OOperationsperations of the of the

Unemployment Unemployment

Insurance FundInsurance Fund

IndexIndex

• Transformation of the fund – getting the basics Transformation of the fund – getting the basics rightright

• What has the operation being doingWhat has the operation being doing

– As relates to its mandate of servicing public As relates to its mandate of servicing public

• Current and Future actions Current and Future actions

Processes and procedures required to support the stated purpose/ objective

Support structures & information systems/ technology

Process

Vision

Culture

Infrastructure OrganisationHuman

Resources

Stated purpose/ objective of FundProvide effective social safety net to unemployed workers

Structure, roles & organization interfaces

People practices, skills & competencies

Values, behaviour and attitudes required to enable vision

In transforming the Fund an holistic In transforming the Fund an holistic approach was adoptedapproach was adopted

Business transformation is a continuous Business transformation is a continuous processprocess

Currentstate

Future stateStrategic

vision

“It is not what the vision is, but what the vision does”.

(Peter Senge)

We are we?We are we?

Organ

isat

ional

re-c

onstru

ctio

n 36

month

s

Impl

emen

t law

Build pro

cesses

Instit. capacity

Realising

Phase 1

2002-2003

Phase 2

2003-2004

Pha

se 3

2005

-200

6

Current State

Future State

•Re-engineer•Build application•Investigation org struct.•Meet all commitments to clients•Strengthen capacity

•Implement new processes•Quick wins :org struct.•Improve service delivery

•Implemented law•Insolvent-to-solvent•Actuarial assessment•Integration to SARS•Extended coverage

Pillars on which turnaround is Pillars on which turnaround is basedbased

Information Technology Information Technology

Revised Legislation Revised Legislation

Institutional restructuringInstitutional restructuring

Sustainable Sustainable FundFund

Progress with re-structuringProgress with re-structuring

• In addition to implementing the legislation approved by parliament in 2002, the In addition to implementing the legislation approved by parliament in 2002, the fund successful extended coverage to all domestic workers in 2003. More than fund successful extended coverage to all domestic workers in 2003. More than 600 000 domestic employers were registered and more than half a million 600 000 domestic employers were registered and more than half a million domestic employees were registered on the funds database. Coverage was also domestic employees were registered on the funds database. Coverage was also extended to all those employee employed by organs of state that are not defined extended to all those employee employed by organs of state that are not defined as officials in terms of the public service regulations. as officials in terms of the public service regulations.

• The Fund continued the process of developing a new The Fund continued the process of developing a new blue print for the organisation by negotiating with key blue print for the organisation by negotiating with key stakeholders the mechanics of the new structure. stakeholders the mechanics of the new structure. This is intended to transform the organisation to This is intended to transform the organisation to deliver on its mandate of social protection to deliver on its mandate of social protection to unemployed workers. unemployed workers.

Legislative Legislative re-structuringre-structuring

Institutional Institutional restructuringrestructuring

• Creation of business applications to support Creation of business applications to support businessbusiness, during the last year the fund was , during the last year the fund was engaged in the development of its new business engaged in the development of its new business applications, that is expected to significantly applications, that is expected to significantly improve the control environment. improve the control environment.

Information Information TechnologyTechnology

PPP with SiemensPPP with SiemensPPP with SiemensPPP with Siemens

UIA 63 of 2002UIA 63 of 2002UIA 63 of 2002UIA 63 of 2002

UIF world class modelUIF world class modelUIF world class modelUIF world class model

2004/2005 was a challenging year in 2004/2005 was a challenging year in which the fund which the fund continued to continued to lalayy a firm a firm foundation for future growth.foundation for future growth.

Growth in investmentsGrowth in investments

2002/2003 2002/2003

2001 2001

- 255k d- 255k deficit

2,620,052 2,620,052 investmentsinvestmentsR R

20020033/200/20044

6,255,000 6,255,000 investmentsinvestments

Benefit ExpenditureBenefit Expenditure (R,000) (R,000)

Year Benefits (m)

1998 3 051 000

1999 2 984 000

2000 2 905 000

2001 2 838 073

2002/3 2 367 000

2003/4 3 282 000April 2004-Jan 2005 2 112 022

As part of its turnaround the fund was able to contain expenditure in an attempt to return to financial health and create the financial strength needed to bring about lasting change. For three quarters of the new financial year this trend

sustained improvement has continued.

