2012 - 2017 strategic plan - department of · pdf filethe strategic plan of the compensation...

Strategic Plan2012 - 2017

Minister Mildred N Oliphant, MP Minister of Labour

Mr Nkosinathi PT Nhleko Director General

Strategic Plan2012 - 2017

i 2012 – 2017 Compensation Fund Strategic Plan

The Department of Labour has, over the years developed policies and implemented programmes to transform the labour market environment and to fulfil its constitutional mandate to contribute to the Decent Work Agenda. In the coming year, the Department will ensure promulgation of the amendments to the LRA, BCEA, EEA, UIA, COIDA, OHSA and the promulgation of the Employment Services Bill. These proposed amendments are all aimed at promoting the sound labour market environment that is conducive to employment creation, economic growth, and protection of vulnerable workers as well as ensuring proper labour standards that put the right of workers above profits. Further more, the Department will in the years ahead, put in place the institutional framework and systems to ensure effective implementation, monitoring and evaluation of these policies to ensure a better life for all our people.

Central to the Department’s strategic objectives and activities will be contribution to the creation of decent employment through inclusive economic growth. Over the next five years, we will work very closely with the Economic and Employment Sector Cluster and Social Protection & Community Development Cluster to integrate our work with that of our sister departments in order to speed up service delivery. In response to the strategic priorities of government, over the next five years, the Department will focus on the following strategic programmes:

• Decentwork• Publicemploymentservices• Enhancinginspectionandenforcementservicestoeffectivelymonitorandenforcecompliancewithlegislation• Strengtheningsocialsecurity• StrengtheningtheinstitutionalcapacityoftheDepartment.

Over the next five years, we will also put in place mechanisms to ensure that the allocated funds are spent as planned to achieve value for money and doing more with less in the best interest of our targeted beneficiaries.

I commit my Department and all Public Entities reporting to the Ministry to work closely with social partners and all Parliamentary oversight bodies to ensure creation of decent work and sustainable livelihoods to our citizens.

FOREWORD BY THE MINISTER

Ms MN Oliphant, MP Executive Authority of the Department of Labour

Minister MN Oliphant, MP Minister of Labour

FOREWORD BY THE MINISTER

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It is with great pleasure that we present the Compensation Fund Strategic Plan for the period 2012/13 – 2016/17.

The Compensation Fund Strategic Plan has been aligned with the National Treasury Framework for Strategic Plans and Annual performance Plans.

The Strategic Plan of the Compensation Fund is also informed by Government’s National Priorities, the Department of Labour’s Strategic Plan and priorities for the next five years.

In light of Government outcomes, the Compensation Fund intends to pursue the following outcomes: • Outcome4:Decentemploymentthroughinclusiveeconomicgrowth• Outcome 12:An efficient, effective and development oriented public service and an empowered, fair and inclusive citizenship

The Fund will also contribute towards the achievement of the Department of Labour’s key result areas, but will concentrate more specifically on protecting vulnerable workers, strengthening social protection and strengthening the institutional capacity of the Department.

The Fund has set itself to pursue the following strategic objectives:• Providinganefficientsocialsafetynet• Providingprofessional,efficientandclientorientedhumanresources• Strengtheningcorporategovernance• IntegrationoftheFundwiththecomprehensivesocialsecurityreforms• Promotepolicyadvocacy• Improvefinancialviability• Improvecorporatesupportandservices• EnhanceequityandaccesstoCOIDservicesandinformation

In order to give practical meaning to the above-mentioned strategic goals, the following are some of the key priorities identified for 2012/13 – 2016/17 financial years:• Implementationoftheapprovedorganisationalstructure• ImplementationoftheIntegratedClaimsManagementandtheFinancialManagementsystems• DecentralisationofCOIDAservicestoallProvinces• Rehabilitation,ReintegrationandReturntoWorkPolicyFramework• AmendmentofCOIDAct• Improvementofrevenuecollection• COIDAeducationalcampaignstoprovideguidanceontheFund’sservices

It is anticipated that the implementation of the above initiatives will go a long way to improve service delivery and address the current challenges and limitations of the Fund.

