Department of Higher Education and Training on its 2016 Strategic & Annual Performance Plans

Meeting report

Opening Remarks
The Chairperson noted that the Director General was not present, and apologies had been received from the Minister and Deputy Minister. This is the time of the year when the Committee engages with the two National Departments to ensure that there is synergy between the two entities. The DHET’s plans should align with the National Development Plan (NDP), the State of the Nation and various other instruments. These should be taken into account as the department develops its Annual Performance Plan (APP). The department has a responsibility to deliver and provide a skilled and trained work force. She asked for the department to address issues that have dominated the DHET, namely Fees Must Fall and how the department is going to take care of that. Is the intervention adequate and will it be sustainable? The President in his State of the Nation Address (SONA) indicated that there are Technical Vocational Education and Training (TVET) colleges that need to be built, what progress has been made in regards to that in the APP? How has the department dealt with migration issues, qualifications and salary issues that are linked to that?

Department of Higher Education and Training on its 2016 Strategic & Annual Performance Plan
Mr Firoz Patel, Deputy Director General: Planning and Monitoring, DHET said the presentation will cover each programme. They have renamed the Human Resource Development; planning, information and monitoring coordination programme to Planning, Policy and Strategy. These two programmes generally still have the same functions. They have introduces two new programmes: Technical and Vocational Education and Training and Community Education and Training. These two are a split from the Reset Branch: Vocational and Continued Education and Training. The two branches were split on 1 April 2016. The APP and Strategic Plan align with the new programme structure as approved by National Treasury.

With regards to Fees Must Fall, the financial years have been affected and will carry through particular effects. The sustainability of the intervention depends on the Presidential Commission which has been set up and is headed by a Judge. They will be taking evidence and make recommendations that will be binding. The migration process was completed on 31 March 2015. There are still issues that are pending; there is still a large amount of harmonisation to be done. On salaries, DHET has ensured that people are paid and on time. The department is working on implementing a pay progression system that links salaries to qualification levels. There is a college in the Eastern Cape where all lecturers are paid at level 13 irrespective of qualifications they hold. This issue will continue to cause tensions and DHET is relying on the Labour Relations Act and the new Employee Act to ensure that they have the same terms and benefits for employees. On qualifications, DHET has put measures in place through the Teaching and Learning Development Programme funded by the European Union at a sum of 36 million Euros. The strategy plan is aligned to the NDP, the Sustainable Development Goals (SGD), SONA as well as the White Paper.

The DHET strategic goals leading up to 2020 is covered by Outcome 5: a capable and skilled workforce for inclusive growth. The department's work is to ensure that it has a very sound legislative framework, almost 98% of the budget is based on transfer payments and in order to ensure that those funds are adequately and efficiently spent, DHET has to operate within a framework that allows institutional delegation. The core mandate is teaching and learning. The department cannot meet their goals without adequate human resources that are able to ensure the implementation of the White Paper on education and training. Education is a societal priority and therefore DHET relies on a very strong stakeholder network. The department has to deal with industry and businesses in ensuring that education and training is able to meet their needs. During the first financial year (2015/16) of the five-year Strategic Plan, the Department assumed full responsibility for the functions of TVET colleges from provinces. The department has effectively increased the staff complement from 1 200 to 38 000. The TVET system has to operate within the White Paper on Post-Schooling Education and Training. The big challenge comes in the new Community and Training (CET) unit which will address the real needs of communities.

There are nine CETs, one per province, there are 50 TVET colleges and 29 universities of which three are new. The life-span of the Sector Education and Training Authorities (SETAs) was extended by a further two years. The 2016/17 APP also includes updates to the Strategic Plan (2015-2020) with regards to the TVET and CET programmes.

