1. Avalanche Business Solutions [Pty] Ltd. Monday, 25th October 2004
Presentation to Parliamentary Select Committee on Social Development re COSTING OF OLDER PERSONS BILL
Avalanche Business Solutions [Pty] Ltd. Monday, 25th October 2004 A

2. PRESENTATION OVERVIEW
Avalanche Business Solutions
Avalanche Team
Project Scope
The Project: - Approach Methodology Process
Legal Dimension - Comprehensive Analysis of Bill Amendments Example: Section Comparative Analysis of Bill, Amendments and Act

3. PRESENTATION OVERVIEW [cont’d]
Fiscal Dimension - Costing Comparative Costing Consent – Process Costing Consent – Assumptions Costing Consent – Provision Costing Consent – Methodology
Service Delivery Model - Roles + Functions Principles Responsibility Levels
Project – Way Forward

4. AVALANCHE BUSINESS SOLUTIONS [PTY] LTD.
Avalanche Business Solutions [ABS] is the consulting division of Avalanche SA [Pty] Ltd.
Avalanche BS holds and manages all related business and support service functions, specialising in the domain of
- Social Development Consulting Human Resource Strategy Development Turnaround Management + Transformation Resource Management Services
Avalanche BS is owned by a BEE holding company
Our reputable team of skilled and experienced personnel has an unwavering commitment to develop the macro-economy in South Africa and sub-Saharan Africa through integral partnerships in strategic sectors of industry.

5. AVALANCHE PROJECT TEAM

6. PROJECT TEAM [cont’d] PROJECT LEADER Donovan Nadison
Turnaround Strategist, Advisor and Change Project Implementer
IMT Member: E Cape DSD Turn Around
LEGAL
Bruce
Pattison
Litigation and Commercial Law Expert
Legal Advisor: IMT E Cape DSD
SOCIAL
Janet
Du Preez
Social Development Sector Expert
Former CD: Social Development, Gauteng DSD
Pravienna
Naidoo
Former PA to Ignatius Jacobs, Former Gauteng MEC: Social Development
FINANCIAL
Ilan
Diamond
Public Sector Financial Costing Expert

7. PROJECT SCOPE Our understanding of the Project Scope is to:
1 Study the Bill in detail to assess the fiscal and budgetary implications;
2 Determine the cost implications of the Bill at national, provincial and local levels across the various sectors;
3 Attend all future deliberations on the Older Persons Bill and Task Team meetings at the Department [DSD];
4 Facilitate consultative processes jointly with national departments and National Treasury in relation to the costing of the Bill;

8. PROJECT SCOPE [cont’d]
5 Determine the cost implications of priorities as determined by the DSD for the two-year MTEF cycle period [the costing should cover two separate MTEF cycles];
6 The DSD will appoint a reference group to work with the Tenderer;
7 Report to the TT on progress and challenges; and
8 Analyze the various components of the Bill and, thereafter, cost the [respective] component.

9. THE PROJECT: APPROACH
Comprehensive Analysis of the Older Persons Bill and Proposed Amendments
Comparative Analysis [Cost Drivers] between the Older Persons Bill, its proposed Amendments and the Aged Persons Act
Cost Driver Analysis to effect implementation and maintenance of the Older Persons Bill
Comparative Analysis between the preliminary scoping and costing exercise and current scoping and cost exercise

10. THE PROJECT: METHODOLOGY
Matrix  determining compulsory and discretionary obligations in order to inform relevant cost drivers variables, as well as administered processes to be implemented.
Costing Model  exploration and comparison between current and proposed models across all levels
Social Services Delivery Model  principles, strategy, roles and functions, powers and duties, structure, cost drivers, budget

11. THE PROJECT: PROGRESS Phase Date Key Activity /ies One 17th Sept 2004
Appointment
04th Oct 2004
Verification + scope finalisation with Client
Outstanding
SLA + Order Number

12. THE PROJECT: PROGRESS [cont’d]
Phase
Date
Key Activity /ies
Two
11th - 24th Oct 2004
Literature Review
Legal + Social Review of Bill + Proposed Amendments
Comprehensive Analysis of Bill, Proposed Amendments + Aged Act
Meeting with Reference Group
Costing of one aspect [new deliverable within 5(7)] of Bill
Preparation for Parliamentary Select Committee Meeting
Presentation to Parliamentary Select Committee

