Energy Sector skills development: Local Government SETA, Construction SETA, Chemical Industries SETA, Wholesale & Retail SETA input

Energy

05 November 2012
Chairperson: Mr S Njikelana (ANC)
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Meeting Summary

The Committee received briefings from the Construction SETA (CETA), the Chemical Industries SETA (CHIETA), the Wholesale and Retail SETA (WRSETA) and the Local Government SETA (LGSETA).

The Construction SETA which was under administration briefed the Committee on the scarce and critical skills in the sub-sector and the key principles buttressing CETA allocations for funding. Details were provided on the CETA funding for skills development interventions in the sub-sector, the achievements on the transitional agreements and an outline of the CETAs planned activities. The CETA had successfully issued 153 certificates, accredited 15 providers, and registered 74 assessors and 19 moderators. The CETA had also accredited 9 trade test centres

The Chemical Industries SETA reported on its contribution to the National Development Plan 2030, its Strategic Infrastructure Projects (SIPS) and the organisation’s role in skills development. CHIETA’s approach to enhancing skills development in the energy sector comprised of supporting national and sectoral imperatives and working in partnership with government and industry stakeholders to identify skills needs and address them. In painting a picture of national education, the Committee was told that of the 13 million workers in the country, 48.5% had no Matric, 30.4 had Matric and only 19.9% had post Matric qualifications. South Africa was ranked 50th by the World Competitiveness Report for 2012. The low educational levels of the country’s human resources and the high unemployment were the main contributors to the poor rating.

The Wholesale and Retail SETA said that it officially took over Fuel Retailers from 1 April 2011 from the MERSETA and had received R26.9 million in levies. On the funding allocated to fuel retailers, R15.5 million had been allocated as discretionary funding and R3.6 million as mandatory grants. This made a total of R19.1 million. A total of 11 915 people had been trained as wholesale providers.

The Local Government SETA outlined to the Committee its contributions in the sub-sectors of electricity, water and environmental sustainability.

In the discussion that followed, the Committee asked questions about the progress in stabilising the Construction CETA after it was placed under administration. Members asked the SETAs about their programmes on gender balance, the empowerment of marginalised groups, on skills development in rural areas and the recognition of prior learning. The Committee asked for details on measures taken to enhance the employability of graduates who did not have work experience and the integration of skilled people who lacked formal academic qualifications. The Chairperson said that the briefings by the SETAs were the beginning of a journey towards to development of skills in the energy sector.

Meeting report

Introduction by the Chairperson
The Chairperson said the SETAs were going to share with the Committee their respective programmes with regards to skills development in the energy sector. The SETAs were doing quite a good job with regards to professional education and training. There was the need to improve skills in the various sub-sectors from the basic levels up to expert and professional levels. The Council for Higher Education was invited but it was unfortunate that they could not attend. The reason for the invitation of the Council for Higher Education was that it was necessary to get a global picture of what was being done to enhance skills development in the energy sector. The operations in the energy sector needed more skills than it currently had.

Apologies were noted from the Minister and Deputy Minister of Higher Education who were absent.

The Chairperson said that it would have been good to have at least one of the Ministers present because a lot of importance attached to skills development. If there were no skills, the energy projects could have the best finance and other resources – but no delivery could be attained.

The Chairperson acknowledged the presence of the Deputy Director General in the Department of Higher Education and Training.

Construction Education and Training Authority (CETA) presentation
The delegation from the Construction SETA (CETA) was led by its Administrator, Mr Themba Mhambi. The briefing outlined the scarce and critical skills in the sub-sector and the key principles buttressing CETA allocations for funding. The presentation also provided the details on the CETA funding for skills development interventions in the sub-sector, the achievements on the transitional agreements and an outline of the CETAs planned activities.

Mr Mhambi told the Committee that the electrical construction sub-sector was transferred from the EWSETA to the CETA on 1 April 2011. After the failure of a working committee created to oversee the transition, a new committee was established in March 2012 led by the Acting Chief Executive Officer of the CETA and the National Director of the Electrical Contractors Association (ECA).