Growth in Revenue (R,000)

FiveFive year revenue growth year revenue growth

2002/2003 2002/2003

2001 2001

20002000

2.72.7

2.82.8

4.34.3

R bnR bn

4.4.0808 20020033/200/20044

15 months

12 months

2004/2005 2004/2005

April 2004-Dec 20045.065.06

Registration of domestic Registration of domestic EmployersEmployers

600 000600 000 domestic employers registered. domestic employers registered.

495 000495 000 details of employees recorded. details of employees recorded.

600 000600 000 domestic employers registered. domestic employers registered.

495 000495 000 details of employees recorded. details of employees recorded.

Overwhelming Public response Overwhelming Public response to campaign to campaign

InternetInternetInternetInternetFaxFax Labour Labour CentresCentres

Call Call CentreCentre

The inclusion ofDomestic workerswas a World firstfor the Department.

As at:As at: Domestic Domestic Employers Employers registeredregistered

Active Active Domestic Domestic Employers Employers registeredregistered

Active Active DistinctDistinctDomestic Domestic Employees Employees registeredregistered

29 February 200429 February 2004 592 522592 522 529 519529 519 484 959484 959

31 March 200431 March 2004 596 368596 368 531 404531 404 488 988488 988

30 April 200430 April 2004 599 278599 278 531 389531 389 489 948489 948

31 May 200431 May 2004 602 712602 712 533 933533 933 492 712492 712

30 June 200430 June 2004 605 712605 712 535 748535 748 493 904493 904

31 July 200431 July 2004 608 365608 365 534 416534 416 495 066495 066

31 August 200431 August 2004 611 022611 022 534 559534 559 495 076495 076

30 September 200430 September 2004 613 918613 918 534 666534 666 497 530497 530

29 October 200429 October 2004 616 583616 583 531 815531 815 498 100498 100

30 November 200430 November 2004 619 265619 265 532 827532 827 498 659498 659

31 December 200431 December 200431 January 200531 January 2005

620 699620 699623 074623 074

529 950529 950529 216529 216

498 927498 927498 210498 210

Registration of domestic Registration of domestic EmployersEmployers

Of the 529 216 active employers, an estimated 444 303 (84%) employers have sent in their declarations, whilst 84913 (16%) employers have still not sent in their declarations.

84%

16%

Compliance by domestic Compliance by domestic EmployersEmployers

As at:As at: Active Commercial Active Commercial Employers Employers registeredregistered

Active Active Distinct Distinct Commercial Commercial Employees Employees registeredregistered

31 January 200431 January 2004 419 753419 753 5 585 7115 585 711

29 February 200429 February 2004 421 378421 378 5 670 9435 670 943

31 March 200431 March 2004 427 938427 938 5 742 9425 742 942

30 April 200430 April 2004 431 762431 762 5 794 6965 794 696

31 May 200431 May 2004 437 484437 484 5 866 9945 866 994

30 June 200430 June 2004 441 944441 944 5 815 2745 815 274

31 July 200431 July 2004 445 367445 367 5 811 9615 811 961

31 August 200431 August 2004 449 424449 424 5 828 8355 828 835

30 September 200430 September 2004 453 525453 525 5 952 6235 952 623

29 October 200429 October 2004 455 851455 851 6 007 6946 007 694

30 November 200430 November 2004 458 368458 368 6 047 7596 047 759

31 December 200431 December 200431 January 200531 January 2005

457 594457 594469 491469 491

6 108 1506 108 1506 115 1166 115 116

Registration of Commercial Registration of Commercial EmployersEmployers

71%

29%

Registered SARS active 298 984, not declaring 95557 (32%), declaring 203427(68%)

Registered UI active 170 507, not declaring 41799 (24.50%), declaring 128708 (75.50%)

Of the 469491 active employers, 332135 (71%) have sent in declarations whilst 169 879(29%) have still not sent in their declarations.

