Strategic Plan UNEMPLOYMENT INSURANCE FUND. Strategic Plan 2018/ /23

Transcription

1 UNEMPLOYMENT INSURANCE FUND Strategic Plan Strategic Plan /23

2 First published in 2018, by the Unemployment Insurance Fund (UIF) Copyright 2018 Directorate: Communication & Marketing Pretoria, South Africa ISBN: RP

3 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 Budget and MTEF Estimates 6.1 Expenditure Estimates ANNEXURE A Acronyms TABLE OF CONTENTS PART A: ST PART B: ST OF THE PART B 32. 3

4 FOREWORD BY MINISTER 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: 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 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: 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. Signed: MN OLIPHANT, MP MINISTER OF LABOUR (EXECUTIVE AUTHORITY OF THE DEPARTMENT OF LABOUR) 4

5 FOREWORD BY THE ACCOUNTING AUTHORITY 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 financial year and beyond. 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 Signed: TM. LAMATI DIRECTOR GENERAL During the MTEF period, the Fund will pursue the following six strategic objectives: 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

6 COMMISSIONER S STATEMENT 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. 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 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 selfservice 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

7 The Fund has been working tirelessly towards the implementation of the Unemployment Insurance Amendment Act of 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. 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. 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. 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 /23 strategic plan. T. MARUPING UNEMPLOYMENT INSURANCE COMMISSIONER 7

8 OFFICIAL SIGN-OFF 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 /23. H. MHLONGO CHIEF DIRECTOR: CORPORATE SERVICES SIGNATURE: NB. MNCONYWA CHIEF DIRECTOR: LABOUR ACTIVATION PROGRAMME SIGNATURE: F. PUZI CHIEF FINANCIAL OFFICER SIGNATURE: J. KUMBI CHIEF DIRECTOR: OPERATIONS SIGNATURE: 8

9 X. MONAKALI CHIEF INFORMATION OFFICER SIGNATURE: T. MARUPING UNEMPLOYEMENT INSURANCE COMMISSIONER SIGNATURE: T. LAMATI DIRECTOR-GENERAL: LABOUR SIGNATURE: S.P. HOLOMISA, MP DEPUTY MINISTER: LABOUR SIGNATURE: APPROVED BY: M. OLIPHANT MINISTER OF LABOUR SIGNATURE: 9

10 PART A: STRATEGIC OVERVIEW 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 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. 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. 1.1 VISION CURRENT VISION The 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 VISION A caring, accessible and customer centric UIF that contributes towards poverty alleviation. 10

11 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. 1.2 MISSION CURRENT MISSION The 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 professionally. NEW MISSION Through multiple channels, we will deliver both financial and social relief, to the right person, at the right time, every time. 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. 11

12 1.3. VALUES The UIF subscribes to the following values; TRANSPARENCY We will be open to all stakeholders without reservations on dealings within the fund. INTEGRITY We will communicate openly, honestly and build relationships based on trust. MUTUAL RESPECT We will respect our colleagues and stakeholders and treat them as we want to be treated. ACCOUNTABILITY We will own up to our responsibilities in relation to our behaviour, actions and results CLIENT-CENTRED SERVICE We will achieve a total customer satisfaction by providing excellent and world class services to our stakeholders. TEAMWORK We will involve each other, work together across the organisation, seek ideas and share solutions. CARING FOR OUR PEOPLE We treat employees with care, dignity and respect. We grow our people for performance excellence. 1.4 VISION, MISSION, STRATEGIC OBJECTIVES, OUTPUTS, KEY PERFORMANCE INDICATORS, CRITICAL SUCCESS FACTORS & VALUES. INFORMATION AND VISION COMMUNICATION A caring, accessible TECHNOLOGY. and customer centric UIF that Manage contributes the Fund s towards projects; and poverty alleviation Develop and implement ICT governance model VALUES MISSION FINANCIAL REPORTING Through multiple Compilation channels, and we submission will of the Annual Financial Statement and deliver both financial Auditor and General social as well relief, as to the right person, publication the of right AFS in time, the annual report. Management of financial every time. reporting; and Provision of financial systems support. INCOME MANAGEMENT Management of revenue and debt Transparency, Mutual respect, Client-centered services, Integrity, Accountability, Team work, Caring for our people collection processes; and Management of payroll audits and enforcement. 12