Scarce and critical skills in the sub-sector
During a workshop held in May 2012 by the CETA, the scarce and critical skills in the sub-sector were identified to include: electrical construction operations (ELCONOP); electrical installations; solar water heating installation; business management; project management; assessment and moderation; skills development facilitation and mentorship.

Key principles for CETA allocations for funding
In providing funding to address the challenge of scarce and critical skills in the sub-sector, the CETA based its operations on the key principles of compliance with the National Skills Development Strategy (NSDS 3); redress in respect of marginalised and vulnerable groups; greater access to the sub-sector and quality based on use of sub-sector expertise.

In its interventions for 2011/12, the CETA had facilitated the training of a total of 3 260 learners and it had invested a total of approximately R23 million on these learners.

Achievements
The CETA had successfully issued 153 certificates, accredited 15 providers, and registered 74 assessors and 19 moderators. The CETA had also accredited 9 trade test centres.

Mr Mhambi said that there were plans for the development of a CETA Sector Skills Plan inclusive of scarce and critical skills pertaining to the sub-sector. The CETA also planned for greater investments and focus on the training of artisans. There were plans to increase support to FET colleges and a review and development of qualifications through industry funding.

Discussion
Questions
Mr J Smalle (DA) asked if the Administrator had been able to turn the CETA around and achieve the purpose of the administration. Were there any challenges in the transfer of the electrical sub-sector from the EWSETA to the CETA as the programme of the CETA only picked up a year later? The energy sector was a wide field but nothing was said about the liquid fuels side of energy. Were there any programmes relating to liquid fuels? Were all the learners sponsored by the CETA undergoing only professional programmes or did the CETA also sponsoring learners at university level. How did the CETA spread its moderators over the national territory?

Mr S Mayathula (ANC) remarked that it was already November yet the CETA was still planning to allocate funds for 2012/13. What was the reason for such a delay? How could FET colleges access the funds of the CETA? What were the processes involved?

Mr J Selau (ANC) said that the CETA had a wide range of issues to cover but the presentation submitted to the Committee was very shallow and many critical issues were left out. In relation to rural communities, how was the CETA planning its operations to ensure that rural communities were catered for? The funding model of the CETA was uneven. As the number of participants was getting smaller, the costs were increasing. What was the exact role of the moderators and assessors? The FETs were supposed to be the shock absorbers for the members of the society who could not make it to university. The FETs were supposed to feed the system with equipped people but this was not being done. What were the SETAs doing to correct this situation?

Mr S Radebe (ANC) said that if the CETA briefing were to be presented to the Portfolio Committee on Higher Education and Training, it would be rejected. The report did not have target figures. The report did not say much with regards to the actual work of the CETA. It was important for the CETA to start thinking of empowering people in rural areas. He gave the example of Nkandla and the Western Cape. The people of Nkandla were poor unlike the people of the Western Cape. The report gave numbers but without any comparison. With regards to the achievements, what was the transformation status of the CETA? Was the CETA empowering black people or was it still using the old, white and Boer assessors for current projects? The CETA did not mention any institutions which they were working with; neither did they have any MOUs with any FETs or colleges. Was the Administrator successful in resolving the issues plaguing CETA?

The Chairperson did not like to restrict Members in their interactions with CETA but due to time constraints and to ensure proper engagements with the other SETAs, the questions needed to be brief and precise.

Mr Selau asked if the CETA was only concerned about solar water heating installations. Did it also plan for the maintenance of the infrastructure which was going to be installed?

The Chairperson asked for an institutional analysis of the targets and the status of skills demand which the CETA had to live up to.

