MOSSEL BAY MUNICIPALITY PMS BEST PRACTICE

1. MOSSEL BAY MUNICIPALITY PMS BEST PRACTICE If its not documented its not done Leadership setting the tone It always seems impossible until it is done PRESENTER: MR E W JANTJIES DIRECTOR CORPORATE SERVICES

2. GEOGRAPHICAL OVERVIEW OF MOSSEL BAY Mossel Bay Municipality is situated within the Eden Municipal District which also includes the Local Municipalities of Bitou (Plettenberg Bay), George, Hessequa (Riversdale), Kannaland (Ladismith) and Oudtshoorn. It is situates on the N2 approximately halfway between the coastal cities of Cape Town and Port Elizabeth The Municipal Area cover 2007 square km

3. MAIN ECONOMIC ACTIVITIES IN MOSSEL BAY • Tourism • Agriculture (Aloes, Cattle, Citrus, Dairy, Ostriches, Sheep, Timber, Vegetables and Wine) • Fishing • Light Industry • Petrochemicals

4. MUNICIPALSUCCESSES

5. PMS IMPLEMENTATION IN MOSSEL BAY MUNICIPALITY PMS Poster campaign informs staff members were conducted during May 2010.

6. IDP PMS EMPLOYMENT EQUITY ORGANIGRAM: LOCATION OF FUNCTION

7. LEGISLATIVE OVERVIEW • SA legislative and regularity framework to define PMS • Constitution of the RSA, 1996 – Section 155 • White paper on Local Government (1998) • Municipal Systems Act, 2000 – Chapter 6 (Sec 38 -46) • Performance managements system to be implemented by each municipality • Culture of performance within municipality • Efficiency, economically, effectively and accountability • Regular monitoring and evaluation • Addresses the key components of the PMS • Municipal Finance Management Act 2003

8. LEGISLATIVE OVERVIEW • Municipal Planning and Performance Management regulations (796, Aug 2001) • Performance Management Regulations for MM’s & s57 Appointees (R805, Aug 2006) • Framework for managing programme performance information (2007) • White paper on transforming Public service delivery (Batho Pele) • National and Provincial Regulations and MFMA Circulars • Annual report guideline, SDBIP and Oversight report • Notice 464: Directive: Performance information public audit act (2007) • Auditor-General to audit PMS

9. GOVERNANCE AND AUDITING • Policy Framework • Framework for managing performance processes • Systems to measure performance • Reporting structure and delegations • Record-keeping • Changes to PDO’s / KPI’s • Supporting documentation

10. GOVERNANCE AND AUDITING • Performance Calendar • Performance calendar to explain when what will need to be done • Reporting on specific day of month • Reviews by Council and management • Municipal website • Performance Reporting • Risks related to objectives prioritised and mitigated • Monitor • Evaluate • Review • Corrective actions

11. GOVERNANCE AND AUDITING • Internal Audit • Audit plan to include the quarterly audits of performance management. • Re-evaluate the SDBIP • Pre- Audit done • Assist in improving external audit outcome • Combined Assurance Approach: • - minimise duplication of audit efforts

12. GOVERNANCE AND AUDITING • Should assess: • Risks and control measures regarding performance information • Risks informing audit plans • Legal compliance

13. GOVERNANCE AND AUDITING • Should assess: • Structure and delegations • Alignment – are we achieving our objectives • Controls to document evidence and compile performance reports • Functionality of the performance management system • Accuracy, completeness and validity of performance information • Performance evidence

14. GOVERNANCE AND AUDITING • Performance Audit Committee • According to the regulations, the performance audit committee must: • review the quarterly reports submitted to it by the internal audit unit • review the municipality's performance management system and make recommendations in this regard to the council of that municipality • assess whether the performance indicators are sufficient

15. GOVERNANCE AND AUDITING • Performance Audit Committee • According to the regulations, the performance audit committee must: • at least twice during a financial year submit an report to the municipal council • Observer during evaluations of s57 – appointees • It is further proposed that the audit committee be tasked with assessing the reliability of information reported.

