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UNEMPLOYMENT INSURANCE FUND PRESENTATION TO THE PORTFOLIO COMMITTEE ON LABOUR

UNEMPLOYMENT INSURANCE FUND PRESENTATION TO THE PORTFOLIO COMMITTEE ON LABOUR. BUDGET REVIEW: 2014 DEPARTMENT OF LABOUR. 2014-07-02. CONTENTS. Vision, Mission and Legislative Mandates Background Planning, budgeting , reporting cycle and key planning concepts

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UNEMPLOYMENT INSURANCE FUND PRESENTATION TO THE PORTFOLIO COMMITTEE ON LABOUR

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  1. UNEMPLOYMENT INSURANCE FUND PRESENTATION TO THE PORTFOLIO COMMITTEE ON LABOUR BUDGET REVIEW: 2014 DEPARTMENT OF LABOUR 2014-07-02

  2. CONTENTS • Vision, Mission and Legislative Mandates • Background Planning, budgeting , reporting cycle and key planning concepts • Summary of the five year Strategic Plan 2014/15- 2018/19 • Performance Report against the 2013-14 Annual Performance Plan • Challenges and Mitigating Strategies • Annual Performance Plan 2014 -2015 • Summary of the Budget 2014/15 – 2016/17 years • Unemployment Insurance Bill (progress) Chief Directorate Communication | 2011.00.00

  3. Vision The Unemployment Insurance Fund strives to contribute to the alleviation of poverty in South Africa by providing effective short term unemployment insurance to all workers who qualify for unemployment and related benefits

  4. Mission The central purpose and role of the Unemployment Insurance Fund is defined as: • Rendering an effective accessible service to all stakeholders • Being a sustainable organisation with sufficient reserves • Administering the Fund professionally

  5. Legislation Mandates Unemployment Insurance Act, 2001 as amended • The Unemployment Insurance Fund (UIF) was established in terms of section 4(1) of the Unemployment Insurance Act, 2001 (Act 63 of 2001) as amended • The Act empowers the UIF to register all employers and employees in South Africa

  6. Legislative Mandates Unemployment Insurance Contributions Act, 2002 • Section 8 of the Act empowers the SARS Commissioner to collect monthly contributions from both employers and workers who are required to register as employers in terms of the fourth schedule to the Income Tax Act and who are liable for the payment of the skills development levy in terms of the Skills Development Act, 1999 (Act 9 of 1999). • Section 9 of the Act empowers the Unemployment Insurance Commissioner to collect contributions from all those employers who are not required to register as employers in terms of the fourth schedule to the Income Tax Act and who are not liable for the payment of the skills development levy in terms of the Skills Development Act, 1999 (Act 9 of 1999). • These contributions are utilised to pay benefits and any other expenditure reasonably incurred relating to the application of this Act.

  7. Planning, budgeting and reporting cycle

  8. Fiscal Years 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Election Election Election Electoral Cycle 5 Year Election Mandate 5 Year Election Mandate ... Planning & Budgeting MTEF MTEF MTEF MTEF 5-year Strategic Plan 5-year Strategic Plan ... • Strategic Plans Budget Budget Budget Budget Budget Budget Budget Budget Budget • Annual Performance Plans and Budgets (with MTEF) APP APP APP APP APP APP APP APP APP APP APP APP In-year Reporting MR MR MR MR MR MR MR MR MR MR MR MR MR MR MR MR MR MR MR MR MR MR MR MR MR MR MR MR MR MR MR MR MR MR MR MR MR MR MR MR MR MR MR MR MR MR MR MR • Monthly Financial Reports • Quarterly Performance Reports Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 AR AR AR AR AR AR AR AR AR AR AR AR End-year Reporting • Annual Reports (with annual financial statements) Long-term Reporting • End-term Reviews EPR EPR The relationship and timing of the different accountability documents Strategic & Annual Performance Plan Unemployment Insurance Fund

  9. Key Concept • Impact: the results of achieving specific outcomes .e.g. reducing poverty and creating jobs. “ what we aim to change” • Outcomes: medium term results for specific beneficiaries that are the consequence of achieving specific outputs. “what we wish to achieve”. Outcomes refer to a changed state of being and are stated in the present tense .e.g. Representative workforce • Outputs: the final product, or goods and services produced for delivery. “what we produce or deliver” . Outputs contain nouns e.g. A training programme for maths teachers

  10. Key Concepts • Activities: the processes or actions that use a range of inputs to produce the desired outputs and ultimately the outcomes. “what we do” • Inputs: all the resources that contribute to the production and delivery of outputs. “ what we use to do the work” • Performance Indicators: a measurement or other type of evidence that shows whether or not a goal is being achieved. A performance indicators contains a verb .e.g. reduce fraud opportunities by implementation of periodic controls

