Maphiri EPWP extension workers - exploring funding options

Report
EPWP EXTENSION WORKERS –
REFELECTIONS ON SOCIAL
SECTOR
EXPLORING FUNDING OPTIONS
DONALD MAPHIRI
DST/HSRC/DOSD GOVERNMENT CLUSTER POLICY
WORKSHOP
31 OCTOBER 2013
CSIR CONFERENCE CENTRE
OUTLINE
 EPWP objectives
 Programme design principles
 Remuneration matters and costs of employment
 Funding and service delivery models
 Implementation framework
EPWP Objectives
 Objectives of EPWP
 Are EPWP objectives conflicting?




South Africa has problems relating to unemployment, poverty, skills and poor
service delivery
key themes that emerge from the review of EPWP objectives are poverty
reduction, work experience, on-the-job training and skills, and
improved quality of public and community services
The overall objective of EPWP should be to extend and improve the quality of
services delivered and the rest of objectives can be prioritised in relation
This would also reduce excessive focus on statistics on work opportunities
and would create scope for EPWP to adapt to challenges in the social sector
 Nature of employment
 There is need for employment of extension workers
 Questions:


employment in NPOs or government
Shortterm or longterm
Programme Design Principles
 Programme design

What is EPWP about?
Improved quality of and extended service delivery
 Not about whether extension workers should be employed; or whether
they should be employed in government or not; or whether their
employment should be short- or long-term
 That is: quality of services delivered should not be affected
by who the employer is!


What is required for effective programme design?

Review of mandate of government
 Review all services that need to be delivered rather than those that
are perceived to ‘fit’ within EPWP framework
 Identify those that need to be provided (and funded) by
government, although the management of delivery thereof could
still be done by other bodies, including non-government bodies
(who could also co-fund such services)
Programme Design Principles (2)
 Programme design
 What is required for effective programme design? (Cont…)


Assess the scale of work to be done
 identify people who qualify for services (target group)
 assess service delivery backlogs (situational analysis)
 generate a complete portfolio of services that need to be delivered in the
social sector including the extent of the problem in each of the service areas
and rate of backlog elimination (i.e. comprehensive strategic plan for the
social sector – in line with integrated service delivery model)
Costing of services
 extent of the resources (and therefore budget) that would be required to
address backlogs – progressive realisation
 this requires comprehensive and coherent quality frameworks
 Prioritisation needs to be done taking into account:
• financial resources available for delivery of services
• backlogs and urgency of the various services under consideration
• capacity of the state to deliver in terms of skills and workforce
Remuneration Matters & Employment Costs
 How should extension worker services be valued?






They are not recognised by professional bodies
They are not represented in bargaining councils
Ministerial Determination 4 prescribes R60 per day (which has not
increased to R66.34), considered by many to be too low
Guide for EPWP Incentive grant put the maximum at R150 per day,
but applies to sectors other than social sector!
Determining a single minimum wage figure is inadequate to address
the problem of fair remuneration in the social sector, especially if the
principle of career-pathing and progression is introduced
the Social Sector Ministerial Determination has not as yet been
gazetted (suggesting confusion around this matter)
Remuneration Matters & Employment Costs
 How should extension worker services be valued?
 value of the resources required to deliver services must be
defined (e.g. work requiring a professional should be valued as
such)
 various exit levels need to be defined and corresponding
remuneration needs to be set for each of the levels
 once people have acquired experience and training over time,
their remuneration should improve and approximate the level
at which workers in other occupations or similar occupations
in other sectors with similar number of years of work
experience and training would get remunerated
Remuneration Matters & Employment Costs
 Costs of employment






