Presentation covering ING south Africa security commission

A brief description of the commission's delivery model

1. Establishment of the AgencyEstablishment of the Agency

Presentation to the PortfolioPresentation to the Portfolio
CommitteeCommittee
7 September 2005

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

3. BACKGROUNDBACKGROUND
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 CHALLENGESINSTITUTIONAL 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 MODELCONSTRAINTS 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 MODELNEW SERVICE DELIVERY MODEL

7. FEATURES OF THE NEW MODELFEATURES OF THE NEW MODEL

Customers
Customers
Performance Management, Payment Contracts, Customer Services
Management Processes of Customer Care & Communications
Strategic Imperatives What Processes & Systems How
Process Applications:
Increase channels, norms & standards -
Right culture and competencies
Delivery:
Channels in place cater for customer
needs, meet the specific infrastructure &
IT needs of the stakeholders
Review and Maintenance:
Ensure right beneficiary gets the right
grant amount - right solutions,
capabilities and competencies in place
Support Services:
Capability building to support the
delivery of Business capabilities through
HR, Supply Chain, Contract
Management & Fraud Strategy
Core role of
SASSA &
Stakeholders
shared
Manage
involvement of
SASSA
Focused
involvement of
SASSA
Primary role
shared
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Strategic
imperatives
Processes & Systems
How?
Performance
Management

8. Pillars of New Service Delivery ModelPillars 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 changesBusiness process changes
Grant Administration
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End
Correct
documents?
Apply for a grant
Conduct interview
with applicant
Complete
application form
manually
Verify supporting
documentation
Produce
supporting
documentation
Ta ke complete set
of fingerprints
Attest application
form
Furnish applicant
with receipt
Calculate means
test
Complete record
of application
Open file for
application
Check application
form and
supporting
documentation
Fix official date
stamp to
application
Make copies of
application form
and supporting
documentation
Send original
application form
plus documents to
capturing centre
File copies
Capture
application form
electronically
Print letter of
rejection
Process
application
Approved?
Print letter of
approval
Enter into payment
record
Receive download
of payment
information
Perform payment
Perform
reconciliation
NO
YES
NO
YES

Grant Administration To-be Process
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Apply for a grant
Produce
supporting
documentation
Receive download
of payment
information
End
Capture
application
manually
Perform payment
Scan documents
into system
Electronic
system
available?
Capture form
electronically
YES
Process
application
Verify
information
via interface
with other
govt
systems
Verification
complete?
Scan complete set
of fingerprints into
system
Print rejection
receipt
System
approved
application?
Print approval
receipt
Verify information
Furnish applicant
with receipt or
send notification
letter
Enter into
payment
record
Reconciliation
End
YES YES
NO
NO
Furnish applicant
with receipt or
send notification
letter
To this
From
this
• Fewer steps
• Less people involved
• Technology enabled
• Faster
• Standardised
• Easily verified
The Grants
Admin processes
will be
reengineered

10. Human resources and Financial Human resources and Financial
efficiencyefficiency
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 CommunicationInfrastructure 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 5–7 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 we’re saying ”Don’t to call us, we’ll find you”
More detail on the above also provided at the end

12. The Journey MapThe 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 2006Envisaged State by April 2006
1.Governance framework in place in terms of relevant laws
2.Agency top management and staff must be appointed
3.Reporting and accountability framework established
4.Functions ringfenced/separated in provinces and national
5.Entity must have its own financial system and policies
6.Agency human resources separated, with policies in place
7.Communication internally and externally operational
8.Information technology infrastructure in place
9.Physical infrastructure available for use

14. Governance FrameworkGovernance 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 Management, staff and
accountabilityaccountability
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 systemsRingfencing 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 Human Resources and
CommunicationCommunication
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 Minister’s 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 Information and Technology
InfrastructureInfrastructure
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. ConclusionConclusion
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. EndEnd

21. INSTITUTIONAL ARRANGEMENTS: INSTITUTIONAL ARRANGEMENTS:
Minister:
National Dept of
Social Development
SASSA Head Office
SASSA Branch Head
Office
SASSA Regional
Office
SASSA District
Office
Provincial DoSD
National DoSD
Minister:
National Dept of
Social Development
SASSA Head Office
SASSA Branch Head
Office
SASSA Regional
Office
SASSA District
Office
Provincial DoSD
National DoSD
New, independent,
specialist Agency:
focused and
motivated towards
service delivery
Communication lines
between Agency and
DoSD will remain open
HOW THINGS HOW THINGS
WILL CHANGEWILL CHANGE

22. VALUE CHAIN AND CAPABILITIESVALUE CHAIN AND CAPABILITIES
THE VALUE CHAIN
Strategic
Goals
Legislations and Institutional Arrangements
Grants Administration & Payments
Identify
Potential
Grant
Beneficiaries
Apply
For
Grant
Approve
Grant
Pay
Grant
Review/
Renew
Grant
Corporate Services
Finance
Information Technology
Strategy and Business Development
CORE BUSINESS PROCESSES
SASSA SUPPORT PROCESSES
C
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B
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23. HUMAN RESOURCE COMPETENCIESHUMAN 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 KPI’s
A change in culture to a customer-centric focus.

24. BUILDING FINANCIAL ACUMENBUILDING 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 INFRASTRUCTUREOPTIMAL 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 CommunicationEnhancing 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 STREAMSERVICE 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 MANAGEMENTHUMAN 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 STREAMFINANCE 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 & COMMUNICATIONSICT, 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.