unemployment insurance fund strategic planpmg-assets.s3-website-eu-west-1.amazonaws.com/uif... ·...

UNEMPLOYMENT INSURANCE FUND ANNUAL PERFORMANCE PLAN FOR THE FINANCIAL YEAR 2018/19

UNEMPLOYMENT INSURANCE FUND

Strategic Plan__________________________________________________________

Strategic Plan 2018/19 - 2022/23


First published in 2018, by the Unemployment Insurance Fund (UIF)

Copyright © 2018

Directorate: Communication & Marketing

Pretoria, South Africa

ISBN: 978-0-621-46182-4

RP79-2018

2


Foreword by Minister Foreword by the Accounting Authority Commissioner’s Statement Official Sign-Off

PART A: STRATEGIC OVERVIEW

1. Vision, Mission and Values 1.1 Vision 1.2 Mission 1.3 Values 1.4 Vision, Mission strategic Objectives, Outputs, Key Performance Indicators, Critical Success Factors & Values. 1.5 Organisational Environment 1.6 Organisational Structure Description Per Programme

2. Legislative And Other Mandates 2.1 Constitutional Mandate 2.2 Legislative Mandate 2.3 Policy Mandate 2.4 Relevant Court Rulings 2.5 Planned Policy Initiatives

3. Situational Analysis 3.1 Performance Environment 3.2 Description of the strategic planning process

4. Strategic Outcome Oriented Goals

PART B: NEW STRATEGIC OBJECTIVES OF THE FUND PER PROGRAMME.

5. Programme Strategic Objectives 5.1 Programme 1: Administration 5.2 Programme 2: Business Operations 5.3 Programme 3: Labour Activation Programme

6. Overview of the 2018/19 Budget and MTEF Estimates 6.1 Expenditure Estimates

ANNEXURE A

Acronyms

TABLE OF CONTENTS

3

4. 5. 6. 8.


10. 11. 12.

14. 15.16. 16. 17. 18. 19.

20.

22.

PART B: STRATEGIC OBJECTIVES OF THE

23. 24. 25. 30. 26.

28.PART B

32.


Strategic planning in the Unemployment Insurance Fund (UIF) is currently guided by the Medium Term Strategic Framework (MTSF) which reflects the national key priorities of Government. The plan contains the Fund’s response to the strategic priorities that talk to the Department of Labour’s remit for the period 2018/19 to 2022/23. The strategic objectives and outputs contained in this strategic plan are central to the Fund’s activities and are aimed at contributing to service delivery outcomes such as:

• The creation of decent employment through inclusive economic growth; • Realising an efficient, effective and development oriented public service and an empowered and inclusive citizenship; and• An inclusive and responsive social protection system.

The Four Strategic Outcomes’ Goals are to:

• Improve revenue collection from employers;• Improve benefit payment to beneficiaries; • Participate in government initiatives of creating and sustaining decent employment; and • Ensure effective administration of the UIF operations.

This strategic plan is aligned to the National Development Plan (NDP) and resources will be mobilised to realise the objectives of the NDP that resonate with the mandate of the Fund.

We have set ourselves challenging milestones through this strategic plan and we commit to the implementation of this plan working very closely with all our social partners.

______________________________________

MN OLIPHANT, MPMINISTER OF LABOUR(EXECUTIVE AUTHORITY OF THE DEPARTMENT OF LABOUR)

Signed:

4

FOREWORD BY MINISTER


FOREWORD BY THE ACCOUNTING AUTHORITY

______________________________________

TM. LAMATIDIRECTOR GENERAL

Signed:

The UIF has in the last few years contributed greatly to poverty alleviation by extending its coverage to vulnerable workers. It has managed to transform the organization by improving the internal control environment. This can be attributable to good work done by the UIF Board, Management and Staff which saw the UIF receiving the ten consecutive unqualified audit reports from the Auditor General. However, the blight to the sterling previous performance of the Fund is the disclaimer audit opinion for the 2017/18 financial year for which we have raised our concern.

The Commissioner has made an undertaking

to turn the situation around and take UIF back to its glory days, and as the department we are committed to provide support for him to achieve this.

UIF has adopted a new vision that seeks to reposition it as a caring, customer-centric organisation, and we anticipate that the new vision will drive the Fund to greatly improve service delivery from the 2018/19 financial year and beyond.

During the 2018/19 MTEF period, the Fund will pursue the following six strategic objec-tives:• Ensure financial sustainability;• Strengthen institutional capacity of the Fund;• Improve service delivery;• Collaborate with stakeholders to improve compliance with UIF Acts;• Provide easy to use services through multiple access points; and• Enhance employability of UIF beneficiaries, enable entrepreunrship and preserve jobs.

These strategic objectives are derived from the four strategic outcomes targeted which were informed by the following three of the fourteen Government outcomes:

• The creation of decent employment through inclusive economic growth; • Realising an efficient, effective and development oriented public service and an empowered and inclusive citizenship; and• An inclusive and responsive social protection system.

The organisation is also keenly aware that in order to achieve its strategic objectives it has to collaborate with stakeholders such as the South African Revenue Services, other State Owned Entities, National, Municipal and Provincial governments, Employer organisations, and Labour unions among others. Collaboration with these stakeholders will harness the Fund’s ability to improve service delivery.

5


COMMISSIONER’S STATEMENT

The Unemployment Insurance Fund (UIF), as the only state institution mandated to provide short - term insurance to vulnerable workers plays a critical role in alleviating poverty in South Africa. In order to effectively deliver on this mandate, the Fund decided to review its mission, vision and objectives to reposition the organisation as a customer-centric organisation. The new vision places the customer at the centre of every activity of the Fund. It proposes the rendering of excellent service to our customers in a courteous and caring manner.

