Transcript Professionalising Local Government: A Critical Examination

Implementation of Municipal Regulations on
Minimum Competency level Requirements
and the Professionalisation of the Municipal
Finance Profession
“Professionalism is knowing how to do it,
when to do it, and doing it.”
Frank Tyger
Prepared By:
Daniel J De Lange
Cell No. 082 557 2064
E-mail [email protected]
The Views Expressed Are Not Necessarily Those Of The
Institute Council
SEPTEMBER 2011
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OVERVEIW
Professionalisation
Factors influencing municipal performance
Minimum Competency Regulations
Financial and Supply Chain Management
(SCM) Competencies
Alignment of IMFO Membership
Requirements to NT Competency Level
Requirements
Implementation of NT Regulations
IMFO To register as a Professional Body
In The Pipeline/ Recent Developments
Imagining our Future
• Celebrating 82 years of investing in human resources
and promoting the professional status of Municipal
Finance Officials
• IMFO’s history is evidence of its success in producing
leaders in the field of Municipal Finance
• IMFO’s member’s willingness to raise their hands when
called upon defines them as leaders in their field
• IMFO members have shown their commitment to the
community and have worked feverishly to implement
the policies and legislation of the state
• IMFO has played an important role in building a new
future in SA
“Instead of just counting the wealth of the
company(municipality), we help create the
wealth of the company(municipality).”
— Jacques Croisetiere, CFO, Rohm and Haas
IMFO’s ROLE
• Desire for a Professional Qualification and
Professional Status for Municipal Accountants
• What is the Role of IMFO and how does it advance
the Professional Status of it’s Members?
• FACT - NT Regulations now Determines
the
Competency Level Requirements for Municipal CFOs
• What Opportunities are there for IMFO ?A question
asked at a 2008 strategic planning session
Professionalisation
• Professionalisation is the social process by
which any trade or occupation transforms
itself into a true "profession of the highest
integrity and competence."This process
tends to involve establishing acceptable
qualifications, a professional body or
association to oversee the conduct of
members of the profession .
Professionalisation of Local
Government
• Professionalisation of local government is more than skills
updating and more about improving professional
practice and institutional capacity. The former can be done
through skills updating and qualifications but the latter can only be
achieved through cultural and behavioural change. This
differentiates between the structural and behavioural attributes of
professionalism. With the structural, professional associations
have a vital role to play in ensuring standards within certain
professions in local government such as public finance
management and planning, for example. For building institutional
capacity, efforts must be targeted at bringing about changes in
behaviours and attitudes both at the leadership and grassroots
level.
Professionalisation of Local
Government (Cont)
• Professionalism also means having an
internal set of standards of
performance and behaviour.
Professionals aspire to high ideals: altruism;
honour and integrity; respect; excellence and
scholarship; caring, compassion, and
communication; leadership; and
responsibility and accountability. (Carter and
Wilson, 2006).
REMEMBER
• “WE ARE THE PROFESSIONALS WHO HAVE TO
MAKE THE DIFFERENCE OUT THERE AND WE
THEREFORE HAVE TO EQUIP OURSELVES FOR
THE JOB”
ARE YOU READY TO TAKE UP THE CHALLENGE?
Finance’s Operating Model
The finance operating model needs to address the multiple responsibilities across
finance operations, steward, strategist and catalyst (business partner)
Stimulate behaviors
across the
organization to
achieve strategic and
financial objectives
Leading Edge
Provide financial
leadership in determining
strategic business
direction and align
financial strategies
Threshold
Performance
Finance
CFO
Function
Focus
Triangle
Protect and preserve
the assets of the
organization
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Balance capabilities,
costs and service levels
to fulfill the Finance
organization’s
responsibilities
The main messages
(COGTA INDABA OCT 2009)
• Professionalisation
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Financial viability
Standardisation
Responsibility
Leadership and Management
Considering short-, medium- and long-term solutions
” Professionalism: It's NOT the job you DO, It's HOW
you DO the job”
Lets Cast our Minds Back – Municipal
Accountants Act No. 21 of 1988
• Independent Board for Municipal Accountants (BMA)
• BMA – determined requirements in connection with training
and municipal accountants, promote standards for training
• BMA – prescribed qualifications of municipal accountants
• BMA – determined category of municipal accountant for a
municipality of a particular grade
• BMA – registered Municipal Accountants
• BMA – had powers to investigate misconduct and to suspend
municipal accountants who were found guilty of misconduct
Municipal Accountants Act No. 21 of 1988
(Cont)
• CFO’s and Finance Officers were required to become
associate members of IMFO which prescribed minimum
qualification requirements
• The Act prescribed duties performed by Municipal
Accounts
NT Minimum Competency Regulations
• NT issued Regulations on Minimum Competency
Level Requirements in June 2007.
