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Establishment of the Agency Presentation to the Portfolio Committee

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Title: Establishment of the Agency Presentation to the Portfolio Committee


1
Establishment of the Agency Presentation to the
Portfolio Committee
  • 7 September 2005

2
OUTLINE OF PRESENTATION
  • Background
  • Institutional challenges and constraints
  • The new Service Delivery Model
  • Process Map towards Agency Establishment
  • Agency business plan and
  • Progress

3
BACKGROUND
  • Providing social assistance grants is a key
    government poverty alleviation program, ensuring
    income support to over 9.8 million vulnerable
    individuals.
  • The budget this year is in excess of R55 billion,
    and will grow to more than R60 billion/annum
    during the MTEF
  • Despite the successes in coverage, major service
    delivery problems have been experienced over the
    years, resulting in significant fraud, indignity
    for the poor, etc.
  • Government has therefore, decided to shift the
    function to the national sphere and the
    administration to a specialist, focused Agency

4
INSTITUTIONAL CHALLENGES
  • The grants system has been facing a number of
    challenges, including
  • Fragmented institutional arrangements
  • Lack of uniformity across provinces and
    inefficient processes
  • Unequal distribution and development of human
    resources
  • high transaction costs, with high levels of fraud
  • Poor quality of service delivery, with long
    distances that some must travel to access
    services for some, hours in the queues
  • These problems often constrain access to social
    assistance, yet access should be a Constitutional
    guarantee for eligible persons.

5
CONSTRAINTS OF CURRENT MODEL
  • The problems experienced are intrinsic in the
    current delivery model, which displays the
    following features
  • Delivery is through a fragmented institutional
    structure
  • There is a lack of dedicated, focused corporate
    support functions
  • Resource competencies/skills not geared toward
    the specialized nature of the service - variable
    staffing standards
  • Disintegrated and inefficient business processes,
    duplication and non-value adding procedures
  • Inadequate financial acumen given the transaction
    nature and
  • Inefficient, insufficient, inequitable
    distribution of infrastructure
  • Less than desirable communication strategies and
    modes

6
NEW SERVICE DELIVERY MODEL
7
FEATURES OF THE NEW MODEL
8
Pillars of New Service Delivery Model
  • The New Delivery Model was developed, and the key
    pillars are
  • Clear accountability framework (see additional
    slide)
  • Simplified Grants admin. processes that are
    customer focused
  • Integrated delivery, one stop services
  • Human resource competencies fitting the Agency
    strategy
  • Financial efficiency
  • Accessibility, at lower costs
  • Communication strategies and modes that are
    proactive
  • I will give a very brief insight into the key
    pillars with more detailed slides at the end of
    the presentation.

9
Business process changes
The Grants Admin processes will be reengineered
  • Fewer steps
  • Less people involved
  • Technology enabled
  • Faster
  • Standardised
  • Easily verified

10
Human resources and Financial efficiency
  • Human Resources
  • A culture change to a customer-centric focus is
    key
  • Staff structures will be aligned to services A
    front office with multi-skilled, customer
    friendly staff and a back office ensuring
    compliance
  • Staff development will be service delivery
    focused and performance linked to norms and
    standards for delivery
  • Financial Management
  • The Agency will reduce the current operational
    costs of 6,3, using economies of scale, using
    Post Office and banks
  • Ensuring Compliance to regulations, business
    rules will be explicit and current initiatives to
    reduce fraud will be given extra impetus through
    regular reviews of all grants
  • Building an effective off-ramp will be an
    explicit Agency focus

11
Infrastructure and Communication
  • Physical Infrastructure People travel long
    distances, exceeding 50km, waiting far too long
    at pay points. The Agency will focus on
  • Implementing an optimal model - making use of all
    current infrastructure closer to government
    services, e.g Home Affairs
  • Ensuring equal access within 57 km of each
    individual
  • IT Agency will exploit the use of Information
    and Communication Technology capturing,
    verifying and approval online.
  • Various methods of accessing the system such as
    call centres, the internet, voice recognition
    technology, etc. will be implemented
  • Communication Internal communication will be
    less complicated with less red-tape and
    bureaucracy
  • To beneficiaries were saying Dont to call us,
    well find you
  • More detail on the above also provided at the end

12
The Journey Map
  • Three distinct phases constitute the journey map
  • Initial phase prior to April 2005 and was
    concluded with MOU signing and introduction of
    the conditional grants - completed
  • Transitional Phase started April 2005, ending
    April 2006. Involves making the Agency
    operational and prepare for function transfer
  • Optimisation phase Full operationalisation
    follows the transfer of the social grants
    function to the Agency and implementing the new
    delivery model with radical improvements in the
    quality of delivery
  • Process is well underway to have the Agency fully
    operational
  • The next slide outlines the envisaged state of
    fully operational and
  • The slides thereafter details the progress in the
    different areas.