Over the next five years, we will put in place measures to ensure that the allocated funds are spent as planned to achieve value for money and to provide our clients with service of a high standard.

COMMISSIONER’S STATEMENT

SS Mkhonto Compensation Commissioner

SS Mkhonto Compensation Commissioner

COMMISSIONER’S STATEMENT

iii 2012 – 2017 Compensation Fund Strategic Plan

It is hereby certified that this Strategic Plan:

• WasdevelopedbythemanagementoftheCompensationFundundertheguidanceoftheMinisterofLabour,

Ms MN Oliphant, MP

• Takesintoaccountalltherelevantpolicies,legislationandothermandatesforwhichtheCompensationFund

is responsible

• AccuratelyreflectsthestrategicoutcomeorientedgoalsandobjectiveswhichtheCompensationFundwill

endeavour to achieve over the period 2012/13 to 2016/17

S Nkhabelane Signature: ____________________________

Director Organisational Effectiveness

T Puzi Signature: ____________________________

Chief Financial Officer

S Mkhonto Signature: ____________________________

Compensation Commissioner

N Nhleko Signature: ____________________________

Director General

Approved by:

MN Oliphant, MP Signature: ____________________________

Executive Authority

OFFICIAL SIGN-OFF

OFFICIAL SIGN-OFF

iv

LIST OF ACRONYMS

AG - Auditor-General APP - Annual Performance PlanBAS - Basic Accounting SystemBCEA - Basic Conditions of Employment Act BUMS - Business Unit Managers (Provincial Deputy Directors)CCMA - Commission for Conciliation, Mediation and ArbitrationCC - Compensation CommissionerCF - Compensation FundCRM - Customer Relationship ManagementCS - Corporate Services CFO - Chief Financial OfficerCOO - Chief Operations Officer CIO - Chief Information Officer COIDA - Compensation for Occupational Injuries and DiseasesDG - Director GeneralDDG - Deputy Director GeneralDEXCOM - Departmental Executive Committee DoL - Department of LabourDPSA - Department of Public Services and AdministrationDWCP - Decent Work Country Programme EC- - Eastern CapeEEA - EmploymentEquityActES - Employment ServicesESSA - Employment Services for South AfricaEPWP - Extended Public Works ProgrammeEXCO - Executive CommitteeFEMA - Federal Employers Mutual AssuranceFS - Free StateGCIS - Government Communication and Information ServicesHO - Head Office HPCSA - Health Professions Council of South AfricaHRM - Human Resource Management ICD - Integrated Client DatabaseICM - Integrated Claims ManagementICT - Information and Communication TechnologyIES - Inspection and Enforcement Services ILO - International Labour Organisation INDS - Integrated National Disability StrategyKZN - KwaZulu-Natal

LMIS&P - Labour Market Information and StatisticsLP - LimpopoLP & IR - Labour Policy and Industrial RelationsLRA - Labour Relations Act KRA - Key Result AreaMBDC - Medical Billing Document ControlM&E - Monitoring and EvaluationMISS - Minimum Information Security SystemMOU - Memorandum of UnderstandingMPU - MpumalangaMTSF - Medium Term Strategic Framework MTEF - Medium Term Expenditure FrameworkNC - Northern CapeNEDLAC - National Economic Development and Labour CouncilNT - National Treasury OHS - Occupational Health and Safety PD - Permanent DisablementPDP - Personal Development Plan PES - Public Employment Services PFMA - Public Finance Management ActPMO - Project Management OfficePPP - Public Private PartnershipPTSD - Post Traumatic Stress DisorderPWD - People with disabilitiesQMS - Quality Management SystemRAF - Road Accident FundRMA - Rand Mutual AssuranceRME - Research Monitoring and Evaluation ROE - Return of EarningsSCM - Supply Chain ManagementSDIP - Service Delivery Improvement PlanSEF - Sheltered Employment Factories SMS - Senior Management ServicesSOE - State Owned EnterprisesSP - Strategic PlanSTEFI Short Term Financial IndexSWOT - Strengths, Weaknesses, Opportunities and ThreatsTCOID - Technical Committee on Occupational Injuries and DiseasesTTD - Total Temporary DisablementUIF - Unemployment Insurance Fund WC - Western CapeWSP - Work Place Skills Plan

