The National Youth Development Agency briefed the Committee on its annual operational plan for 2010/11. The Committee commented that it found itself at a disadvantage in that it had still not received the takeover reports compiled by the Umsobomvu Youth Fund when its functions, together with those of the National Youth Commission, were transferred to the National Youth Development Agency (NYDA), and further commented that the strategic plans should have been presented, instead of merely an operational plan. Furthermore no senior officials from the Presidency were present. The Committee did, however, allow the presentation to proceed. The NYDA indicated that the Auditor-General had given a disclaimer in respect of the National Youth Commission’s audit, and that the final audit was not available yet. The Umsobomvu Youth Fund audit was unqualified. Both these bodies had effectively ceased to function, but their continuing contractual commitments, that had been taken over by the NYDA, posed financial problems for it. The NYDA had received only one third of the funding that it had requested. No funding was given separately for the merger process, which was financed from the current budget, which was now insufficient to sustain the NYDA’s planned programmes.
Members noted that the audit disclaimer, and the question of staff takeover, were issues that must be clarified and addressed, although it was impossible to do so at this meeting because of the lack of certainty and the relevant documentation was not provided. Members asked whether the National Youth Commission was still in existence or administering any funding, the status of the provincial youth commissions, whether the Integrated Youth Development Strategy had been finalised, and whether gender issues were being considered. Members also cautioned that there should not be duplication of projects across different departments, that the re-commitment of funds must be taken into consideration and that a full listing of all projects, with an indication of their sustainability, cost, funding allocations and timeframes, was required. Members called for elaboration also on the contractual commitments, commented that the operational project linked to the South African Football Association should extend to other sporting codes, and that volunteering should be encouraged, particularly in rural areas, and there should be greater emphasis on activism, outreach and contributions to community projects. Collaboration with other departments was suggested, along with the need to stress artisan training. Members questioned the plans for outstanding debts, but warned that the NYDA should not become a micro-lending agency, asked about rural projects, the high percentage of the budget allocated to salaries, and the need to ensure proper and cost-efficient outcomes. Members asked that all outstanding reports must be submitted to the Committee, and that the NYDA must also furnish a proper strategic plan and budget.
National Youth Development Agency (NYDA) Annual Operational Plan 2010/11 briefing
Mr Steven Ngubeni, Chief Executive Officer, National Youth Development Agency, began to detail what would be included in the presentation.
The Chairperson interrupted him, and asked for the report that had been compiled by the Umsobomvu Youth Fund (UYF) for the take over by the National Youth Development Agency (NYDA).
Ms Teboho Sejane, Business Strategist, NYDA, said that the report was not available.
Mr Ngubeni stated that the agenda for this meeting had indicated that the NYDA should be presenting its Annual Plan for 2010/2011.
Ms Bernice Hlagala, Director in The Presidency, noted that the National Youth Commission (NYC) report had been submitted the previous week, to the Clerk in Parliament.
Ms D Ramodibe (ANC) expressed concern about the procedures taken, noting that this Portfolio Committee, which was responsible for oversight over the NYDA, had not received the report.
Ms V Mafana, official from the Presidency, said that corrective measures would be taken.
Mr G Selau (ANC) commented that the procedure was ‘dislocated’ and said that the NYDA should present that report in a formal meeting.
Ms P Duncan (DA) added that the Department itself should have sent the report to the Portfolio Committee. An apology was expected as this oversight was seen as disrespectful to the Committee. The report was more important than the presentation and the Portfolio Committee needed time to prepare for its engagement with the institutions.
Mr D Kekana (ANC) proposed that during its presentation the NYDA delegation should give a brief background and mention what NYDA had inherited from the two previous youth organisations.
Ms H Malgas (ANC) also noted that a senior official should have accompanied the NYDA delegation to the meeting, and pointed out that the NYDA falls under the Presidency. It was noted that no apology was received.
The Chairperson responded that the Minister was attending a Cabinet meeting and had indeed sent apologies. However, she questioned who was to be regarded as the accounting officer in respect of what was to be presented to the Committee. However, in view of the fact that funds had been spent in bringing this Pretoria-based delegation to the Cape Town meeting, she noted that proceedings would continue, despite the serious concerns raised.
Mr Ngubeni apologised for the misunderstanding about the presentation. The National Youth Commission had received a disclaimed audit report, because of issues not elaborated on. The Umsobomvu Youth Fund audit was unqualified. The contractual commitments of both these bodies posed funding problems for the NYDA.