16. PERFORMANCE MANAGEMENT DEFINED “ Performance Management is about creating relationships and ensuring effective communication between the employer and the employee.” “ Performance Management is an ongoing process throughout the year. It’s not just about performance appraisal. In fact, performance appraisal is only a small part of it. Performance management is about preventing, detecting and solving under-performance problems” “ Performance Management is about effective utilisation of available resources for maximum impact on service delivery” CHANGE PROCESS & SYSTEM IMPROVEMENT TEAMWORK OBJECTIVE

17. BASIC REQUIREMENTS - PMS FRAMEWORK • Must be applicable to all levels in the municipality • Corporate performance indicators aligned with IDP and budget and SDBIP • Performance Contracts, evaluation and measurement for s57 appointments and other managers • Performance management and evaluation at lower level • Create a culture of performance within the municipality • Including incentives to assist in creating a culture of performance • Measures to address weak performance

18. TRANSFORMING PMS IN MUNICIPALITIES

19. TRANSFORMING PMS IN MUNICIPALITIES

20. MBM - PMS FRAMEWORK The performance policy framework (ADOPTED by MBM Council in 2009) provides guidance in terms of the municipality’s cycle and processes of performance planning, monitoring, measuring, reviewing, reporting, auditing and quality control. PMS GOLDEN THREAD OF ACCOUNTABILITY

21. PMS OBJECTIVES • Facilitates strategy (IDP) deployment throughout the municipality and align the organization in executing its strategic objectives - Vision, mission and IDP into clear measurable outcomes • Tool for assessing, managing, and improving the overall health and success of business processes and systems. • Create an organisational performance culture (culture of best practices); • Provide early warning signals; • Promote accountability. • Develop open and constructive relationship between customers, leadership and employees;

22. PMS OBJECTIVES • Encourage reward for good performance; • Manage and improve poor performance; • Link performance to skills development and career planning, therefore encourage learning and growth; and • Replace existing assessment models with a consistent approach to performance measurement and management. • Sustainable improvements in Service Delivery • Comply with legislative framework

23. PMS PRINCIPLES • Simplicity • We develop our community by developing our staff • Align with municipal strategy and promote good performance • We appoint good people and therefore expect good performance • Each staff member takes ownership of own career

24. PMS PRINCIPLES • Implementable • Transparency and accountable • Effective and Efficient • Public participation • Integration with municipal processes • Objectivity • Reliability

25. LOOKING BACK AT PREVIOUS AUDIT OUTCOMES • Previous audit outcomes reveal that: • Inconsistency between Integrated Development Plan, Service Delivery and Budget Implementation Plan and Annual Performance Report • Pre- determined objectives and indicators were not measurable • No processes and systems were in place to monitor the achievement of goals and targets. • No corrective actions and measure were provided In the cases where indicators were deleted, the reason for such amendments was the mere fact that the indicators were not measurable and there was no measuring tool or instrument to determine the results

26. LOOKING BACK AT PREVIOUS AUDIT OUTCOMES • Previous audit outcomes reveal that: • KPI’s are were not relevant and measurable • Indicators/measures not verifiable (not possible to validate the process and system that produce the indicator) • KPI’s reported on in all PM reports were not the same • Lack of monitoring and review of the recording of actual achievements by senior management • Lack of standard operating procedures of the recording of actual achievement • Insufficient POE kept • No quarterly reporting to council on Top Layer SDBIP • No monthly reporting to Portfolio Committees on Departmental SDBIP • Audits of actual performance not taking place, especially Top Layer • Performance audit committees not established and meeting to analyse performance reports and audits of performance by internal audit

27. LOOKING BACK AT PREVIOUS AUDIT OUTCOMES • Previous audit outcomes reveal that: • Indicators and targets were not suitably developed during the strategic planning process • IDP objectives not achievable, cannot be aligned with budgets and SDBIP (iMAP) • KPI’s on SDBIP that were not budgeted for • SDBIP (KPI’s and targets) were not adjusted when budgets were adjusted • Planned development priorities/objectives were changed but not approved and/or adequately explained in the annual performance report

28. LOOKING BACK AT PREVIOUS AUDIT OUTCOMES • Previous audit outcomes reveal that: • Sufficient reasons for non-performance and corrective measures were not indicated on the system and in PR’s and annual reports • Measures taken to improve performance not supported by adequate and reliable corroborating evidence • The annual performance report was not on time for audit purposes

29. LOOKING BACK AT PREVIOUS AUDIT OUTCOMES • Previous audit outcomes reveal that: • Sufficient appropriate audit evidence/relevant source documentation could not be provided to measure the validity and accuracy of KPIs • Actual results reported in the annual • performance report per KPI are inaccurate

30. PERFORMANCE MODULE LINKAGES Organisational Performance KPI’s linked to budget KPI’s linked to Nat KPA’s KPI’s linked to mun KPI’s KPI’s per department Baseline per KPI Targets per quarter / month Types of indicators Responsibility Measurement criteria Reviews and reporting Annual Report Performance improvement