Through the analysis of our service delivery value chain, we have been able to identify gaps and bottlenecks that contribute to the frustration and dissatisfaction of our customers and

stakeholders. To address these challenges, the Fund has developed the Service Delivery Action Plan which outlines key interventions such as reviewing of business processes, upgrading of IT infrastructure, leveraging on IT tools that promote greater self - service, integration of ICT systems, review of the labour centre model and increasing staff capacity through training.

All mentioned interventions are at various stages of implementation. For example we have already started piloting the Queue Management system in three provinces. The positive feedback from our customers indicates that we are on the right path; the next step is to address some of the teething problems that were identified during the piloting and rolling out the system in all labour centres.

We have made the commitment to be a forward thinking organisation by tapping into new technologies as means of delivering excellent service using affordable multiple channels. We have on our plan the determination to explore installation of Wi-Fi facilities at our Labour Centres. We believe this initiative will inculcate a culture of self-service amongst our customers, which will subsequently position us as an institution that not only is concerned with quantifying the number of claims processed during a particular period, but also as the one that provides support to our customers through innovative technology.

Our commitment to improve service delivery prompted us to also segregate and review turn - around times for processing of each benefit. The turn-around time for the unemployment benefit, which accounts for 90% of claims has been reduced from 30 days to 20 days. The intention is to ensure that our timeous intervention helps to reduce the impact of poverty amongst our citizens

6


The Fund has been working tirelessly towards the implementation of the Unemployment Insurance Amendment Act of 2016. We have addressed all problems that have hampered us from implementing the Act and we anticipate the promulgation of the implementation date to be announced during the 208/19 financial year. We believe the implementation of the Act will drastically improve the lives of our beneficiaries as they will be able to enjoy the benefits for a longer period of time at no extra cost.

According to the latest figures from StatsSA unemployment stood at 27,7%, which has a corresponding increase in the number of unemployment claims lodged with the Fund. Our effort to fight the scourge of unemployment has not been limited to only paying close to R 40 million worth of claims per day, but we have also responded by funding poverty alleviation schemes administered under the Labour Activation Programmes (LAP) business unit.

In an effort to elevate the role played by LAP in poverty alleviation, we have reviewed its objectives to sharpen its focus and increased the targets to achieve greater impact. The UIF Board has also established a LAP Sub-Committee to oversee LAP functions and address any bottlenecks to achieve greater efficiency.

The Fund remains committed to maintaining the current sound financial position and constantly ensures that revenue collection constantly improves, and compliance is enforced.

The two recent developments at PIC where the CEO was accused of mismanagement and sharp decline in the value of UIF equity at Steinhoff got the UIF board and management very concerned. In both instances UIF was swift to call the CEO to apprise the Board and management on these issues, and in both instances the Board and management were quite satisfied. The CEO undertook to update the Board on new developments.

UIF will continue to maintain sound relations with all strategic stakeholders such DoL, PIC, Nedlac, other SOEs, and Banks among others. These stakeholders play a pivotal role in assisting the Fund to achieve its objectives and executing its mandate.

We are thankful for the tireless support of the Minister, Deputy Minister and the Director General of the Department of Labour, and we look forward to their continued support as we implement the 2018/19 - 2022/23 strategic plan.

______________________________________

T. MARUPINGUNEMPLOYMENT INSURANCE COMMISSIONER

7


It is hereby certified that this Annual Performance Plan:

• Was developed by the management of the Unemployment Insurance Fund under the guidance of the Minister of Labour, MN Oliphant and Deputy Minister SP Holomisa;• Was prepared in line with the National Development Plan; and• Accurately reflects the strategic outcomes oriented goals and objectives which the Unemployment Insurance Fund will endeavour to achieve over the period 2018/19 - 2022/23.

OFFICIAL SIGN-OFF

H. MHLONGO

CHIEF DIRECTOR: CORPORATE SERVICES

SIGNATURE:__________________________

NB. MNCONYWACHIEF DIRECTOR: LABOUR ACTIVATION PROGRAMME

SIGNATURE:__________________________

F. PUZICHIEF FINANCIAL OFFICER

SIGNATURE:__________________________

8

J. KUMBICHIEF DIRECTOR: OPERATIONS

SIGNATURE:__________________________


T. LAMATIDIRECTOR-GENERAL: LABOUR

SIGNATURE:__________________________

APPROVED BY:M. OLIPHANTMINISTER OF LABOUR

SIGNATURE:__________________________

T. MARUPINGUNEMPLOYEMENT INSURANCE COMMISSIONER

SIGNATURE:__________________________

X. MONAKALICHIEF INFORMATION OFFICER

SIGNATURE:__________________________

S.P. HOLOMISA, MPDEPUTY MINISTER: LABOUR

SIGNATURE:__________________________

9



The UIF’s strategic plan is derived from the Minister of Labour’s service delivery agreement and policy directives from the Department of Labour. The strategic plan sets out the broad strategic goals and objectives that the UIF pursues over the medium term. The UIF is on a continuous journey to meet the needs of its clients, align its work with international best practice and understands that the pursuit and search for relevance remains its critical responsibility.

Our strategy is the key business driver for all areas in the organisation and aims to align all activities and people to a common purpose. This Strategic Plan document includes the key aspects of the Fund’s strategy for the period 2018/19 to 2022/23 and it is informed by the strengths, weaknesses, threats and opportunities identified. A series of fundamental statements relating to the UIF’s vision, mission, values and objectives guides the Fund’s proposed strategic initiatives and action plans. This strategic plan is also informed by the National Development Plan as well as the Medium Term Strategic Framework.

