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Meeting reportJOINT MONITORING COMMITTEE ON IMPROVEMENT OF QUALITY OF LIFE AND STATUS OF CHILDREN, YOUTH AND DISABLED PERSONS
26 October 2007
UMSOBOMVU YOUTH FUND ANNUAL REPORT 2006/07
Acting Chairperson: Mr D Gamede (ANC, NCOP)
Document handed out:
Umsobomvu Youth Fund presentation
Umsobomvu Youth Fund 2006/7 Annual Report
Audio recording of meeting
The Committee were briefed on the Annual Report of the Umsobomvu Youth Fund for 2006/07. The report outlined the results, successes, goals and financial statements of the Fund.
The Committee asked questions about the late submission of the financials, the challenges for the year, clarity on Youth Advisory Centres and the monitoring of partner programs and young people. Finally three proposals were made to the Umsobomvu delegation and the amicable and positive meeting was adjourned.
The Acting Chair, Mr Dumisane Gamede (ANC, NCOP) welcomed the new Whip of the Committee, Ms Xoliswa Makasi. He noted the apology of the Chairperson who was out of the country.
Mr B Mkongi (ANC, NA) questioned the choice of venue, as there were a number of members with disabilities and this room was not accessible to them.
The Chair recognised the point made. They had agreed in the past never to use this venue and so he was not sure why they had been assigned this room. This would be the first task for the new Whip to take up. The Chair introduced the Umsobomvu Youth Fund (UYF) delegation.
Presentation from Umsobomvu Youth Fund
Mr Mbongeni Mtshali (Director of Operations: UYF) gave an apology for the UYF CEO whose flight from Johannesburg had been delayed and would be present within the next 20 minutes. Mr Mtshali continued with a slide show on the overall performance of the UYF for the past year.
He explained their approach to youth development noting that they had put together relevant products and services, as well as focussed on establishing walk-in centres and call centres for young people to interface with the Fund. They had aligned their programmes with ASGISA and the National Skills Development Strategy (NSDS).
Mr Mtshali noted the highlights of the UYF for the past financial year. They were one of a few governmental organisations to receive the ISO 9000 rating. Ten businesses they support won awards in two distinguished award presentations last year, and one of their companies was runner-up in the public sector innovation awards. Mr Mtshali compared the year to 2005 and showed a 16% growth in the number of young beneficiaries and a tripling in number of loans. As to their plan of action for the year ahead, last year they presented a framework to deal with people with disabilities, and this time it had become a plan of action. The UYF had sensitised employees to persons with disabilities, begun a campaign program and, as far as possible, had put together infrastructure so that people with disabilities could move around unhindered in their facilities.
Mr Sello Nkoane (Acting CFO: UYF) spoke to the financial report in the Powerpoint presentation and highlighted a few things that were not in the report, noting that a corporate governance review had produced no significant problem findings. They achieved an unqualified audit opinion. From the Public Finance Management Act (PMFA) point of view, two issues were raised. One being that the Fund did not submit a complete set of financial statements on 31 May as required. Relating to the income statement, Mr Nkoane noted that there had been a 43% increase in terms of project disbursement, while at the same time they managed to keep operational costs constant. There was also a significant increase in terms of loans. The balance sheet showed a decrease in terms of cash, because of increase of project disbursement, and the amount of interest they earned also decreased with less money in the bank.
Mr Mtshali highlighted the plans for the current period. These included increasing their footprint in terms of access and outreach by adding 13 branches to the current network beyond the main cities. There would also be the founding of a Women’s Fund to increase the number of female clients with UYF. Their current target for the National Youth Service Program (NYSP) was 18 000 but the coming year they have more than doubled this to 50 000 youngsters. They also planned an increase in micro-lending, with a target of 100 000 young people to reach by 2010. Finally, the UYF was working to train young people as volunteers for the 2010 FIFA World Cup to make sure that they were also participating in volunteering and entrepreneurial roles.
The Chair welcomed the UYF CEO, Mr Malose Kekana, who had arrived.
Mr Malose Kekana (CEO: UYF) explained the delay in getting to the meeting and said that his colleagues had touched on everything in their presentation. He added that the ability to meet targets going forward was obviously dependent on sustained funding for the Fund, and he hoped that their kind of funding continued and increased going forward. He said that in the life of the Fund they knew what they were doing, and as not much was changing they were now able to make sure they did the best job.
The Chair thanked the UYF for their engagement. He also noted that the Committee was originally meant to hear from the National Youth Commission that day, but had received an apology and rescheduled that meeting for the 16 November. The Chair gave the opportunity for members to interact with the delegation.
Mr Mkongi said that he was excited about thir work for youth with disabilities, but their priorities listed a women fund but not a youth with disabilities fund.