LIST OF ACRONYMS

1 2012 – 2017 Compensation Fund Strategic Plan

TABLE OF CONTENTS

TABLE OF CONTENTS

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TABLE OF CONTENTS


ORGANISATIONAL STRuCTuRE

ORGANISATIONAL STRUCTURE

Compensation CommissionerMr Shadrack Mkhonto

Chief Financial OfficerMs Thembeka Puzi

Director: Income ReportingMs Ella Ntshabele

Director: Financial ReportingMr Pitso Moloto

Director: Financial ControlMs Pumla Mjoli

Director: Support Services

Mr Leon van der Westhuizen

Director: Organisational Effectiveness

Mr Simon Nkhabelane

Acting Project Manager

Mr Simon Nkhabelane

Acting Chief Director: Human Resource

ManagementMs Thembi Moleko

Director: Medical Services

Mr AK Pillay

Director: Compensation ClaimsMr Basimano Dingaan

Director: Internal Audit

Ms Tshidi Ikaneng

Senior Legal Admin OfficerNontombeko Mathe-Ndlazi

Senior Legal Admin OfficerAndile Solwandle

Senior Legal Admin OfficerOrphan Letsoko

Chief Information OfficerMr Vikash Sirkisson

Deputy Director: Organisational

Monitoring and EvaluationMr Madodana Tuntulwana

Deputy Director: Risk Director

Mr Twana Makhubela

Deputy Director: Communications

Ms Dikentsho Seabo

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PART A: STRATEGIC OVERVIEW

1. VISION

To be an employer of choice and an internationally reputable provider of compensation for occupational injuries and diseases, rehabilitation and reintegration services.

2. MISSION

• Toutilise/leverageautomatedsolutionstoprovideefficient,quality,client-centricandaccessibleCompensationFund services

• To ensure effective rehabilitation and re-integration services, through reputable (proven) programmes• To ensure financial viability through efficient collections and prudent investments• To promote job creation initiatives through social responsible investments• Todevelopandretainacompetentandcontentworkforce

3. VALuES• Wetreatemployeeswithcare,dignityandrespect• Werespectandpromote:

- Client centred services - Accountability - Integrity and ethical behaviour

• Learninganddevelopment• WelivetheBathoPeleprinciples• WelivetheprinciplesoftheDepartment’sServiceCharter• Weinculcatethesevaluesthroughourperformancemanagementsystem



4. LEGISLATIVE AND OTHER MANDATES

4.1 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, all South Africans have a right to social security. The Compensation Fund is then mandated to provide social security to all injured and diseased employees.

4.2 LEGISLATIVE MANDATE

The Compensation Fund is a public entity of the Department of Labour. The Fund administers the Compensation for Occupational Injuries and Diseases Act no. 130/1993 as amended by the COIDA 61/1997. The main objective of the Act is to provide compensation for disablement caused by occupational injuries or diseases sustained or contracted by employees, or for death resulting from such injuries or diseases, and provide for matters connected therewith.

The Fund generates its revenue from levies paid by employers, which consists mainly 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 that the assessment is not less than the administration costs incurred.