• 3 areas of minimum competency requirements:
1)Higher education qualifications
2)Work-related experience
3) Financial & Supply Chain Management
competencies
NOTE: The above should be read in conjunction with the Performance
Management Regulations issued in terms of the Municipal Systems
Act by dplg which deals with Core Managerial and Occupational
Competencies (Government Gazette no 29089 1August 2006 )
NT Qualification and Other Requirements Higher
education qualifications
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A chief financial officer must have or attain by 1 January 2013 a higher education
qualification as follows:
Qualification
Municipal Capacity & Budget
At least NQF Level 6 in fields
of accounting, finance or
economics or
Certificate in Municipal
Financial Management (SAQA
Qualification ID No. 48965
All low capacity municipalities
Medium capacity municipalities with annual
budgets or a value below R500 million for the
current year
Municipal entities with annual budgets of value
below R500 million for the current year
At least NQF level 7 in fields of
accounting, finance or
economics or Chartered
Accountant (SA)
All high capacity municipalities
Medium capacity municipalities with annual
budgets of a value equal to or above R500 million
for the current year
Municipal entities with annual budgets of a value
equal to or above R500 million for the current
year
NT Qualification and other
Requirements (Cont)
Work Related Experience
EXPERIENCE
Minimum of 5 years at middle management
level
Minimum of 7 years at senior and middle
management level
Municipal Capacity and Budget
All low capacity municipalities
Medium capacity municipalities with
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Annual budgets of a value below
R500 million for current year
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Municipal entities with annual
budgets of a value
below
R500
million for the current year
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All High capacity municipalities
Medium capacity municipalities
with annual Budgets of a value
equal to or above R500 million of
current year
Municipal entities with annual
budgets of a value equal to or
above R500 million for current
year
NT Financial and Supply Chain Management
(SCM) Competencies
Generally, the financial and SCM skills required of officials are categorised
into 11 competency areas. They are:
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Strategic leadership and management
Strategic Financial Management
Operational financial management
Governance, ethics and values in financial management
Financial and performance reporting
Risk and change management
Project management
Legislation, policy and implementation
Stakeholder relations
Supply Chain Management
Audit and assurance.
SIX Refined NT Skills Programmes(21 UNIT
STANDARDS-- 166 credits )
1.
2.
3.
4.
5.
6.
Strategic Management and Budgeting
Municipal Accounting and Risk Management
Governance & Legislation
Costing & Capital Planning
Municipal IT & Project Management
SCM & PPPs
SAQA 48965 PROGRAMME OUTLINE
LP
TITLE OF LEARNING PROGRAMME
RELEVANT UNIT
STANDARDS
LP1
Strategic management; Budgeting
implementation and Performance
management
116358; 116342; 116345;
116364; 116363; 116341
LP2
Municipal accounting and Risk
management
119350; 119348; 116346;
116362; 116339; 116357;
116351
LP3
Governance and Legislation
116348; 116343; 116344;
116361; 119334
LP4
Cost and Capital Planning
116347; 116340; 119331;
(119341
LP5
Municipal IT Support and Project
Management
119351; 119352; 119343;
116360
LP6
Supply Chain Management and Public
Private Partnership
116353; 119353
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UNIT STANDARDS
GROUPING OF OFFICIAL PER REGULATIONS
UNIT
STD
NO.
