1. Acting Director- General: Mr Les Kettledas
PRESENTATION TO
PORTFOLIO COMMITTEE
18 March 2008
Acting Director- General: Mr Les Kettledas

2. Index
I. Unemployment Insurance Fund
II. Compensation Fund

3. Unemployment Insurance Fund STRATEGIC PLAN & MTEF BUDGET 2008-2011

4. Presentation outline Part C Part D Part A Part B Overview
Strategic Perspective
Part B
Strategic Outputs for 2008/09
Part C
Performance Review
Part D
Budget information
Strategic Priorities

5. Part A: Overview

6. Overview Core function Main products Administration
The collection of contributions and the provision of short term cash benefit on a monthly cycle to registered workers that become unemployed.
Main products
Unemployment benefit
Illness benefit
Maternity
Adoption benefit
Dependants benefit
Administration
UIA No 63 of Administration
UCA No 4 of Collection

7. UIF Strategic Perspective
Vision
Mission
Objectives

8. Vision
To be a sustainable organisation providing effective short
term financial relief to qualifying contributors & their dependents
Mission
To provide short-term insurance benefits to qualifying contributors through;
Effective and efficient administration;
Ensuring accessibility of services to all stakeholders

9. 4 balanced Strategic Objectives
Financial:
To obtain clean audit opinion
Stakeholders:
To increase stakeholder awareness and support of the Fund
People:
To recruit and retain competent staff
Processes:
To enhance the quality of service to our clients

10. Part B Strategic Outputs for 2008/09

11. Medium Term Output Targets
Clean audit opinion
Improve contribution collection from employers
Improve compliance by employers
Reduction of losses to the Fund
Improve financial and operations management and reporting
Increase stakeholder awareness and support for the Fund
Entrench UIF as a safety net against unemployment hardships
Educate stakeholders about their rights and obligations
Build relationships with stakeholders
Recruit and retain competent and caring staff
Develop a multi-skilled and competent workforce
Recruit and retain competent staff
Develop and implement a succession plan
Enhance quality of service to our clients
Optimal use of technology. Define and automate processes
Improve operational efficiency
Enhance IT systems

12. Part C: PERFORMANCE REVIEW 2007/08 PERFORMANCE REVIEW ACHIEVEMENTS

13. 2007/08 STRATEGIC REVIEW 4 STRATEGIC PRIORITIES ADOPTED
Investment in infrastructure to boost service delivery
Improve financial sustainability of the Fund
Building a sound institution based on good governance
Increase emphasis on performance management not just finance

14. 2007/08 REVIEW : Achievements
Investment in infrastructure to boost service delivery
Document management system implemented
Awareness campaign reaching 20+ million

15. 2007/08 : Achievements Improve financial sustainability of the Fund
2006/07
CHANGE
CONTR. INCOME
TOTAL ASSETS
SURPLUS

16. 2007/08 : Achievements
Building a sound institution based on good governance
Implemented
Risk management strategy and function
Corporate governance framework

17. 2007/08 : Achievements
Increase emphasis on performance management : EMPLOYERS
2007/08
2006/07
Change
Domestic
23 091
Commercial
73 033
Taxi
4 836
3 015
1 821
Total
97 945

18. 2007/08 : Achievements
Increase emphasis on performance management : EMPLOYEES
2007/08
2006/07
CHANGE
DOMESTIC
4 132
COMMERCIAL
TAXI
5 413
4 782
631
TOTAL

19. 2007/08 : Achievements
Increase emphasis on performance management: BENEFITS
2007/08
R’000
2006/07
Change
Unemploy.
(20 549)
Illness
4 232
Maternity
36 917
Adoption
585
588
(3)
dependent
(11 421)

20. 2007/08 : Achievements HUMAN RESOURCES MANAGEMENT AFR.M 5 38.9 6 54.5
EMPLOYMENT EQUITY SR 13 TO 15: 12 POSTS
NUM.T
%. T
CUR.N
CUR.%
AFR.M 5
38.9 6
54.5
AFR.F 4
36.9 2
18.2
COL.M
1.4
COL.F
1.7
IND.M
1.5 1
9.1
IND.F
1.3
WHI.M
8.9
WHI.F
9.4

21. 2007/08 : Achievements HUMAN RESOURCES MANAGEMENT NUM.T %. T CUR.N
EMPLOYMENT EQUITY SR 9 TO 12: 74 POSTS 62 FILLED
NUM.T
%. T
CUR.N
CUR.%
AFR.M 29
38.9 18
AFR.F 27
36.9 21
33.9
COL.M 1
1.4 3
4.8
COL.F
1.7
IND.M
1.5
IND.F
1.3
1.6
WHI.M 7
8.9
WHI.F
9.4 12
19.4