13 STRATEGIC OBJECTIVES 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 OUTPUTS Sound financial management Social responsible investment Maintain Staff establishment Improve client service Ease of doing business Improved compliance Improved Technology Enhanced employability, preserve jobs. CRITICAL SUCCESS FACTORS 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% 95% of new companies issued with registration document within new registered employers new employees registered with the Fund Free WI-FI in 126 sites SAP release 1 implemented beneficiaries provided with learning and/or work place experience 90% of Training Lay-Off Scheme approved within 20 13

14 1.5 CURRENT ORGANISATIONAL STRUCTURE UNEMPLOYMENT INSURANCE COMMISSIONER DIRECTORATE: RISK MANAGEMENT DIRECTORATE: INTERNAL AUDIT CHIEF DIRECTORATE: CORPORATE SERVICES CHIEF DIRECTORATE: OPERATIONS CHIEF DIRECTORATE: LABOUR ACTIVATION PROGRAMME CHIEF FINANCIAL OFFICER Directorate: Human Resource Management Directorate: Operations Directorate: Labour Activation Programme Directorate: Investment Management and Actuarial Services Directorate: Communications and Marketing Directorate: Compliance Directorate: Labour Activation Programme Directorate: Budget Expanditure and Bank Reconciliation Directorate: Organisational Development Directorate: Provincial Support Directorate: Labour Activation Programme Directorate: Supply Chain Management Directorate: Legal Services Directorate: Income Directorate: Policy Development, Strategic Planning, Monitoring & Evaluation Directorate: Financial Reporting Directorate: Information and Communication Technology Directorate: Board Services 14

15 1.6 ORGANISATIONAL STRUCTURE DESCRIPTION PER PROGRAMME. A. PROGRAMME 1: ADMINISTRATION Programme purpose: To provide management, strategic and administrative support to the fund OFFICE OF THE COMMISSIONER Provide strategic leadership and overall management ragarding the administration and overall operations of the Fund INTERNAL AUDIT Independently focus on reviewing the internal controls of the Fund; reviewing risk management, governance processes and programs of the Fund RISK MANAGEMENT Enterprise wide risk management; and fraud investigations CORPORATE SERVICES To provide support and an enabling environment for the Fund to meet its strategic objectives through placing the right people at the right time. 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. ORGANISATIONAL EFFECTIVENESS Job design and evaluation; Change management; and Business process development and mapping 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. BOARD SERVICES Enhance good governance of the organisation; Board support and administration; Compliance management & Governance; Security management services. Policy management LEGAL SERVICES Provision of legal services INCOME MANAGEMENT Management of revenue & debt collection process & management of payroll audits & enforcement. CHIEF FINANCIAL OFFICER Provide financial governance on financial management and accounting services of the Fund. INVESTMENT MANAGEMENT Provide financial governance on financial management and accounting services of the Fund. 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. EXPENDITURE, BUDGET, AND BANK RECONCILIATIONS Creditor and expenditure management. Claims payments; Reconciliation of bank accounts; & Intergated budget planning and management. SUPPLY CHAIN MANAGEMENT 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. 15

16 PROGRAMME 2: BUSINESS OPERATIONS Programme 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 PROGRAMME Programme 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 The UIF is a Schedule 3 A public entity in terms of the Public Finance Management Act (PMFA), 1 of CONSTITUTIONAL MANDATE 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. 2.2 LEGISLATIVE MANDATE 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. 16

17 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. 2.3 POLICY MANDATE 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 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. 17

