Annual Performance Plan 2018/19

Transcription

1 Annual Performance Plan 2018/19

2 ANNUAL PERFORMANCE PLAN 2018/19 COMPENSATION FUND Annual Performance Plan 2018/19 I Compensation Fund 1

3 Compensation Fund I WORKING FOR YOU TABLE OF CONTENTS FOREWORD BY THE MINISTER 3 ACCOUNTING OFFICER S STATEMENT 4 OFFICIAL SIGN-OFF 6 LIST OF ACRONYMS 8 ORGANISATIONAL STRUCTURE 9 PART A: STRATEGIC OVERVIEW UPDATED SITUATIONAL ANALYSIS REVISIONS OF LEGISLATIVE AND OTHER MANDATES OVERVIEW OF 2018/19 BUDGET AND MTEF ESTIMATES 16 PART B: PROGRAMMES AND SUB-PROGRAMME PLANS 20 PROGRAMME 1: ADMINISTRATION 20 PROGRAMME 2: COID SERVICES 26 PROGRAMME 3: MEDICAL BENEFITS 32 PROGRAMME 4: ORTHOTIC AND REHABILITATION 38 PART C: LINKS TO OTHER PLANS 44 ANNEXURE D Vision Mission Values Strategic orientated goals 45 ANNEXURE E 46 ANNEXURE F 54 2 Annual Performance Plan 2018/19 I Compensation Fund

4 FOREWORD BY THE MINISTER One of the key occupations of the Department of Labour (DoL) is to promote opportunities for women and men to obtain decent and productive work that is characterised by conditions of freedom, equity, security and dignity, the International Labour Organisation (ILO) defines these fundamental principles as Decent Work. In this formulation, the protection of workers against work-related sickness, disease and injury, as embodied in the Bill of Rights in our Constitution is an essential element of security and continues to be a high priority for this government. Mistakes, accidents, oversights, injuries, no matter how skilled and careful, can happen even in the safest workplaces. They usually occur when least expected and inadvertently cause harm to workers especially to those who are the most vulnerable and who work in precarious work environments. According to ILO estimates, each year two million men and women die from work-related diseases and accidents a death toll averaging some 5, 000 workers a day. The socio-economic damage of these incidents and fatalities on workers and their families, as well as the entire society, has reached the levels where all of us need to join hands in finding solutions and real partnerships going forward. The 2018/19 Compensation Fund s Annual Performance Plan (APP), is by and large a reflection of our resolve to ensure that we play our part in insuring that the Fund contributes to the attainment of Decent Work from occupational injuries and diseases perspective. To this end the Fund will be implementing its revised organisational structure which is geared towards improving performance in general and rehabilitation and the return to work programme in particular. Vocational rehabilitation will be one of the key focus areas, wherein workers who cannot return to work because of injuries or diseases sustained at a workplace, will be reskilled based on their current capabilities in order to enhance their re-absorption back in the labour market. This Plan is also designed to lift the overall quality of work and impact of the Compensation Fund in order to improve the lives of all those that we serve. I look forward to an effective and efficient implementation of this Plan, and I am confident that with dedication and commitments, nothing is impossible. We are here to serve; providing the best service delivery possible to our people is the end, the Annual Performance Plan is the means. Ms MN Oliphant, MP Executive Authority of the Department of Labour Annual Performance Plan 2018/19 I Compensation Fund 3

5 Compensation Fund I WORKING FOR YOU ACCOUNTING OFFICER S STATEMENT I am pleased to present the Compensation Fund s Annual Performance Plan for 2018/2019 that covers the organisational renewal and priorities which must be achieved in the financial year. The Annual Performance Plan is based on five priorities, namely: building capacity to act truly as a vanguard for the protection of vulnerable workers and their families, ensuring that work places are safe from injuries and diseases; fast-tracking the improvement of service delivery; eradicating backlog; improving stakeholder relations, implementing rehabilitation and reintegration programme and amending the Compensation for Occupational Injuries and Diseases (COID) aimed at broadening the scope of coverage so as to include domestic workers. The Policy s priorities are also to strengthen the core business and provide avenues to fulfil the goals on the National Development Plan (NDP) and the Medium Term Strategic Framework and advancing outcome 4 and outcome 13 aimed at improving the lives of vulnerable employed South Africans. Improved internal capacity and morale is a recipe for improved performance. During the 2017/18 Financial Year, the Compensation Fund has made significant progress in addressing backlog, improving relations with key and strategic stakeholders, setting up internal control measures and addressing key health and safety issues that affect vulnerable employees in a workplace. Processing of claims also improved significantly. Compared to the 90% of registered claims which were adjudicated within 60 working days of receipt during the 2016/17 Financial Year, 97% of the registered claims were adjudicated within 60 working days of receipt by the end of December of the 2017/18 Financial Year. Amongst the issues which are the focus by the Fund over the medium term is to continuously improve access to social insurance for the working age population with the aim of preventing or alleviating poverty and providing protection against vulnerability. It is on this basis that the Fund is working together with the Inspections and Enforcement Services of the Department of Labour to ensure that intense inspections are conducted within workplaces. Working towards impact In the year 2018/2019, the Compensation Fund will continue to ensure that its strategic investments are aimed at broadening coverage of services to all employees of the Republic of South Africa. This will be done through investment in human capacity development, improvement of technological infrastructure, investments on social security programmes, and building capacity in the provinces. In response to the service delivery challenges, the Fund is continuously investing on strengthening its provincial processing centres, to ensure an improved registration, adjudication and processing of all qualifying claims within reasonable turnaround times. Improvement on turn-around times in delivering quality services is key. In order for this to be realised, the Fund has budgeted R11 billion for the 2018/2019 financial year, capacitated its key and strategic programmes by reviewing its organisational structure and standard operating procedures. Given the budget pressures, it cannot be business as usual. Increased efficiency and productivity in every corner of the Compensation Fund is mandatory to get the best value from the income generated from employers. We have a choice; we can choose to focus on the impossibilities of it all, or we can choose to see the opportunities. In the words of Dr Nelson Mandela, Let our choices reflect our hopes and not our fears. And in our case, we choose that latter. 4 Annual Performance Plan 2018/19 I Compensation Fund