The Chief Financial Officer, Mr Theuns Tredoux, outlined the Department’s structure, budget and expenditure trends, the allocations per programme over the 2016 MTEF period; a summary per economic classification that covers the key expenditure items, key budget pressures facing DHET and financial performance of DHET. Slide 8 outlines the six programmes: the new Programme 4: TVET and Programme 6: CET as well the name change of Programme 2. There is also a change in the environment of DHET through the increase in the number of employees where DHET now stands at 38 031. Of that figure there is a total 28942 permanent staff, while the other 9089 are from the educator claims received from the community centres. Outside of the 6 programmes and the budget distribution over these, DHET also has ‘direct charges’; the amount received from National Treasury based on the skills levy contributions that SARS collects. That is for the funding of the 21 SETAs and the National Skills Fund. These charges are indicated separately in the budget. If the direct charges are excluded, the budget increases at an annual average rate of 9.8%, from R42.0 billion in 2015/16 to R55.3 billion in 2018/19. For 2016/17, the allocation is at R49.2 billion, a R7.3 billion increase (18% from 2015/16). The direct charges themselves (the skills levies increases at an annual average rate of 11.8% from R15.8 billion in 2015/16 to R22.1 billion in 2018/19. For the current financial year, 2016/17, the allocation is at R17.6 billion.

The department’s budget is dominated by programme 3: University Education, which is approximately 80.4% of the budget in 2016/17. This is subsidies transferred to universities. Consequently, transfer payments also dominate the budget in terms of the economic classification of expenditure. When looking at the normal departmental services, excluding all the transfers, that is approximately 16.7% of the budget. The compensation of employees with the new establishments and the taking over of the TVET and CET staff is R7.8 billion for 2016/17. The sad part is that DHET only has R382.975 million to function with for 2016/17, which is approximately 0.8% of the total budget. The Department received an additional allocation of R24.1 billion over the MTEF period. This was to address these following purposes: Compensation of Employees based on the 2015 public sector wage settlement agreement (R840 million); the “zero per cent” increase in university fees receives R5.7 billion which is broken up over the 3 years. For 2016/17, DHET received an additional R 300 million, for 2017/18 it goes up to R2.6 billion and for 2018/19 R2.8 billion. The National Student Financial Aid Scheme (NSFAS) is divided into two parts: historic debt relief which is debt accumulated across the institutions, an additional amount of R2.5 billion was provided as a once off allocation for 2016/17; also to support unfunded continuing and new NSFAS students. A total of R8 billion has been provided over the MTEF period; R2 billion for 2016/17, R2.9 billion for 2017/1 and R3 billion in 2018/19. There are two additional function shifts apart from the TVET and CET functions. As from 1 April 2016, DHET now has the administrative responsibility of the Public Service Sector Education and Training Authority which moved from the Department of Public Service and Administration, this was allocated R312 million over the MTEF. There is also a function shift for Medical Students funding which moves from the Department of Health this financial year at an allocation of R75.3 million. The direct charges for SETAs and the National Skills Fund (NSF) grow to R6.7 billion over the MTEF period. The department will also experience baseline reductions, over the MTEF period here is a reduction of R43 million for the skills levy and R29.4 million for goods and services. Mr Tredoux discussed how the funds are allocated in table form on slides 18 and 19. With the direct charges, the budget increased from R49.2 billion to R66.8 billion.

DHET experiences some system pressures, and acknowledges the current financial and fiscal constraints of government which have an impact on service delivery. They are limited in what they can do with regards to the allocations. The department is unable to attain the growth requirements within the post-school education system in terms of enrolments, infrastructure development which includes student accommodation and TVET infrastructure. The department aims at having a similar infrastructure grant for TVET sector as they have for the university sector. It also needs to increase operations and student support in all these areas. This is linked to the implementation of the White Paper, there are currently two processes: the Presidential Commission looking at university funding and NSFAS, also National Treasury appointed consultants to do a costing of the roll-out of the White Paper and the financial implications for this. Key risks associated with student fee zero increases are the sustainability factors, as there is an allocation for 2016/17 for the ‘zero-fee’ increase; the question is what will happen next year. In terms of operational pressures within DHET is the cap on the compensation of employees, this is placing a burden on the ability to roll out new staff in the establishment and also has an effect on regional presence. Institutional monitoring and evaluation remains limited and DHET is still heavily reliant on NSF project support such as the funding of the National Artisan Moderation Body. Cost implications for examination services remain a concern as DHET must continue with examination at TVET and CETs.