Compliance by Commercial Compliance by Commercial EmployersEmployers

A total of 52957 claims were received in January 2005, 44048 were finalised. Claims in process of being finalised for the month is therefore 8909.The value of the overpayments raised represents 0.91% of the benefits paid.

With reference to processing volumes, 5 centres make up almost 56.43% of the total claims processed; these are KwaZulu Natal with 15.99%, Western Cape with 9.72%, Gauteng South with 11.58%, Germiston with 8.38% and Free State with 6.8%.

Claims Processing for Jan 2005Claims Processing for Jan 2005

Trend of claim paymentsTrend of claim payments

Month Received Approved

Value of overpayments

raised

Number of payments

to beneficiari

esAmount paid to

beneficiaries

Value of payments that were cancelled due to beneficiary failing to report for collection or

starting work

Dec-03 32 378 39 060 R 2 655 708.78 227 126 R 190 486 298.52 R 7 423 495.55

Jan-04 48 659 37 968 R 3 060 837.40 209 531 R 174 652 473.53 R 8 115 188.27

Feb-04 52 209 41 858 R 3 284 338.15 207 474 R 180 455 347.75 R 7 714 368.29

Mar-04 58 229 45 290 R 2 311 652.08 259 626 R 220 123 586.74 R 8 812 656.46

Apr-04 52 263 36 529 R 2 336 962.27 215 481 R 184 163 202.63 R 8 037 806.03

May-04 63 867 49 536 R 2 697 228.33 224 740 R 196 101 184.95 R 8 424 297.43

Jun-04 60 906 50 046 R 3 150 737.84 233 891 R 206 149 157.37 R 9 350 625.87

Jul-04 62 503 54 172 R 3 699 152.97 241 204 R 215 831 455.83 R 8 892 582.70

Aug-04 55 529 47 247 R 2 399 651.76 267 255 R 233 578 365.07 R 8 944 538.89

Sep-04 54 744 47 267 R 2 259 039.59 216 453 R 193 610 331.68 R 9 110 869.64

Oct-04 59 272 51 862 R 2 393 845.41 229 281 R 204 115 028.14 R 8 368 255.83

Nov-04 55 604 47 679 R 2 319 483.15 276 625 R 246 432 381.63 R 8 628 988.49

Dec-04 41 590 37 194 R 1 768 740.37 237 045 R 209 970 051.10 R 9 294 048.02

Jan-05 52 957 44 048 R 1 770 553.13 218 586 R 192 972 163.25 R 8 949 629.29

Feb-05 58 176 50 006 R 2 149 852.54 210 260 R 194 633 667.10 R 7 862 733.69

Number of payment by benefit Number of payment by benefit typetype

Unemployment Illness Maternity Adoption Dependants Grand Total

Received 489122 29390 62554 52 27017 608135

Approved 402835 24053 59252 49 21046 507235

86.0386.03 81.8 94.7 94.2 77.8 AVG 86.9

Number Paid 2196491 152484 183549 236 22382 2 555 142

Amount Paid 1.682 b 113. 5 m 242.1 m 355.9 188 5m 2.227 b

Monthly trends on applications and approvals

0

10 000

20 000

30 000

40 000

50 000

60 000

70 000

Dec-03 Jan-04 Feb-04 Mar-04 Apr-04 May-04 Jun-04 Jul-04 Aug-04 Sep-04 Oct-04 Nov-04 Dec-04 Jan-05

Received Approved

Breakdown of domestic claims processed

DOMESTIC CLAIMS as @ December 2004   DOMESTIC CLAIMS PAID as @ January 2005

REGION

Number of claims received from domestic workers Amount paid

 

REGION

Number of claims received from domestic workers Amount paid

 