6 I want to take this opportunity to thank the Minister and Deputy Minister of Labour for their leadership and support in my plan of turning the Compensation Fund around and improving service delivery. Conclusion The pace and magnitude of outcry for improving service delivery is currently racing ahead beyond our control and manifests in threats to the Compensation Fund. There is an urgent need for the holistic assurance of discipline and dedication from the employees of the Fund to shape the performance environment and facilitate progress towards sustainable and improved service delivery. Simply put, if social development is a goal of the country, prevention of injury on duty, occupational diseases and/or fatalities that occurs in a workplace provides boundary conditions and economic growth, as they always say that A productive employee is a happy and healthy employee. Transforming the Compensation Fund has taken great effort, but with everyone in unison, greater heights can be achieved. I believe that this Annual Performance Plan will go a long way in ensuring that the Compensation Fund achieves its stated objectives and fulfilling its mandate. Mr. T.M. Lamati Director-General Department of Labour Annual Performance Plan 2018/19 I Compensation Fund 5

7 Compensation Fund I WORKING FOR YOU OFFICIAL SIGN-OFF It is hereby certified that this Annual Performance Plan: Was developed by the management of the Compensation Fund under the guidance of the Minister of Labour, Ms MN Oliphant, MP. Takes into account all the relevant policies, legislation and other mandates for which the Compensation Fund is responsible and was prepared in line with the Compensation Fund Strategic Plan. Accurately reflects the performance targets which the Compensation Fund will endeavour to achieve over the period 2018/19. M.J. Ledwaba Director: SPPM&E Signature: T. Headbush Chief Operations Officer: Signature: N. Qamata Chief Director: Corporate Services Signature: M. Ruiters Chief Director: COID Services Signature: 6 Annual Performance Plan 2018/19 I Compensation Fund

8 J. Modiba Chief Financial Officer Signature: V. Mafata Compensation Commissioner Signature: T. Lamati Director-General of Labour Signature: S.P. Holomisa, MP Deputy Minister Signature: Approved by: M.N. Oliphant, MP Executive Authority Signature: Annual Performance Plan 2018/19 I Compensation Fund 7

9 Compensation Fund I WORKING FOR YOU LIST OF ACRONYMS ACRONYM AGSA APP CD CF CPI COIDA D DOL GDP TTD IES KRA MTEF MP N/A ROE TTD PA DESCRIPTION Auditor-General of South Africa Annual Performance Plan Chief Director Compensation Fund Consumer Price Index Compensation for Occupational Injuries and Diseases Act Director Department of Labour Gross domestic Product Temporary Total Disablement Inspection and Enforcement Services Key Result Area Medium Term Expenditure Framework Member of Parliament Not Applicable Return of Earnings Temporary Total Disablement Pensions Administrators 8 Annual Performance Plan 2018/19 I Compensation Fund

10 ORGANISATIONAL STRUCTURE Compensation Commissioner: Mr. V. Mafata Director: Internal Audit Ms. B Gumbu Acting Director: Risk Management Ms. K Lebepe Director: Anti-Corruption and Integrity Management Ms. K Lebepe Acting Chief Director: Medical Benefits: Ms. M Ruiters Chief Director: Orthotics, LAP and Rehabilitation Services: Vacant Chief Director: COID Services Ms. M Ruiters Chief Director: Financial Management Mr. J Modiba Chief Director: Corporate Services Ms. N Qamata Chief Operations Officer: Mr. T Headbush Director: Executive Support: Vacant Annual Performance Plan 2018/19 I Compensation Fund 9