Responses
Mr Mhambi replied that CETA had noted the comments of the Committee. CETA was placed under administration because of serious lapses in its management especially financial management. It was found that up to 80% of the projects allocated had some form of fraud and corruption attached to them. The CETA had allocated a lot of money but still could not meet its target. The mandate of the administrator was to stabilise the organisation. This mandate was almost 80% complete and by the end of the next financial year, the process was going to be complete. In terms of fraud and corruption, two particular interventions had been undertaken. The first was the auditing of all the projects within CETA. This had led to the termination of more than 80% of the contracts which CETA had. An entity had been appointed to make sure that the learners did not suffer as a result of the process. CETA was also auditing all the accreditations given by CETA. This had led to the de-accreditation of entities which should not have been accredited. On the governance front a new constitution had been developed and was being presented to the Minister at the end of November 2012. CETA had also conducted a due diligence and it was now in a position to determine who should or should not be on the board.

The Chairperson asked Mr Mhambi to minimise the institutional issues and deal only with the issues of relevance to skills development in the energy sector. The institutional issues were to be reported to the Portfolio Committee on Higher Education and Training.

Mr Mhambi said that CETA was now in a position to deal with expansion of programmes in the future. The only thing which CETA dealt with in relation to energy was electric construction such as installing electricity in buildings. Some of the issues raised by members such as liquid fuels was not dealt with by CETA. CETA did not deal with maintenance and repairs. It was mandated to deal with the installation of electricity in buildings.

 CETA spent an average of R36 000 per learner and this was because it had been found that the amounts which were previously invested in learners was not enough to enhance their training or learnerships. The CETA was working with the Universities of Venda, Johannesburg, Wits, KwaZulu Natal and many FET colleges. CETA also wanted to align the level of training and education which it provided to that of other institutions of higher learning.

Besides carrying out their own training, CETA was assisting FET colleges in the funding of their learners and the improvement of their curriculum and uplifting of their students to ensure a balance between what was happening at CETA level and FET level.

With regards to allocations, the allocations referred to did not include training that had already taken place. The allocations were not responding to specific targets as yet as the target had to be based on the Sector Skills Plan. CETA was working on a Sector Skills Plan which was going to include the electric construction sub-sector.

On the funding of the electrical construction workshops, CETA had visited the FETs and had verified how much they had in terms of electrical construction.

The Chairperson asked how many FETs had been visited.

Mr Mhambi replied that CETA had visited about 12 FET colleges. These visits were done with the Electrical Contractors Association. These visits were meant to establish what kind of intervention could be made. In terms of allocations, R2 million had been set aside per FET college.

On the question of taking marginalised groups into account, Mr Mhambi said that 40% of all training funded by CETA must cover women and 2% was for people with disabilities.

With regard to CETA assisting Eskom with solar water heater installations, the current situation was that the Financial Fiscal Commission (FFC) was going to give CETA a specific figure upon which CETA was going to allocate amounts for that.

Chemical Industries Education and Training Authority (CHIETA) presentation
In a presentation done by the Group Executive: Governance and Support Services, Mr Trevor Channing, the Committee was presented with the mandate, scope, board and chambers of the CHIETA; the National Development Plan 2030, the Strategic Infrastructure Projects (SIPS) and CHIETA’s role in skills development.

Mr Channing said the issues pertinent to the chemical sector were identified in the National Development Plan 2030 (NDP). In the NDP, there were plans to reduce South Africa’s over reliance on coal for energy and ensure a greater mix of energy sources for future demand.

The Chairperson called on Mr Channing to focus only on the matters which were of relevance to the agenda of the day which had to do with the contribution of the SETAs towards skills development in the energy sector.

Mr Channing reported on the SIPS saying that the CHIETA had 18 SIPS with the objective of supporting chemical sector related skills development in relevant projects. CHIETA’s approach to enhancing skills development in the energy sector comprised of supporting national and sectoral imperatives and working in partnership with government, industry stakeholders, other SETAs to identify skills needs and address them.
In painting a picture of national education, Mr Channing said that of the 13 million workers in the country, 48.5% had no Matric, 30.4% had Matric and only 19.9% had post Matric qualifications. South Africa was ranked 50th by the World Competitiveness Report for 2012. The low educational levels of the country’s human resources and the high unemployment were the main contributors to the poor rating.