The operations of the Compensation Fund are also affected by the following legislation:

• OccupationalHealthandSafetyAct,1993 • NEDLACAct,1994 • LabourRelationsAct,1995asamended • BasicConditionsofEmploymentAct,1997asamended • EmploymentEquityAct,1998 • SkillsDevelopmentAct,1998asamended • UnemploymentInsuranceAct,2001asamended • UnemploymentInsuranceContributionsAct,2002

4.3 RELEVANT COuRT RuLINGS

Decided Cases

Michael Donald Healy vs. Workmen’s Compensation Commissioner (delivered 15 September 2008: Eastern Cape Division)

This was a section 91 (5) appeal, the Appellant appealed against a decision of the first Respondent (CC) that, as a resultofanoccupationalinjurytohisknee,hewaspermanentlydisabledtoanextentof18%.

TheCourtheldthattheguidelinesthattheRespondentandhisAssessorsapplieddidnotadequatelymeasurethe degree of disablement in the circumstances of this case and that an assessment consistent with schedule 2 of theCompensationforOccupationalInjuriesandDiseasesAct130of1993was45%permanentdisablement.Theappeal was allowed with costs.

Karel Petrus Jooste Mouton vs. The State (delivered: 30/08/2002: Cape of good hope Provincial Division)

This was an appeal against the decision of the Compensation Fund Tribunal. The Appellant lodged a claim for chronic adjustment disorder and anxiety, the claim was refused on the basis that the conditions did not arise out of, or in the course of his employment. The Tribunal confirmed this.


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The Court held that the Tribunal overlooked the provisions of Section 65 completely and relied on the Circular Instruction which is an internal guideline not law.

S Hammond vs. The Compensation Commissioner and the Director-General (Transvaal Provincial Division: delivered 6/8/2004)

This was an appeal against the decision of the Tribunal to reject the Appellant claim on the basis that it was not workrelated.TheCourtfoundthattheAppellantdidnotmeettherequirementsofsection65(b)and“IamequallysatisfiedthattheAppellanthasfailedtoprovehiscaseonabalanceofprobabilities”,oreitherhefailedtoprove his case. The appeal was dismissed with costs.

The effect of these three cases is that the Compensation Fund Circular Instructions are not legislation, they are just guidelines for internal purposes, therefore not binding to the Courts.

The Fund must then regulate the Circular Instructions.

4.4 PLANNED POLICY INITIATIVES

Development of a Rehabilitation, Re-integration and Return-to-work Policy for Injured and Diseased Workers

In the assessment of some South African policy documents from other government departments, which provide a framework for rehabilitation of people with disabilities and an adoption of an integrated approach, Integrated National Disability Strategy (INDS) which also stresses the importance of vocational integration, it was apparent that there is little focus on linking rehabilitation to return to work policies and programmes.

The Compensation Fund has since embarked on a process of developing an integrated and comprehensive policy framework for rehabilitation, re-integration and return-to-work of injured and diseased employees.

Aims of the Policy Framework:

• Promotionofreturntoworkand/orfunctionalityforworkerswhosufferedoccupationalinjuries/diseases • Re-integrationofinjured/diseasedemployeesbackintotheworkplace • Promotionoffunctionalitythroughskillsdevelopment,alternativeemploymentandrehabilitation • Relationofareturn-toworkstrategytocompensatorymechanisms

Progress:

• ResearchhasbeendonebytheInstituteforSocialLawandPolicy(ISLP) • DraftreporthasbeendevelopedandpresentedtotheCFSeniorManagementandtheCFBoard • Executivesummaryofthedraftreporthasbeencirculatedtoallstakeholdersforcomments • ThepolicyhasbeenapprovedbytheMinisterofLabour • ItisnowbeingsenttoNEDLACforconsultationprocesses

Way forward:

• Consultationswithindividualstakeholderswillcommenceafterfeedbackhasbeenreceivedfromall constituencies • Amajormultidisciplinaryconsultativeworkshopwillbeheldtodiscussthefinalpolicydocument • ThepolicydocumentwillthenbesubmittedtoCabinetandParliamentfordiscussion • TheActisprojectedtobepromulgatedin2014/15