11 Compensation Fund I WORKING FOR YOU 10 Annual Performance Plan 2018/19 I Compensation Fund

12 PART A STRATEGIC OVERVIEW Annual Performance Plan 2018/19 I Compensation Fund 11

13 Compensation Fund I WORKING FOR YOU PART A: STRATEGIC OVERVIEW The South African labour administration system recognises that labour market flexibility for competitiveness of enterprises should be balanced with the promotion and protection of the basic rights of workers and with provision of adequate social safety nets to protect vulnerable workers. Despite the introduction of progressive labour and employment policy reforms and programmes, the labour market is still characterised by high levels of unemployment and under-employment, inequality and discrimination, violation of employment standards and fundamental rights at work, and unacceptably high levels of workplace incidents and injuries. 1. UPDATED SITUATIONAL ANALYSIS 1.1. PERFORMANCE DELIVERY ENVIRONMENT The Fund s delivery environment is affected by many external environmental factors. Some of the challenges from this environment are as follows: The first challenge is: The World Bank has lowered its estimates for South Africa s economic growth between 2017 and It said South Africa s economy, which grew by 0.5% in 2016 (2017 Budget Review), would not show much improvement with 0.6% growth in 2017 and 1.1% in 2018, before showing more gains in 2019 of 2%. The projections for 2017 and 2018 are 0.5 and 0.7 percentage points less respectively than its January 2017 figures The figures paint a far gloomier picture than the South African Reserve Bank s (SARB) latest economic projections. It said on 25 May that it had revised growth projections down to 1.0% (2017), 1.5% (2018) and 1.7% (2019). These figures were lower than the official growth projections revealed in the 2017 Budget Review, which expected growth figures of 1.3% (2017), 2% (2018) and 2.2% (2019). The SARB s reasoning for the lower projections were due to the expected impact of the sovereign credit ratings downgrade on domestic private sector gross fixed capital formation in particular. The World Bank agreed, saying a deterioration of investor confidence in South Africa amid two recent sovereign rating downgrades to sub investment grade have impacted its economic growth. These will have a negative effect on the Funds ability to grow the investment portfolio. As a result of the slow growth, many businesses will be negatively affected. This will in return impact on the Funds investment growth as the Fund will in all probability receive less revenue from business. DoL will continue to implement measures to ensure that employers are submitting (Return of Earnings ) ROE s to the Fund. The second challenge relates to: Poverty alleviation programs designed to promote employment and strengthen protection of social security are overwhelmed by the current South African s unemployment rate which according to the Statistic SA 1st Quarter Labour Survey 2017: The growth in employment by , was offset by the growth in the number of job-seekers by driving the unemployment rate to 27,7% in the first quarter (Q1) of This is the highest unemployment rate observed since September The growth in employment was observed in all industries except agriculture, trade and services. The biggest growth was observed in manufacturing (62 000), finance & other business services (49 000) and Mining (26 000). Mining grew for the first time in Q1:2017 after declining for four successive quarters. Furthermore, employment grew in all provinces quarter to quarter except in Eastern Cape and Limpopo. All metros registered growth in employment except Nelson Mandela Bay, Mangaung and City of Johannesburg which remained virtually unchanged. There were approximately extra people in employment in Q1:2017 compared to the same period last year. The year-onyear employment growth was driven by manufacturing ( ), construction ( ) and finance ( ). Of the people who joined the ranks of the unemployed, approximately 58% were young people aged years increasing the youth unemployment rate by 1,6 percentage points to 38,6%. The proportion of those in short term unemployment 12 Annual Performance Plan 2018/19 I Compensation Fund

14 (i.e. those who have been looking for work for less than a year) increased by 2,4 percentage points to 34,2% a further indication that these were young people who joined the labour force at the beginning of the year. Unemployment rate remained high among those with education level of less than matric at 33,1% which is 5,4 percentage points higher than the national average. While the unemployment rate among graduates remained at 7,3%. Unemployment rate increased or remained virtually unchanged in all provinces except Northern Cape. The biggest increase in unemployment rate was observed in Eastern Cape which increased by 3.8 percentage points to 32,2%. The expanded unemployment which includes those who wanted to work but did not look for work increased by people, resulting in an increase of 0,8 of a percentage point in the expanded unemployment rate to 36,4%. This is approximately 9,3 million people who did not have work but wanted to work in Q1:2017. The above mentioned should be seen together with the outcomes of the StatSA Poverty Survey published on 22 August. The report states the following: Despite the general decline in Poverty between 2006 and 2011, poverty levels in South Africa rose in When applying the upper-bound poverty line ( R992 per person per month)in 2015 prices), we see that more than one out of every two South African were poor in 2015, with the poverty headcount increasing to 55,5% from a series low of 53,2% in This translates into over 30,4 million South Africans living in poverty in While the recent increase in headcount is unfortunate, we are still better off compared to the country s poverty situation a decade earlier when it was estimated that two out of every three people (66,6% or roughly 31,6 million) people were living below the upper-bound poverty line in There is a need to ensure compliance by employers on COID services and the Fund is working with the Inspections and Enforcement Services (IES) in this regard by creating awareness on safety in the workplaces. The third challenge is: New technological innovations will have impact on the labour market as many of the jobs will become automated. This might have a negative impact on the labour market as many jobs might become redundant resulting in an increase in the unemployment rate. Training of employers and CF employees on Umehluko will continue to ensure an improvement in the delivery of services. The fourth challenge relates to: Lack of Safety Compliance by the Mining Industry and other industries to the Occupational Health and Safety Amendment Act gives rise to the high injury and fatalities in the labour market. There is a need to ensure compliance by employers on COID services and the Fund is working with the Inspections and Enforcement Services (IES) in this regard by creating awareness on safety in the workplaces. The fifth challenge is: Inadequate instruments for constant performance monitoring and evaluation of labour market policies and programmes to determine their impact on the economy: -- Stakeholder participation and strategic partnerships in programme delivery, monitoring and feedback is inadequate, despite our strong culture of social dialogue in policy development. -- Planning processes are to some extent not well co-ordinated between strategic departments on related socioeconomic development programmes. -- Our appreciation and use of modern information and communication technology systems to manage data and information is inadequate. 1.2 OVERVIEW OF THE ORGANISATIONAL ENVIRONMENT The Compensation Fund plays a significant role in terms of providing social security to employees. However, the Fund is impacted by various challenges which impedes on its mandate and strategic objectives. The following strengths and weaknesses have been identified in the CF Environment: Strengths CF Strategic Plan 2015/ /20 Continuous implementation of the CF Action plan Annual Performance Plan 2018/19 I Compensation Fund 13