Reporting on the scarce and critical skills within the sub-sector, the critical skills groups included crafts and related trades, professionals, technicians and associate professionals, plant and machine operators. The CHIETA interventions comprised of artisan development programmes, learnerships, bursaries, workplace experience internships, graduate development and other skills programmes.

Mr Mayathula suggested that both the WRSETA and the LGSETA should also do their presentations before a general engagement with members.

Wholesale and Retail SETA (WRSETA) presentation
The Chief Operations Officer of the WRSETA, Dr Hennie Zwarts, explained that the WRSETA had a mandate to facilitate skills development in the wholesale and retail sectors as per the Skills Development Act. The main area of focus of the WRSETA within the energy sector was on Fuel Retailers.

After an announcement by the Minister of Higher Education and Training in November 2010, the WRSETA signed a Memorandum of Understanding with the MERSETA which arranged for a bulk transfer of 3 256 levy paying companies from the MERSETA to the WRSETA. The WRSETA officially took over Fuel Retailers from 1 April 2011 and had received R26.9 million in levies.

On the funding allocated to fuel retailers, R15.5 million had been allocated as discretionary funding and R3.6 million as mandatory grants. This made a total of R19.1 million. A total of 11 915 people had been trained as wholesale providers.

Dr Zwarts concluded by saying that the sector skills plan research reflected a growth in the forecourt as a result of leading supermarket retailers aligning themselves with petroleum brands. This implied an increase in the need for skills offering across the retail learning programmes.

Local Government SETA (LGSETA) presentation
The delegation from the LGSETA comprised of the Chairperson of the LGSETA, Mr Duma Nkosi and the CEO of the LGSETA, Ms Ntombenhle Nkosi.

Mr Nkosi said that within the local government sector, the most outstanding aspect of energy was electricity. There was the recent development for the need to monitor the installation of solar water heaters in the country. This need directly exposed the challenge of the lack of skills within the energy sector at local government level. There were huge requirements for technical skills in local government. The major concern of the LGSETA was that of service delivery. The LGSETA was striving to make a contribution to ensure that there was sustainability, efficiency and effectiveness in terms of provision of basic services. Electricity was a professional service and the skills in the sector had to be continually updated.

Mr Nkosi said that in the communities, there was the display of “very good skills” in illegal connections of electricity. It was important for government to start thinking about how these skills which were being used for the wrong purpose could be utilised appropriately. He said this briefing did not give an entire picture of the demand but only outlined the LGSETA contribution in addressing the skills challenge in the energy sector.

In briefing the Committee on the contributions of the LGSETA to skills development in the energy sector, Ms Nkosi outlined the LGSETA’s alignment to local governments and to national outcomes. In contributing to the goal of achieving an efficient, competitive and responsive economic infrastructure framework, the LGSETA was providing apprenticeship training and Integrated Development Plan (IDP) training. It was funding training in road construction and maintenance, municipal planning, water and waste water treatment, transport planning and infrastructure asset management. The LGSETA was also making contributions towards Cabinet’s Outcome of the protection and enhancement of environmental assets and natural resources.

Electricity contribution
In terms of the LGSETA’s contribution to electricity, the LGSETA had been appointed as the development quality partner for Electrical Qualification by the Quality Control for Trades and Occupations (QCTO). The aim of the QCTO qualification development was to develop one electrical artisan learner qualification for all sectors in South Africa. The curriculum had been submitted to the QCTO for consideration and registration.

On capacity development, the LGSETA had established Government Certificate of Compliance (GCC) programmes in collaboration with the Association of Municipal Electrical Undertakings (AMEU) to implement GCC programmes for local government.

Water contribution
The LGSETA had completed a National Process Controller training project which focused on water and waste water treatment processes. 1 795 candidates were trained in 136 municipalities in eight provinces of the country. In ensuring that the municipal training capacity was sustained, 210 assessors and 189 mentors were trained.