Mr Kekana noted that Mr Mkongi’s observation about priorities was correct, and that they would change the omission.
Mr Mkongi asked for details of their successes in the three youth categories. [This question was unintentionally not answered in the UYF’s group response.]
Mr Mkongi asked the whereabouts of the 15 000 youth that had completed NYSP and the project management program. He said that they could not put anyone into the training matrix without a dedicated exit opportunity.
Mr Kekana assured the Committee that they did have a monitoring mechanism in place, which was improving as it developed. He also noted that government departments assisted with monitoring because they put their money in the project and need to watch it.
Ms J Chalmers (ANC, NA) was also concerned about what happened after the training. She cited an example of interns in Parliament last year who came in with high hopes and expectations, only to finish the year without any concrete employment within Parliament.
Mr Kekana mentioned that for all their projects, they tracked their students after completion of the training. Their courses were all 18 months long, where 12 months was training and thereafter there was monitoring. He acknowledged that in the past the connection with exit opportunities was not so good but it was now getting better. They had realised from a small project with Nestle ice cream sales that if they linked people intentionally to business opportunities, it worked very well.
Mr Kekana added that they were putting in an alumni program that would help to keep track of their young people, who are very mobile. It was thought that every two years there would be meetings to see what they were doing. The alumni would also be asked to come and lobby Parliament for money by using their own stories to show the effectiveness of Umsobomvu.
Mr Mkongi noted that they did not report on an issue that the Committee had raised last year concerning unity and cohesion in the UYF and the fact that some of their offices operated on the periphery of the organisation.
Mr Kekana replied that they had put the requested results of unity and cohesion into the annual report.
Mr Mkongi was also concerned that this was the second time that there were problems with the financials.
Mr Kekana spoke to the issue of the late submission of financials. The problem was rather with the PFMA that created blockages to funding small businesses. He actually thought that the PFMA should change to accommodate them. He explained his point by saying that one of the requirements was small businesses were to produce audited financial statements. This could cost R200 000, so a small business with a grant of R500 000 would not spend almost half its funds on auditing. Therefore, the reason why they were late was that they had 300 SMEs that could not produce consolidated financial staements in time.
Ms Chalmers asked for clarity on “the specifics” of the work of the Fund. She said that she would prefer specific examples of where they worked and what they achieved. She assumed that a lot was being done, but it was not really being portrayed in the report, and she wished for a more descriptive document.
Ms Xoliswa Makasi (ANC, NA) noted also that people in her constituency asked her about the UYF but she did not know what the UYF were doing and where they were. She noted that many vouchers were given away but wanted to know to whom and to what type of businesses these were given.
Mr Kekana answered that it was an unfortunate choice in deciding how much information to put in and what to leave out of the report. He added that all the information they needed was there for accessing on the UYF website. It had a project report on all the people they were working with and what they were doing that included a description of the project, service provider, synopsis, location etc. Regarding the vouchers, Mr Kekana noted that part of the ISO 9000 rating stipulated that every customer served must be surveyed, and as such they had all the details she needed.
Mr Kekana also extended an invitation to visit the projects they partake in. There were a number of projects in each province and he suggested structuring a day or two with the Committee to show them what they were doing on the ground.
Ms Chalmers pointed out that page 25 of the Annual Report mentioned all the walk-in centres, but did not say where they were. She wondered if youth knew where they were. She asked for a short, powerful document that said where the centres were and how the youth could get there.
Mr Kekana said that on their website was the June 2007 report that showed all the youth advisory centres. Mr Kekana added that the decision to set up Youth Advisory Centres (YACs) was due to the allegations of inaccessibility. Within 3 years they now had 120 of them, but the growth overtook them so fast that the support was not good enough. They had now introduced a YAC support group as well as an electronic employee support service.
Ms Chalmers asked what the youth card was, and what it did.
Mr Kekana said that the youth card was a rewards card that also helped to track the youth. The UYF was talking to Visa to make it a transaction card.
Mr Mkongi asked about basic education training as he was not sure of the strategy that UYF used. Noting that there were thousands of teachers who were unemployed, he wanted to know if they were taking on new people or targeting unemployed teachers for this training.
Mr Kekana responded that for education training they did recruit people who were already trained.
Mr Mkongi noted that the UYF had made research of the involvement of the private sector in youth development and had raised concerns that they were not contributing. He wanted to know what the progress was in that regard.
Mr Kekana said that the private sector was benefiting young people incidentally rather than intentionally, and they wanted to fix that.
Mr Mkongi asked why it was so exorbitant to audit the books of small businesses.
Mr Nkoane answered that there were a number of accounting standards that the SMEs needed to comply with. For this to happen the auditors had to do a thorough audit which was expensive. He agreed that it was expensive, but as they required compliance with International Financial Reporting Standards (IFRS), so therefore did the SMEs with which they partner.
