PRESENTATION ON THE COSTING OF THE OLDER PERSONS BILL FOR PORTFOLIO COMMITTEE AUGUST 2005

INTRODUCTION Costing of the Older Persons Bill was outsourced to a service provider viz Avalanche Solutions. The National Department together with the Provincial Departments of Social Development worked closely with the service provider serving as a reference group to ensure accuracy and appropriateness of the costing.

PROJECT PROCESS The costing was done for the following programmes:-  Residential Care  Integrated Community Care and Outreach Services  Home Based Care  Poverty Relief and Economic Empowerment  Capital Costs  National and Provincial Administration

PROJECT DESIGN  Understand the contents of the Bill  Analyse each component of the Bill in order to cost the OPB  Assess the fiscal and budgetary implications  Determine the cost implication at a National, Provincial and Local levels across various sectors

PROJECT DESIGN  Determine the cost implications of priorities as determined by the DSD for the three-year MTEF cycle period  Analyse the various components of the Bill, and thereafter cost the components  Facilitate consultative processes jointly with National department and Treasury

LEGAL ASSESSMENT: PURPOSE  This assessment was done in order to identify and determine the cost drivers that may impact on the implementation of the relevant provisions of the Bill  To identify the rights and obligations (both compulsory and discretionary obligations)  To identify the risks of litigation related to the implementation of the provisions of the Bill.

LEGAL ASSESSMENT: APPROACH + METHODOLOGY  Unpacked provisions of the Bill  Assessed meaning and impact of the provisions of the Bill  Assignment of responsibilities (nationally and provincially) and cost implications thereof  Identified the provisions of the Bill that would, in probability, lead to litigation  Gain understanding of and insight into objectives and goals that the legislature proposes to attain to Bill, and determine practical and financial implications.

LEGAL ASSESSMENT: IMPLICATIONS FOR LITIGATION General Provisions throughout the bill which increases the administrative role of the state, both at National and Provincial Level a.Chapter 1 (2) Provision for Developmental Programmes b.Chapter 2 New conditions for the care of Older Persons in Residential Facilities c.Chapter 3 (12) Protection of Older Persons (Rights based approach to service delivery) d.Chapter 3 (14) provision of psychosocial Services e.Chapter 3 (15) provision of psychosocial Reports f.Chapter 3 (17) Keeping of a register of abuse of Older Persons..

FISCAL ASSESSMENT  Norms and standards for service delivery within developmental paradigm  Pre-determined costing models  Data on existing services and targets  Funding provided for services of both government and NGO’s

FISCAL ASSESSMENT Scope and Extent of Current Services Analysis per province of Old Age Homes Services Centres Overall subsidies to NGO’s for other programmes In all cases analysis was done i.t.o Number of facilities Subsidy per province Total number of residents/beneficiaries Unit cost

FISCAL ASESSMENT  Approach and Methodology Through consultation with provinces, the core programmes were identified as follows:  Promotion and Protection of Older Persons  Community Based Programmes  Home Based Programmes  Intergenerational Programmes

FISCAL ASSESSMENT  Residential Care  National and Provincial Departmental Administration  Economic Empowerment and Development

NORMS  The norms upon which the costing was done is based upon policies and service delivery models of the Department of Social Development  The baseline data of Older Persons used is based on the number of older persons who are currently in receipt of the Old Age Grant, as these have been means tested into vulnerability  2% of the total vulnerable older persons as a target for accommodation in a residential care facility (old age homes).

NORMS  3% of the total vulnerable Older Persons would be provided for in home based care. This service is for those Older Persons who require frail care services whilst remaining in the community  20% for integrated community care and outreach programmes. This is to ensure that the bulk of Older Persons remain independent and are at the highest possible level of functioning in the community.

LEVELS OF CARE The programmes have been costed according to the following levels  Basic care – the minimum level at which the service can be provided  Intermediate care – minimum level plus additional services such as: -ancillary health, occupational- and physiotherapy -recreational activities and others  Tertiary care – more advanced and luxurious care such as that which is provided in retirements or private homes (Please refer to attachments)

Table 3: Distribution of Total Older Persons (60+) by Province

FINDINGS AND ANALYSIS  Current allocation for 2005/06 = R462m  For 2006/07 = R514m  Projected estimates as set out in table 7, exceeds the Department’s budgetary allocation  Consideration must be given to the fact that costing models give the actual cost of basic services for Older Persons  Provisions in the Bill regarding monitoring processes will require an increase in the number of social service personnel.

FINDINGS AND ANALYSIS  Innovations introduced by the bill e.g. register of older persons Bill increase administrative functions  The new processes to manage and operate a facility expands the administration function of the facilities and the Department.

FINDINGS AND ANALYSIS  The right to reasonable access to basic service, places a burden to the government to make assistance/services available  Notification of Older Persons’ Abuse and the notification for thereof demand an increase of professionals to notify, investigate, report and take action.

KEY OBSERVATIONS  The demand for services outweigh the available services  Service points are more required in rural areas as revealed in poverty gaps  The implementation of the Madrid Plan of action on Ageing demand a different scope of services  The development of community based care and support services is critical.

CONCLUSION  Government has to invest in community based services and target programmes that reach the poor of the poorest  Resources should be driven by needs, with a view to keep Older Persons independent within the community and functioning at the maximum potential level. T H E E N D