Pretoria 3 295 956042.6 Pretoria 3551 1030935  

Johannesburg 2 761 859942.4 Johannesburg 2763 860777.6  

Durban 3 989 997469.9 Durban 4297 1081284  

Pietermaritzburg 994 181754.5 Pietermaritzburg 1043 192299.2  

East London 737 155196.7 East London 781 166213  

Port Elizabeth 1 399 337695.9 Port Elizabeth 1546 374977.5  

Cape Town 1 371 497879.6 Cape Town 1440 527140.5  

Bloemfontein 2 276 405189.5 Bloemfontein 2534 453974.7  

Kimberley 1 132 211506.1 Kimberley 1218 228434.8  

George 479 115830.4 George 497 120143.4  

Germiston 2 661 647592 Germiston 2796 690266  

Mpumalanga 3 020 629531.5 Mpumalanga 3219 675017.9  

Limpopo 944 180098.8 Limpopo 1041 199813  

North West 602 107910.1 North West 607 109016.3  

  25 660 6283640   27333 6710293  

Processing of domestic claims per region Processing of domestic claims per region showing movement from December 2004 showing movement from December 2004

to January 2005to January 2005

0

500

1 000

1 500

2 000

2 500

3 000

3 500

4 000

4 500

5 000

Dec-04 3 295 2 761 3 989 994 737 1 399 1 371 2 276 1 132 479 2 661 3 020 944 602

Jan-05 3551 2763 4297 1043 781 1546 1440 2534 1218 497 2796 3219 1041 607

PretoriaJohannes

burgDurban

Pietermaritzburg

East London

Port Elizabeth

Cape Town

Bloemfontein

Kimberley

GeorgeGermisto

nMpumala

ngaLimpopo

North West

Domestic Amount paid per region Domestic Amount paid per region showing movement from December 2004 showing movement from December 2004

to January 2005to January 2005

0

200000

400000

600000

800000

1000000

1200000

Dec-04 956042.6 859942.4 997469.9 181754.5 155196.7 337695.9 497879.6 405189.5 211506.1 115830.4 647592 629531.5 180098.8 107910.1

Jan-05 1030935 860777.6 1081284 192299.2 166213 374977.5 527140.5 453974.7 228434.8 120143.4 690266 675017.9 199813 109016.3

PretoriaJohannes

burgDurban

Pietermaritzburg

East London

Port Elizabeth

Cape Town

Bloemfontein

Kimberley

GeorgeGermisto

nMpumala

ngaLimpopo

North West

Average period from unemployment to application and to approval by region and section - 2003

RegionAdoption Dependants Illness Maternity Unemployment Total Adoption Dependants Illness MaternityUnemployment Total

Bloemfontein 106.50 53.00 36.45 37.23 75.42 69.29 114.00 144.28 125.50 80.61 46.38 58.53 Cape Town 28.94 55.63 21.22 31.31 84.27 69.46 174.61 121.81 134.47 99.37 73.84 83.14 Durban 37.40 43.29 20.16 36.52 85.72 77.57 88.40 102.91 80.29 48.60 20.74 28.40 East London 533.00 36.80 11.72 23.07 72.01 64.24 65.00 113.13 97.06 51.59 26.78 36.18 George - 50.83 22.53 42.28 92.32 80.72 - 106.75 87.73 61.86 37.54 45.02 Germiston 91.40 63.26 26.13 59.18 85.07 78.87 203.20 93.70 88.82 46.16 22.90 30.87 Johannesburg 77.00 42.11 19.14 45.79 75.08 67.11 125.86 121.85 108.19 60.07 35.99 45.03 Kimberley - 60.88 17.01 27.41 83.08 73.33 - 94.58 89.49 55.42 20.02 29.85 Mmabatho 22.33 39.85 7.29 14.71 76.70 69.15 118.67 170.06 132.74 116.48 61.91 71.49 Pietermaritzburg - 41.01 22.76 31.21 80.09 71.28 - 100.35 74.82 49.68 19.57 29.75 Pietersburg/Polokwane - 32.10 15.13 19.88 82.57 75.25 - 200.73 118.13 99.32 49.56 59.77 Port Elizabethe 1.00 50.11 20.59 36.25 84.64 74.91 200.67 118.84 90.89 55.78 31.10 40.00 Pretoria 77.00 41.81 13.27 33.27 76.53 66.15 126.20 128.47 110.75 77.27 46.58 56.32 Witbank 43.33 42.87 23.80 37.66 92.79 85.11 66.33 86.93 75.77 44.25 15.98 22.74 Grand Total 58.37 46.17 21.00 37.02 82.26 73.20 145.44 117.26 101.32 70.42 36.36 45.94

Average period unemployment to application Average period application to approval

