UPDATE; Compensation Fund to follow RMA system

The Labour minister has instructed the Compensation Commissioner to implement the Rand Mutual Assurance (RMA) claim system in the Compensation Fund.

Minister Mildred Oliphant told parliament in her budget vote in May 2013 that the matter was urgent. “We will also amend the Compensation Fund Act to introduce an enabling provision for rehabilitation, and early return to work, for injured and diseased workers.”  The Draft Amendment Bill has been signed by the board and it is going through internal legal processes.

Claims management has improved, she said, “but more still needs to be done.  We have managed to process 934 000 invoices in medical payments amounting to R1.5b.” The Compensation Fund for injuries and diseases at work has “experienced challenges”, said Labour minister Mildred Oliphant.

A turnaround promised in her last budget vote speech, “has been partly implemented.” The online submission of Return of Earnings System was launched in May last year.  About 200 000 employers switched from manual to an online submission system and the fund was able to collect over R7.3bn in revenue as a result.

In the period under review, the Compensation Fund paid out over R775m in pensions to 295 000 pensioners.

“The Fund has funded a total of 21 Social Civil Society job creation projects and the discussions with the PIC to allocate R3.5 billion investible income for job creation and infrastructure development projects.

Fishers, domestic workers get more protection

Regarding obligations to the International Labour Organisation (ILO), South Africa has been in the forefront of ratifying various conventions. Recently Parliament ratified the following:
• Maritime Labour Convention of 2006: To provide for a modern system of improved conditions of decent work in the maritime sector together with an enforcement regime.
• Convention concerning Work in the Fishing Sector of 2007 (No 188) – To ensure that employees on fishing vessels will have decent conditions of work, including food and accommodation, occupational safety and health, medical care and social security.
• Labour Inspection Convention of 1947 (No. 81): To provide useful guidance for designing and monitoring an improved labour inspection system.
• Domestic Worker Convention of 2011 (No. 189): To enhance the protection of domestic work worldwide. Issues in this convention are already entrenched in the Sectoral Determination for Domestic Workers.  Domestic workers will be covered by the Compensation for Occupational Injuries and Diseases Act (COIDA).
• HIV and AIDS Code and Technical Assistance Guidelines have been reviewed and aligned with the ILO’s Recommendation 200 concerning HIV and AIDS and the world of work has also been adopted.

More DOL computer contract problems

A Labour Department media briefing on their IT contract with EOH was cancelled in May. Labour minister Mildred Oliphant said supply chain management processes were followed when invoking the termination support.

DoL director general Nkosinathi Nhleko would have addressed the “dilemma and winding down of the public private partnership with ICT supplier Siemens” and the department’s transaction advisor PWC was expected to go out on tender by July 2013, but postponement of the briefing implies that the situation remained subject to change.

==== Previous update April 2013

The SA Labour Department Compensation Fund reported its compensation fraud and backlog clearance plan to the Parliamentary Portfolio Committee on Labour in May 2013.

Compensation commissioner Shadrack Mkhonto said they aimed by 2016 to have the capacity to finalise medical claims within 30 days of receiving invoices.

“We also want to be able to provide medical advice on medical claims within 24 hours by 2016. We will develop a rehabilitation and reintegration policy framework and participate in consultative processes by 2014,’’ the commissioner said.

On the financial viability of the Fund, he said R1.6 billion was collected in quarter four against the annual target of R1b per year of the debt book at March two years ago.

“Implementation of the Return of Earnings website last year, for online submissions, has been successful. Up to March 31 this year, 94 302 on-line submissions were received with a total revenue of R3.3b,’’ Mkhonto said.

The politicians were informed that challenges facing the Fund included the delay or non-reporting of accidents by employers, and inadequate information technology systems.

Mkhonto said key strategic interventions to address the challenges included;
• enhancement of integrated claims and financial management systems
• implementation of a revenue management strategy
• marketing of the Return of Earnings website to increase employers’ access and invoicing, as well as creating incentives for filling online submissions
• backlog management, by a rescue plan dealing with claims registration and adjudication of claims
• implementation of a newly approved organisational structure by advertising  critical vacant posts
• decentralisation of Compensation for Occupational Injuries Diseases (COID) Act services to provinces
• amendment to the Coid Act
• engaging with the Fund’s stakeholders.

The briefing was also addressed by Nkosinathi Nhleko, the Labour Department’s director-general; Lerato Molebatsi, deputy director-general for Corporate Services; and directors of Nedlac, Allistair Smith; Commission for Conciliation Mediation and Arbitration, Nerine Kahn; and Productivity SA, Bongani Coka.

Two medical health care providers were convicted and sentenced to three years house arrest, five years suspension, and paying back respectively R2.1m and R455 212, with 15% interest.

Another four health care providers are on trial for defrauding the Compensation Fund to the value of R1.3m.

Seven former employees of the fund are on trial for colluding with fraudulent health care providers. Two medical professionals are being disciplined by the Health Professions Council. The court saga follows two years of ongoing investigations and prosecution in several cases.

The fund has completed 86 of 142 cases of fraud and corruption in four months, leading to arrest and conviction of employees and health care providers.

* See more reports on Compensation Letter of Good Standing, and the SA Compensation Fund and Department of Labour ICT, IT and computer capacity saga on Sheqafrica.com

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Edmond Furter

Editor at Sheqafrica.com
Edmond Furter is the editor of Sheqafrica.com. He is a freelance technical journalist, and has won six journalism awards. He specialises in industrial, business, and cultural content in web, journal, and book formats.

One thought on “UPDATE; Compensation Fund to follow RMA system

  1. My letter of Good Standing expired on 31 March 2013 and I was told to pay R900, which I paid, and still I have not receive my Letter.

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