31. CURRENT STATUS : SDBIP & PERFORMANCE DEVELOPMENT

32. SDBIP & PERFORMANCE DEVELOPMET PM Policy (Framework) IDP / MY-Mun SC Top Level SDBIP Municipal Scorecard Monitoring / evaluation LGTAS Council Exco Top Level SDBIP Quarterly Reports BUDGET Departmental SDBIP Implement of top level & detail performance of dept’s Dept ‘s Activities Mgmnt Portfolio Committee SDBIP Monthly Reports Skills Development AG Audit Work Place Skills Plan Council Dept A Dept B Serv. Provider s SCM Mgmnt Council Annual Review Annual Report SP Perf. Quarterly Reports S57 Performance Contracts R805 Audit MM Dir A Dir B StaffPerformance Evaluation Committee S57 Performance Reviews Managers Managers Councilors Management Team Staff Performance Reviews Ownership: Municipal Manager / Performance Manager / Executive Mayor

33. Vision Goals / objectives Strategies / programmes / projects Implementation and monitoring instruments • INTEGRATING FINANCIAL AND NON- FINANCIAL information IDP BUDGET SDBIP Nat Outcomes Prov. Strat. Nat KPA’s OPERATIONAL BUDGET Revenue & Operational Expenditure For 2010 /11 Top Layer SDBIP Strategic Objectives National Requirements • IDP Strategic Objectives • Strategic objectives are long-term, continuous strategic areas that help you connect the municipal mission to its vision. Strategic objectives encompass four areas: financial, customer, operational, and people. • What are the key activities that you need to perform in order to achieve your vision / Mun KPA’s? Financial SDBIP Revenue Capex Opex BUDGET Alignment Budget should visibly address strategic objectives. Budget should address prioritised projects. Departmental SDBIP KPI’s to implement Top Layer SDBIP Departmental Activities Capital Projects Progress CAPITAL BUDGET Prioritised Capital Projects For 2010 /11 IDP Prioritised Capital Projects

34. INTEGRATING FINANCIAL AND NON- FINANCIAL INFORMATION iMAP • Reporting on: • Financial Information • Non-financial information • Alignment of IDP with budget and budget with SDBIP • Alignment with provincial and national strategic interventions

35. TOP LAYER SDBIP INPUT OWNERSHIP IDP SC Top Layer SDBIP Municipal Manager KPA’s / Strategic Objectives Budget Submitted to Council to Review Performance indicators Directors Strategic Manager MTAS Prioritised projects OWNERSHIP Nat. Outcomes Year-end Review Municipal Manager Dir’s / SDBIP Officer Capital Expenditure Directors CFO High / Severe Risks Risk Register Revenue by source Directors CFO Quarter 3 Review Municipal Manager Dir’s / SDBIP Officer Monthly Cashflow Directors CFO Mid-year Review (Include s72 report) Municipal Manager Dir’s / SDBIP Officer Expenditure per Ward Directors CFO Quarter 1 Review Municipal Manager Dir’s / SDBIP Officer Actual Performance Quarterly Directors Multi-Year Municipal Scorecard CFO Financial Performance Monthly Submit to Mayor (14 days after budget approval Mayor review and approve (28 days after budget approval Municipal Website

36. DEPARTMENTAL SDBIP Top Layer SDBIP Update TL SDBIP with actual results of Dept SDBIP KPA’s / Strategic Objectives IDP Performance indicators Annual Report Input Budget Prioritised projects Capital Projects MTAS Nat. Outcomes High / Severe Risks Revenue by source INPUT Risk Register Monthly Cashflow Departmental SDBIP Council Scorecard Departmental Scorecards Monthly Report to Portfolio Committee Management Team Monthly Review Mayor review and approve (28 days after budget approval) Actual Performance to be updated monthly Actions to address areas where performance are less than required standard Expenditure per Ward INPUT Departmental Activities Reporting Requirements Municipal Systems Municipal Manager Directors Municipal Manager All KPI Owners Management Management OWNERSHIP SDBIP Officer

37. CONCLUSION • It is important to note that a PMS is dynamic • and will change and develop over time to • reflect the unique features of the municipality. • Performance management provides the mechanism to measure whether targets to • meet its strategic goals set by the organisation and its employees are met. Explore Endless Horizons

38. THANK YOU/ DANKIE YOURS IN SERVICE DELIVERY….