5. SITuATIONAL ANALYSIS

5.1 PERFORMANCE ENVIRONMENT

The Compensation Fund is a State Owned Social Security Entity primarily providing health and life insurance (compensation and rehabilitation) to workers for occupational injuries sustained and diseases contracted in the course of their employment, and to compensate dependants in fatal cases. Despite many challenges, the Fund has stayed the course in delivering a social safety net to its beneficiaries. In line with the overall government policy ofimprovingthequalityofservices,theFundhas,overthepastyearsinitiatedprogrammestoimproveservicedelivery. These initiatives include, among others, measures to improve the claims processing turn around times and business process reengineering. The Fund has piloted decentralisation to four provinces, namely: KwaZulu-Natal, Free State, Limpopo, and Eastern Cape. Decentralisation of operations to the point of contact with clients and creating multiple channels to enhance accessibility for client segments and forming strategic partnerships will continuetobecentralinthisstrategicdirectiontoenhancethecapacityoftheFundtodeliverqualityserviceson time, and everywhere. The Fund has made good progress in relation to improving compliance with legislation and policies.

5.1.1 Processing of Compensation Benefits

There has been a substantial increase in the number of compensation benefits processed during 2010/11 as compared to the past three years. This increase is attributed to the continuous review of old claims to eliminate backlogs; some enhancements on IT systems and the new policy on earnings, see the table hereunder:

TEMPORARY TOTAL DISABLEMENT, PERMANENT DISABLEMENT AND PENSION PAYMENTS

Year No of payments Amount paid

2007 335,345 R652,466,698

2008 327,647 R630,708,449

2009 340,159 R771,801,533

2010 329,091 R801,724,702


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A reporting facility has been developed to facilitate adjudication of claims and the processing of benefits. With these reports, it is possible to identify claims with relevant medical reports:

• Theclaimsprocessingsystemhasbeenenhancedtoincludeafinalizationstatuswhichenablesmanagement to draw operational reports and Management Information System reports for identifying backlogs and efficient management of claims. There are however, still some challenges on this enhancement despite its deployment and they are being addressed. • TheE-claimssystemhasalsobeenenhancedtobeabletoprocessexemptedemployerclaimsasfrom 01 April 2010. This change has eliminated the duplication and loss of awards, as awards are sent electronically to National Treasury and to certain employers for payment.

With the implementation of the Integrated Claims Management and Financial systems, which were deployed in 2011, more time will be spent in the 2012/13 financial year to address system glitches and enhancing the system to include a Return of Earnings website, SMS’s and emails as well as MIS. It is envisaged that the Integrated Claims Management and Financial systems will yield positive spin-offs in the long-term.

5.1.2 Processing of Medical Accounts

AtotalamountofR1,9billionwaspaidasmedicalbenefitsto868,284beneficiariesin2010/11,ascomparedto R1,4billionpaidto781,249beneficiariesin2009/10.

The Compensation Fund is experiencing high turnover of staff in the area of Medical Services, which is responsible for providing expert advice to the Fund on re-opening of claims, complex medical conditions and bills, Post Traumatic Stress Disorders (PTSD) and assistive devices. The Fund has during 2011 advertised in the media for registration into its database of health care providers who are willing to render medical services to the Fund on a contractual and sessional basis.

Although the Fund has achieved most of its objectives in the past few years, the following challenges still exist:

(i) Turnaround time on disputes settlement (ii) Operationalinefficiency(poorqualityofservicesrenderedandlongclaimsturnaround) (iii) Disparate systems and centralised claims processing (iv) Lack of Customer and Stakeholder Relations Management Strategy and ineffective utilisation of existing network of social partners (v) Poorandinefficientemployerservices:Inadequateprocessestoensureallemployersareregistered, correctly assessed and all debt collected. This results in assessments and collections below expected levels andinadequatemanagementofthedebtor’sbook-aroundR1billionon“baddebts”. (vi) Delay and/or non-reporting of accidents: Our communication strategy and wide coverage in the print and electronic media, among others, seeks to address this challenge.