15 Compensation Fund I WORKING FOR YOU Collective and participatory planning process by CF management including Provincial Offices Revised organisational structure which is being implemented Contribution to Outcome 13 Improving employer compliance and revenue generation(cf-filling) Staff skill development (through bursaries and other initiatives) Weakness The ever changing economic landscape which has the prospects to affect the investment by the Fund. The Fund appointed Actuaries to ensure informed investments are done through the Public Investment Corporation (PIC). All identified and/or suspected fraudulent activities are dealt with through both internal processes and law enforcement agencies. Systems not responsive to effective and efficient service delivery. The Fund is in the process of procuring systems that will ensure service delivery including the turnaround times is improved. This includes a system wherein employers will perform self-registration and declarations. Ability to attract and retain critical skill, e.g. Medical Practitioners. The Fund reviewed job profiles for required critical skill to ensure ability to compete with already established departments requiring similar skill set. The Fund further partnered with the South African Institute of Chartered Accountants (SAICA) wherein the Fund invested in the training of critical skills. Further to this, the following key issues have been identified related to the Fund s Organisational Environment: The Fund s Head Office vacancy rate was at 23.2% at the end of December This can be attributed to the fact that due to implementation of the revised CF structure, new posts are being created which will be filled in due course. The Fund is in process of addressing the Audit Findings from the Auditor General of South Africa ( AGSA) Audit Report of 2016/17. In order to address the audit findings the Fund developed an AGSA Audit Action Plan and being monitored on a continuous basis. The Fund is continuing with the implementation of the revised Structure. As part of the process the programme structure has been revised. The revised Programme structure contains the following 4 Programmes which are reflected in the 2018/19 APP: -- Programme 1: ADMINISTRATION -- Programme 2: COID SERVICES -- Programme 3: MEDICAL BENEFITS -- Programme 4: ORTHOTIC AND REHABILITATION The Fund has paid 100% of approved benefits within five working days by 31 December % ( claims finalised out of the received) of claims received was adjudicated within 60 workings of receipts (end of December 2017). 94% of medical invoices received ( invoices were received and was finalised within 60 workings of receipts (end of December 2017). 2. REVISIONS OF LEGISLATIVE AND OTHER MANDATES 2.1. CONSTITUTIONAL MANDATE The mandate of the Compensation Fund is derived from Section 27 (1) (c) of the Constitution of the Republic of South Africa. In terms of this Act, specifically the mentioned Section, all South Africans have a right to social security. The Compensation Fund is mandated to provide social security to all injured and diseased employees 14 Annual Performance Plan 2018/19 I Compensation Fund

16 2.2. LEGISLATIVE MANDATE The Compensation Fund is a Schedule 3A Public Entity (These entities are normally extensions of a public entity with the mandate to fulfil a specific economic or social responsibility of government. They rely on government funding and public money, either by means of a transfer from the Revenue Fund or through statutory money. As such, these entities have the least autonomy.) of the Department of Labour. The Fund administers the 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 injuries or diseases, and provide for matters connected therewith. The Fund generates its revenue from levies paid by employers and this consists of annual assessments paid by registered employers on a basis of a percentage or fixed rate of the annual earnings of their employees. The COID Act, however, makes provision for a minimum assessment to ensure the assessment is not less than the administration costs incurred. The operations of the Fund are also informed by the following legislations: Constitution of the Republic of South Africa, 1996, as amended; Occupational Health and Safety Act, 1993; National Economic Development and Labour Council Act (NEDLAC), 1994; Labour Relations Act, 1995, as amended; Basic Conditions of Employment Act, 1997, as amended Employment Equity Act, 1998, as amended; Skills Development Act 1998, as amended; Unemployment Insurance Act, 2001, as amended; Unemployment Insurance Contributions Act, 2002; Employment Services Act, 2014; Public Finance Management Act, 1999, as amended; Public Service Act, 1994, as amended; Broad Based Black Economic Empowerment Act, 2003; Preferential Procurement Policy Framework Act, 2000; Prevention and Combating of Corrupt Activities Act, 2004; Promotion of Access to Information Act, 2000; Promotion of Administrative Justice Act, 2000; and Promotion of Equality and Elimination of Unfair Discrimination Act, I would like to take this opportunity to thank the Minister, the Deputy Minister, the Director- General and the Compensation Fund Board for their leadership and support as well as the Compensation Fund employees for their dedication in ensuring that we meet the Fund s mandate. Mr. V. Mafata Compensation Commissioner Annual Performance Plan 2018/19 I Compensation Fund 15