It is a fact that a high percentage of the South African workforce is not covered by UIF. This poses a challenge which needs a comprehensive strategy which will ensure that all qualifying workers are protected as legislated by the Act. This Strategic Plan provides a clear strategic direction for the UIF to address this challenge as well as ensuring overall improvement in service delivery.

The services of the UIF are carried out through the Department at 126 Labour Centres spread throughout the nine provinces. The service delivery model of the Department is a decentralisation and integrated model which requires undivided attention; as such the UIF will focus in this area to improve service delivery.

The Unemployment Insurance Board oversees the processes of planning and budget preparations, and recommends to both the Minister (Executive Authority) and the Director-General Labour (Accounting Authority) the approval of the Fund’s Medium Term Expenditure Framework. The Board will continue to ensure that the Fund’s mandate is taken to the next level of improved service delivery.

1.1 VISION

1. VISION, MISSION AND VALUES

Based on the strategic context, the proposed strategic direction, the Board considerations, and the various discussions and inputs from stakeholders, the UIF proposes some changes to its vision and mission to make them more relevant.

CURRENT VISIONThe UIF strives to contribute to the

alleviation of poverty in SA by providing effective short term unemployment insurance to all

workers who qualify for unemployment and related benefits

NEW VISIONA caring, accessible and customer

centric UIF that contributes towards poverty alleviation.

10


The new vision can be further elaborated as follows:• CARING: After interacting with the UIF, customers should feel that their needs are being addressed, and that the UIF empathises and solves the customers queries or problems;

• ACCESSIBLE: The customer should be able to access the UIF through a variety of channels and locations. Increasing customer convenience should be at the centre of any planned ease of access measures; and

• CUSTOMER-CENTRIC: The customer should be placed at the centre of the UIF’s processes and procedures. Business activities and relief processes should support the idea of being customer centric.

The new mission can be further elaborated as follows:• MULTIPLE CHANNELS: Clients should be able to access the UIF and its services through various channels and across different physical locations. All this is aimed at increasing the UIF’s accessibility to its customers

• FINANCIAL RELIEF: Monetary claims paid out to contributors;

• SOCIAL RELIEF: Non-financial aspect of unemployment relief such as that provided under the Labour Activation Programme, e.g. training;

• RIGHT PERSON: The claim should be paid directly to the contributor.

• RIGHT TIME: The claim should be paid out at the time when the contributor requires it.

• EVERY TIME: complete applications should receive the correct form of relief every time.

1.2 MISSION

CURRENT MISSIONThe central purpose of the UIF is

defined as:

• Rendering an effective accessible service to all stakeholders;

• Being a sustainable organisation with sufficient reserves; and

• Administering the UIF profes-sionally.

NEW MISSIONThrough multiple channels, we will

deliver both financial and social relief, to the right person, at the right time,

every time.

11


FINANCIAL REPORTINGCompilation and submission of the Annual Financial Statement and Auditor General as well as publication of AFS in the annual report. Management of financial reporting; and Provision of financial systems support.

INCOME MANAGEMENTManagement of revenue and debt collection processes; andManagement of payroll audits and enforcement.

INFORMATION AND COMMUNICATION TECHNOLOGY.Manage the Fund’sprojects; and Develop and implement ICT governance model

1.4 VISION, MISSION, STRATEGIC OBJECTIVES, OUTPUTS, KEY PERFORMANCE INDICATORS, CRITICAL SUCCESS FACTORS & VALUES.

VISIONA caring, accessible and customer

centric UIF that contributes towards poverty alleviation

MISSIONThrough multiple channels, we will

deliver both financial and social relief, to the right person, at the right time,

every time.

VALUESTransparency, Mutual respect, Client-centered services, Integrity, Accountability,

Team work, Caring for our people

12

TRANSPARENCYWe will be open to all stakeholders

without reservations on dealings within the fund.

MUTUAL RESPECTWe will respect our colleagues and stakeholders and treat them as we

want to be treated.

CLIENT-CENTRED SERVICEWe will achieve a total customer

satisfaction by providing excellent and world class services to our

stakeholders.INTEGRITY

We will communicate openly, honestly and build relationships

based on trust.

ACCOUNTABILITY We will own up to our

responsibilities in relation to our behaviour, actions and results

TEAMWORKWe will involve each other, work together across the organisation, seek ideas and share solutions.

CARING FOR OUR PEOPLEWe treat employees with care, dignity and respect. We grow our people for performance excellence.

1.3. VALUES

The UIF subscribes to the following values;


13

STRATEGIC OBJECTIVES

CRITICAL SUCCESS FACTORS

OUTPUTS

Ensure financial

sustainability

Strengthen institutional

capacity of the Fund.

Improve service delivery

Collaborate with stakeholders

to improve compliance with

UIF Acts

Provide easy to use services

through multiple access points

Enhance employability of

UIF beneficiaries,

enable entrepreneurship and preserve jobs

Sound financial

management

Social responsible investment

80% of Social Responsible investment

100% of invoices

paid within 30 calendar days

after receipt by the UIF

Vacancy rate reduced to

≤ 10%

90% of benefits claims

processed within 15% working days

95% of new companies issued with registration

document within 2 working days

Free WI-FI in 126 sites

SAP release 1 implemented

65 000 new registered employers

250 000 new employees

registered with the Fund

450 000 beneficiaries provided with

learning and/or work place experience

90% of Training Lay-Off

Scheme approved within 20 working days

Maintain Staff establishment

Improve client service

Ease of doing business

Improved compliance

Improved Technology

Enhanced employability, preserve jobs.