With regards to environmental practices, Ms Nkosi told the Committee that there was no formal undergraduate programme for waste management and the LGSETA was in the process of designing new professional courses for waste management. This was being done in collaboration with the Cape Peninsula University of Technology and the Institute of Waste Management of South Africa. The LGSETA was also investing in the funding of the development and implementation of new programmes. Energy recovery processes and programmes formed part of the new qualifications.

In conclusion to the presentation by the CEO Ms Nkosi, the LGSETA Chairperson Mr Nkosi said that from daily experiences and reports from communities, electricity was fast becoming more important than water and it was one of the basic services which people were not willing to do without.

Discussion
The Chairperson reminded members that in the interactions with the SETAs, questions should not be directed towards the general functioning of the SETAs but focus should be given to the issue of skills development within the energy sector. The institutional aspects of the operation and performance of the SETAs were not the focus of the day.

The Chairperson said that the interactions with the SETAs was a journey which the Committee had started with the aim of understanding the skills demands and measures to address them within the energy sector. There were many players in the sector which all had vital roles to play so the Committee had a lot of work to do in terms of coordination.

Questions
Ms N Mathibela (ANC) said that it was important for the SETAs to note that there were many people in the country who had the necessary skills and were good with their hands but not very good academically. The country was losing a lot of skills in this way. What were the SETAs doing to enhance the integration of people who had skills but did not have any academic qualifications? When these people applied for jobs, they were turned down but what was being forgotten was that many people, who even had PhDs, cannot repair an iron cord or a kettle cord.

Mr Radebe asked CHIETA how it assisted individuals who had skills but did not have qualifications. What were the recent contributions to recognition of prior learning? He asked how far the WRSETA was in terms of gender balance in the sub-sector as there were complaints that women in the sector were not being supported? He asked for clarity on the contributions of the LGSETA in terms of marine skills development. What was the progress on the partnership with CPUT?

Mr Selau said that CHIETA looked like the industrial SETA as its major focus was on chemicals. What was the target group of CHIETA? To WRSETA, he asked which certificates were given to its learners at
National Qualifications Framework (NQF) Level 7 as it was said that this class was for professionals. The word ‘professional’ was vague. He asked if the learners were employed in their own businesses or were working for other people. Was there any way of assisting unemployed learners to get jobs? He asked what the focus was in respect to the selection of people. Was there specific focuses on the rural areas and people being called from the rural areas to come to the big cities to receive education? Mr Selau said that he sounded like he did not like big cities but that was not the case. To the LGSETA, he said that all documents concerning local government looked like a “copy and paste” as they had the same challenges all the time. What could be done to train the people in the rural areas instead of trying to get trained people from the urban areas to come to the rural areas? Who was the target groups of the IDP and what could be done to ensure that the IDPs achieved beneficial results for the people it was intended for?

Mr Smalle asked the SETAs if there were discussions with schools to create awareness of which skills were in short supply and the relevant areas of focus and demand. He asked the WRSETA if it was optimally using the levies and funding which was being provided by the retailers. What was the percentage of the business people who were participating in their programmes? To the LGSETA, illegal connections were illegal and the government should not consider encouraging anything which was illegal.

The Chairperson asked what skills were provided to elementary workers. Why were the numbers of learners and trainees very low? Was it just the nature of the sectors or was it related to the resources available to the SETAs? He noted LGSETA Chairperson, Mr Duma Nkosi, used to be the Chairperson of the Portfolio Committee on Energy so the issues he was raising were informed by his understanding of the matters being discussed. With regards to the issue of illegal connections, he was aware of the position of the government and was just presenting the practical situation to the Committee. It was a fact that illegal connections were a reality. The issue was what could be done from a skills approach. To what extent was the LGSETA integrated into the work of municipal engineers? On the issue of municipal training capacity, it was important for members to continue to monitor that area. What was the composition of the electrical working groups?