The Department of Labour conducted an extensive discussion on the repositioning of the Department. This resulted in the Compensation Fund being classified under the Employment Services Branch. The outcome of this process places the Compensation Fund as a critical player in Employment Services, particularly rehabilitation of injured workers, and facilitation of the re-entry of workers into the labour market. It is for this reason that the Compensation Fund is central to Integrating Social Insurance Services with re-skilling/rehabilitation and job matching programmes. The Compensation Fund also generates critical data and statistics regarding occupational injuries and diseases, which is greatly underutilised in the labour market. This information is critical for planning preventive interventions and assessing the cost of occupational accidents and injuries to the economy, and enhancing productivity.

TheCompensationFundTurnaroundStrategywillhighlightthenecessaryinterventionsrequiredtoensure:

(i) Serviceandqualityimprovementandaccessibilitytoitsclients (ii) Sustainable and affordable benefit regime (iii) Improved revenue collection and capture a higher percentage of employers (iv) Resolve legislative and administrative challenges



(v) Improved compliance with legislation (vi) Improved institutional capacity

In the quest for business transformation and performance improvement (service and quality),wewill createsustainable value from leveraging our intangible assets: human capital; databases and information systems; responsivehigh-qualityprocesses;customerandstakeholderrelationships;innovationcapabilitiesandculture.ThiswillrequireoftheFundtoinvestinhumanandinformationcapitalandeffectiveinternalmanagementsystems.

The Compensation Board has reviewed the existing benefits and made some remarkable increases in the benefits to be paid to injured employees and dependents in a form of lump sum, loss of earnings and monthly pension. These increases have been determined on the basis of the actuarial investigations and recommendations of the Compensation Board. These major increases include the following:

• IncreaseofthesalaryceilingfromR261,893toR277,860perannum • Themonthlycompensationpensionincreasedby4.6%plus90%purchasingpowerofthelowpensionearners • TheminimumearningsincreasedfromR3,055toR3,241.00permonthwhilemaximumearningsincreased fromR21,824toR23,155(75%=17,366.25)permonthfortheTemporaryTotalDisablement(TTD)andfor PermanentDisablement(PD)lumpsumpayment.Earningshaveabiginfluenceinthecalculationofbenefits • The constant attendance allowance for pensioners who need constant nursing increased from R1,300 per month to R1,379 per month in addition to the monthly pension • The maximum partial dependency lump sum increased from R95,200 to R107,007 • Maximum funeral benefits increased from R12,300 to R13,050

The Compensation Fund has since July 2009 started with the Pilot Project of Decentralisation of certain Compensation services to four provinces namely: Limpopo, Free State, KwaZulu-Natal and Eastern Cape. Later during December 2010, the Fund rolled out the pilot project to the 5 remaining provinces comprising: Gauteng, North West, Northern Cape, Western Cape and Mpumalanga.

The decentralisation pilot is at a smaller scale and as such is focusing on registration of claims, adjudication for liability and payment of medical claims, as there is no permanent organisational structure of the Fund in the provinces. This initiative is therefore a short term intervention to address the delays in the processing of claims at Head Office. The payment of compensation benefits is still processed centrally at Head Office. The lessons learnt from the pilot sites were considered in the finalisation of the organisational structure. The decentralised pilot sites will be phase out over time as the new organisational structure is rolled out to provinces. Considerable progress has been made in improving service delivery and the table below illustrates this:

DECENTRALISATION STATISTICAL REPORT FOR 2010/2011

Province Registered claims Accepted claims Number of medical accounts paid

Value of medical accounts paid

Eastern Cape 1,351 15,867 177,436 R255,618,155

Free State 3,732 5,804 19,088 R69,585,278

Gauteng North 437 Not yet started Not yet started Nil

Gauteng South 152 278 Not yet started Nil

KwaZulu-Natal 4,726 7,669 43,515 R73,443,790

Limpopo 2,635 3,861 5,927 R19,950,761

Mpumalanga 135 110 Not yet started Nil

Northern Cape 185 57 Not yet started Nil

North West 257 Not yet started Not yet started Nil

Western Cape 224 199 Not yet started Nil

TOTAL 13,834 33,845 245,966 R418,597,984


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5.2 ORGANISATIONAL ENVIRONMENT