14

1.5 CURRENT ORGANISATIONAL STRUCTURE

DIRECTORATE:RISK

MANAGEMENT

UNEMPLOYMENT INSURANCE COMMISSIONER

DIRECTORATE:INTERNAL AUDIT

CHIEFDIRECTORATE:CORPORATE

SERVICES

CHIEFDIRECTORATE:OPERATIONS

CHIEFFINANCIALOFFICER

CHIEFDIRECTORATE:

LABOURACTIVATION

PROGRAMME

Directorate: Human Resource

Management

Directorate:Compliance

Directorate:Organisational Development

Directorate:Provincial Support

Directorate: Legal Services

Directorate:Information and Communication

Technology

Directorate: Communications and

Marketing

Directorate: Operations

Directorate: Labour Activation

Programme


Programme

Directorate:Investment

Management and Actuarial Services

Directorate: Budget Expanditure and

Bank Reconciliation

Directorate: Supply Chain Management

Directorate: Income

Directorate: Financial Reporting


Programme

Directorate: Policy Development, Strategic Planning,

Monitoring & Evaluation

Directorate:Board Services


15

1.6 ORGANISATIONAL STRUCTURE DESCRIPTION PER PROGRAMME.

A. PROGRAMME 1: ADMINISTRATIONProgramme purpose: To provide management, strategic and administrative support to the fund

OFFICE OF THE COMMISSIONERProvide strategicleadership and overall management ragarding the administration and overall operations of the Fund

CORPORATE SERVICESTo provide support and an enabling environment for the Fund to meet its strategic objectives through placing the right people at the right time.

CHIEF FINANCIAL OFFICERProvide financial governance on financial management and accounting services of the Fund.

INVESTMENT MANAGEMENTProvide financial governance on financial management and accounting services of the Fund.

SUPPLY CHAINMANAGEMENT AND AUXILIARY SERVICES•Enhance supply chain management processes and systems to be in line with the regulatory framework and governance best practices. •Provision of intergrated financial administration and supply chain management services •Records management; & •Assets facilities management.

EXPENDITURE, BUDGET, AND BANK RECONCILIATIONS•Creditor and expenditure management.•Claims payments; •Reconciliation of bank accounts; & •Intergated budget planning and management.

HUMAN RESOURCE MANAGEMENT•Training and development of staff; •Maintaining sound labour relations; •Promoting equality in the Fund; •Performance management; •Recruitment and selection; & •Provision of service condition and benefits.•Protection of vulnerable workers.

INTERNAL AUDITIndependently focus on reviewing the internal controls of the Fund; reviewing risk management, governance processes and programs of the Fund

RISKMANAGEMENTEnterprise wide risk management; and fraud investigations

COMMUNICATION & MARKETING•Provision of communication services;•Provision of marketing services; and •Advertising, branding and publications.

INFORMATION & COMMUNICATION TECHNOLOGY•Manage the Funds projects; and Develop and implement ICT governance model.

FINANCIAL REPORTING•Compilation and submission of the Annual Financial Statement and Auditor General as well as publication of AFS in the annual report. •Management of financial reporting; and •Provision of financial systems support.

LEGAL SERVICES•Provision of legal services

ORGANISATIONAL EFFECTIVENESS•Job design and evaluation;•Change management; and •Business process development and mapping

BOARD SERVICES•Enhance good governance of the organisation;•Board support and administration;•Compliance management & Governance;•Security management services. Policy management

INCOME MANAGEMENT•Management of revenue & debt collection process & management of payroll audits & enforcement.


16

PROGRAMME 2: BUSINESS OPERATIONSProgramme purpose: To collect contributions and pay benefits.

The programme consists of the below sub-programmes:

Chief Directorate: Operations• Management and administration of benefits payments;• Management and administration of declaration processes;• Monitoring of provincial office performance;• Provision of Call Centre services; and• Registration of employers.

PROGRAMME 3: LABOUR ACTIVATION PROGRAMMEProgramme purpose: Provide strategic leadership and guidance on the implementation of the Labour Activation Programmes.Chief Directorate: Labour Activation Programme• Develop strategies and policies to guide the monitoring of Labour Activation Programmes.• Maintain partnership and network with relevant stakeholders involved in Labour Activation Programmes.• Provide funding to the institutions identified with the responsibility of executing Labour Activation Programmes.

2. LEGISLATIVE AND MANDATES

2.1 CONSTITUTIONAL MANDATE

2.2 LEGISLATIVE MANDATE

The UIF is a Schedule 3 A public entity in terms of the Public Finance Management Act (PMFA), 1 of 1999.

The supreme mandate of the UIF is derived from section 27 (1) (c) of the Constitution of the Republic of South Africa. The UIF provides social security to its contributors in line with section 27 (1) (c) which states that “everyone has the right to social security”.

The mandate of UIF is stated in the Unemployment Insurance Act (Act 63 of 2001) as amended. The UIF was established in terms of section 4(1) of the UIA. The Act empowers the UIF to register all employers and employees in South Africa and pay those who qualify for unemployment insurance benefits.


17

2.3 POLICY MANDATE

The Unemployment Contributions Act (Act 4 of 2002) empowers the SARS Commissioner and the UI Commissioner to collect monthly contributions from both employers and employees. Section 9 of the UCA empowers the UI Commissioner to collect contributions from all those employers who are not required to register as employers in terms of the fourth schedule of the Income Tax Act (Act 58 of 1962) and who are not liable for the payment of the skills development levy in terms of the Skill Development Act (Act 9 of 1999). These contributions are used to pay benefits and other expenditure reasonably incurred relating to the application of the Act.