Turnaround time for claims Turnaround time for claims processing in 2003processing in 2003

Average period from unemployment to application and to approval by region and section - 2004

RegionAdoption Dependants Illness MaternityUnemployment Total Adoption Dependants Illness MaternityUnemployment Total

Bloemfontein 1.00 29.87 7.16 11.36 58.52 49.10 164.00 129.22 110.43 69.97 36.50 50.29 Cape Town 10.75 - 8.17 9.58 77.73 61.41 133.75 96.90 92.27 61.40 30.01 39.53 Durban 64.67 27.33 8.56 12.18 50.97 44.46 86.33 95.49 73.95 43.97 18.99 26.80 East London 1.00 19.19 4.69 11.65 64.46 56.17 47.50 118.24 89.47 57.19 33.00 41.05 George 1.00 35.27 7.19 9.15 77.87 64.62 35.00 100.42 75.35 55.94 30.10 36.89 Germiston 83.75 27.91 6.76 11.97 56.48 47.87 59.25 83.62 75.40 38.27 12.91 21.33 Johannesburg 55.00 28.43 7.95 15.93 61.51 50.28 74.43 101.00 87.15 46.09 20.07 29.57 Kimberley - 28.18 12.04 11.51 65.34 56.78 - 71.81 75.77 48.20 14.34 22.33 Mmabatho - 26.47 2.27 4.69 54.30 48.10 - 175.23 147.57 117.68 65.89 75.90 Pietermaritzburg - 23.34 6.18 11.84 57.69 49.61 - 100.70 70.98 48.47 17.76 27.96 Pietersburg/Polokwane100.00 23.00 11.02 7.40 74.06 66.40 82.00 144.07 104.16 77.01 33.80 42.45 Port Elizabethe 3.67 21.16 8.01 13.59 70.06 60.26 94.33 120.34 103.61 65.23 39.55 47.40 Pretoria 26.67 21.60 5.20 10.76 56.50 45.94 110.17 116.81 93.73 64.35 33.68 43.00 Witbank - 22.06 8.11 13.16 62.90 56.81 - 83.92 67.26 39.74 15.52 21.13 Grand Total 32.15 26.10 7.57 11.55 62.05 52.64 106.10 107.05 87.53 56.15 26.86 35.62

Average period unemployment to application Average period application to approval

Turnaround time for claims Turnaround time for claims processing in 2004processing in 2004

Below 6 weeks Above 6 weeks

0 10 20 30 40 50 60 70 80

Bloemfontein

Cape Town

Durban

East London

George

Germiston

Johannesburg

Kimberley

Mmabatho

Pietermaritzburg

Polokwane

Port Elizabethe

Pretoria

Witbank

Target indicator 2004

Performance against Key Performance against Key performance Indicatorperformance Indicator

How have we How have we performed?performed?

AdoptionAdoption DeathDeath IllnessIllness MaternityMaternity UnemUnemploymploymentent

0.008550730.00855073 4.4425994.442599 4.8328094.832809 10.286210.2862 80.4298387780.42983877

Days To Days To apply apply

20032003 58.3758.37 46.1746.17 2121 37.0237.02 82.2682.26

20042004 32.1532.15 26.1026.10 7.577.57 11.5511.55 62.0562.05

Days To Days To approveapprove

20032003 145.44145.44 117.26117.26 101.32101.32 70.4270.42 36.3636.36

20042004 106.10106.10 107.05107.05 87.5387.53 56.1556.15 26.8626.86

Call centre trendsCall centre trends  Calls Received Calls answered Calls abandoned

Service level

Abandon rate Average time in queue (seconds)