17 Compensation Fund I WORKING FOR YOU 3. OVERVIEW OF 2018/19 BUDGET AND MTEF ESTIMATES 3.1 EXPENDITURE ESTIMATES Compensation Fund: Programme 2014/15 Audited outcomes 2015/ /17 Adjusted appropriation 2017/ /(R 000) Medium-term expenditure 2019/ /21 Programme 1: ADMINISTRATION Programme 2: COID SERVICES Programme 3: MEDICAL BENEFITS Programme 4: ORTHOTIC AND REHABILITATION Subtotal Direct charges against Revenue Total Change to budget estimate Economic Classification Current Payments Compensation of employees Goods and services of which: Communication Computer services Consultants, contractors and special services Inventory Maintenance repair and running cost Operating leases Travel and subsistence Advertising and Legal services Other (Administrative expenditure Items not provided for in the template) Depreciation and Acc Amortisation Interest and rent on land Financial transactions in assets and liabilities Transfers and subsidies to: Provinces and municipalities Departmental agencies and accounts Universities and technikons Public corporations and private enterprises Foreign governments and international organisations Non-profit institutions Households/ Compensation benefits Payments for capital assets Buildings and other fixed structures Machinery and equipment Cultivated assets Annual Performance Plan 2018/19 I Compensation Fund

18 Programme 2014/15 Audited outcomes 2015/ /17 Adjusted appropriation 2017/ /(R 000) Medium-term expenditure 2019/ /21 Software and other intangible assets Land and subsoil assets of which: Capitalised compensation Total RELATING EXPENDITURE TRENDS TO STRATEGIC GOALS The Compensation Fund recorded a total spending of R billion for the 2016/17 financial year against a total approved budget of R , which represent a 20% under spending for 2016/17 financial year. The following were the main cost drivers for the recorded 2016/17 budget spending: Compensation of Employees: The total spending for the 2016/17 is, R million. Goods and Services: The total spending for the 2016/17 is, R million. Capital Expenditure: The total spending for the 2016/17 is, R million. Benefits paid: The total spending for the 2016/17 is, R billion. The total approved Compensation Fund budget allocation for 2017/18 financial year is, R billion, with the following major sub-allocations: Compensation of Employees:, R million Goods and Services:, R million Capital Expenditure: R million Benefits paid: R billion Compensation of Employees: The Fund has spent a total of R 636 million on Compensation of Employees over the 2016/17 financial year, which recorded 100% spending. The total approved Compensation of Employees budget for the 2017/18 financial year is R 653 million, which includes the newly approved functional structure implemented in October 2017/18 financial year. Goods and Services: The Fund has spent a total amount of R 357 million for the 2016/17 financial year on Goods and Services; this includes the organisational administrative expenditure and all the consultation fees. The 2017/18 approved budget for Goods and Services, amounts to R 854 million. Capital Expenditure: The Compensation Fund spent a total amount of R 102 for the 2016/17 financial year; this is mainly due the procurement of office furniture and the office equipment. The total Capital Expenditure Budget amounts to R 24 million, for the 2017/18 financial year. The major part of the budget will be utilised on the Compensation Fund s relocation project to the new building. Annual Performance Plan 2018/19 I Compensation Fund 17

19 Compensation Fund I WORKING FOR YOU Strategic objectives of the Compensation Fund Strategic objective 1 Provide effective and efficient client oriented support services. Objective statement 1 To provide value adding services to clients through Human Resources, Risk Management, Financial Services and Audit Services. Strategic objective 2 Provide faster, reliable and accessible COID services by Objective statement 2.1 Promote rehabilitation, re-integration and return to work of injured and diseased workers and contribute to various schemes designed to decrease unemployment including investing mandated funds in socially responsible investments. Objective statement 2.2 To process compensation benefits and medical expenses for injured and diseased workers and promote rehabilitation, re-integration and return to work policy for injured and diseased workers. 18 Annual Performance Plan 2018/19 I Compensation Fund