Programme 1: Administration
Mr Tredoux said there are three key strategic objectives; human resources, financial management and information communication technology (ICT). For human resources it is to see all funded positions filled, with the target or 2016/17 being at 90%. With financial management, DHET aims to pay creditors within 30 days; this has been a challenge for DHET.

Programme 2: Planning, Policy and Strategy
Mr Patel said the programme purpose is to provide strategic direction in the development, implementation and monitoring of departmental policies and the Human Resource Development strategy. Strategic objective 1 will look at the development of 2 new Post-School Education and Training policies namely, the National Policy on Career Development Services across all spheres of Government and the Policy for Open Learning and Distance Education by 31 March 2017. This will entail having dialogue with all stakeholders; Cabinet, the public and having provincial road shows. Strategic objective 2 is to develop a Sector Monitoring and Evaluation Framework for effective implementation of oversight of the entities DHET transfers funds to. On monitoring reports on post-school education and training, there a two reports published; the International Relations Monitoring Report and an Approved Macro Indicator trend report. Strategic objective 3 is to develop and implement a teaching and learning support plan aimed at improving access to quality teaching and learning. There is already material developed for the identified two Programmes to be piloted in 2017/18 and approved by 31 March 2017. Strategic objective 4 is to develop management information systems for colleges, SETAs and private post-school institutions by 31 March 2018. This will provide an integrated system where it will possible to find learners by name, ID number, find which university they are in, what programme they are doing and how long it took to complete such programme. The department is looking at publishing statistical reports such as the Annual Report on Skills Supply and Demand, which can be used by Parliament and researchers to gain an understanding of the sector.

Programme 3: University Education
Mr Mahlubi Mabizela, Chief Director: University Policy and Development, DHET said the purpose is to develop and coordinate policy and regulatory frameworks for an effective and efficient university education system, to also provide financial support to universities, the NSFAS and all national institutes for Higher Education. The programme has 7 strategic objectives:
• 1. To develop 7 new and review 2 policies/regulations/pieces of legislation to ensure sound provision of university education by 31 March 2017
• 2. To develop 1 integrated plan that will enable collaboration between university education and other PSET sectors by March 2017
• 3. Monitor and evaluate the higher education sector and produce 12 annual oversight reports
• 4. Develop and implement a Teaching and Learning Development Capacity Improvement Programme (TLDCIP) covering 5 plans to improve the capacity of universities in teaching and research by March 2017
• 5. Develop and implement a student leadership capacity development strategy and Central Application Services to support access to Post-School institutions by 31 March 2020
• 6. Publish an annual first-time entering undergraduate cohort analyses report
• 7. Facilitate stakeholder networks through the establishment of a BRICS Think Tank and participative academic forum and report progress on partnerships annually
Under strategic objective 7, there are performance indicators tabled on slide 43. These targets were set based on system capacitation, which includes academics and equipment in institutions and funding that is given to institutions for the specific items. It is highlighted that there is a decline in target numbers for; Graduates in Engineering Sciences from universities, Graduates in initial Teacher Education from universities, Doctoral graduates from universities and Research Masters graduates. That is due to plans that have over exceeded targets and DHET needs to revise these. Mr Mabizela stated that the programmes are guided by the NDP 2030 and their targets are streamlined by those reflected on the NDP.