18 2.4 RELEVANT COURT RULINGS PARTIES AMOUNT CLAIMED NATURE OF CLAIM STATUS ATTORNEYS PARTICULARS 1. S Khepelele Vs Minister of Labour Still to be determined Payment of unemployment benefits of ex-mine worker. Still pending State Attorney. Mr V. Siphondo VSpondo@justice.gov.za Tel : (021) H. Saqqid Vs Minister of Labour and another Still to be determined Unemployment benefits Still pending State Attorney Ms. T. Naidoo ThNaidoo@justice.gov.za Tel: (011) (EXT 7727) 3. H. Phili vs The Minister of the Department of Labour Benefits still to be determined Maternity benefits Still pending State Attorney Ms M. Pillai mpillai@justice.gov.za Tel: (031) B.P Mzamo vs UIF and another Costs still to be determined Cancellation of the Mortgage Bond Still pending State Attorney Ms Dlanjwa TDlanjwa@justice.gov.za Tel: (043) / MICT SETA vs UIF and another 1 st claim: R nd claim: R Payment for services rendered in terms of the Funding agreement. UIF paid MICT SETA. The matter was finalised. State Attorney Mr. S. Zulu SZulu@justice.gov.za Tel: (012) B. E. Ndlovu vs The Minister of the Department of Labour Benefits still to be determined Death/dependent s benefits Still pending State Attorney Mr. T. Skosana TSkosana@justice.gov.za Tel: (031) V. Tengo vs The Minister of the of Labour and another Still to be determined Payment of the illness benefits Matter is still pending State Attorney Ms. L. Hart LHart@justice.gov.za Tel: (041)

19 2.5 PLANNED POLICY INITIATIVES The amendments to the Unemployment Insurance Act No. 63 of 2001 relate to improvements 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 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 rising unemployment. 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. 19

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 1 st Performance Review in June/July Strategic Planning Session (1 st Draft SP & APP) In August Mid Term Review (2 nd Draft SP & APP) In October/November Tabling of SP & APP In February Approved Strategy & APP in January Directorate Planning Sessions 20

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 a mid-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 every year. 21

22 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: STRATEGIC OBJECTIVE OUTCOME GOAL STATEMENT Strategic Objective 1 Ensure Financial Sustainability. Strategic Objective 2 Strengthen the institutional capacity of the Fund. Strategic Objective 3 Improve service delivery. Strategic Objective 4 Collaborate with stakeholders to improve compliance with UIF Acts. Strategic Objective 5 Provide easy to use services through multiple access points Strategic Objective 6 Enhance employability of UIF beneficiaries and preserve jobs, enable entrepreneurship and preserve jobs. Decent employment through inclusive economic growth. (DOL strategic objective 8, Outcome 12). Create a better South Africa, a better Africa and a better World An efficient, effective and development oriented public service. Transforming society and uniting the country 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 Maintain vacancy rate at 10% Contribute in the various schemes designed to alleviate the harmful effects of unemployment which includes investing mandated funds in the Social Responsible Investments Strengthening the institutional capacity of the Department Promote equity in the labour market 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. 22

23 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. STRATEGIC OBJECTIVE 1 Objective Statement Baseline Justification Links ENSURE FINANCIAL SUSTAINABILITY To establish, improve and maintain effective, efficient and transparent systems of financial management. The Fund achieved 11.1% for administrative expenditure and 85% of total mandated Social Responsible Investment. Ensure financial management function provides services to its stakeholders to enable them to achieve their mandates. National Treasury Regulations and the Public Finance Management Act of STRATEGIC OBJECTIVE 2 Objective Statement Baseline Justification Links STRENGTHEN INSTITUTIONAL CAPACITY OF THE FUND To reduce the vacancy rate of the Fund. The Fund had 582 posts of which 77.1% were filled and 22.9% were vacant as at 31 March Provide necessary support to the UIF strategic functions. Public Service Act and Public Service Regulations RISK REGISTER FOR PROGRAMME 1 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 environment investments STRATEGIC RISK REGISTER Medium Continuous monitoring of investment performance and market trends; and Investment strategy and mandate to be reviewed yearly. 23

24 5.2 PROGRAMME 2: BUSINESS OPERATIONS. Programme purpose: To collect contributions and pay benefits. STRATEGIC OBJECTIVE 3 Objective Statement Baseline Justification Links IMPROVE SERVICE DELIVERY Improve service delivery to beneficiaries and employers by introducing technology to ease the burden of compliance and increase revenue collections; increase processing centers and improve the claim turnaround times. 89% of valid claims with complete information approved/rejected within 5 weeks. Ensure efficient and effective UIF services. Government Outcome 4: Decent employment through inclusive economic 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 Baseline Justification Links To increase the number of employers who are declaring their employees and paying correct contributions. A total of newly registered employers were recorded at the end of March Lack of employer/employee information on the database delays the processing of claims and increases the risk of fraud. Government Outcome 4: Decent employment through inclusive economic 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 Baseline Justification Links To increase the ICT infrastructure in all Labour centres to have automated compliance system and U-filing modernization New The delays in the processing of claims and payments which increases the risk of fraud. Government Outcome 4: Decent employment through inclusive economic growth. DoL Strategic Objective (KRA 3): Protecting vulnerable workers, (KRA 5): Strengthening social protection. 24

