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Compensation Fund Challenges and Turnaround Initiatives

Compensation Fund Challenges and Turnaround Initiatives. Select Committee Presentation. Director-General : NPT Nhleko. 27 February 2013. CONTENTS. Objectives of the Fund. 1. Background. 2. Audit Findings. 3. Diagnostic Review Findings. 4. Interventions. 5. Looking forward. 6.

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Compensation Fund Challenges and Turnaround Initiatives

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  1. Compensation FundChallenges and Turnaround Initiatives Select Committee Presentation Director-General : NPT Nhleko 27 February 2013

  2. CONTENTS Objectives of the Fund 1 Background 2 Audit Findings 3 Diagnostic Review Findings 4 Interventions 5 Looking forward 6 Critical success factors 7

  3. OBJECTIVES OF THE FUND “To pay compensation for death or disablement caused by occupational injuries and diseases sustained or contracted by employees”

  4. BACKGROUND The Compensation Fund (CF) has historically been faced with various challenges in delivering efficient and timeous services to its stakeholders. These challenges can be categorised into people, processes and systems in the business capability areas/model. The acting capacity of the Director General in the Compensation Fund provided insight and appreciated the extent of challenges facing the organisation in its entirety. The challenges are complex in nature as they are systemic and have been in existence for years.

  5. AUDIT FINDINGS

  6. OVERVIEW OF AUDIT FINDINGS 2008/9 2009/10 2010/11 2011/12 Revenue Management and Debtors Qualification Qualification Disclaimer Disclaimer Disclaimer Disclaimer Claims Bank Reconciliations Disclaimer Disclaimer Qualification Qualification Qualification Cleared Qualification Cleared

  7. Audit Analysis - Areas of high concern (2011/12) Source : AG Management Report 2012

  8. Audit Analysis - Areas of high concern (2011/12)

  9. DIAGNOSTIC REVIEW FINDINGS

  10. STRATEGIC CHALLENGES The following issues and challenges were found to be plaguing the Fund and preventing it from optimally delivering services to all its stakeholders. Source : CF Diagnostic Review

  11. STRATEGIC CHALLENGES contd… Source : CF Diagnostic Review

  12. BUSINESS CAPABILITY CHALLENGES

  13. INTERVENTIONS

  14. SHORT TO MEDIUM (6 MONTHS)

  15. SHORT TO MEDIUM (6 MONTHS)

  16. SHORT TO MEDIUM (6 MONTHS)

  17. SHORT TO MEDIUM (6 MONTHS)

  18. SHORT TO MEDIUM (6 MONTHS)

  19. LOOKING FORWARD

  20. LONG TERM INTERVENTIONS The Compensation Fund is a going-concern that would require Operational and Strategic Interventions Strategic Projects Business Operating Model Organisational Values and Culture Organisational Strategy and Structure Operational Projects Business Processes and Policies Performance Management Framework Fraud and Risk Management Strategy Skills Assessment Change Management Revenue and Debt Management Strategy IT Strategy Source : CF Diagnostic Review

  21. IDEAL VALUE CHAIN Ideally, the primary business of the Fund is to generate income, pay out claims and manage the rehabilitation of claimants. These functions are then supported by common back-office support services that include HR, Finance, Procurement, Information Technology, Governance and Compliance and Risk and Audit Management. Manage Service Delivery Revenue Management Claims Management RehabilitationManagement • Employer Registration • Customer Segmentation • Monitoring • Claim Registration • Claim Pre-processing • Claims Processing • Adjudication • Claim status reporting • Dispute Management • Investigations • Dispute Settlements • Recovery of Expenses from 3rd parties • Fraud and risk management • Employer declaration • Contribution Determination • Payment Management (contributions) • Payment Processing • Approve payment • Beneficiary payments • Monitoring • Restoration and re-integration of workers • Provision of assistive devices • Reporting • Implementation of Funds Strategy • Monitoring Investments Performance • Managing external investment managers • Review Policy and Framework • Reporting • Registration • Processing • Payments • Reporting Risk Management Governance& Compliance Support Services (HR , Finance, Supply Chain, Communications, ICT, Legal services) Source : CF Diagnostic Review

  22. CRITICAL SUCCESS FACTORS

  23. FACTORS TO MAKING THIS PROCESS SUCCESSFUL • Project is owned and reported directly to the Director-General • Dedicated project team appointed • External expertise on project team • Communications and interactions with all stakeholders • Governance processes to be followed eg. supply chain management • Buy-in and acceptance by stakeholders • Continuous change management

  24. THANK YOU

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