Mr Sello Nkoane, General Manager: Finance, NYDA, said that the NYDA inherited the rights and obligations of the two previous youth development bodies. There was no longer a NYC board as the Minister took responsibility for its functions on 21 October 2009. The ‘take on balance’ audit conducted by Ernst & Young on Umsobomvu Youth Fund displayed no problems. The NYC had a few problems so the Auditor General decided that a statutory audit was necessary and it included an assessment of governance and the total value of all assets and liabilities. The Executive was engaged with, and it was decided that the numbers available would be used for forecasting but adjustments would be made once the full audit report was received. The National Youth Development Agency Act dissolved the NYC, and no transactions were made from 1 October 2009 to 5 March 2010. The NYC had effectively been a shell while the process of dissolution was completed. Umsobomvu Youth Fund was a Section 21 company and a resolution was passed to dissolve it and effect a transfer to the NYDA, delisting it as public property.
Mr Ngubeni presented the Annual Plan and Budget with revised figures (see attached presentation). He outlined the vision, purpose and key performance areas. He emphasised the area of funding, because he noted that the NYDA was allocated only one third of the funding it had requested.
Mr Nkoane addressed the financial implications of the merger of Umsobomvu Youth Fund and the NYC. National Treasury (NT) had declined the merger funding and this had to be absorbed into the current budget. The newly allocated funds received went into inherited commitments and the remaining funds were insufficient to sustain the NYDA’s planned programmes.
The Chairperson noted that the NYC disclaimer had to be clarified. She also noted that the question of staff must be addressed.
Ms Duncan noted that this Portfolio Committee had to oversee the NYDA. She noted, in relation to the NYC, that being awarded a disclaimer was the worst audit option. She agreed that the transfer of staff raised concerns. She suggested that the Minister and the Presidency must talk about the disclaimer. The inheritance that NYDA referred to cannot be addressed in the meeting, because there was too much uncertainty, and the relevant documentation was not at hand for accurate referencing.
Mr Kekana agreed with Ms Duncan on the last point, and said that the disclaimer should be reviewed later. He said that the youth needed to be assisted, and the Committee should be acting to do so. The unqualified Umsobomvu Youth Fund audit was commended.
Ms H Malgas (ANC) asked if the NYC was a shell, and whether the Trust did still administer funding.
Mr Nkoane explained the current position. He noted that the disclaimer related to the financial period from March 2009 and the Auditor-General had not completed the full audit yet. He reported that Umsobomvu Youth Fund still existed as an entity but did not conduct business, as its functions were transferred to the NYDA. The NYC had been formed through an Act of Parliament, and its dissolution was tied in to the repealing of this Act. All its assets, however, was formed based on a parliamentary Act and dissolving it requires that the Act be repealed. All assets, however, had been moved to NYDA.
Ms Ramodibe asked about the status of the provincial youth commissions.
Mr Nkoane responded that the provincial youth commissions fell under the provincial Premiers. The NYDA was in talks with the Premiers to establish provincial chapters. The provinces were expected to carry the operational costs and the municipalities were engaged to promote this end. The NYDA relied on the Presidency to oversee this process because it regulated all government institutions.
The Chairperson told the NYDA delegation that they should be careful when speaking of their ‘inheritance’ because the NYDA was created to address the problems of Umsobomvu Youth Fund and the NYC. She was critical of the presentation, saying that the Committee had expected a strategic plan to be presented, but instead an operational plan was presented.
Ms Ramodibe asked if the Integrated Youth Development Strategy (IYDS) had not been finalised, because the presentation indicated otherwise. The role of gender was not addressed in the presentation, and she asked if it was considered in the planning.
Ms Sejane answered that the IYDS was not finalised.
Ms Malgas said that a strategic plan was necessary. She asked if there was collaboration with relevant different departments to address the key performance areas.
Ms Malgas noted that the Department of Transport in the Eastern Cape had a bicycle programme, similar to that of the NYDA, and she asked if there was a relationship between the two entities.
Ms Malgas asked how the matric rewrite project differed from that of the Department of Basic Education. She stressed that the duplication of projects should be avoided at all costs. The de-commitment and re-commitment of funds for contractual obligations in the new financial year was a point that the NYDA was asked to consider in ifs final planning. A full listing of projects and indications as to their sustainability was requested.