22. Part D: Budget Information
MTEF Budget 2008
Strategic priorities

23. Economic classification: MTEF 2008
Staff costs
R’000
Goods & Services
Other
Benefits
Revenue
2007/08
71 000
2008/09
11 000
2009/10
3 200
2010/11
3 300

24. MTEF 2008 GROWTH TRENDS: SURPLUS - OVER R16 bn OVER 3YRS
Total MTEF growth in Rand (bn)
Surplus
2007/
2008/
2009/
2010/

25. MTEF GROWTH TRENDS REVENUE – year on year + 11%
MTEF 2008 growth trend in Rand (bn)
Revenue increase
2007/
2008/
2009/
2010/

26. MTEF GROWTH TRENDS BENEFITS & RESERVES – Rands (bn)
BENEFIT RESERVES (yr)
2007/
2008/
2009/
2010/
Average benefit growth of 14% per year.
Actuary sourced estimates.

27. MTEF GROWTH TRENDS ADMIN EXPENDITURE: Average 9% over 3 years
MTEF 2008 Admin growth in Rands (m)
Admin Increase
2007/
2008/09 1,
2009/10 1,
2010/11 1,

28. MTEF 2008: GROWTH IN SUPPORT OF STRATEGIC PRIORITIES
Enhancing quality of service to our clients –
Reducing paper trail through development of IT solutions
Implement updated standard operating guide
Improve benefit value to clients
Input to social security review forum
Obtaining clean audit report - improving revenue management:
Implement Debt & Compliance Management strategy: compulsory declarations

29. MTEF 2008: GROWTH IN SUPPORT OF STRATEGIC PRIORITIES
Obtaining clean audit report - improving revenue management:
Improve debt collection through outsourcing of debt collection services and application for court orders.
Increase stakeholder awareness and support:
Advocacy & awareness campaigns through
Media campaigns
Stakeholder meetings
Promotional material
Obtaining clean audit report – Curbing fraudulent transactions –
Implement bank verification strategy.

30. MTEF 2008: GROWTH IN SUPPORT OF STRATEGIC PRIORITIES
Recruiting and retaining competent staff by providing resources for
Training & workshops facilities
Bursaries
Learnerships
Implementation of a work place skills plan
Enhance quality of service to clients through the optimal use of technology by:
continuously maintaining and enhancing the Fund’s management systems
Undertaking a special project to improve the quality of the Fund’s declaration database
Implementing an integrated management information system for siyaya

31. Benefit Improvement - impact on surplus: R1.9bn over three years
Proposal under consideration:
Impact of Change of IRR from a minimum 38% to 45% and a maximum 60% to 65% on estimated surpluses:
2008/09 R544m
2009/10 R622m
2010/11 R713m
Assuming claim expenditure will increase on average by 14.66%

32. Financial achievements as at 31 December 2007
YTD 07/08
(R‘000)
YTD 06/07
% Change
Increase/
decrease
Contributions
6,743,224
5,911,226 14
Investment income
1,291,481
767,991 68
Other income
1,634
1,008 62
Benefits expenditure
2,176,415
2,167,237
0.4
Operating expenditure
267,910
264,182 1
Staff cost
212,985
235,418 10
Net surplus
4,497,765
2,999,342 50
Investments
24,691,649
17,826,987 39
Technical reserves
11,590,807
10,405,748 11
Acc surplus
14,274,646
8,330,713 71
Total assets
26,006,975
18,960,940 37

33. Financial achievements as at 31 December 2007: Budget vs Actuals
December YTD
2007/08
(R‘000)
Budget
YTD
2006/07
Variance
(R’000) %
Over/
Under
Contributions
6,743,224
6,553,239
189,985 3
Investment income
1,291,481
1,032,980
258,501 25
Other income
1,634
1,024
610 60
Benefits expenditure
2,176,415
2,934,894
(758,479) 26
Operating expenditure
267,910
392,886
(124,976) 32
Staff cost
212,985
307,356
(94,371) 31
Net surplus
4,497,765
2,876,862
1,620,903 56

34. COMPENSATION FOR CCUPATIONAL INJURIES AND DISEASES ACT, 130 OF 1993 AS AMENDED (COIDA)

35. VISION AND MISSION MISSION
To provide compensation for occupational injuries, diseases and the rehabilitation of employees and deliver continuous value to all stakeholders

36. VISION AND MISSION VISION
To develop and implement solutions to provide quality and accessible services according to standards as set in consultation with stakeholders, whilst maintaining the Fund’s liquidity.

