Transcript Overview of Alignment of IDP & Performance Management

Service Delivery Through Effective
Governance
OVERVIEW OF ALIGNMENT OF IDP, PMS, BUDGET &
OVERSIGHT
Phenyo Chwene
IMFO Conference
08-10 October 2012
Emperors
Outline
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MSA Objective
Planning and Performance Framework
Local Govt Accountability
Planning Processes
– IDP & Budget
• Measurement Processes
– SDBIP
– In year Reporting
• Council Oversight
– MPACs
MSA Objective
To establish a simple and enabling framework
for the core processes of planning,
performance management, resource
mobilisation and organisational change that
underpin the notion of developmental local
government.
Planning & Performance Framework
Local Govt Political and Administrative
Accountability
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Political structures
Administrative structures
EE imperatives
Skills development imperatives
Provide an opportunity for stakeholders to represent
the interests of their constituencies.
• Provide a structure for discussion, negotiations and
joint decision making
• Ensure proper communication between all
stakeholders and the municipality
• Monitor the planning and implementation process
Political and Administrative Interface
PLANNING PROCESS: IDP
• Strategic Direction and Goals set by Council through
IDP
• Has 5 year Span – aligned to term of council
• The IDP is reviewed annually and necessary changes
can be made.
• Community needs
• Municipal powers and functions
• Sector plans
• General KPIs
• Policy decisions
• National and Provincial Development Programmes
An overview of a typical IDP process
Phase 0
Preparation
: What do we need to prepare to plan?
: Municipal Process Plan and District Framework
Phase 1
Analysis
: Where are we?
: Well understood Priority Issues
Phase 2
Strategies
: Where do we want to go? How do we get there?
: Vision, Objectives, Strategies, ID Projects
Phase 3
Projects
Phase 4
Integration
Phase 5
Approval
: What detail do we need to define to realise the strategies?
:Indicators and basic project implementation information
: What do we need to manage to make it happen?
: Integrated management programmes and plans
: Are we satisfied?
: Amended and adopted IDP
Management and implementation of IDP projects, programmes
and plans
Key Challenges
• Non-Adherence to the Legislative Requirements
– Approval of Process Plans (ito MFMA/MSA)
– Community Engagements
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Planning not taken seriously and that’s where we start to fail i.e. developing
credible IDPs & SDBIP
– Poor Evaluation of plans i.e. IDP and SDBIPs
– Pre-planning,
– During implementation and
– post-implementation
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Non- Alignment of IDP & Budget Process
– IDP not informing the budget and processes not aligned properly
• Poor sector alignment
• Weak IGR Structures
SOLUTIONS
• Strengthen the planning structures i.e.:
• IGR Structures (District IGR Structures, Municipal
Manager’s Forum, CFO’s Forums etc)
• IDP Steering Committee (Technical Team Level),
• Budget Steering Committee,
• Enhance Project Management Unit (PMU) Capacity – to
do detailed planning, monitoring and evaluation of
projects.
• Strengthen IDP Rep Forums – ensure community
participation in the planning, monitoring and project
steering capacity
Service Delivery Through Effective
Governance
OVERVIEW OF ALIGNMENT OF IDP, PMS, BUDGET &
OVERSIGHT
Phenyo Chwene
IMFO Conference
08-10 October 2012
Emperors
Outline
• Measurement Processes
– SDBIP
– In year Reporting
• Council Oversight
– MPACs
IMPLEMENTATION & MEASUREMENT:
BUDGET
• The IDP informs the annual budget which
must be approved by council.
• Mayor then approves a Service Delivery and
Budget Implementation Plan (SDBIP).
• Service delivery targets linked to performance
contracts for senior managementAnnual
Budget
• Medium Term Expenditure Framework
• Related policies
IMPLEMENTATION AND
MEASUREMENT: SDBIP
• Section 1 of the MFMA defines the SDBIP as:
“a detailed plan approved by the mayor of a municipality in terms of
section 53(1)(c)(ii) for implementing the municipality’s delivery of
services and the execution
of its annual budget and which must include (as part of the top-layer)
the following:
(a) projections for each month of(i) revenue to be collected, by source; and
(ii) operational and capital expenditure, by vote;
(b) service delivery targets and performance indicators for each
quarter”.
SDBIP
• The SDBIP is a layered plan,
• Top layer of the plan dealing with:
– consolidated service delivery targets and in-year
deadlines, and linking such targets to top management.
• The (lower) layer of detail of the SDBIP,
» Provides more detail on each output
» breaking up such outputs into smaller outputs and
linking these to each middle-level and junior
manager.
• Implementation Tool
• sets in-year information, such as quarterly service delivery
and monthly budget targets, and links each service delivery
output to the budget of the municipality,
• Monitoring Tool
• Enables the council to monitor the performance of the
municipality against quarterly targets on service delivery.
