COMPENSATION FUND STRATEGIC PLAN 2014/15 - 2018/19 AND 2015/16 APP PRESENTATION

1. COMPENSATION FUND STRATEGIC PLAN 2014/15 - 2018/19 AND 2015/16 APP PRESENTATION PORTFOLIO COMMITTEE: LABOUR 2015.03.25

2. TABLE OF CONTENTS • OVERVIEW AND OBJECTIVES OF THE FUND • DIRECTOR-GENERAL’S OVERVIEW 2.1 INTERVENTIONS 2.2 PROGRESS TO DATE 3. STRATEGIC PLAN 2014-2019 4. SUMMARY OF THE COMPENSATION FUND STRATEGIC PLAN 2015 – 2019 5. COMPENSATION FUND PROGRAMMES 6. SERVICE DELIVERY OUTCOMES 7. STRATEGIC OBJECTIVES AND OBJECTIVE STATEMENTS PER PROGRAMME 8. ANNUAL PERFORMANCE PLAN 2015/16 9. PERFORMANCE INDICATORS AND QUARTERLY TARGETS 10. FINANCIAL ALLOCATION FOR THE APP 11. WAY FORWARD

3. OVERVIEW AND OBJECTIVES OF THE FUND • The Compensation Fund is a public entity of the Department of Labour. • The Fund administers the Compensation for Occupational Injuries and Diseases Act no. 130/1993 as amended by the COIDA 61/1997. • The main objective of the Act is to provide compensation for disablement caused by occupational injuries or diseases sustained or contracted by employees, or for death resulting from such injuries or diseases, and provide for matters connected therewith. Chief Directorate Communication | 2011.00.00

4. DIRECTOR-GENERAL’S OVERVIEW The Compensation Fund has been experiencing challenges namely: • Financial Management • Disclaimer of audit opinion for a number of years now and the increase in the number of issues identified by the AG that were not resolved by management is an indicative of the weak internal controls. • Information Technology • ‘Teething’ challenges with the processing and payment of claims on the Umehluko systems. For example, there is no integration between claims processing and adjudication on the one hand and payments on the other. • Human Capital Management - Mismatch between the strategic needs of the Fund and the available skills, especially in the core business and finance. Whilst a number of middle and senior management appointments have been made, the impact has not yet been felt.

5. DIRECTOR-GENERAL’S OVERVIEW (CONT) • Customer Relationship Management • The Fund is currently not responsive to enquiries from the clients. This has in some instances led to unhappy clients escalating their issues to the offices of the CC, DG, DM and Minister. In other cases clients have sought relief in court. This has largely been attributed to inadequate information flow between the implementers and client relations officers. • Cumbersome Assessment Structure • The current assessment model and classification is outdated, open to abuse and manipulation and being highly complicated (too many classes). As a result, the AG always had issues with the completeness, validity of rates and the risk of collusion between employers and staff. • Incidents of Fraud and Corruption - As a result of ambiguous assessment structure, there have been incidents of fraud and corruption involving staff and employers. In addition, there have also been incidents of fraudulent claims between staff and some medical practitioners.

6. INTERVENTIONS • Initiated Project on Skills Audit • Initiated a ‘Smart Form’ project to reduce the use of paper applications • Intensified Training of Users on the Umehluko System • Developed a draft Policy on Employer Classification and Rating Model • The Minister appointed a Task Team to assist the Fund to address audit previous audit findings and prepare for upcoming financial year end • Developed and approved an Anti-Corruption and Fraud Strategy. In terms of the strategy all staff members will be expected to declare their financial interest • Appointed close to 100 Interns to assist in addressing backlog in the claims management environment • The Fund is currently assessing the possibility of reconfiguring organisational arrangements to ensure that the structure is able to respond appropriately to the constitutional mandate of the Fund

7. PROGRESS TO DATE • A service provider to conduct Skills Audit was appointed at the end of March 2015. SCM is in the process of finalising the Service Level Agreement. • Measures to Address Backlog: Since appointment these interns processed 65 543 invoices. The Team has also set a benchmark target of 250 invoices per user per day. This backlog will be finalised by end of June 2015. • A Cabinet Memorandum seeking to obtain approval for the implementation of the Policy on Employer Classification and Rating Model has been prepared and is en-route to Cabinet. • Consultations to make the declaration of financial interest for employees below the SMS level, a Department wide initiative are underway. In the interim, the necessary form and guidelines for completion have been designed. • A draft concept document on the reconfiguration of the organisational arrangements will be finalised by end of April 2015.