37. STRATEGIC OBJECTIVES Efficient social safety net
Financial viability of the Fund ensured
Effective cash and investments management
Management reforms and restructuring of the Fund are effected
Enhance quality and access to COIDA services and information
Effective data and information management ensured

38. SPECIFIC OUTPUTS-(2007/08)
Reforming Management and restructuring the Fund through the following initiatives;
Establishing an automated Integrated claims and revenue management system
Refocusing the fund for better service delivery
Developing and implementing an advocacy, communication and marketing strategy
Improving turn-around time for claims settlement
Improving collection and access to services

39. ACHIEVEMENTS 84% Reduction in backlog claims
New imaging system Implemented
Elimination of cheque payment method
Improvement in Revenue Collection
Communication Strategy in place

40. CHALLENGES
The following strategic outputs were not achieved in the reporting year;
Policy on Early Return to Work not finalised
Claims Turn-Around time still remains a challenge
Slow progress in the implementation of IT hampers our finalisation of the Integrated claims and revenue Systems

41. FINANCIAL INFORMATION
FEB 2008
2007/08
R’000
2006/07
Variance %
Contributions revenue
3,336,907,301
2,579,469,438
22.7
Investment income
556,102,560
470,330,516
15.4
Other income
11,854,528
12,570,631
(-5.6)
Benefits paid
2,016,713,837
2,374,316,893
(-15.1)
Admin
313,420,910
463,733,456
(-32.4)
Surplus
1,820,279,668
355,058,219
55.5
Investments
16,480,639 ,000
15,142,223,000
17.8

42. FINANCIAL INFORMATION CONTINUED….
Benefits
No. of claims paid
No. of payments made
Amount
MEDICAL
543,449
886,511
1,430,143,788
COMPENSATION
324,627
331,672
655,543,479
TOTAL
868,076
1,218,183
2,085,687,267

43. STATISTICS ON CLAIMS OPENED SINCE 2000 TO OCTOBER 2007
YEAR
OPENED
ACCEPTED %
REPUDIATED
PAYMENTS
2000
237605
188208 79
2217
168821
89.6
2001
274635
224046 82
4047
198035
88.39
2002
249702
213106 85
4270
187649
88.05
2003
233660
203167 87
3730
180097
88.64
2004
220576
188703 86
2810
163545
86.66
2005
246841
211179 68
2698
182461
86.40
2006
216584
168082 78
1442
144983
86.25
2007
182723
117272 64
1040
82757
70.56
TOTAL 81
22254
86.43

44. MEDICAL PAYMENTS BY FEBRUARY 2008

45. NUMBER OF MEDICAL ACCOUNTS PAID BY FEBRUARY 2008

46. TTD PAYMENTS BY FEBRUARY 2008

47. TTD PAYMENT TOTALS BY FEBRUARY 2008

48. NUMBER OF PENSION PAYMENTS BY FEBRUARY 2008

49. TTD PAYMENTS BY FEBRUARY 2008

50. PD LUMP SUM PAYMENTS BY FEB 2008

51. PRIORITIES FOR 2008/09 Consolidating the EFT Payments
Improving Collections
Improving the Claims Turn-around time
Development of Funds Information System
Addressing the Human Capacity Challenge

52. MTEF- BUDGET FOR 2008/09-2010/11 Total Revenue Surplus/Deficit
Account\
2007/2008
2008/2009
2009/2010
2010/2011
Description
Budget
Forecast
Total Assessment Income
3,030,474
3,240,809
3,435,257
3,641,372
Total Other Income
1,287,146
1,353,962
1,433,736
1,519,761
Total Revenue
4,317,620
4,594,771
4,868,993
5,161,133
Current Expenses
433,249
501,120
502,825
527,261
Transfers and Subsidies
2,338,775
2,671,113
2,831,381
3,001,263
Total Expenses
2,772,024
3,172,233
3,334,206
3,528,524
Surplus/Deficit
1,545,596
1,422,538
1,534,787
1,632,609

53. CONCLUSION
We project a marginal inflationary increase of 7% on revenue over the period
We also project an average 12% increase in Claims due rising medical costs
Significant growth of 13% on Compensation to employees due to the engagement of contract workers

54. Thank you