Mr Ngubeni responded that the NYDA was in talks with the Inter-Departmental Committee (IDC) on youth development. The NYDA worked with other departments and in fact, its bicycle project was funded by the Department of Transport.
Ms Duncan also commented that the NYDA had presented not a strategic, but an operational plan. The potential duplication of projects within departments was a cause for concern. The lack of funding was seen to hinder the progress of the NYDA. The cost of activities, the actual allocation and time frames should be included in the report.
Mr Ngubeni responded that the Committee Agenda had stated that an “Annual Plan 2010/2011” was expected and NYDA had prepared accordingly. The Public Finance Management Act stated that presentation on operational strategy was necessary.
Ms Maduna countered that both strategic and operational strategies were required according to that Act.
Ms P Maduna (ANC) asked for an elaboration of the contractual commitments.
Mr Nkoane responded that skills development projects started by the previous youth development bodies had to be completed. In addition, staff salaries had to be paid and offices had to be maintained.
Mr Ngubeni added that the matric rewrites were funded by the NYDA.
Mr Selau said that the NYDA had to prepare the youth to lead the country one day. The Operational project linked to the South African Football Association (SAFA) should extend to other sporting codes. The presentation made no mention of volunteerism and he said that this should be encouraged, especially in rural areas, so that youth could gain experience. The presentation related more to funding than activity and this did not reflect the ANC’s value of activism. There were no outreach projects, nor an establishment where youth could contribute to their community projects. The NYDA should assess how the key performance areas relate to the rest of government.
Mr Ngubeni answered that the presentation’s focus on funding was intentional, and, judging from the Committee’s reaction, this strategy had clearly worked.
Mr Kekana agreed that the NYDA should prepare the youth for leadership. The NYDA should address current youth issues, although the inherited projects were necessary because their continuation helped youth in training. He proposed that there should be collaboration with the Ministry of Higher Education and Training for matric re-writes. He also pointed out that artisans were necessary for the next 30 years because of the housing backlog, so artisanship was a viable training option and could be addressed with this Ministry as well. The lack of experience of graduates should be addressed through internships and learnerships. The NYDA delegation was encouraged to use its position of being close to the President to its full advantage when seeking funding or collaboration. NYDA should make full use of its opportunities.
Mr Ngubeni responded that the current budget tied the hands of the NYDA in relation to what it could achieve. NYDA was engaging with the President, the Minister, the National Treasury, and private companies about funding.
Ms Sejane added that the ‘Fly the Flag’ campaign was part of grooming future leaders.
Ms Maduna asked if youth with disabilities were included in the plan.
Ms Ramodibe asked if there was a recovery plan for outstanding debts.
Mr Nkoane answered that loan collections were handled through a loan management system. The NYDA would engage with debtors, but if serious talks with them failed, then they were handed over to loan collections. Happily, all loan capital from Umsobomvu Youth Fund had been collected.
The Chairperson warned that the NYDA should not become a micro-lending agency creating a feeling of dependency. The resources should be refocused. Drug use among the youth should be addressed.
Ms Ramodibe asked if there were rural-specific projects.
Mr Ngubeni indicated that the rural youth were being accommodated through the Bicycle project.
The Chairperson added that the discrepancies between the various documents presented should be rectified. She also noted that documents that were discussed in meetings should be delivered well before the time so that Committee Members could read and prepare themselves on them.
Mr Ngubeni said that the revised plans contained the specifics.
Ms Sejane commented that there were significant strategic shifts, even though projects and services were maintained. The programmes affected more people and encouraged youth leadership with a focus on social cohesion.
The Chairperson questioned the high percentage of the budget allocated to salaries, and asked whether this was justified. Proper outcomes were emphasised, and if staff were simply transferred with the merger, their value may be overstated. The Committee Members needed to be able to confirm the work of the NYDA, and presently this was not the case. A warning was made not to have overly lush offices, because public money was being used to pay rentals.
Mr Ngubeni said that the percentage was skewed because it was based on a higher budget allocation and had not been revised since.
Mr Kekana added that offering a good salary was one way to address corruption.
Ms Duncan made a final appeal to the NYDA delegation to submit the transitional reports as a matter of urgency.
Ms Thomson said that the NYDA should now furnish the Committee with the correct Medium Term Expenditure Framework strategic and financial plan.
The meeting was adjourned.
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