Theorganisationalstructure,inadequateskills,andstaffinglevelposedachallengefortheFundtobeabletodeliveronitsmandate.Thestaffestablishmentof711hadprovedtobeinadequateandnecessitatedtheappointmentof 379 fixed term contracts. In the previous years, the focus of the Fund was on improvement of business processes, service delivery model and organisational structure. Significant progress has been made in reviewing the organisational structure, its people (Human Capital), its processes and operations systems, and the changes requiredtooptimizeitsoperationalcapacity.TheFundrealizedthatthereisnoproperfitbetweenjobdemandsand the available skills. In acknowledgement of this challenge, the Fund developed a competency framework, conducted a skills audit exercise, developed new business processes, defined role profiles to ensure proper developmentandtodeterminequalitiestofitthejob.Theneworganisationalstructurewasdesignedinformedbythe above and also in line with the Compensation Fund decentralisation strategy. The new organisational structure willgrowto1,334posts.

The deployment of the Compensation Fund new organisational structure and decentralisation is anticipated to improve CF performance and service delivery, and also address all current challenges experienced by the Fund. Apart from the challenges relating to resources, the Fund still contends that the organisational culture does not promote service excellence and this is mainly due to the legacy of amalgamating the TBVC structures into a single entity. A number of initiatives geared towards building a culture conducive to high standards of service delivery are planned. This will include, among others, the climate and culture survey and ethics programme (which is aimed at shaping the behaviour and attitudes of staff). The Customer Satisfaction Survey, which focuses on internal and external stakeholders, started late in November 2011 and its recommendations will be implemented in the medium-term period. The Fund will embark on the process of change management. The key focus areas of the change management programme will be good governance, proper performance management, effective leadership and management. The intention is to make sure that the Fund becomes a goal orientated, customer-centric and high performing institution. The focus will be striving for operational excellence through continuous service delivery improvement.

The Fund will in the five year period focus more attention to managing performance of staff in the organization. To this effect, the Fund will be ensuring that performance policies are understood and adhered to across the organization. Performance agreements will be aligned to the Strategic Plans of the Fund and entered into by each employee. Implementation of the performance agreements will be monitored on a continuous basis. The Work Place Skills Plan will be implemented to ensure that all employees are trained and developed in order to provide a competent workforce. The Fund managed in the previous years to address all the training needs identified in theWorkplaceSkillsPlan.TheFundalsomanagedtomaintainstaffturnovertoaround2.7%andvacancyratetoaround2.5%.

In the past financial years, the Fund managed to appoint senior managers to capacitate its leadership level. The Fund will, in the next MTEF period embark on a robust induction and leadership development programmes to enhanceleadershipcapability.Employmentequitywillalsobeoneoftheprioritiespursuedtoemploypeoplewith disabilities and women.

5.3 DESCRIPTION OF THE STRATEGIC PLANNING PROCESS

The Fund’s Strategic Plan guides all other planning processes within the Fund, including the development of the Medium Term Expenditure Framework (MTEF); Annual Performance Plans; the Annual Budget and Performance Agreements of Senior Managers, Managers, Supervisors and staff.

The Strategic Plan is reviewed and revised each year in preparation for the submission of inputs for development of the MTEF. The development and implementation of the Strategic Plan is managed as a value chain that realises theequalimportanceandinterrelationshipsbetweenallprogrammeswithintheFund.