The UIF is expected to make a contribution to the following service delivery outcomes:• Creation of decent employment through inclusive economic growth;• An efficient, effective and development-oriented public service and an empowered and inclusive citizenship; and• An inclusive and responsive social security system.

Overall, the UIF is expected to provide adequate social safety nets to protect vulnerable workers.

The Fund administers the following legislations:

• Unemployment Insurance Act, 30 of 2001, as amended (UIA). Purpose: the Act empowers the UIF to register all employers and employees in in South Africa for unemployment insurance benefits.• Unemployment Insurance Contributions Act, 4 of 2002. Purpose: to provide for the imposition and collection of contributions for the benefit of the Unemployment Insurance Fund; and to provide for matters connected therewith.


18

PARTIESAMOUNT CLAIMED

NATUREOF CLAIM

ATTORNEYS PARTICULARSSTATUS

1. S Khepelele

VsMinister of Labour

Still to be determined

Payment of unemployment

benefits of ex-mine worker.

Still pending State Attorney.Mr V. Siphondo [email protected] : (021) 441-9200

Still pending

State Attorney Ms. T. Naidoo [email protected]: (011) 330 7600 (EXT 7727)

2.H. Saqqid

VsMinister of Labour

and another

Still to bedetermined

Unemployment benefits

3.H. Phili

vsThe Minister of

the Department of Labour

Benefits still to be determined Maternity benefits Still pending

State Attorney Ms M. [email protected]: (031) 365 2554

4.B.P Mzamo

vsUIF and another

Costs still to be determined

Cancellation of the Mortgage Bond Still pending

State Attorney Ms Dlanjwa [email protected]: (043) 706 5100 / 19

5.MICT SETA

vsUIF and another

1st claim: R 3 440 766.00

2ndclaim: R 11 411 847.77

Payment for services rendered

in terms of the Funding

agreement.

UIF paid MICT SETA. The matter

was finalised.

State Attorney Mr. S. [email protected]: (012) 309 1528

6.B. E. Ndlovu

vsThe Minister of

the Department of Labour

Benefits still to be determined

Death/dependent’s benefits Still pending

State Attorney Mr. T. Skosana [email protected]: (031) 365 2546

7.V. Tengo

vsThe Minister of

the of Labour and another

Still to bedetermined

Payment of the illness benefits

Matter is still pending

State AttorneyMs. L. Hart [email protected] Tel: (041) 585 7921

2.4 RELEVANT COURT RULINGS


19

2.5 PLANNED POLICY INITIATIVES

The amendments to the Unemployment Insurance Act No. 63 of 2001 relate toimprovements of benefits and administrative changes regarding the submission of information by employers to the organisation. The UI amendment Act of 2017 was accented to by the President in January 2017.

3. SITUATIONAL ANALYSIS

Due to the economic crisis South Africa is experiencing a rise in unemployment. This is shown by the high number of claims approved by the UIF that have been always above seven hundred thousand in the past five years. The new administration introduced the National Development Plan (NDP) so that it can deal with risingunemployment.

The NDP proposes that social security reforms should be undertaken to ensure, among others, the following:• Expanding public employment to provide work for the unemployed, particularly youth and women;• Closing the retirement savings and risk benefit gap through reforms, including mandatory contributions, with consideration given to government subsidising these contributions for low income or periodic workers; and• Integrating databases in the social security environment to enable communities to conduct social audits of government services, leading to better and more effective targeting of government’s social and employment programmes.

In this regard, the UIF has established a Labour Activation Programme (LAP) as one of the active labour market interventions. The LAP seeks to engage and promote activities that preserve and create jobs, and focuses on:

• Enhancing the employability of UIF beneficiaries;• Re-introducing working-age UIF beneficiaries into work;• Supporting job preservation;• Accessible LAP services; and• Enabling entrepreneurial environment.


20

3.1 PERFORMANCE ENVIRONMENT

The services of the UIF are carried out through the 126 labour centres of the Department of Labour spread across the nine provinces. The service delivery model of the department is decentralised and integrated and requires specific attention. As such, the Fund will continue to focus on this area to improve service delivery as in the past financial year 2017/18.

Efficiency improved with 89% of claims finalized within five weeks. In order to improve the turnaround times for the claims, the UIF has successfully piloted web based claims system which enables claimants to lodge their claims through the internet. More than twenty thousand (20 000) beneficiaries were able to claim from the comfort of their homes. Revenue collection also increased by 6.6% as compared to the previous year. Enforcing compliance to the Unemployment Insurance Acts has always been one of the challenges; however the online u-filling system has increased the number of employers declaring their employees. More than seventeen thousand employers were registered on u-filling.

There are challenges in the Taxi industry with regard to how the industry operates. This results in employers being reluctant to register for UIF purposes. This deprives their employees of the benefits available from the UIF. In addition to sending the Inspectors to the industry to enforce compliance, we are in discussions with the department of transport in order for us to access their database of registered taxis. Enforcing compliance will be easy as soon as we get details of the owners and their business addresses.

3.2 DESCRIPTION OF THE STRATEGIC PLANNING PROCESS

Description of the Strategic Planning Process

1st Performance Review inJune/July

Strategic Planning Session

(1st Draft SP & APP) In August

Mid Term Review(2nd Draft SP & APP)

In October/November

Directorate Planning Sessions

Approved Strategy & APP in January

Tabling of SP & APP In February


21

The first step, the UIF undertakes an annual evaluation of the previous financial year, and considers proposals on key priorities and budget requirements for the coming MTEF cycle. The key priorities and strategic objectives are informed by the MTSF and service delivery outcomes specific to the Fund. This process is the basis for the Fund to submit the first draft Annual Performance Plan to National Treasury at the end of August each year.