8. STRATEGIC PLAN 2014/15 – 2018/19

9. SUMMARY OF THE COMPENSATION FUND STRATEGIC PLAN 2015 - 2019 • The Compensation Fund (CF) Strategic Plan is a five year plan which takes into cognisance the Vision 2030 as espoused in the National Development Plan (NDP) and the Medium Term Strategic Framework (MTSF) 2014 – 2019. • The MTSF finds expression through the 14 priorities and actions (commonly referred to as outcomes) identified for implementation in the next five years.Two of the outcomes were the basis for the development of the Compensation Fund of the Strategic Plan: • Outcome 4: Decent employment through inclusive growth. • Outcome 12: An efficient, effective and development-oriented public service.

10. SUMMARY OF THE COMPENSATION FUND STRATEGIC PLAN 2015 – 2019 (Cont.) • Based on the two outcomes discussed above, the Compensation Fund has developed four key strategic outcome oriented goals, namely: • Improve payment of benefits to the beneficiaries of the Fund. • Improve the collection of revenue from employers. • Participate in government initiatives of creating and sustaining decent employment. • Effective administration of the Fund’s operations. • Based on the Strategic Plan, the Compensation Fund developed the 2015/16 Annual Performance Plan (APP). The APP focuses on the measures which will implemented in order to reach the five year objectives of the Strategic Plan. The APP includes indicators, annual and quarterly targets.

11. COMPENSATION FUND PROGRAMMES • Corporate Management And Executive Support 2. Financial Management 3. Operations Management 4. Corporate Services

12. SERVICE DELIVERY OUTCOMES

13. STRATEGIC OBJECTIVES AND OBJECTIVE STATEMENTS PER PROGRAMME

14. STRATEGIC OBJECTIVES AND OBJECTIVE STATEMENTS PER PROGRAMME

15. ANNUAL PERFORMANCE PLAN 2015/2016

16. CORPORATE MANAGEMENT AND EXECUTIVE SUPPORT’S PERFORMANCE INDICATORS AND QUARTERLY TARGETS FOR 2015 /16 FINANCIAL YEAR

17. CORPORATE MANAGEMENT AND EXECUTIVE SUPPORT’S PERFORMANCE INDICATORS AND QUARTERLY TARGETS FOR 2015 /16 FINANCIAL YEAR

18. CORPORATE MANAGEMENT AND EXECUTIVE SUPPORT’S PERFORMANCE INDICATORS AND QUARTERLY TARGETS FOR 2015 /16 FINANCIAL YEAR

19. FINANCIAL MANAGEMENT’S PERFORMANCE INDICATORS AND QUARTERLY TARGETS FOR 2015 /16 FINANCIAL YEAR

20. FINANCIAL MANAGEMENT’S PERFORMANCE INDICATORS AND QUARTERLY TARGETS FOR 2015 /16 FINANCIAL YEAR

21. OPERATIONS MANAGEMENT ’S PERFORMANCE INDICATORS AND QUARTERLY TARGETS FOR 2015 /16 FINANCIAL YEAR

22. OPERATIONS MANAGEMENT ’S PERFORMANCE INDICATORS AND QUARTERLY TARGETS FOR 2015 /16 FINANCIAL YEAR

23. OPERATIONS MANAGEMENT ’S PERFORMANCE INDICATORS AND QUARTERLY TARGETS FOR 2015 /16 FINANCIAL YEAR

24. OPERATIONS MANAGEMENT ’S PERFORMANCE INDICATORS AND QUARTERLY TARGETS FOR 2015 /16 FINANCIAL YEAR

25. CORPORATE SERVICES’ PERFORMANCE INDICATORS AND QUARTERLY TARGETS FOR 2015 /16 FINANCIAL YEAR

26. FINANCIAL ALLOCATION FOR THE 2015/16 APP Compensation Fund main cost drivers in 2015/16: • Approved Allocation: R 4 844 578 000 Approved Allocation Breakdown:

27. WAY FORWARD • It is recommended that the Portfolio Committee notes the Strategic Plan 2014-2019 and the Annual Performance Plan 2015/2016 of the Compensation Fund.

28. Compensation Fund | 2015.02.13 Thank You…