20 PART B PROGRAMMES AND SUB-PROGRAMME PLANS Annual Performance Plan 2018/19 I Compensation Fund 19

21 Compensation Fund I WORKING FOR YOU PART B: PROGRAMMES AND SUB-PROGRAMME PLANS 4. PROGRAMME 1: ADMINISTRATION 4.1. PROGRAMME PURPOSE The purpose of the programme is to provide an effective and efficient client oriented support services to the Fund/entity. PROGRAMME DESCRIPTION: Compensation Commissioner: To compensate workers and or their family members for occupational injuries and diseases sustained by the worker while on duty. Executive Support: To provide executive and administrative support of the Office of the Commissioner. Internal Audit: To provide an independent and objective assurance service.. Risk Management: To provide risk and integrity management services. Anti-Corruption and Integrity Management: To provide anti-corruption and integrity management services. Office of the Chief Operations Officer: To strategically oversee the management of operations services. Chief Financial Officer: To provide financial management services.. Corporate Services: To provide corporate services.. STRATEGIC OBJECTIVES Strategic objective 1 Provide effective and efficient client oriented support services. Objective statement 1.1 To provide value adding services to clients through Human Resources, Risk Management, Financial Services and Audit Services. Baseline R33 billion proceeds from investments. 70% achievement of the audit plan (based on the average of 2013/14-81% and 2014/15-61%. Risk management Maturity level Annual Performance Plan 2018/19 I Compensation Fund

22 4.2. STRATEGIC OBJECTIVE ANNUAL TARGET FOR Strategic Objective Risk Management Provide effective and efficient client oriented support services. Internal Audit Provide an effective and efficient client oriented support services. Financial Management Provide an effective and efficient client oriented support services. Audited/ Actual Performance Estimated Performance Medium-term Targets 2014/ / / / / / /2021 Achieve risk management maturity level 2. 61% of the plan implemented by 31 March 2015 (22 projects) billion in investments. The Fund s risk management maturity level increased annually to 3 by 31 March % (31/44) of the project plan were implemented by 31 March % growth was achieved [The Investments as at 1 April 2015 amounted to R 49.7 billion and the closing balance as at 31 March 2016 amounted to R 51 billion.] The Fund s risk management maturity level increased to 3.5 by 31 March % of projects were executed during the financial year (36/46). Investment portfolio return = 7.3% for the year to March 2017 compared to 8.28% target return. The Fund s risk management maturity level increased to 3.7 by 31 March % of projects on the risk based audit plan implemented annually by 31 March Investment return at a rate of CPI+2% at 31 March The Fund s risk management maturity level increased to 4 by 31 March % of projects on the risk based plan implemented by 31 March Investment return at a rate of CPI+2% at 31 March The Fund s risk management maturity level increased to 5 by 31 March % of projects on the risk based plan implemented by 31 March Investment return at a rate of CPI+2% at 31 March The Fund s risk management maturity level increased to 5.5 by 31 March % of projects on the risk based plan implemented by 31 March Investment return at a rate of CPI+2% at 31 March Annual Performance Plan 2018/19 I Compensation Fund 21

23 Compensation Fund I WORKING FOR YOU 4.3. PROGRAMME PERFORMANCE INDICATORS AND ANNUAL TARGETS FOR Indicator number Strategic objective Risk Management 1.1 Provide effective and efficient client oriented support services. Internal Audit 1.2 Provide effective and efficient client oriented support services. Financial Management 1.3 Provide effective and efficient client oriented support services. Key performance indicators The Fund s risk management maturity level increased to 4 by 31 March Percentage implementation of the approved annual risk-based audit plan. Percentage annual increase on investment returns by 31 March of the current financial year compared to the previous financial year. Audited/ actual performance Estimated performance Medium-term targets 2014/ / / / / / /2021 Achieve risk management maturity level 2. 61% of the plan implemented by 31 March 2015 (22 projects). R49.7 billion in investments. The Fund s risk management maturity level increased annually to 3 by 31 March % (31/44) of the project plan were implemented by 31 March % growth was achieved [The Investments as at 1 April 2015 amounted to R 49.7 billion and the closing balance as at 31 March 2016 amounted to R 51 billion. ] The Fund s risk management maturity level increased to 3.5 by 31 March % of projects were executed during the financial year (36/46). Investment portfolio return = 7.3% for the year to March 2017 compared to 8.28% target return. The Fund s risk management maturity level increased to 3.7 by 31 March % of projects on the risk based audit plan implemented annually by 31 March Investment return at a rate of CPI+2% at 31 March The Fund s risk management maturity level increased to 4 by 31 March % of projects on the risk based plan implemented by 31 March Investment return at a rate of CPI+2% at 31 March The Fund s risk management maturity level increased to 5 by 31 March % of projects on the risk based plan implemented by 31 March Investment return at a rate of CPI+2% at 31 March The Fund s risk management maturity level increased to 5.5 by 31 March % of projects on the risk based plan implemented by 31 March Investment return at a rate of CPI+2% at 31 March Annual Performance Plan 2018/19 I Compensation Fund