13
Envisaged State by April 2006
  • Governance framework in place in terms of
    relevant laws
  • Agency top management and staff must be appointed
  • Reporting and accountability framework
    established
  • Functions ringfenced/separated in provinces and
    national
  • Entity must have its own financial system and
    policies
  • Agency human resources separated, with policies
    in place
  • Communication internally and externally
    operational
  • Information technology infrastructure in place
  • Physical infrastructure available for use

14
Governance Framework
  • In terms of the governance arrangements, progress
    includes
  • The Agency Act is operational, Social Assistance
    Act will be in force by March 2006.
  • MOU governs the transitional period, but a
    Business Partnership Agreement was drafted for
    post April 2006.
  • Reporting framework in terms of Agency Act and
    the relevant PFMA sections will be finalised by
    end of September
  • In the absence of a Board, an Advisory Panel was
    constituted of high level government and industry
    leaders to advise CEO.
  • National Department in the process of rolling out
    structures and staff for oversight
    responsibility.

15
Management, staff and accountability
  • Interviews are underway to appoint executive
    management and process will be complete by end of
    September Advertisements of remainder of
    management and staff posts will be out in next
    week
  • An organizational alignment framework developed
    that defines reporting and accountability
    framework
  • CEO will appoint regional or provincial managers
    by October to establish that line of
    accountability
  • Operational ringfencing document is currently
    being completed to assess reporting at the lower
    levels in provinces

16
Ringfencing and financial systems
  • Ringfencing social security from social
    development services is is critical in setting up
    the Agency function and All Provinces have
    undertaken financial ringfencing to identify
    budgets, assets, liabilities and staff for
    social grants function
  • Operational ringfencing is now underway in
    provinces, and will give a clear indication of
    what is in each province after separation to
    constitute a separate Agency province or entity
  • The Agency financial systems model have been
    agreed upon, and system will be in place at
    national soon and tested and rolled out in
    provinces by January 2006
  • Financial management and administration function
    outsourced to complement Agency resources
  • Bank account in place and awaiting PFMA listing

17
Human Resources and Communication
  • Human resources staff for transfer were
    identified, but dispute with labour is a
    challenge.
  • Human resources framework approved by DPSA,
    policies drafted and will be submitted for
    Ministers approval by end of September
  • Human resources function headed by a seconded
    senior manager and HR function was outsourced to
    support Agency staff with Human resource system,
    Persal being populated.
  • Communication head seconded and strategy is
    being rolled out. Expertise for branding and
    corporate identity to be appointed soon.
  • IT infrastructure for internal communication
    being rolled out
  • Outstanding matters are communication policies
    and processes.

18
Information and Technology Infrastructure
  • Information Technology infrastructure is being
    rolled out at national and will start in
    provinces soon, prioritizing NorthWest Province
    and Gauteng who are on different systems
  • The design and development of an Enterprise
    Resource planning system that will integrate
    Finance, HR and with grants administration has
    been initiated
  • Physical infrastructure At national, the Agency
    head office refurbishment is well underway. Each
    of the provinces are procuring separate offices,
    some up to district level for movement of staff
    to new buildings

19
Conclusion
  • The presentation outlined the current social
    grants challenges and the envisaged new service
    delivery model
  • I have provided Members with an outline of the
    phases of the Agency establishment, the expected
    state by April and progress made to date.
  • Additional information is submitted in the
    additional slides that follow.