25 RISK REGISTER FOR PROGRAMME 2 STRATEGIC RISK REGISTER RISK NO. RISK TITLE 1. Non-compliance with legislation by employers 2. Inadequate governance structures 3. Low recovery rate on overpayments 4. Inadequate IT systems, structure and infrastructure. RESIDUAL RANKING PLANNED RESPONSE ACTION (MITIGATING FACTORS) 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. Medium Improve reporting lines between the Fund, Provinces and Labour centres in regard to UI operations. Medium Improve compliance by Employers-Unemployment Insurance Act. Follow up and recovery of debt. Medium Development and implement of ICT strategy for the Fund; and Improve ICT governance. 5.3 PROGRAMME 3: LABOUR ACTIVATION PROGRAMME. Programme purpose: To provide strategic leadership and guidance on the implementation of the Labour Activation Programme. STRATEGIC OBJECTIVE 6 Objective Statement Baseline Justification Links ENHANCE EMPLOYABILITY OF UIF BENEFICIARIES, ENABLE ENTREPRENEURSHIP AND PRESERVE JOBS. To increase the Fund s participation in the schemes aimed at training of unemployed UI contributors. 5 applications for Training Lay-off Scheme received of which 2 were approved and 3 rejected within 30 days during 2016/2017 financial year UIF beneficiaries provided with learning and/or work place experience 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. 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. 25

26 RISK REGISTER FOR PROGRAMME 3 STRATEGIC RISK REGISTER RISK NO. RISK TITLE 1. Inadequate utilisation of Training layoff schemes (TLS) funding 2. Delays in signing funding agreements with SETAs. RESIDUAL RANKING PLANNED RESPONSE ACTION (MITIGATING FACTORS) Medium Improve collaboration between CCMA, PSA and the Fund. Review the current TLS process. High Development and implementations of Labour Activation Strategy. 6. OVERVIEW OF THE BUDGET AND MTEF ESTIMATES 6.1 EXPENDITURE ESTIMATES Administrative Budget of the Unemployment Insurance Fund per Programme TOTAL ADMINISTRATION BUDGET PER PROGRAMME PROGRAMME 1: ADMINISTRATION 2017/2018 (Revised Estimate) 2018/ / /2021 Budget R 000 R 000 R 000 R 000 R R R R PROGRAMME 2: BUSINESS OPERATIONS 2017/2018 (Revised Estimate) 2018/ / /2021 Budget R 000 R 000 R 000 R 000 R R R R PROGRAMME 3: LABOUR ACTIVATION PROGRAMME 2017/2018 (Revised Estimate) 2018/ / /2021 Budget R 000 R 000 R 000 R 000 R3 124 R6 497 R6 861 R

27 2017/2018 (Revised Estimate) 2018/ / /2021 Total Budget R 000 R 000 R 000 R 000 R R R R OVERVIEW OF THE BUDGET AND MTEF ESTIMATES Programmes 2017/2018 (Revised Estimate) 2018/ / /2021 Programme 1: Administration R R R R Strategic Objective: Ensure Financial Stability R R R R Programme 2: Business Operations R R R R Strategic Objective: Improve Service Delivery R R R R Improve Compliance To The Unemployment Insurance Act R R R R Programme 3: Labour Activation Programmes Strategic Objective: Enhance employability of UIF beneficiaries. Grand Total for Programmes: R3 124 R3 124 R R6 497 R6 497 R R6 861 R6 861 R R7 238 R7 238 R