13. COMPREHENSIVE ANALYSIS OF THE OLDER PERSONS BILL AND PROPOSED AMENDMENTS
Compulsory vs. Discretionary Obligations
Administrative Obligations
Legal Implications re Litigation
Compulsory: Where any party who needs to act by law has no choice but to do so  shall / must
Implementation of the Act
Regulations
Systems + Procedures
Infrastructure
Equipment
Personnel
Programmes
Litigation may arise from
Interpretation of wording + provisions
Constitutional issues [discrimination, etc.]
Grievance  administrative law [natural laws of justice]
Discretionary: Where any party who needs to act has an option to act or not to act  may

14. THE PROJECT: EXAMPLE – SECTION 5 [cont’d] X
Older Persons Bill + Proposed Amendments
Provision [Section 5]
Comp. Oblig.
Discr. Oblig.
Administrative Obligations
Legal Impl. [Litigation]
5(1)(a)
Subject to Section 23, no person may operate a facility unless such facility has been registered under this Section. X
To develop and maintain register of facilities
5(1)(b)
A facility maintained by the State does not have to be registered under this Section.
5(2)
A person who wished to own, manage or operate a facility must, in the prescribed manner, apply to the Minister for registration.

15. THE PROJECT: EXAMPLE – SECTION 5 [cont’d] X
Older Persons Bill + Proposed Amendments
Provision [Section 5]
Comp. Oblig.
Discr. Oblig.
Administrative Obligations
Legal Impl. [Litigation]
5(3)
After consideration of
application in Subsection (2) the
Minister may —
5(3)(a)
Refuse the application or
grant it subject to such
conditions as he may
determine, and if granted, direct
a registration certificate
specifying those conditions be
issued to the applicant in the
prescribed form; or X
Regulations [procedures]

16. THE PROJECT: EXAMPLE – SECTION 5 [cont’d] X
Comparison between [new] Older Persons Bill + Aged Persons Act
Provision [Section 5]
Comp. Oblig.
Discr. Oblig.
Administrative Obligations
Legal Impl. [Litigation]
5(3)(b)
Subject to such conditions as he
may determine, grant authority to
the applicant to operate the facility
for such period, not exceeding
12 months, as the Minister may
determine, and direct that a
temporary registration certificate
specifying those conditions be
issued to the applicant in the
prescribed form for that period,
and after expiration of the said
period, or after notice by the
applicant in the prescribed
manner that the said conditions
have been complied with,
whichever occurs first,
reconsider the application. X
Regulations [procedures]

17. THE PROJECT: EXAMPLE – SECTION 5 [cont’d] X
Comparison between [new] Older Persons Bill + Aged Persons Act
Provision [Section 5]
Comp. Oblig.
Discr. Oblig.
Administrative Obligations
Legal Impl. [Litigation]
5(4)
The Minister may at any
time after one month’s notice
of his or her intention to do so,
and after consideration of any
representations received by him
or her during such month,
amend or cancel a
registration certificate issued
in terms of subsection (3)(a). X
Regulations
5(5)(a)
Amendment or
cancellation of registration
certificate must be effected by
notice to the holder thereof,
and takes effect on a date
specified in notice.
Notification

18. THE PROJECT: EXAMPLE – SECTION 5 [cont’d] X
Comparison between [new] Older Persons Bill + Aged Persons Act
Provision [Section 5]
Comp. Oblig.
Discr. Oblig.
Administrative Obligations
Legal Impl. [Litigation]
5(5)(b)
Date specified in notice
may not be earlier than three
months after the date of the
notice, unless the Minister and
the holder of the registration
certificate have agreed
otherwise. X
[limited on date]
Regulations
5(6)
A person to whom a
registration certificate has been
issued in terms of Subsection
(3) may not transfer it to any
other person

19. THE PROJECT: EXAMPLE – SECTION 5 [cont’d] X
Comparison between [new] Older Persons Bill + Aged Persons Act
Provision [Section 5]
Comp. Oblig.
Discr. Oblig.
Administrative Obligations
Legal Impl. [Litigation]
5(7)
If registration of facility
cancelled in terms of subsection
(4), or if the owner of a facility
wishes to close down such
facility for any reason, he must
take reasonable steps to
ensure that on the closing down
of such facility the older persons
concerned are accommodated
in another registered facility
or with persons who, in the
opinion of a social worker, are
fit and proper persons for
accommodating the older
person or older persons. X
Monitoring on part of owner