20
End
21
INSTITUTIONAL ARRANGEMENTS
HOW THINGS WILL CHANGE
Communication lines between Agency and DoSD will
remain open
New, independent, specialist Agency focused and
motivated towards service delivery
22
VALUE CHAIN AND CAPABILITIES
23
HUMAN RESOURCE COMPETENCIES
  • The Agency will ensure the following outputs ito
    the implementation of the Service Delivery Model
  • Staffing structures will be better aligned to
    core business (services to beneficiaries)
  • Staff development will be in line with service
    delivery requirements (not generic)
  • An effective performance monitoring system will
    be developed that is linked to norms and
    standards for delivery that inform the KPIs
  • A change in culture to a customer-centric focus.

24
BUILDING FINANCIAL ACUMEN
  • The grants admin system distributes over R55
    billion. This is a transaction based institution
    that requires financial acumen.
  • The Agency will ensure the following outputs in
    terms of the implementation of the new Service
    Delivery Model
  • The Agency will endeavour to reduce the current
    operational costs and the high cost of
    transactions by building on economies of scale.
  • An appropriate payment model that will
    redistribute pay points more optimally will be
    introduced. (Migration of people to banks where
    possible will be considered).
  • Ensuring Compliance to regulations, business
    rules will be explicit.
  • Recent initiatives to reduce fraud has indicated
    that with a minimal investment the returns are
    high and the Agency will keep the focus on fraud
    reduction.
  • Data interrogation with the most sophisticated
    statically analysis tools would also be
    institutionalised

25
OPTIMAL USE OF INFRASTRUCTURE
  • The findings indicate that some people still
    travel distances in access of 50km, and wait long
    at pay points. The Agency will focus on the
    following
  • Developing and implementing an efficient and
    optimal model (making use of all current
    infrastructure before investing in new ones)
  • Ensuring equal access within 5 7 km of each
    individual
  • Investment in infrastructure will be required to
    ensure beneficiaries are paid in dignity.
  • The migration of significant number of
    beneficiaries to banks where available and
    generate efficiencies to pay for current
    infrastructure shortages

26
Enhancing Communication
  • Current approaches to communication is limited,
    lack innovation and is reactive
  • The Agency will utilize various and innovative
    means of reaching potential and active
    beneficiaries
  • Within in year various mechanisms will be put in
    place to proactively go out and find
    beneficiaries before they come and apply, for
    example the biggest database of school going
    children has already been built up at the Agency,
  • Using sms, email and a virtually integrated
    national call centre would facilitate
    applications
  • Using voice recognition technology should enable
    regular reviews with burdening beneficiaries

27
SERVICE DELIVERY WORK STREAM
  • The following was accomplished
  • Developed a new Service Delivery Model and three
    year Strategic plan covering implementation.
  • Already initiated a range of integrity
    improvement initiatives to reduce risk of
    transferring ineligible beneficiaries and data to
    Agency.
  • The Operational ring fencing template for
    national will be complete by September.
  • Developed the optimal delivery network for future
    payments of grants based on infrastructure and
    service demands

28
HUMAN CAPITAL MANAGEMENT
  • The following is finalised
  • Organisational structures National and Provincial
    finalised
  • The ring fencing of core personnel was completed
    (National and Provincial)
  • The decision on support staff is still
    outstanding due to discussions between various
    stakeholders
  • Migration plans for the transfer of staff in
    December in process of finalisation
  • Service providers are appointed to assist with
    HCM operational matters (nationally) for 6
    months
  • Permanent positions will be advertised and
    filled
  • Interim policies and procedures in process of
    finalisation

29
FINANCE WORK STREAM
  • The following is finalised
  • Interim Funding Mechanism finalised (Conditional
    Grants to Provinces)
  • Interim Systems in place at Head Office (Logis,
    Persal, BAS)
  • Bank account was opened for SASSA Head Office
  • Interim policies and procedures drafted
  • Ring Fencing at National completed and ring
    fencing at Provinces in progress
  • Costing Model developed
  • Cash Flow for Provinces finalised

30
ICT, INFRASTRUCTURE COMMUNICATIONS
  • The following is finalised
  • The IT architecture plan has been developed for
    standardisation and service providers for
    communication networks are on standby.
  • The tender for an ERP system was awarded and
    implementation will commence soon.
  • The Agency Head Office is 70 complete (finalised
    end of October 2005) and the move to separate
    provincial Agency offices has already been
    completed in three of the nine provinces.
  • A tender for Agency branding will be issued soon.
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