Analysis should be done within context of total cost of service
delivery
Workers in elementary positions in govt get at least 400% more than
the prescribed EPWP minimum wage
If EPWP workers are paid at these rates programme would be
unaffordable
However work aimed at standardising pay for equal value work
should proceed
costing process therefore excludes the particular option of paying
extension workers at public service pay scales or indeed creating a
new level below level 1 in the public service
the costing covers all costs of service delivery including
complementary inputs used in the social sector as well as facility and
administrative costs
Remuneration Matters & Employment Costs
 Early childhood development (model results – status
quo)
MODEL OUTPUT COSTS
2008/09
2009/10
2010/11
2011/12
2010/2013
2013/14
Early childhoold Development
8,572,493,033
9,775,848,948 11,021,609,450 12,968,138,729 14,957,536,027 17,219,529,109
ECD Cost
Provincial coordination
Current funding level
Based on children funded
8,553,111,104
19,381,929
9,757,231,866
18,617,082
11,003,479,089
18,130,361
12,949,712,859
18,425,870
14,939,179,689
18,356,338
17,201,277,068
18,252,041
947,987,269
1,213,228,035
1,587,478,039
1,917,346,451
2,353,504,422
2,877,978,175
947,987,269
1,213,228,035
1,587,478,039
1,917,346,451
2,353,504,422
2,877,978,175
1,080,799,000
1,422,641,000
1,583,736,000
1,751,355,000
14%
15%
16%
17%
DSD reported figures
Funding to total cost
11%
12%
Remuneration Matters & Employment Costs

Early childhood development (model results – scenarios)
Scenario 1: Requiring that underpaid and part time workers are
offered stipends at the Ministerial Determination level of R60 per
day plus the minimum benefits as outlined in the Ministerial
determination;
 Scenario 2: Temporary and underpaid workers are employed to
work full time; and
 Scenario 3: Raise the minimum wage to R80 plus minimum
benefits prescribed in the Ministerial Determination.

Modelling scenarios
Baseline cost
Scenario 1
marginal increase
Scenario 2
Marginal increase
Scenario 3
marginal increase
Total marginal increase
2008/09
2009/10
2010/11
8,553,111,104 9,757,231,866 11,003,479,089
8,685,844,588 9,908,651,784 11,174,239,190
132,733,484
151,419,918
170,760,101
8,936,614,791 10,194,725,819 11,496,852,172
250,770,202
286,074,035
322,612,982
9,461,497,707 10,793,502,598 12,172,108,008
524,882,916
598,776,779
675,255,837
908,386,603 1,036,270,732 1,168,628,919
2011/12
12,949,712,859
13,150,676,051
200,963,191
13,530,351,010
379,674,960
14,325,042,318
794,691,308
1,375,329,459
2010/2013 2013/14
14,939,179,689
15,171,016,894
231,837,204
15,609,021,389
438,004,495
16,525,801,273
916,779,884
1,586,621,583
17,201,277,068
17,468,219,168
266,942,099
17,972,546,503
504,327,335
19,028,145,613
1,055,599,110
1,826,868,545
Remuneration Matters & Employment Costs
 Early childhood development (model results –
scenarios)

ECD services expanded to all poor children
MODEL OUTPUT COSTS
2008/09
ECD
ECD cost
Provincial coordination
Current funding level
Based on children funded
2009/10
2010/11
2010/2013
2013/14
24,124,285,941
24,104,904,012
19,381,929
27,517,048,317
27,498,431,235
18,617,082
31,491,907,467
31,473,777,106
18,130,361
37,059,108,442
37,040,682,572
18,425,870
42,749,605,963
42,731,249,624
18,356,338
49,219,886,907
49,201,634,866
18,252,041
947,987,269
1,213,228,035
1,587,478,039
1,917,346,451
2,353,504,422
2,877,978,175
947,987,269
1,213,228,035
1,587,478,039
1,917,346,451
2,353,504,422
2,877,978,175
1,080,799,000
1,422,641,000
1,583,736,000
1,751,355,000
5%
5%
6%
6%
DSD reported figures
Funding to total cost
2011/12
4%
4%
Remuneration Matters & Employment Costs
 HCBC (model results – Status Quo)
STAFF CATEGORY
PERSONNEL COSTS
GOODS & SERVICES
TOTAL
2008/09
2009/10
287,903,576
529,106,664
760,714,346 1,388,064,817
2010/11
572,151,745
1,500,989,803
2011/12
642,289,935
1,684,991,177
2012/13
723,048,805
1,896,854,974
2013/14
812,402,848
2,131,267,449
1,048,617,923
1,917,171,481
2,073,141,549
2,327,281,113
2,619,903,779
2,943,670,297
PROVINCIAL COORDINATION15,250,000
COSTS
21,441,593
20,518,547
20,383,936
20,307,015
20,191,634
1,063,867,923
1,938,613,074
2,093,660,095
2,347,665,048
2,640,210,794
2,963,861,932
CURRENT FUNDING LEVEL 511,413,000
Provincial DSD budgets
511,413,000
Current funding as % of total cost
49%
599,231,000
599,231,000
31%
630,105,000
630,105,000
30%
667,911,300
667,911,300
29%
705,314,333
705,314,333
27%
740,580,049
740,580,049
25%
GRAND TOTAL
Remuneration Matters & Employment Costs
 HCBC (model results – Scenarios)
Modelling scenarios
Baseline cost
Scenario 1
marginal increase
Scenario 2
Marginal increase
Scenario 3
marginal increase
Total marginal increase
2008/09
1,048,617,923
1,174,800,872
126,182,950
1,276,072,994
101,272,122
1,382,738,606
106,665,612
334,120,684
2009/10
1,917,171,481
2,149,069,398
231,897,917
2,335,186,414
186,117,016
2,531,215,540
196,029,125
614,044,058
2010/11
2,073,141,549
2,323,905,349
250,763,800
2,525,163,777
201,258,428
2,737,140,707
211,976,930
663,999,158
2011/12
2,327,281,113
2,608,785,218
281,504,105
2,834,715,251
225,930,033
3,072,677,731
237,962,480
745,396,619
2010/2013 2013/14
2,619,903,779
2,936,803,042
316,899,263
3,191,140,580
254,337,538
3,459,023,475
267,882,895
839,119,695
2,943,670,297
3,299,731,827
356,061,530
3,585,500,282
285,768,455
3,886,488,023
300,987,741
942,817,726
Funding and Service Delivery Models
 How should services be funded?
 decide on the extent to which such services will be funded and the sequencing of
such funding going forward to fulfil the requirement of progressive realisation of
rights in the Constitution
 develop detailed guidelines supplementing the financial awards policy for
service providers focussing on portfolio of services, backlogs and funding
levels for various services and categories of beneficiaries (perhaps this should be
what has now come to be called the NPO funding guidelines)
 there will always be services that will be fully funded and those that will be
partially funded
 Decision on levels of funding needs to be done for each key resource required per
service area