The second step is a strategic planning consultation process that takes places from August to the end of November each year. The focus of the consultation process is to take stock of the previous years’ financial and non-financial performance and chart the way forward for the MTEF period in terms of the strategic objectives, key deliverables and budget.

The third step is a Mid-Term Review and Planning workshop which takes place at the end of the second quarter of every year. Whilst the focus of this session is amid-term review of progress with regards to the current performance of the Department, it equally ensures that the agreed priorities of the annual evaluation are developed into a concrete programme of action (Annual Performance Plan) taking into account the possible MTEF allocations for the following year. This will allow the Department to submit the second draft Annual Performance Plan to National Treasury at the end of November.

The fourth step entails the strategic planning sessions of the branches to finalize on agreed priorities of the annual evaluation and mid-term review and formulate the annual work plans of the branches taking into account the possible MTEF allocations for the following year.

The fifth step is the finalisation and approval of the Strategic Plan and Annual Performance Plan in line with the allocated funds. This will lead to agreed targets and resource allocations between the DG and branch heads with the COO/Chief Directors: Provincial Operations by the end of January. The APP will inform the DG’s performance agreement (Integrated Work Plan), and is cascaded down to branches and provincial operations’ work plans and performance agreements.

The sixth step and final step in a given planning cycle is the approval of the Strategic Plan and the Annual Performance Plan and for tabling to Parliament by the Minister by March every year.


4. STRATEGIC OBJECTIVES AND OUTCOME ORIENTED GOALS

The fund also needs to contribute mainly to the following strategic objectives, outcomes and goals of the Department of Labour:

22

STRATEGIC OBJECTIVE OUTCOME GOAL STATEMENTStrategic Objective 1• Ensure Financial Sustainability.

Decent employment through inclusive economic growth.

• Promote Occupational and health services;• Contribute to decent employment creation;• Protect vulnerable workers;• Strengthen occupational safety protection;• Promote sound labour relations;• Monitor the impact of legislation and• Development of the occupational Health and Safety policies

Strategic Objective 2• Strengthen the institutional capacity of the Fund.

(DOL strategic objective 8, Outcome 12).

• Maintain vacancy rate at 10%

Strategic Objective 3• Improve service delivery.

Create a better South Africa, a better Africa and a better World

• Contribute in the various schemes designed to alleviate the harmful effects of unemployment which includes investing mandated funds in the Social Responsible Investments

Strategic Objective 4• Collaborate with stakeholders to improve compliance with UIF Acts.

An efficient, effective and development oriented public service.

• Strengthening the institutional capacity of the Department

Strategic Objective 5• Provide easy to use services through multiple access points

Transforming society and unit-ing the country

• Promote equity in the labour market

Strategic Objective 6• Enhance employability of UIF beneficiaries and preserve jobs, enable entrepreneurship and preserve jobs.

Decent employment through inclusive economic growth.

• To increase the Fund’s participation in the schemes aimed at training of unemployed UI contributors, preserve jobs and creating the enabling environment that enhance the entrepreneurship.


PART B: NEW STRATEGIC OBJECTIVES OF THE FUND PER PROGRAMME.

5. PROGRAMME STRATEGIC OBJECTIVES 5.1 PROGRAMME 1: ADMINISTRATION.

Programme purpose: To provide management, strategic and administrative support to the fund.

23

STRATEGIC OBJECTIVE 1 ENSURE FINANCIAL SUSTAINABILITYObjective Statement To establish, improve and maintain effective, efficient and transparent

systems of financial management.Baseline The Fund achieved 11.1% for administrative expenditure and 85% of total

mandated Social Responsible Investment.Justification Ensure financial management function provides services to its

stakeholders to enable them to achieve their mandates.Links National Treasury Regulations and the Public Finance

Management Act of 1999.

STRATEGIC OBJECTIVE 2 STRENGTHEN INSTITUTIONAL CAPACITY OF THE FUND

Objective Statement To reduce the vacancy rate of the Fund.

Baseline The Fund had 582 posts of which 77.1% were filled and 22.9% were vacant as at 31 March 2017.

Justification Provide necessary support to the UIF strategic functions.

Links Public Service Act and Public Service Regulations

RISK NO.

RISK TITLE RESIDUAL RANKING

PLANNED RESPONSE ACTION(MITIGATING FACTORS)

1. Inadequate skills and capacity Medium • Full implementation of the approved organisational structure; and• Training and development of officials.

2. Fraud and Corruption High • Improve internal controls around the UI19 and verification process;• Profile/vetting of officials processing UI claim; and• Improve the implementation of the Fraud detection and prevention strategies.

3. Inadequate Stakeholder engagement (internal and external)

Medium • Development and implementation of a communication strategy; and• Strengthen the working relations with IES during communication campaigns.

4. Under spending Medium • Alignment of the budget to strategic objectives; and• Monthly monitoring of budget utilisation.

5. Volatile economic environ-ment investments

Medium • Continuous monitoring of investment performance and market trends; and• Investment strategy and mandate to be reviewed yearly.

STRATEGIC RISK REGISTER

RISK REGISTER FOR PROGRAMME 1


24

5.2 PROGRAMME 2: BUSINESS OPERATIONS.

Programme purpose: To collect contributions and pay benefits.

STRATEGIC OBJECTIVE 3 IMPROVE SERVICE DELIVERYObjective Statement Improve service delivery to beneficiaries and employers by introducing

technology to ease the burden of compliance and increase revenuecollections; increase processing centers and improve the claimturnaround times.

Baseline 89% of valid claims with complete information approved/rejected within 5 weeks.

Justification Ensure efficient and effective UIF services.