Nov-03 37961 34966 2959 82% 8% 23

Dec-03 25034 23615 1331 85% 5% 16

Jan-04 35524 33795 1709 85% 5% 15

Feb-04 34160 32992 1138 90% 3% 10

Mar-04 36228 33705 1796 85% 5% 16

Apr-04 25076 23745 1330 85% 5% 14

May-04 31482 30068 1414 86% 4% 14

Jun-04 26902 25126 977 87% 4% 12

Jul-04 27410 25806 1574 85% 6% 14

Aug-04 25964 24959 1005 89% 4% 11

04-Sep 24201 23131 1049 88% 4% 12

04-Oct 28414 27099 1232 86% 4% 13

04-Nov 29086 28115 938 89% 4% 10

04-Dec 17023 16563 456 93% 3% 9

05-Jan 28015 26232 1659 82% 6% 18

05-Feb 33318 32228 1006 91% 3% 9

Average 28832 27328 1371 86.47% 4.67% 13.8

0

5000

10000

15000

20000

25000

30000

35000

40000

Calls Received 37961 25034 35524 34160 36228 25076 31482 26902 27410 25964 24201 28414 29086 17023 28890

Calls answered 34966 23615 33795 32992 33705 23745 30068 25126 25806 24959 23131 27099 28115 16563 27406

Calls abandoned 2959 1331 1709 1138 1796 1330 1414 977 1574 1005 1049 1232 938 456 1351

Nov-03 Dec-03 Jan-04 Feb-04 Mar-04 Apr-04 May-04 Jun-04 Jul-04 Aug-04 04-Sep 04-Oct 04-Nov 04-DecAverag

e

UIF CALL CENTREUIF CALL CENTRE

Full audit trail of useractions

Channels New UIF Business Process Applicationresponse

Call Centre•Employer wishes to Register•Employer wishes to Declare employees•Unemployed worker wishes to claim

Acc

ess

Siy

aya

Employer/EmployeeDatabases are

updated

UI 54

Agent

Cli

ent

Co

rres

po

nd

en

ce

Dat

abas

e

Tel

E-mail

Fax

UI 32 / 33 a

Notice of Amended details

Call in

Walk-In

Post

Self-help WWW

Labour centre official

Exception reportsFor risk management

Registration of employer, declaration of employees, payment of contributions, Claims

Receipt issuedFrom AR

INCREASING FOCUS ON SERVICE DELIVERYINCREASING FOCUS ON SERVICE DELIVERY

High level Siyaya work flowHigh level Siyaya work flow

Application clerk will:

Search for the claimant on the databaseIf the claimant cannot be found, clerk will register claimantIf found the clerk can register a claim in terms of the five benefit typesThe clerk will enter a date of applicationThe clerk will allocate a pay pointThe system will print a pay schedule for the chosen pay point, andthe applicant will be told when to report next if necessary.Siyaya sends a trigger to AXS-ONE to create the vendor and liability forpayment to be executed as per the agreed schedule.

PROCESSING OFFICE

Declarations

Capture U19

amendments

Claims

Finalise

Registry

Record claim

Illustration of claim processing in the event of the clientbeing located on the database enabling immediate claim

processing

Illustration of claim processing in the event of the client not beinglocated on the database requiring back office processing

Applicant arrives atLabour Centre

Help DeskThe main function of reception will beto screen client to check if recorded onthe database, there can be 2 outcomes

Yesdirect applicant to

Nodirect applicant tocase management

Application clerk will take theapplication manually and thenrefer to the back office forprocessing because certaininformation is outstanding thatprevents immediate processing

Payschedule

RefusalNotice

Payschedule

RefusalNotice

Full audit trail of useractions

Channels New UIF Business Process Applicationresponse

Ac

ce

ss

Siy

ay

a If the client is found on the Database, a claim can be registered

Cli

ent

Co

rres

po

nd

en

ce

Dat

abas

e

Payschedule

Walk-InLabour centre official

Exception reportsFor risk management

Adjudication of claim employee on database

Enters id Number into Siyaya, system Search's for previous claim

Siyaya requests clerk to verifytombstone details Once verified, Siyaya applies Business rulesClaim approved based on Declaration or rejectedIf approved Siyaya prints pay dates as per schedule or if rejected refusal notice

Refusal notice

Future work ProgrammeFuture work Programme Grow database Implement CRM Operationalise SIYAYA Improve service delivery Communication and

education

Way f

orw

ard

200

5-2

006

April 2005

100% of benefit claims are paid Electronically

utilising Mzansiand Teba bank

channels

Siyaya operational

• Crm upgraded customer care line

April 2006

80% of registeredemployers submit their declarations

April 2006100% of all approved

claims are paid within 28 days

April 2006

April 2006