UNIT
STANDARD
DESCRIPTIO
N
NQF
LEVEL
CREDITS
Accounting
Officer
(18 US)
CFO
(20 US)
Senior
Manager
s
(15 US)
Other
Financial
Officials
(Middle
Managem
ent)
(16 US)
Head:
SCM
(16 US)
SCM
Manager
s
(10 US)
Programme 1: Strategic Management & Budgeting (77 credits) – 6 USs
116358
116342
116345
Contribute to the
strategic
planning
process in a
South
African
municipality
6
Apply
approaches
to
managing
municipal
income
and
expenditure
within a multiyear framework
6
Apply
the
principles
of
budgeting within
a municipality
5
15
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15
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15
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116363
116341
Plan
a
municipal
budgeting
and
reporting
cycle
6
Prepare and
analyse
municipal
financial
reports
6
Conduct
performance
managemen
t to a South
African
municipal
environment
6
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116364
8
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12
12
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Implementation of Regulations
Regulations require:
• An assessment of all existing managers (may include
TRAINING (CPMD) and RPL assessment);
• Identification of skills gaps;
• Development of an implementation plan (Personal
Development Plan ) to assist individual officials to meet the
required competency levels by 31 December 2012.
• Half-yearly reports to NT and the relevant Provincial
Treasury in terms of the regulations (and to Council for
information regarding progress made on the implementation
of the regulations).
What Happens If I Have not Achieved
The Competency Requirements?
• The municipality may not employ or retain any
person who has not met the said requirements by
2013. This will be made possible through the signing
of the performance agreements. That is, if CFO,s
have signed that they will attain the required
competency standards by 2013 and this target is not
achieved,
this
implies
nonperformance!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
• This approach will not solve all the challenges that
will face us from 1 January 2013 and I would like to
suggest
the
introduction
of
transitional
arrangements
that
will
assist
with
the
implementation of the NT regulations
Management of Risks
• Lack of qualified competent professional assessors
and subject experts
• Human resource and labour relations issues to be
dealt with in terms of the Labour Relations Act
• Lack of awareness of the implications of the
competency requirements
• Scarcity of competent CFO’S by 2013 especially at
low capacity and medium capacity municipalities
• Lack of financial and human recourses to deal with
onerous compliance issues (assessment ,mentors
,trainers ,RPL )
Risks (Cont)
• 2013 Around the corner –RUNNING OUT OF TIME?
• Certificate courses currently provided by institutions may
not be recognized (uncertainty)
• CFO,S may be appointed without an appropriate accounting
background(accounting 111)
• No accurate national dtabase available of the progress made
with Q&C requirements of CFO,S and financial officers
Monitoring and reporting
competency levels
• The accounting officer is responsible to monitor
compliance with the Regulations.
• Each municipality is required to furnish half yearly
implementation returns to the National Treasury (31
December and 30 June). The return is to be in the format
of the Schedule to the Regulations and, where
applicable, include consolidated information on all its
municipal entities.
• The consolidated returns are to be furnished by no later
than 30 January and 30 July respectively.
Professional Status OF IMFO Technical
Members(CFO’S )
• Desire for a Professional Qualification
• What is the Role of IMFO and how does it
advance the Professional Status of it’s
Members?
• FACT - NT Regulations now Determines the
Competency Level Requirements for
Municipal CFOs, ACCOUNTING OFFICER
INCLUDING SENIOR MANAGEMENT
• IMFO
aligned
their
membership
requirements with NT competency level
requirements
Alignment of IMFO Membership Requirements to
NT Competency Level Requirements (Associate
Membership)
• Alignment was a Logical Step
• No significant Differences in Qualification Requirements (accounting 3 )
• NEW-Financial and Supply Chain management Competencies/Core Occupational
Competencies &Core Managerial Competencies ( portfolio of evidence )
• Practical Experience ( Completing The Logbook)
• 6 subjects( economics, business economics/business management/public
management, cost and management accounting,
municipal/commercial/mercantile law, auditing municipal finance, municipal
accounting) recommended but no longer prescribed
• Members 1742 associates 530
• Create two Categories of Associate (NT CFO Requirements) and Licentiate
Members (NT Financial Officials )
CFO Categories
ASSOCIATE
 < R500 million – NQF Level 6 or Certificate in
Municipal Finance
SENIOR ASSOCIATE
 > R500 million – NQF Level 7 or CA
 TRANSITIONAL ARRANGEMENTS !!!!!!!!!!!!
