OVERVIEW OF THE PRESENTATION

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OVERVIEW OF THE PRESENTATION

• Introduction
• Sources of SAMDI Revenue
• Graphic Presentation of Revenue by Source
• Background SAMDI
• Brief Historical Background of Cost Recovery
• Aim of Cost Recovery
• Goals of Cost Recovery
• Status of Cost Recovery
• Graphic presentation of the Financial Status
• Challenges
• The Way Forward

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INTRODUCTION

• SAMDIs vision is
• the creation of a self sustaining Organisational
  Transformation Centre of Excellence for Public
  Service Delivery

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SOURCES OF SAMDIs REVENUE
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BACKGROUND SAMDI

• Before 1994 training and development in the
  Public Service was provided by the Public Service
  Training Institute (PSTI), which was then changed
  to the South African Management Development
  Institute (SAMDI)
• Training and Development was offered free of
  charge by this body, and focused on technical
  skills
• In October 1999, SAMDI became a schedule 1
  Department, with its own Director-General
  accountable to the Minister for Public Service
  and Administration.

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BACKGROUND SAMDI (continued)

• Concerns were raised that SAMDI should compete
  with other providers and not to enjoy monopoly
  like the PSTI
• This concern is also reflected in the White Paper
  on Public Service Education and Training
• The rationale was that competition would lead to
  quality service and programmes
• Cabinet then mandated SAMDI to embark on Cost
  Recovery

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BRIEF HISTORICAL BACKGROUND ON COST RECOVERY

• Cost recovery strategy was initiated during 1999
• National Treasury approved the Trade Account in
  2001
• National Treasury approved the initial tariffs in
  2001
• Shadow invoicing commenced during October 2001
• Implementation of cost recovery from 1 April
  2002
• Tariffs amended in October 2002 (More market
  related)

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COST RECOVERY

• Aim To support SAMDI business through the
  recovery of costs on services rendered through
  fair and recognised outsourcing processes

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GOALS OF COST RECOVERY

• Short Term
• To recover portion/part of costs
• Annually increase the portion of costs to be
  recovered
• Long Term
• To recover all costs( Break-even)
• To be sustainable

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STATUS OF COST RECOVERY

• Total revenue April 2002 to March 2003
• R 6 778 947
• 1036 Invoices issued to the amount of
• R 13 049 089
• Total debtors outstanding R 4 628 111
• Tariffs revised during October 2002
• Inclusion of consultation fees
• Inclusion of professional management fees

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CHALLENGES

• Implementation and monitoring of the Cost
  Recovery Strategy and Financing of training and
  development programmes
• Willingness of departments to pay for services
• Shrinking budget lines versus cost of training
  and development
• Enforcement of payment for training and
  development services rendered
• Expensive Leadership and Management Development
  Programmes Cost of external service providers
• Government priority programmes versus cost
  recovery

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CHALLENGES Continue

• Aggressive marketing of SAMDI products and
  services to departments
• Systems for Cost Recovery
• GAAP compliant, Booking, Invoicing, Certification
  and Weekly financial reporting
• Management of debtors
• Capacity to handle the number of invoices issued
• Capacity to handle the follow up of debtors
• To achieve an un-qualified audit report
• Access to skills development levy

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THE WAY FORWARD

• The strategic plan for SAMDI
• Structure linked to the strategic plan
• Revisit the strategic marketing plan
• Consolidation of the funding structure

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THANK YOU
Please visit SAMDIs website at www.samdi.gov.za