The Compensation Fund Executive Management convenes two strategic planning and performance review workshops annually. The June/July workshop evaluates previous financial year performance and identifies priorities for the budget requirements for the comingMTEF cycle.These are informedby theMediumTermStrategic



Framework (MTSF) and government service delivery outcomes. Programmes conduct workshops to align strategic plans and translate the strategic plan into operational plans, determine targets and performance agreements. The Executive management signs off the following year draft strategic plan for approval by the Minister in September of the current year. The mid-term review workshop is conducted in October/November of the same year, to review and evaluate performance against mid-year targets.

The process towards developing the strategy was also informed by the Fund’s statutory form of an entity (Schedule 3: National Public Entity), the Life and Health Insurance industry structure, industry norms and standards for benchmarking. The Fund conducted a SWOT analysis to develop its 5 Year Strategic Plan:

STRENGTHS WEAKNESSES

• Full senior management component• Financial stability of the Fund• Support by the Compensation Fund Board• Turnaround strategy of the Fund supported by

all stakeholders• Well defined and achievable objectives of the

Fund• Monopoly

• Poor records and document management.• InadequateITsystems• Work too centralised and controlled at Head

Office• Capacityconstraintsandinadequateskills• Detection of fraud and corruption• Lack of enforcement of COID Act• Lack of MIS• Inadequateimplementationofchange

management• Non compliance with laws and regulations• Lack of business continuity plan• Inappropriate organisational culture

OPPORTuNITIES THREATS

• New policy initiatives:- Rehabilitation- COIDA amendments

• IT innovations• Decentralisation of COIDA functions to

provincial offices and labour centres• Organisational restructuring:

- Separate business entities- Capacity and structure- Business process re-engineering- Payroll audit

• Business partnerships

• Fraud and corruption• Political considerations:

- IDTT (social security reforms)• Reputational damage• Uncertain future IT services


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Jul ‘10 Sep ‘10 Oct ‘10 Ju1 ‘11 Sep ‘11 Nov ‘11 Jan ‘12

Strategic Plan (SP)

1st Planning workshop

2nd Planning workshop

Draft SP Submitted to EA

SP Approved by EA

Approved SP presented to Portfolio Committee



Draft SP Submitted to EA

Revised SP (in line with new framework)

SP approved by the EA


Draft 12/17 SP submitted to EA

Annual Performance Plan (APP)



Draft APP submitted to EA

APP Approved by EA

Approved APP presented at the Minister’s Mid-Term Evaluation Session



Draft APP submitted to EA

Revised APP (in line with new framework)

APP approved by the EA


Draft 12/13 APP submitted to EA

The Compensation Fund Strategic Plan is based on consideration of the above SWOT analysis and the following macro environmental factors:

(i) The drive by government to create a comprehensive social security network and also to integrate occupational health and safety and compensation competencies across government (ii) Drivebygovernmentandtheincreasingawarenessanddemandbythecitizensforqualityandaccessto government (social security) services (iii) Increasing demands for good corporate governance, and the continued effect of fraud and theft (iv) Increasing developments in communication and information processing technology. (v) HIV and AIDS will also have a bearing on the Fund’s policies, strategies and resources (vi) Socio-economic factors and growth accompanied by (potential) increase in rates of occupational incidents and accidents (vii) Constitutional and legislative challenges to policies and administration of the Fund

Due to the Auditor’s comments and the introduction of the new National Treasury Framework for the Strategic Plans and the Annual Performance Plans, the approved CF Strategic Plan was revised in July/August 2011 and October/November 2011. This was intended to effect the Auditor’s recommendation and to align the plan with the new NT Framework. The revised 2011-2016 Strategic Plan was approved by the Minister in November 2011. The draft 2012-2017 Strategic Plan will be submitted to the Minister for approval in January 2012.

According to the NT Framework the Strategic Plan may be changed during the five year period it covers. However, such changes should be limited to revisions related to significant policy shifts or changes in the service delivery environment. Below is the timetable of events and processes that were followed in developing the Compensation Fund Strategic Plan:


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