  11. UIF Strategic Plan2014/2015 – 2015/19 • Over the five year period, the UIF will pursue five strategic objectives to: • Fund Poverty Alleviation Schemes • Improve Governance • Strengthen the institutional capacity of the Fund • Encourage Compliance through enhanced service delivery • Improve Stakeholder Relations

  12. Link between Service Delivery Outcomes & Strategic Objectives

  13. UIF CONTRIBUTION TO THE NDP

  14. UIF CONTRIBUTION TO THE NDP

  15. PERFORMANCE REPORT AGAINST THE 2013-14 ANNUAL PERFORMANCE PLAN

  16. 4.1 ACTUAL PERFORMANCE DURING 2013/14 F/Y

  17. Strategic Objective 1: Fund Poverty Alleviation Schemes • The Minister of Labour approved and launched training 9 initiatives and committed R300 million for training of these unemployed beneficiaries. • The R 4 billion UIF/IDC partnership has resulted in 21,192 jobs saved and 23,268 jobs created since the inception of the partnership in 2009. • The proposal to create a Labour Activation Fund was submitted to the Minister on31 March 2014 and approval to proceed to the next step of feasibility approved.

  18. Strategic Objective 2: Improve Governance • 90% all fraudulent cases were investigated and finalized during the financial year • Internal Audit were conducted in 28 offices with 90% of reports presented to and signed off by management. Implementation of improvement recommendation is in progress.

  19. Strategic Objective 3: Strengthen the Institutional Capacity of the Fund • 88% of planned training interventions as per the Work Place Skills plan implemented by end of year. • Establishment of the Fund has 3.7% of People with Disability • Establishment of the Fund has 23% of the Youth

  20. Strategic Objective 4: Encourage Compliance through enhanced service delivery • 86% of claims approved or rejected within five weeks of application • A total of 4043 registered employees used uFiling to submit claims by the end of March 2014 – An increase of 84% compared to last year • 34% increase in Employers using U-Filing to declare and pay contributions as compared to prior year • A total of 61 new employers were registered by the end of March 2014 – An increase of 4% • 11.8% increase in contributions revenue to R 15,3 billion as compared to the previous year by March 2014

  21. Strategic Objective 4: Improve Stakeholder relations • provinces by the 31st March 2014 to create awareness in the community • Multi-Media campaign had a reach of 41 million people according to GCIS/All Media Survey by March 2014 • 36 Community Radio Stations were utilized during the Workers’ Month campaign • 4 MOUs have been signed between UIF and external stakeholders to improve service delivery efforts

  22. Performance Highlights 2013/2014

  23. CHALLENGES • Non compliance by employers in terms of compliance to the Unemployment Insurance Act and Unemployment Insurance Contribution

  24. MITIGATING STRATEGIES • Implementation of the uFiling System to provide for: • Electronic Submission of employee information • Electronic payment of contributions by employers • Online Claims application • Improvement of the claims processing functions in the Labour Centres

  25. UNEMPLOYMENT INSURANCE AMENDMNET BILL • Cabinet has approved the Bill in early 2013. • The Department released the Bill for public comments • After encapsulating public comments in the Bill, it was then tabled at NEDLAC for social partners to deliberate on the Bill • NEDLAC deliberations were concluded in November 2013 • Cabinet Approved the Bill in December 2013 for submission to Parliament for further processing.

  26. UNEMPLOYMENT INSURANCE AMENDMNET BILL The proposed amendments deal with a number of issues: • Inclusion of learners, public servants and foreign workers who are currently not covered in terms of the provisions of the UI Act currently • Extension of period of benefits to contributor from eight months to twelve months • Extension of a period in which a contributor can lodge a claim, from six months to twelve months • To allow beneficiaries to claim if they have credits regardless of when they last submitted a claim

  27. UNEMPLOYMENT INSURANCE AMENDMNET BILL The proposed amendments deal with a number of issues: (cont…) • To provide for the nomination of beneficiaries in case of death benefits • To assist in financing the employment promotion projects by the Public Employment Services • To give powers to the appeals committee to adjudicate on late applications for benefits • To give the Minister the power to vary the income replacement rate through Regulations

  28. UNEMPLOYMENT INSURANCE AMENDMNET BILL The proposed amendments deal with a number of issues: (cont…) • Delinks maternity benefits from unemployment benefits • Introduces a 66% fixed rate for maternity benefits • Paying full maternity benefits for miscarriage occurring in the 3rd trimester of pregnancy • Decrease of the waiting period for illness benefits from 14 days

  29. Chief Directorate Communication | 2013.00.00 Thank You…

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