28 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 TO 2021/22 PROGRAMME 1: ADMINISTRATION Purpose: Provide management, strategic and administrative support services to the Fund. STRATEGIC OBJECTIVE 1: ENSURE FINANCIAL SUSTAINABILITY OUTPUT Sound Financial Management PERFORMANCE INDICATOR Percentage of administrative expenditure (excluding capex) maintained 15% /20 15% by March /21 15% by March /22 15% by March /23 15% by March 2023 Social responsible investment Percentage of valid invoices paid within 30 calendar days after receipt by the Fund Percentage of total mandated Social Responsible Investment committed. 100% within 30 calendar days by March % % within 30 calendar days % by March % within 30 calendar days % by March % within 30 calendar days % by March % within 30 calendar days % by March 2023 STRATEGIC OBJECTIVE 2: STRENGTHEN INSTITUTIONAL CAPACITY OF THE FUND OUTPUT Staff establishment maintained PERFORMANCE INDICATOR Percentage of vacancy rate reduced. Vacancy rate reduced to 10% /20 Vacancy rate maintained at 10% by March /21 Vacancy rate maintained at 10% by March /22 Vacancy rate maintained at 10% by March /23 Vacancy rate maintained at 10% by March 2021 PROGRAMME 2: BUSINESS OPERATIONS Purpose: To collect contributions and pay benefits STRATEGIC OBJECTIVE 3: IMPROVE SERVICE DELIVERY 28

29 OUTPUT Improved Client Service PERFORMANCE INDICATOR Percentage of valid claims (Unemployment) benefit) with complete information approved or rejected within specified time frames. 90% within /20 90% within /21 90% within /22 90% within /23 90% within Percentage of valid claims (In-service benefits; Maternity, illness and adoption benefits) with complete information approved or rejected within specified time frames. 90% within % within % within % within % within Percentage of valid claims (Deceased benefit) with complete information approved or rejected within specified time frames. 90% within % within 20 working days by March % within % within % within 10 by March 2023 Percentage of benefit payment documents captured/created after receipt within specified time frame. 95% within % within 4 by March % within 3 by March % within % within Ease of doing business Percentage of new companies captured or created with a registration document (UI54) within 2. 95% within % within % within % within % within Percentage of applications with complete information issued with compliance certificates or tender letter within 10 working days 90% within % within % within 10 working days by March % within 10 working days by March % within 10 working days by March 2023 STRATEGIC OBJECTIVE 4: COLLABORATE WITH STAKEHOLDERS TO IMPROVE COMPLIANCE WITH UIF ACTS OUTPUT Improved compliance PERFORMANCE INDICATOR Number of newly registered employers per year by March / by March / by March / by March / by March 2023 Number of newly registered employees with the Fund by March by March by March by March by March 2023 STRATEGIC OBJECTIVE 5: PROVIDE EASY TO USE SERVICES THROUGH MULTI- PLE ACCESS POINTS OUTPUT Improved Technology PERFORMANCE INDICATOR Number of provincial sites upgraded with free Wi-Fi to access UIF systems 126 provincial sites /20 50 provincial sites /21 50 provincial sites /22 50 provincial sites /23 50 provincial sites

30 OUTPUT Improved Technology PERFORMANCE INDICATOR Integrated claims management System (ICMS) implemented. Develop, test and deploy release 1 by March /20 Develop, test and deploy release 2 by March /21 Implement in all provinces /22 N/A 2022/23 N/A 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. OUTPUT Enhanced employability Job preservation PERFORMANCE INDICATOR Number of UIF beneficiaries provided with learning and/or work place experience opportunities Percentage of Training Lay-off Scheme (TLS) applications with complete information approved or rejected by the delegated authority within specified timeframes by March % within / by March % within 15 working days / by March % within / by March % within 10 working days / by March % within 10 working days

31 31

32 ACRONYMS AFS APP CFO DG DPSA EEA ESA/B HRM IDC LAP MTEF MTSF NDP ICD ICT IES PIC SARS SETA UCA UIA UIF Annual Financial Statements Annual Performance Plan Chief Financial Officer Director-General Department of Public Services and Administration Employment Equity Act Employment Services Act or Bill Human Resource Management Industrial Development Corporation Labour Activation Programme Medium Term Expenditure Framework Medium Term Strategic Framework National Development Plan Integrated Client Database Information and Communication Technology Inspection and Enforcement Services Public Investment Corporation South African Revenue Services Sector Education and Training Authority Unemployment Contributions Act Unemployment Insurance Act Unemployment Insurance Fund 32