Responses
Mr Nkosi said that with regards to the IDP, there were situations were there would be local, provincial and national projects and the IDPs of the local areas needed to be amended to incorporate provincial and national programmes. The whole idea behind the IDP was that there should be a local approach to the solving local problems and creating a plan which could be implemented annually or over other specific time periods. The IDP also responded to the incremental development of municipalities.

On the issue on the backlog of skills, the LGSETA was going to revert to the Committee in writing with regards to the exact figures on the skills backlog in the energy sector. With regards to the training of managers, the LGSETA was finding a way to ensure that not only managers were trained but the training component was cascaded to the rest of the teams.

The suggestions to consider the skills of people involved in illegal connections was not meant to justify illegal connections but to say that electricians and plumbers could be integrated into the work of the sector and one could probably register them.

The CEO of the LGSETA, Ms Nkosi, said that the LGSETA was working on the marine sector and it had piloted a project in the Eastern Cape which indicated the need in coastal municipalities for assistance in marine management and sustainability. This programme had been expanded to 12 municipalities in the Northern Cape, Western Cape, KZN and the Eastern Cape. Workshops were held for communities, traditional leaders and councilors, training them on how to manage marine sustainability. About 400 beneficiaries had been registered.

The Municipal Infrastructure Support Agency (MISA) was new and the LGSETA was still finding its way to working with it. The LGSETA had a contract with the Development Bank of Southern Africa to train 100 artisans in local municipalities. The contract had been transferred by the National Treasury to MISA for management. The LGSETA was having talks with MISA to improve working relationships and collaborations.

The Electrical Working Groups were formed by the LGSETA and the AMEU. Labour organisations were considered and SALGA and COGTA were involved.

On the issue of water, energy and the environment, the LGSETA board had approved a project which was to be done in collaboration with the Department of Water and Environmental Affairs to train 100 unemployed learners and 100 employed learners in issues of environmental management.

The Chairperson said that the LGSETA could do a written follow up on the other questions and issues raised by the Committee.

The COO of the WRSETA, Dr Zwarts said that with regards to the challenge where employers did not want to employ people with only academic qualifications and no work experience, the WRSETA had sponsored 5 000 graduates from FETs and employed them in workplaces for 12 months. This was going to improve their employability.

On the issue of women development, the wholesale and retail sector did not have a problem up to supervisor level. It was at management level where there was a challenge. The WRSETA had just completed a development programme on NQF level 6 which had a 50 – 50 male and female participation. The WRSETA board had just approved another management development programme only for women.

On the classification of professionals, the WRSETA considered manager, senior managers and CEOs to be professionals. The NQF level 7 was dedicated for leadership programmes.

On the focus of people in the rural areas, the WRSETA was organising work place development programmes in the rural areas. It was indeed a challenge keeping people in the rural areas as many people love living in urban areas. Another challenge was that the training providers were not in the rural areas but based in the urban areas.

Dr Zwarts said that the training by the WRSETA was focused on skills development in business management so that retail and small business owners and managers could grow and be able to manage and run bigger businesses.

Mr Trevor Channing from CHIETA said that with regards to transformation in the industry, CHIETA was driving processes on capacity building and awareness. It was also involved in using its grants system and human resources to drive the transformation process. Labour workplace skills plans were now signed with managers and management. CHIETA had allocated substantial resources for training.

On the recognition of prior learning, CHIETA was currently involved in a process where it wanted to take chemical operators to train them and put value to their skills through the use of RPL.

On targets in the petroleum sector, CHIETA had done a comprehensive study on the state goals and with higher education institutions and the estimated demand had been identified. The focus was on current demand but also looking at future alternative resources. This process was being done in collaboration with the Department of Energy and other stakeholders.

The chemicals which CHIETA had a focus on was not directly linked to energy as it was not dealing with petroleum but dealt mostly with polymers and rubber. 

The Chairperson said that what the Committee was seeking to do was to identify what each institution could do to improve the development of skills in the energy sector. The institutions which had just presented had been making significant contributions to the energy sector. The LGSETA had a big role to play in municipalities in terms of electricity.

The meeting was adjourned.

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