment in subsiduary 33,776

Inventories 36,740

Trade and other receivables 5,163,218

Short term deposits and cash equivalents 9,230,901

Finance lease liabilities (1,886,789)

Trade and other payables (11,502,645)

Finance lease liabilities (664,248)

5,253,035

Cash and cash equivalents acquired (763,818)

Cash inflow on transfer of operations 4,489,217

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:

In 2010 a deferred tax liability of €158,540 was transferred from MITTS Limited

to MITA.

MALTA INFORMATION TECHNOLOGY AGENCY

Gattard HouseNational RoadBlata-l-Bajda HMR 9010Malta

Tel No: (356) 2123 4710Fax No: (356) 2123 4701

www.mita.gov.mt

August 2011

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