24 4.4. QUARTERLY TARGETS FOR Indicator number Strategic objective Risk Management 1.1 Provide effective and efficient client oriented support services. Internal Audit 1.2 Provide effective and efficient client oriented support services. Financial Management 1.3 Provide effective and efficient client oriented support services. Key performance indicators The Fund s risk management maturity level increased to 4 by 31 March Percentage implementation of the approved annual risk-based audit plan. Percentage annual increase on investment returns by 31 March of the current financial year compared to the previous financial year. Reporting period Annual target Annual The Fund s risk management maturity level increased to 4 by 31 March Quarterly 85% of projects on the risk based plan implemented by 31 March Annual Investment return at a rate of CPI+2% at 31 March Quarterly targets Budget estimate 1st 2nd 3rd 4th (R 000) The Fund s risk management maturity level increased to 4 by 31 March R % 45 % 60% 85% R Investment return at a rate of CPI+2% by 31 March R Annual Performance Plan 2018/19 I Compensation Fund 23

25 Compensation Fund I WORKING FOR YOU 4.5. RECONCILING PERFORMANCE TARGETS WITH THE BUDGET AND MTEF COMPENSATION FUND PROGRAMMES 2014/15 EXPENDITURE OUTCOME 2015/ /17 (R 000) ADJUSTED APPRO- PRIATION 2017/ Budget Forecasts 2018/ / /21 Programme 1: Administration Compensation Commissioner CD: Chief Financial Officer CD: Corporate Services CD: Chief Operating Officer Total Change to 2005 budget estimate 1 Payable as from 1 April Salary: R Car allowance: R 2 Payable as from 1 April Salary: R Car allowance: R Economic classification Current payments Compensation of Employees Compensation Benefits Goods and Services of which: Communication Computer services Consultants, contractors and special services Inventory Maintenance repair and running cost Operating leases Travel and subsistence Investment Expenditure Other Depreciation and Amortisation Interest and rent on land Financial transactions in assets and liabilities Transfers and subsidies to: Provinces and municipalities Departmental agencies and accounts Universities and technikons Public corporations and private enterprises Foreign governments and international organisations Non-profit institutions Households Transfers and subsidies to: Provinces and municipalities Departmental agencies and accounts Universities and technikons Public corporations and private enterprises 24 Annual Performance Plan 2018/19 I Compensation Fund

26 COMPENSATION FUND PROGRAMMES 2014/15 EXPENDITURE OUTCOME 2015/ /17 (R 000) ADJUSTED APPRO- PRIATION 2017/ Budget Forecasts 2018/ / /21 Foreign governments and international organisations Non-profit institutions Households Payments for capital assets Buildings and other fixed structures Machinery and equipment Cultivated assets Software and other intangible assets Land and subsoil assets of which: Capitalised compensation Total PERFORMANCE AND EXPENDITURE TRENDS The total spending for Programme 1: Administration for the 2016/17 amounted to R 983 million, this is inclusive of the entire Compensation Fund staff costs, assets and Information and Communication Technology (ICT) related costs. The 2017/18 approved budget for Programme 1, total to R billion. The huge increase in Programme 1 budget is due to the newly increased organisational structure and the Fund s relocation project to the new building, planned for the 2017/18 financial year. Annual Performance Plan 2018/19 I Compensation Fund 25

27 Compensation Fund I WORKING FOR YOU 5. PROGRAMME 2: COID SERVICES 5.1. PROGRAMME PURPOSE To administer compensation claims, medical adjudication, accounts and customer care PROGRAMME DESCRIPTION: Compensation Benefits: To monitor compensation benefits services. Employer Services: To provide registration and assessment services of employers Treasury, investment and actuarial services: To provide strategic management of the Fund s treasury, investment and actuarial services. STRATEGIC OBJECTIVE Strategic Objective 2 Provide faster, reliable and accessible COID Services by 2020 Objective statement 2.1 Promote rehabilitation, re-integration and return to work of injured and diseased workers and contribute to various schemes designed to decrease unemployment including investing mandated funds in socially responsible investments. Baseline All claims were paid within 45 days employers assessed 60 working days to process claims for payment 26 Annual Performance Plan 2018/19 I Compensation Fund

28 5.2. STRATEGIC OBJECTIVE ANNUAL TARGETS Strategic Objective Provide faster, reliable and accessible COID Services by 2020 Audited/ Actual Performance Estimated Performance Medium-term Targets 2014/ / / / / / /2021 N/A 95% of claims paid within 5 working days registered (active) employers as at 31 March N/A 76% (R3,706 billion out of R3.905) 46% of active employers were assessed out of claims adjudicated were adjudicated within 60 working days 100% of approved benefits paid within 5 working days by 31 March 2017 (R 4.3 billion was paid within 5 working days.) 95% of the annual target was achieved [ active employers assessed / (60% of the total active employers on databank= annual target *100)] 90% of the registered compensation claims were adjudicated within 60 working days (A total of compensation of the received during the financial year were adjudicated within 60 working days). 95% of approved benefits paid within 5 working days yearly 75 % of active registered employers assessed annually 85% of claims adjudicated within 60 working days of receipt 98% of approved benefits paid within 5 working days yearly 75% of active registered employers assessed annually by 31 March % of claims adjudicated within 40 working days of receipt 100% of approved benefits paid within 5 working days yearly 90 % of active registered employers assessed annually by 31 March % of claims adjudicated within 30 working days of receipt 100% of approved benefits paid within 5 working days yearly 90 % of active registered employers assessed annually by 31 March % of claims adjudicated within 30 working days of receipt Annual Performance Plan 2018/19 I Compensation Fund 27