Links Government Outcome 4: Decent employment through inclusive eco-nomic growth. DoL Strategic Objective (KRA 3): Protecting vulnerable workers, (KRA 5): Strengthening social protection.

STRATEGIC OBJECTIVE 4 COLLABORATE WITH STAKEHOLDERS TO IMPROVE COMPLIANCE WITH UIF ACTS

Objective Statement To increase the number of employers who are declaring their employees and paying correct contributions.

Baseline A total of 58 531 newly registered employers were recorded at the end of March 2017.

Justification Lack of employer/employee information on the database delays the processing of claims and increases the risk of fraud.

Links Government Outcome 4: Decent employment through inclusive eco-nomic growth. DoL Strategic Objective (KRA 3): Protecting vulnerable workers, (KRA 5): Strengthening social protection.

STRATEGIC OBJECTIVE 5 PROVIDE EASY TO USE SERVICES THROUGH MULTIPLE ACCESS POINTS

Objective Statement To increase the ICT infrastructure in all Labour centres to have automat-ed compliance system and U-filing modernization

Baseline New

Justification The delays in the processing of claims and payments which increases the risk of fraud.

Links Government Outcome 4: Decent employment through inclusive economic growth. DoL Strategic Objective (KRA 3): Protecting vulnerable workers, (KRA 5): Strengthening social protection.


25

5.3 PROGRAMME 3: LABOUR ACTIVATION PROGRAMME.

Programme purpose: To provide strategic leadership and guidance on the implemen-tation of the Labour Activation Programme.


STRATEGIC OBJECTIVE 6 ENHANCE EMPLOYABILITY OF UIF BENEFICIARIES, ENABLE ENTREPRENEURSHIP

AND PRESERVE JOBS.Objective Statement To increase the Fund’s participation in the schemes aimed at training of

unemployed UI contributors.Baseline 5 applications for Training Lay-off Scheme received of which 2 were

approved and 3 rejected within 30 days during 2016/2017 financial year. 6000 UIF beneficiaries provided with learning and/or work place experience

Justification To assist those who have lost their jobs to get skills in order to participate fully in the labour market. To assist companies to preserve jobs.

Links Government Outcome 4: Decent employment through inclusive economic growth. DoL Strategic Objective (KRA 3): Protecting vulnerable workers, (KRA 5): Strengthening social protection. (KRA 1) Contribute to employment creation.

RISK NO.



1. Non-compliance with legislation by employers

High • Cleansing of the employer master data.• Improve working relations between the Fund and DoL (IES) to enforce compliance to UI Act.• Improve working current relations with SARS, to enforce compliance to UI contributions Act.

2. Inadequate governance structures

Medium • Improve reporting lines between the Fund, Provinces and Labour centres in regard to UI operations.

3. Low recovery rate on overpayments

Medium • Improve compliance by Employers-Unemployment Insurance Act.• Follow up and recovery of debt.

4. Inadequate IT systems, structure and infrastructure.

Medium • Development and implement of ICT strategy for the Fund; and• Improve ICT governance.



Budget

PROGRAMME 3: LABOUR ACTIVATION PROGRAMME

2017/2018(Revised Estimate) 2018/2019

R’000

R6 497

R’000

R3 124

2019/2020

R’000

R6 861

2020/2021

R’000

R7 238

26


RISK NO.



1. Inadequate utilisation of Training layoff schemes (TLS) funding

Medium • Improve collaboration between CCMA, PSA and the Fund.• Review the current TLS process.

2. Delays in signing funding agreements with SETAs.

High • Development and implementations of Labour Activation Strategy.


6. OVERVIEW OF THE 2018/19 BUDGET AND MTEF ESTIMATES

6.1 EXPENDITURE ESTIMATES

Administrative Budget of the Unemployment Insurance Fund per Programme

Budget

PROGRAMME 1: ADMINISTRATION

TOTAL ADMINISTRATION BUDGET PER PROGRAMME


R’000

R2 138 262

R’000

R1 844 206

2019/2020

R’000

R2 037 965

2020/2021

R’000

R2 154 648

Budget

PROGRAMME 2: BUSINESS OPERATIONS


R’000

R1 737 722

R’000

R1 658 270

2019/2020

R’000

R1 846 525

2020/2021

R’000

R1 960 331


27

R3 882 481R3 505 600 R3 891 351 R4 122 217

Total Budget


R’000R’000

2019/2020

R’000

2020/2021

R’000

OVERVIEW OF THE 2018/19 BUDGET AND MTEF ESTIMATES

R2 138 267

R1 737 722

R1 723 120

R14 602

R6 497

R6 497

R3 882 481

R1 844 206

R1 658 270

R1 647 980

R10 290

R3 124

R3 124

R3 505 600

R2 037 965

R1 846 525

R1 831 105

R15 420

R6 861

R6 861

R3 891 351

R2 154 648

R1 960 331

R1 944 063

R16 268

R7 238

R7 238

R4 122 217

Programmes

Programme 1: Administration

Programme 2:Business Operations

Grand Total forProgrammes:

Programme 3:Labour Activation Programmes

Strategic Objective:Ensure Financial Stability

Strategic Objective:Improve Service Delivery

Strategic Objective:Enhance employability of UIF

beneficiaries.

Improve Compliance To TheUnemployment Insurance Act


R2 138 262R1 844 206

2019/2020

R2 037 965

2020/2021

R2 154 648


ANNEXURE A

The management of the Fund have decided on pursuing the following strategic objective for the planning period 2017/2018 to 2021/2022: The structure of the strategic objectives has been aligned with National Treasury guidelines on Performance Information.