IMFO Associate Membership (AIMFO)
Requirements and Transitional
Arrangements
• A relevant first degree or equivalent on NQF 6 as
approved by the Institute AND
• Financial Accounting I and II AND
• Accounting III AND
• 6 other subjects (A subject on 1" and 2nd year level will
count for 2 subjects), chosen from:
• Economics
• Business Economics/Business Management/Public
Management
• Cost and Management Accounting
• Auditing
IMFO Associate Membership (AIMFO)
Requirements (cont)
• Municipal/Business/Commercial/Mercantile Law
• Municipal Finance AND
• Completed the Institute's Practical Training Programme
OR
Advanced level Learnership completed.
OR
A Chartered Accountant with One Year Full- Time Service in the
Finance Department of a Local Or Related Authority
OR
A Chartered Accountant with Two years External experience of
the Finances of a Local or Related Authority
IN THE PIPELINE
• Policy for Continuous Professional
Development
• Application to be registered as a
professional body for municipal
finance officers
IMFO To register as a Professional Body
IMFO’s must comply with SAQA’s criteria for registering a
professional designation
• In order for a professional designation to be registered on
the National Qualification it must:
• Protect the interest and the professional status of its
members.
• Protect the public interest in relation to services provided
by practitioners and the associated risks.
• Show evidence of inherent social responsibility and
advancing the objectives of the NQF.
CRITERIA FOR RECOGNITION
• Be a legally constituted entity with the
necessary human and financial resources to
undertake its functions, governed either by a
statute, charter or a constitution and
compliant with and adhere to good corporate
governance practices.
• Represent, and where applicable, also
regulate, a recognised community of expert
practitioners.
• Apply peer judgement in decision making
CRITERIA FOR RECOGNITION (Cont)
• Develop, award and revoke its professional designations in terms
of its own rules, legislation and/or international conventions.
• Monitor its professional designations in terms of its own rules,
legislation and/or international conventions.
• Manage the revocation of designations, as well as disciplinary
matters, appeals and complaints in a transparent manner and in
terms of its own rules, legislation and/or international
conventions.
• Set criteria for, promote and monitor continuing professional
development (CPD) for its members to meet the relevant
professional designation requirements.
• Show evidence of a fully functional information management
system compatible with the National Learners’ Records Database.
CRITERIA FOR RECOGNITION (Cont)
• Monitor compliance with an agreed code of conduct
and/or ethics, including criminal record screening
where applicable.
• Co-operate with the relevant QCs in respect of
qualifications and quality assurance in its
occupational field.
• Not be accredited as a provider by a QC.
• Be involved in the development of a body of
specialised knowledge taking due cognisance of
national and international benchmarks.
• Not be registered as a provider with the Department
of Higher Education and Training.
IMMEDIATE NEXT STEPS
IMMEDIATE NEXT STEPS
• IMFO To register as a Professional Body
• Promote the new membership requirements for CFO’S
• All assessment of competencies must be undertaken by
assessors accredited by the Local Government SETA (LGSETA)
in terms of the SAQA guidelines and NQF-registered Unit
Standards and criteria.
• The development plan and learning pathway of the official
should be reflected in his/her annual performance
agreement to ensure that existing competency gaps are met
within the prescribed timeframes ie. I January 2013
• Align all training to prescribed accredited Unit Standards
• Lobby for the introduction of legislation that will create a
statutory body that will regulate and enforce qualification
standards and code of conduct for municipal accountants
• THAT’S IT
• Thank You