20. THE PROJECT: EXAMPLE – SECTION 5 [cont’d] X
Comparison between [new] Older Persons Bill + Aged Persons Act
Provision [Section 5]
Comp. Oblig.
Discr. Oblig.
Administrative Obligations
Legal Impl. [Litigation]
5(8)
Any person who contravenes
or fails to comply with a
provision of this section, or of a
condition imposed thereunder,
is guilty of an offence. X

21. COMPARATIVE ANALYSIS OF THE OLDER PERSONS BILL, ITS PROPOSED AMENDMENTS, AND THE
AGED PERSONS ACT
Please note that Section 5 [Registration of Facilities] of the Older Persons Bill [and its respective Proposed Amendments] replaces [repeals] Section 3 of the Aged Persons Act.
Also, two completely new provisions pertain to
Acquiring of consent by residents [Older Persons]; and
Handing back of assets procured with State funding.

22. COSTING – COMPARATIVE
Comparative Analysis of Provision 5(7) of Older Persons Bill, in conjunction with Proposed Amendment 9(4) and Aged Persons Act.
Aged Persons Act
Consult Minister
+ Competent Authority
3A(3)a
Report
3A(3)b
Older Persons Bill + Proposed Amendments
Consult Minister
7(3)a
Notification +
Consultation
9(4)
Report to
Minister
7(3)b
Asset
Transfer
7(3)c

23. COSTING CONSENT – PROCESS
High level preliminary costing example relating to Consent clause added The adding of Consent as an element will mean:
A person must be notified
Acquire Consent
Must be taken to see the facility, if necessary
Must approve or disapprove – for whatever reason
If approve – must be transferred , etc..
If disapprove – start process again, and so on – until person is happy and approves

24. COSTING CONSENT – PROCESS [cont’d]
The adding of Asset Transfer as an element will mean:
Keeping an asset register
Admin to keep register up to date
When facility closes down will need a recon
Will then need a physical transfer of the assets to the Government

25. COSTING CONSENT – ASSUMPTIONS
High Level preliminary costing example relating to Consent clause added
Costing Example
1 social worker / facility placed at a cost of R60,000 / annum
Admin support [drivers, office staff, etc.] relating to consent element of bill costed at additional cumulative R60,000 / annum
15% premium on delivery to those Provinces with most facilities in deep rural areas – Limpopo, KwaZulu Natal, Eastern Cape, Mpumalanga, Northern Cape

26. COSTING CONSENT – PROVISION
Government Subsidised Residential Facilities
 Province
Number of facilities
Cost per facility per annum
Cost per Province of Consent
Western Cape
139
120,000
16,680,000
Gauteng 96
11,520,000
KwaZulu Natal
138,000
13,248,000
Free State 71
8,520,000
Eastern cape 54
7,452,000
Northern Cape 28
3,864,000
North West
3,360,000
Limpopo 9
1,242,000
Mpumalanga 7
966,000
TOTAL
R66,852,000

27. COSTING CONSENT – METHODOLOGY
Private Facilities
Province 
Number of
facilities
Cost per
facility per
Annual
Province of
Consent
Western Cape
135
120,000
16,200,000
same ratio as Gauteng (Private
/ Subsidised)
Gauteng 93
11,160,000
93 actual facilities
KwaZulu Natal
138,000
12,834,000
Free State 36
4,320,000
use ratio as 50% (Private /
Subsidised)
Eastern cape 27
3,726,000
Northern Cape 14
1,932,000
North West
1,680,000
Limpopo 5
690,000
Mpumalanga 4
552,000
TOTAL
R53,094,000

28. COSTING CONSENT – METHODOLOGY R 119,946,000
Grand Total [Government Subsidised + Private facilities]
R 119,946,000

29. SERVICE DELIVERY MODEL: ROLES + FUNCTIONS
develop
protect
protect
care
care

30. SERVICE DELIVERY MODEL: PRINCIPLES
Respect for Older Persons’ right to self-determination
Community care vs. institutional care [developmental]
Broadens access to the especially vulnerable [definition of facility expanded to include private residential homes and shelters]

31. SERVICE DELIVERY MODEL: RESPONSIBILITY LEVEL
National DSD
Provincial DSD
DSO
NPO
Older Person

32. THE PROJECT: WAY FORWARD
Phase
Date
Key Activity /ies
Three
Oct – Nov 2004
Develop Service Delivery Model
Dev detailed costing framework:
Identify cost drivers
Assume regulations
Develop costing model
Cost Bill + verify with Treasury
Dec 2004 – Jan 2005
Present Costings to Department of Social Development for Approval
Feb 2005
Project Closeout

33. Thank You.