Mr Kekana added that there was a new set of IFRS coming out soon that would bring the cost down.
Ms Chalmers spoke about the idea of mentoring and encouraging skilled and experienced people to feed into the youth programs in a mentor capacity.
Mr Kekana said that they just been approved R6m for a mentoring program where young agriculture graduates would mentor and work with emerging farmers. This was young people mentoring each other and mentoring communities. He also outlined the Big Brother, Big Sister program that was growing in leaps and bounds where 2 200 young people were paired with adults. The UYF was considering the resuscitation of youth clubs, which used to be very useful in providing young people with a nurturing environment where they received peer on peer training.
The Chair asked that the UYF make their documents available in Braille as there were members of the Committee who were blind.
Mr L Nzimande (ANC, NA) said that on an oversight visit to the Free State recently they had seen problems with other organisations that had subjected young people to horrible experiences. His question was how and how often service providers and mentors were assessed.
Mr Kekana responded that they would look into the Free State incident aout the relationships with service providers as they had not heard about it yet. However, such reports were the reason they needed to have their own advisory centres, as service providers want to make money.
Mr Nzimande asked about the visibility plan of action for rural communities as his rural constituency did not have internet or a community radio station.
Mr Kekana noted that Mr Nzimande was correct in that their presence in the rural areas was not as big as it could be. However, their new program of their own advisory centres had helped, as one of the stipulations for ISO 9000 rating was that they had to have consistency. There was a manual on how to do everything so the system was in place and having the same standards everywhere would help with growth. He added that they were also introducing SMS technology so that youth in rural areas could SMS questions and have answers returned to them.
Mr Nzimande asked what the proportional balance of the 120 YACs were and wondered if they were assigned by districts, and if they would stop at 120.
Mr Kekana said that they were looking at adding 42 this year and to try and get to each and every town.
The Chair asked that in the presentation they be able to see the targets for the year, and not just the achievements.
Mr Kekana said that the target-versus-achievement information was in the Annual Report. He added that the Institute of Directors voted their report as the best annual report last year.
The Chair also said that the Committee wanted to know the challenges they faced, and not just the successes celebrated.
Mr Kekana replied that some of the challenges they had were around sustained funding, communication, skills and accessibility. There were young people in distant areas that knew about the Fund but could not get to it. He admitted that they needed to continue to do more to get out to these areas, and were issuing RFPs for 42 new towns. Although they may not be able to provide full services in every town, they hoped to at least have a presence there. Communication was a challenge as advertising was very expensive. Community radio was the best medium. As to skills challenges, they were growing so fast and did not pay “top dollar” so often they would train people who would get poached. They took 30 young interns into the Fund each year and tried as far as possible to employ them.
The Chair wanted to know how the UYF were prioritising the issue of skill scarcity that the Government had identified, as he did not see it in the report.
Mr Kekana responded that they had mainly prioritised skills for labour intensive skills areas, especially in rural areas. The demand for these skills was present so they focussed on them.
The Chair also wondered who would lead the Women’s Fund within the UYF, as the present delegation were all men.
Mr Kekana noted that the Annual Report did not say that all the divisions that provide services were lead by women. There were definitely females in the Fund at top senior level positions, so the Women’s Fund was not a problem.
The Chair noted the example of the partnership with Nestle, but wanted also to hear about youth getting involved in “the real thing.” He wanted to see youth in the first economy in sectors such as Information Technology, mining, infrastructure etc, so that that the youth did not just end up on the streets selling ice cream.
Mr Kekana gave some examples of big brand partnerships and SMEs that they were funding. UYF had a 26% share in the fashion outlet Sun Goddess, 5 or 6 businesses operating in Sandton City, and had created over 200 millionaires as a Fund. He said that it was always a dilemma between choosing the big names or micro loans for small companies that bring in regular incomes for the owners. However, the Chair was correct in asserting that they should not restrict youth to the edges of the economy.
Mr Mkongi suggested three proposals. He proposed that the UYF establish a parliamentary office so that the MPs had close access to information. He mentioned that there was space in the office of the Youth Commission. A second proposal was youth clubs and he suggested that UYF should fund the South African Youth Commission to evaluate the need and do that job. A third proposal was that the UYF work with the Department of Provincial and Local Government to train local youth units and councils on the local political systems so that when they became councillors they did not have to be trained again.
Mr Kekana thanked the Committee, noting that the UYF always grew and became better after interaction with them.
The Chair expressed his thanks and concluded the meeting by reminding the Committee that the NCOP was going to Stellenbosch soon, and that the UYF were always present there.
The meeting was adjourned.