29 Compensation Fund I WORKING FOR YOU 5.3. PROGRAMME PERFORMANCE INDICATORS AND ANNUAL TARGETS FOR Indicator number Strategic Objective 2.1 Provide faster, reliable and accessible COID Services by Provide faster, reliable and accessible COID Services by Provide faster, reliable and accessible COID Services by 2020 Key Performance Indicators Percentage of approved benefits paid within 5 working days Percentage of active registered employers assessed annually by 31 March 2019 (excl exempted employers) Percentage of claims adjudicated within 40 working days of receipt Audited/ Actual Performance Estimated Performance Medium-term Targets 2014/ / / / / / /2021 N/A 95% of claims paid within 5 working days registered (active) employers as at 31 March N/A 76% (R3,706 billion out of R3.905) 46% of active employers were assessed out of claims adjudicated were adjudicated within 60 working days 100% of approved benefits paid within 5 working days by 31 March 2017 (R 4.3 billion was paid within 5 working days.) 95% of the annual target was achieved [ active employers assessed / (60% of the total active employers on databank= annual target *100)] 90% of the registered compensation claims were adjudicated within 60 working days (A total of compensation of the received during the financial year were adjudicated within 60 working days). 95% of approved benefits paid within 5 working days yearly 75 % of active registered employers assessed annually 85% of claims adjudicated within 60 working days of receipt 98% of approved benefits paid within 5 working days yearly 75% of active registered employers assessed annually by 31 March % of claims adjudicated within 40 working days of receipt 100% of approved benefits paid within 5 working days yearly 90 % of active registered employers assessed annually by 31 March % of claims adjudicated within 30 working days of receipt 100% of approved benefits paid within 5 working days yearly 90 % of active registered employers assessed annually by 31 March % of claims adjudicated within 30 working days of receipt 28 Annual Performance Plan 2018/19 I Compensation Fund

30 5.4. QUARTERLY TARGETS FOR Indicator number Strategic Objective 2.1 Provide faster, reliable and accessible COID Services by Provide faster, reliable and accessible COID Services by Provide faster, reliable and accessible COID Services by 2020 Key Performance Indicators Percentage of approved benefits paid within 5 working days Percentage of active registered employers assessed annually by 31 March 2019 (excl exempted employers) Percentage of claims adjudicated within 40 working days of receipt Reporting Period Annual Target Quarterly 98% of approved benefits paid within 5 working days yearly Quarterly 75% of active registered employers assessed annually by 31 March 2019 Quarterly 90% of claims adjudicated within 40 working days of receipt Quarterly Targets Budget estimate 1st 2nd 3rd 4th (R 000) 98% of approved benefits paid within 5 working days yearly 98% of approved benefits paid within 5 working days yearly 98% of approved benefits paid within 5 working days yearly 98% of approved benefits paid within 5 working days yearly R % 55% 65% 75% 90% of claims adjudicated within 40 working days of receipt 90% of claims adjudicated within 40 working days of receipt 90% of claims adjudicated within 40 working days of receipt 90% of claims adjudicated within 40 working days of receipt Annual Performance Plan 2018/19 I Compensation Fund 29

31 Compensation Fund I WORKING FOR YOU 5.5. RECONCILING PERFORMANCE TARGETS WITH THE BUDGET AND MTEF COMPENSATION FUND PROGRAMMES EXPENDITURE OUTCOME 2014/15 (R Million) 2015/16 (R Million) 2016/17 (R Million) ADJUSTED APPROPRIATION 2017/18 (R Million) Budget Forecasts 2018/19 (R Million) 2019/20 (R Million) 2020/21 (R Million) Programme 2: COID SERVICES CD: COID Services CD: Provincial Operations Total Change to 2005 budget estimate 1 Payable as from 1 April Salary: R Car allowance: R 2 Payable as from 1 April Salary: R Car allowance: R Economic classification Current payments Compensation of Employees Compensation Benefits Goods and Services of which: Communication Computer services Consultants, contractors and special services Inventory Maintenance repair and running cost Operating leases Travel and subsistence Debt Collectors Other (Investment Management fees) Interest and rent on land Financial transactions in assets and liabilities Transfers and subsidies to: Provinces and municipalities Departmental agencies and accounts Universities and technikons Public corporations and private enterprises Foreign governments and international organisations Non-profit institutions Households Transfers and subsidies to: Provinces and municipalities Departmental agencies and accounts Universities and technikons Public corporations and private enterprises Foreign governments and international organisations Non-profit institutions Households 30 Annual Performance Plan 2018/19 I Compensation Fund