Programme 4: Technical and Vocational Education and Training
Ms Thembisa Futshane, Chief Director: TVET Colleges planning and Institutional Support, DHET, presented on. She indicated that she will also summarise her presentation as requested by the Chairperson. The programme purpose is to: Plan, develop, implement, monitor, maintain and evaluate national policy, programmes, assessment practices and systems for Technical and Vocational Education and Training. There are 6 strategic objectives for this programme:
• 1. To develop 1 and revise 2 legislative and guiding frameworks aimed at steering the Technical and Vocational Education and Training sector by 31 March 2017
• 2. To standardise the level of governance across TVET institutions, monitor implementation and take appropriate actions when deficiencies are detected by 31 March 2017
• 3. To develop and implement 1 teaching and learning support plan for TVET institutions by 31 March 2017
• 4. To improve success in programmes offered in TVET institutions by developing and implementing one student support plan by 31 March 2017
• 5. To ensure geographic spread of TVET institutions through the establishment of 12 additional sites of delivery, i.e. campuses, by 31 March 2020
• 6. To establish a coordinating structure for support and research in the TVET sector by 31 March 2017.

The total budget for TVET colleges for 2016/17 is rounded off to R6.6 billion. Slide 57 shows the provincial breakdown of this allocation. The average baseline growth rate from 2015 to 2016 is 6.71%. There is also the provincial breakdown of the bursary which has an average baseline growth rate of 5.33%.

Programme 5: Skills Development
Mr Zukile Mvalo, Acting Deputy Director General: Skills Development, DHET, said the programme purpose is to promote and monitor the national skills development strategy. Develop a skills development policy and regulatory framework for an effective skills development system. This programme has six targets and three strategic objectives:
• Target 1: is to develop a workplace based learning programme regulations approved by the Minister by 31 December 2016.
• Target 2: National Skills Development Strategy approved by the Minister by 31 March 2017
• Target 3: SETA landscape approved by the Minister by 31 March 2017
• Target 4: SETA monitoring reports on skills development approved
• Target 5: Average lead time from trade test application received until trade test conducted at INDLELA at 120 days
• Target 6: National artisan learners pass trade test rate at Indlela (Institute for National Development of Learnerships Employment Skills and Labour Assessments) at 52%.

Programme 6: Community Education and Training
Mr Bheki Mahlabo, Acting Deputy Director General: Community Education and Training, said that this is one of the new programmes in DHET. He asked the Committee members to look at the addendum which outlines the strategic plans for this programme. The department is trying to make something that was never a system, a system. In 2008/9 both Province and National departments were audited by the Auditor General (AG) to develop an education sector report. The AG was critical both of national and provinces citing: poor quality, funding disparities, lack of responsiveness of programmes to communities, inefficiencies, non-standardisation of educator salaries and poor capacity for monitoring, a somewhat outdated curriculum and a lack of learning and teaching material. To create systems, there needs to be frameworks, which is guided by strategy 1; to develop four guiding frameworks (policies and regulations) aimed at steering the CET system. In terms of quality, the approval of the education, training and development improvement plan will go to the core of quality. In regards to infrastructure, at the moment there are 9 CETs, one in each province. The department has linked to each CET a number of centres, with the biggest number being in KwaZulu Natal. The next project is to set up norms to define what a community learning centre is, what would constitute a big, small, medium college and what should be the minimum requirements to establish such a college. This is in order to create system DHET can monitor over time. The approach is to have at least 30% of the programme centres around programmes that are already available: Second Chance and Literacy Programmes. Most of the programmes will need engagements with community organisations to assess the community needs.

Discussion
The Chairperson thanked the DHET delegation for their presentation. She asked the members to ask questions they need answered now as they have the opportunity to forward questions for written response.

Mr M Khawula (IFP) thanked the DHET for the presentation and asked on the disparities between TVET and University funding and noted how underfunded TVETs are. This may add to the mentality in communities that TVET colleges are not important. He asked DHET is not contributing to this mentality through their allocations? With regards to Fees Must Fall, is DHET not establishing a precedent for this behaviour to continue in other establishments like the TVET colleges in order to gain more funding and attention? He asked about pass percentages, and how a department can plan to fail 20% of learners, because to expect an 80% pass means you are okay with a 20% fail. He added that as long as a system in not a 100% it is a cause for concern. He asked about Fees Must Fall funding, where did the funds come from?