STRATEGIC OBJECTIVES AND ANNUAL PERFORMANCE INDICATORS FOR THE FIVE YEAR PLANNING PERIOD 2018/19 TO 2021/22

PROGRAMME 1: ADMINISTRATION

Purpose: Provide management, strategic and administrative support services to the Fund.

STRATEGIC OBJECTIVE 1: ENSURE FINANCIAL SUSTAINABILITY

28

OUTPUT PERFORMANCEINDICATOR

TARGET2018/19

TARGET2019/20

TARGET2020/21

TARGET2021/22

TARGET2022/23

Sound Financial Management

Percentage of admin-istrative expenditure (excluding capex) maintained

≤ 15% by March 2019

≤ 15% by March 2020

≤ 15% by March 2021

≤ 15% by March 2022

≤ 15% by March 2023

Percentage of valid invoices paid within 30 calendar days after receipt by the Fund

100% within 30 calendar days by March 2019





Social responsible investment

Percentage of total mandated Social Re-sponsible Investment committed.

80% by March 2019

80% by March 2020

80% by March 2021

80% by March 2022

80% by March 2023

STRATEGIC OBJECTIVE 2: STRENGTHEN INSTITUTIONAL CAPACITY OF THE FUND

PROGRAMME 2: BUSINESS OPERATIONS

Purpose: To collect contributions and pay benefits

STRATEGIC OBJECTIVE 3: IMPROVE SERVICE DELIVERY


TARGET2018/19

TARGET2019/20

TARGET2020/21

TARGET2021/22

TARGET2022/23

Staff establishment maintained

Percentage of vacancy rate reduced.

Vacancy rate reduced to ≤ 10% by March 2019

Vacancy rate maintained at ≤ 10% by March 2020





29

STRATEGIC OBJECTIVE 4: COLLABORATE WITH STAKEHOLDERS TO IMPROVE COMPLIANCE WITH UIF ACTS

STRATEGIC OBJECTIVE 5: PROVIDE EASY TO USE SERVICES THROUGH MULTI-PLE ACCESS POINTS


TARGET2018/19

TARGET2019/20

TARGET2020/21

TARGET2021/22

TARGET2022/23

Improved compliance

Number of newly registered employers per year.

65 000 by March 2019

70 000 by March 2020

75 000 by March 2021

80 000 by March 2022

80 000 by March 2023

Number of newly registered employees with the Fund

250 000 by March 2019

250 000 by March 2020

250 000 by March 2021

250 000 by March 2022

250 000 by March 2023


TARGET2018/19

TARGET2019/20

TARGET2020/21

TARGET2021/22

TARGET2022/23

Improved Technology

Number of provincial sites upgraded with free Wi-Fi to access UIF systems

126 provincial sites by March 2019






TARGET2018/19

TARGET2019/20

TARGET2020/21

TARGET2021/22

TARGET2022/23

Improved Client Service

Percentage of valid claims (Unemployment) benefit) with complete information approved or rejected within specified time frames.

90% within 15 working days by March 2019





Percentage of valid claims (In-service benefits; Maternity, illness and adoption benefits) with complete information approved or rejected within specified time frames.





90% within5 working days by March 2023

Percentage of val-id claims (Deceased benefit) with complete information approved or rejected within specified time frames.


90% within 20 work-ing days by March 2020




Percentage of benefit payment documents captured/created after receipt within specified time frame.






Ease of doing business

Percentage of new companies captured or created with a registra-tion document (UI54) within 2 working days.






Percentage of applications with complete information issued with compliance certificates or tender letter within 10 working days



100% within 10 working days byMarch 2021




30


TARGET2018/19

TARGET2019/20

TARGET2020/21

TARGET2021/22

TARGET2022/23

Improved Technology

Integrated claims management System (ICMS) implemented.

Develop, test and deploy release 1 by March 2019

Develop, test and deploy release 2 by March 2020

Implement in all provinces by March 2021

N/A N/A


TARGET2018/19

TARGET2019/20

TARGET2020/21

TARGET2021/22

TARGET2022/23

Enhanced employability

Number of UIF beneficiaries provided with learning and/or work place experience opportunities

450 000 by March 2019

1 000 000 by March 2020

2 000 000 by March 2021

2 000 000 by March 2022

2 000 000 by March 2023

Job preservation

Percentage of Training Lay-off Scheme (TLS) applications with complete information approved or rejected by the delegated authority within specified timeframes.






PROGRAMME 3: LABOUR ACTIVATION PROGRAMME

Purpose: To provide strategic leadership and guidance on the implementation of the Labour Activation Programme.

STRATEGIC OBJECTIVE 6: ENHANCE EMPLOYABILITY OF UIF BENEFICIARIES, ENABLE ENTREPRENEURSHIP AND PRESERVE JOBS.


31


32

AFS Annual Financial Statements

APP Annual Performance Plan

CFO Chief Financial Officer

DG Director-General

DPSA Department of Public Services and Administration

EEA Employment Equity Act

ESA/B Employment Services Act or Bill

HRM Human Resource Management

IDC Industrial Development Corporation

LAP Labour Activation Programme

MTEF Medium Term Expenditure Framework

MTSF Medium Term Strategic Framework

NDP National Development Plan

ICD Integrated Client Database

ICT Information and Communication Technology

IES Inspection and Enforcement Services

PIC Public Investment Corporation

SARS South African Revenue Services

SETA Sector Education and Training Authority

UCA Unemployment Contributions Act

UIA Unemployment Insurance Act

UIF Unemployment Insurance Fund

ACRONYMS

unemployment insurance fund strategic planpmg-assets.s3-website-eu-west-1.amazonaws.com/uif... ·...

Documents