Municipal Public Accounts Committee
(MPAC)
• MPAC is the mechanism through which the Council exercises
oversight, monitoring and evaluation over the financial and nonfinancial performance information in accordance with prescribed
legislation and corporate governance principles.
• Established ito MStruct Act Section 79
• Section 129(4) of the MFMA further provides for the issuance of
guidance on the manner in which municipal councils should
consider annual reports and conduct public hearings, and the
functioning and composition of any public accounts or oversight
committees established by the council to assist it to consider an
annual report.
Municipal Public Accounts Committee
• Key oversight role ensuring executive and administration
accountable for performance.
• Section 129 of the MFMA requires the council to consider
the annual reports of its municipality and municipal entities
and to adopt an “oversight report” containing the council’s
comments on each annual report.
• The oversight report must include a statement whether the
council:
– has approved the annual report, with or without reservations;
– has rejected the annual report; or
– has referred the annual report back for revision of those
components that can be revised.
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MPAC Functions
Performs an oversight function on behalf of council
Engage directly with the public
Consider public comments
Consider and evaluate the content of the annual report and to make
recommendations to Council when adopting an oversight report on the
annual report;
Reviewed in-year reports, including the quarterly, mid-year and annual
reports;
Examine the financial statements and audit reports of the municipality
and municipal entities,
Evaluate the extent to which the Audit Committee’s and the Auditor
General’s recommendations have been implemented;
Promote good governance, transparency and accountability on the use of
municipal resources;
Recommend or undertake any investigation in its area of responsibility,
after reviewing any investigation report already undertaken by the
municipality or the Audit Committee; and
Perform any other functions assigned to it through a resolution of council
within its area of responsibility.
Financial governance framework applicable to
local government
Responsible for
Oversight over
Accountable to
Council
Approving policy and
budget
Executive Mayor or
Committee
Community
Executive Mayor or
Mayoral Committee
Policy, budgets,
outcomes,
management
of/oversight over
municipal manager
Municipal Manager
Council
Municipal Manager
Outputs and
implementation
The Administration
Executive Mayor or
Committee
Chief Financial
Officer and Senior
Managers
Outputs and
implementation
Financial
Management and
Operational
Functions
Municipal Manager
COUNCIL OVERSIGHT ROLE
• Council adopts IDP and undertakes annual review and
assessment of past performance outcomes (Systems
Act)
• Council conducts oversight roles by approving annual
budget and monitors financial and non-financial
performance through in-year reports:
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Monthly (MFMA Sec 71)
Quarterly (MFMA Sec 52)
Mid-year reviews (MFMA Section 72
Annual Financial Statements
• Submitted to Auditor-General who issues audit report
– Annual Reports (MSA 46 & MFMA Sec 121)
• Reports on financial and nonfinancial performance.
• Links to the strategic goals in the IDP
AUDIT COMMITTEE
• Established ito of MFMA Section 166
• Provides independent specialist advice on:
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financial performance,
efficiency and effectiveness,
performance management and
compliance with legislation
• Council considers the authoritative and credible view
of the Audit Committee on the review of the AFS
• Internal audit functionally reporting to the Audit
Committee
– Providing administrative support
– Review of financial and non-financial reporting
Financial Governance in Practice
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CHALLENGES
Performance management not taken serious (by the way process!!):
– Inadequate monitoring and evaluation processes
– Sustainability Reporting not done adequately – report done for “malicious
compliance”
Audit Committees tend to be appointed without ensuring their independence is
sustained
– Members appointment based on allegiances and patronage
– Combined assurance role and objectivity and independence is always
challenged
– Audit Reports not tabled at Council level
– Internal Audit not supported to execute their responsibilities
• Late submission of financial and non-financial information impeding audit
plan and assignments against the backdrop of inadequate human
resources capacity.
MPACs are not capacitated adequately to execute their mandate with regard to:
– The roles and responsibilities
– Conducting detailed analysis of financial and nonfinancial reports
– Not given adequate administrative support
– Objectivity questioned at every turn – impartiality of chairpersons
SOLUTIONS
• Audit Committees should be given space to exercise
their independence character
– Appointing suitably qualified and experienced members
– Functional support by Internal Audit at all times not
compromise
– Capacity building key in the execution of their mandate
• Strengthen capacity of practitioners to be able to
conduct evaluations of plans
– Develop a course for mainly focusing on evaluation of
plans
• Ensure proper alignment of IDP, SDBIP and Budget
– Planning and Performance Unit should strive to work
together from the planning phase to reporting stages.
SOLUTIONS
• MPAC should be support to perform its work
diligently
– Assigning of administrative personnel (to support
with its function – agenda, reports and research)
– Given room to exercise their mandate by:
• Being provided with space to be objective – not to be
influenced by party political directives
• Conduct analysis and recommend to council without
fear or favour
• Provided with capacity building programmes to
enhance their level of competence and skills.