Ms L Dlamini (ANC) welcomed the presentation and asked where does the country stand in terms of skill requirements? What are the DHET’s plans in meeting these requirements? With regards to accommodation, the presentation said the biggest problem is at TVET level, but there is also a problem at university level. What informed the quoted figure of 1000 as tabled in the presentation? She asked for a bigger picture which will also indicate and highlight the plans DHET has.

Ms T Mpambo-Sibhukwana said that 33 students in colleges in the Western Cape have been promised travel allowance, but have still not received their allowances in April, 61% of learners have received these allowance which may lead to tension. Students who migrate from the Easter Cape to Gauteng after their first year, do they still receive funding? With regards to Fees Must Fall, what are the planned responses to the ‘missing middle”? What is the status of repayment of NSFAS bursaries? What is happening to the arrested students? The means test regarding Fees Must Fall, has DHET taken into account the Committee's recommendation of promoting academic performance in awarding NSFAS funding?

Mr C Hattingh referred to the TVET college 15% throughput target and the bursary investment made to the sector. There must be some plan in place to address the root of the problem. The department cannot invest so much money and then have so little to show for it. What plan is in place to ensure that DHET reaches the 15% target they have set? Should the standard of TVET college educators be raised?

The Chairperson reiterated that DHET will answer only a few questions now and provide written responses to the rest. She recommended that there be a one day workshop that would allow the Committee to engage fully with DHET without any time constraints. She added that her question can be responded to in writing. She touched on employment; why has employment not been finalised in DHET? The department has introduced a sixth programme, which will require the employment of a DDG, Chief Directors and staff under them, is there a budget for this? Is the DHET present in provinces, are there offices that people can accessible to people at local level? On migration, what are DHET plans and what are the budget allocations? For Programme 4, the rolling out of the 12 TVET Colleges is on track, one has been completed and the others are in progress - the Committee does not know where these colleges are and what the plans are regarding the remaining ones. On qualifications, a qualification should be connected to the salary and work load. How does DHET determine payment for an N5 qualification versus a person who has a degree or a senior degree? She asked Ms Dlamini to take over as chairperson as she had to leave.

Regarding TVET and university funding, Mr Patel replied that there are huge differences because there is more interest in university education but DHET is putting a strategy in place to make TVET colleges more attractive through artisan programmes. On success rates, they will respond in writing. They will follow up on last year’s questions that they have not answered. With regards to planning, this is mainly done through SETAs. Considerable work has been done to identify infrastructure needs and to address the needs as well. Accommodation will be responded to in writing, but there is no money and no funds. On the quality front, DHET is collecting that information from colleges. The 1000 target is minimal, but the CFO has indicated that there is not adequate funding available; the budget for this number came from the National Skills Fund. Ms Mpambo-Sibhukwana questions will be responded to in writing - the "missing middle" is linked to the Presidential Commission. The NSFAS bursaries are not repayable, but the loans are and he will provide her with the number. DHET has zero-tolerance for students who vandalised property and are hoping for the law to take its course. With the means test, it is academic performance first, then poverty.

The throughput rate is a concern for DHET as well, he said DHET took over TVET Colleges on 1 April, 2015, so it is unclear when the problem started. The department cannot guarantee that they can reach 15% but will put in place measures and systems to ensure that they reach it. There will be systems in place to evaluate teacher performance and capability. The majority of the questions are not related to the APP, but are about systems and programmes. The department is willing to avail themselves to a workshop in order to fully engage with the Committee. "Outputs versus expenditure, it is out of sync".

The Chairperson thanked Mr Patel and responded to his comment of questions not relating to APP. These are issues that members feel supposed to be part of the APP. There needs to be adequate costing for each programme, because if DHET said they need funding for accommodation and was then asked how much, they would not be able to answer as they do not have the required accommodation numbers.

The meeting was adjourned.