funding criteria will indicate to what extent wages, materials (complementary
inputs), facilities, transport, utilities, etc will be funded for each service area, per
level of intervention, per beneficiary type, per location type
Funding formula can be designed to further objectives such as transformation by
putting more weight on rural based services and partnership arrangements
If funding is adequate it would not matter whether extension workers are employed
in government or by NPOs
Funding and Service Delivery Models
 Current policy documents
 Guidelines for NPO funding/financing do not seem to exist (but should
deal with issue of funding models in detail)
 Integrated service delivery model


Deals with levels of intervention and generic norms and standards
Policy on financial awards






Transformation matters (funding coverage, sustainability, etc) – to go beyond
help with preparing business plans and include guidance with setting up
NPOs, relaxing eligibility criteria, introduce lump sum funding and
governance requirements all linked to sun set clauses
Service specifications (where, how, whom, etc)
Financing (uniform funding model, co-financing, programme financing,
financing of services i.e. call for proposals)
Methods of payments (not explicitly linked to transformation)
Eligibility criteria (accounting compliance could be a challenge)
Disclosure of co-funding (NPO Act does not deal with this adequately and
business plans should be designed to reveal this information)
Funding and Service Delivery Models
 Funding Options
 Full funding by the State (or to the same level as those services
delivered by the State – NAWONGO case in Free State)
 Partial funding (where donors supplement base State funding)
 Requirement for co-payment by beneficiaries
 No State funding at all e.g. Pre-grade R in ECD
 Co-funding/supplementary by donors
 Full funding by private/non-governmental sector (recognise
that EPWP initiatives do not necessarily have to be funded by
the State)
Funding and Service Delivery Models
 Supplementary funding
 Does it matter?



Development of funding models has nothing to do with the availability of
donor funding or its absence
donor funding simply makes additional funding available as would be the case
if beneficiaries were required to contribute for the services they received
Where NPOs are involved as is the case currently there has been concern
about the practice of double-dipping
 Requires accounting framework where organisations funded are required to
report on the use or application of such funds per service area also
disclosing the source of such funds
 NPO Act should be amended to provide for penalties for cases where
organisations have been found to be engaged in double dipping, which
penalties might include withdrawal of their registration. Currently, NPO act
says in s. 29(2)(c) it is an offence “to make false representations in any
document or narrative, financial or other report submitted to the director”.
But NPOs simply refuse to make information available and therefore
cannot be penalised in terms of the Act
Implementation Framework
THANK YOU

similar documents