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AGRICULTURE & LAND AFFAIRS PORTFOLIO COMMITTEE
20 November 2007
AGRISETA ANNUAL REPORT 2006/07
Chairperson: Mr M Mohlaloga (ANC)
Documents handed out:
AgriSETA (Sector Education and Training Authority) presentation
Motivation for additional funds and/or an alternative training funding model for the agricultural sector
AgriSETA Annual Report 2006/07 [available at www.agriseta.co.za]
Audio recording of meeting
The Chief Executive Officer (CEO) of AgriSETA presented the Committee with the current status of the source of funding derived by the SETA, through its contributing employers in the primary and secondary agricultural sector. A small number of contributors were responsible for serving a vast sector and the question was put to the members whether the SETA was really in a position to serve some of these enterprises adequately, such as small scale or subsistence farmers and those who had received land through restitution. The needs here were great and the SETA was grappling with the need to provide basic literacy skills in addition to agricultural training. The income had funded employer grants and project expenses to the amount of R124,5 million. This was a continual challenge and obstacle in the delivery of the SETA’s mandate, as the training they were expected to provide could often not begin before basic literacy and numeracy skills had been attained. Consequently the SETA was being bogged down by the almost overwhelming task of first providing basic education before being able to start on its specific task of agricultural sector training. This issue was discussed at length by members. Representation was also made by the executive board of the SETA for additional funding in view of it mammoth task and the fact that it had very little resources available from contributing members to the fund, while still being expected to serve the entire agricultural sector.
Mr Machiel van Niekerk, CEO of AgriSETA, presented to the Committee facts and figures, which showed that only 3527 companies were contributing to the SETA at present, from which derived R136,5 million. This constituted the one percent skill development levy. About 2770 of these were farmers from the primary sector. This had funded R124,5 million worth of employer grants and project expenses and R8,9 million of projects such as learnerships. Admin costs represented 10% of the revenue and 20% was held in the NSF. Employers could earn up to 50% of the levy back by fulfilling certain requirements. The profile of employers revealed that only 289 companies employed over 150 employees. The number of contributing members had dropped substantially from over 9000 because a new threshold of a minimum salary bill of R500 000 had been set as opposed to the previous R300 000. The SETA was small in comparison to others and yet it served a vital sector of the economy, a large part of which consisted of non-contributors to the fund. Scarce and critical skills had been identified and categorized. The most critical of these were farm management, literacy and numeracy, technical skills such as artisans, engineers and technicians. While overall equity had been fair, it was difficult to attract disabled people into the industry.
A large portion of the discretionary funds had been spent on Adult Basic Education and Training (ABET), which taught literacy and numeracy. This was a computer-based programme. The SETA proved computers, software and facilitators. The farmer just needed to provide a venue. There were 20 000 people participating in this programme while 500 more were involved in face to face training. Learnerships and skills programmes represented a further investment, as well as the provision of bursaries of R30 000 per annum per learner, internships where farmers were being paid R30 000 per annum to take on a student for a year, workplace experience grants and apprenticeships. The latter had been reinstated and from January next year more than 250 apprentices would be starting this programme, whereby R72 000 was provided by the SETA for a period of two years per apprentice.
The priority focus areas in scarce and critical skills were identified, with the lack of literacy and numeracy posing a considerable challenge. People had to be encouraged to take on numeracy courses by not allowing them to continue onto level 3 of literacy courses until they had completed a level 1 numeracy course. Mr van Niekerk concluded that the SETA would be setting up farmers for failure if it did not have access to greater resources as the development of farmers was a long term process. He provided motivation for an increase in funding, since the needs of the primary agricultural sector were not being met by a long margin. The primary sector consisted of some 45 000 commercial farming enterprises, emerging farming enterprises, which involved about 650 000 people and approximately 1200 000 people involved in small scale or subsistence farming. This situation had grave implications on the country as a whole. Alternative means of funding needed to be established, or a new funding model which was aligned to the farming sector would have to be developed. A long-term strategy was needed. Limited funds meant it was beyond their means to turn projects from failure to success. The proposal presented in their document: Motivation for additional funds and/or an alternative training model for the agricultural sectors could change the lives of many people, but would require political decisions.
Mr Sipho Khumalo, Chairperson of the SETA, said additional funds were needed to assist the SETA to deliver on its mandate. He highlighted the fact that 90% of their discretionary funds were being spent on ABET. The agricultural sector was directly linked to the situation of people in the rural areas. They needed alternative funding also because the discretionary funds could be reduced due to employers earning their levies back in totality. People had to be able to complete their programmes. Government had to deal with land reform beneficiaries. Land had been given but no access to support and assistance. The NSF treated the SETA like any other SETA doing application for funds, even though they had far less funds available compared to other SETA’s. These issues needed attention urgently, because even though the SETA was producing good results, it was in danger of running out of funds.
Mr Jack van Dyk, the Vice Chairperson, said that in summary the SETA could and did deliver, but that limited funds did not allow the SETA to consider the needs of those that did contribute. The SETA needed access to decision-makers and other sources of funding in order to become more effective.
Dr A van Niekerk (DA) asked for examples of successes and an identification of the shortcomings of their work on the farms.
Ms B Ntuli (ANC) said the Committee had an oversight role to play and asked what plan the SETA had to offer as a viable alternative to the current situation. She asked which educational institutions the SETA was using, the geographic spread of learnerships. She understood that UNISA people were paying a fee and asked what relationship the SETA had with UNISA.
Mr D Dlali (ANC) referred to page 59 of the annual report which made reference to the quality of training. He questioned the amounts being spent on entertainment by the board.
Mr Singh agreed that the sector needed support especially in view of increasing food prices due to interest hikes and fuel price increases. He asked what level of interaction happened between the various departments. These should combine resources. He commented that Gauteng and the Western Cape were the biggest beneficiaries of training.
Dr A van Niekerk (DA) asked where apprenticeships were taking place and what sort of follow up there was in this regard. He commented that the SETA was increasingly called upon to deliver beyond its resources, although they still had R100 million in the bank.
Mr S Abram (ANC) said that a rescue plan was needed. There was one extension officer for every 600 farmers. He asked what funding would be required to alleviate the situation and how did the seta rate the government’s concern over these matters. He asked why Ms Mpo Matelamusi had been retrenched. He asked what changes in the current model of funding would generate enough funds to cover the needs of the SETA.
Mr Mahlaloga suggested the SETA was spreading itself very thinly by being so heavily invested in the ABET programme and suggested that this should be a task for the Department of Education. This would allow the SETA to focus on its core functions. He asked how the extension officers were being trained.
Mr M van Niekerk said the SETA was small in comparison to others and yet it served a vital sector of the economy, a large part of which consisted of non-contributors to the fund. Scarce and critical skills had been identified and categorized. A major part of the budget had been spent on Adult Basic Education and Training (ABET), which taught literacy and numeracy. He said the dilemma partly was created by the R7 billion which had been allocated to acquire land for restitution claims. These claims would require another R7 billion in order to provide the claimants with access to training, capital, development and mentorship. He cited an example where in Oudtshoorn, transport had been required to move produce and a truck had been provided but no pump had been provided by the Department of Agriculture. A positive example of what could happen when Departments coordinated their efforts, was the instance of thirteen black ladies who started growing Barberton daisies in a joint venture with the Departments of Agriculture, Trade and Industry and the Agricultural Research Council. These ladies are now earning R16000 a month each.
Mr van Niekerk said emerging farmers were not in a position to attend training for 34 weeks. They needed a drastic plan of assistance. He said the Seta had requested a meeting with the Minister of Agriculture, but to date they had not met with her. There was little communication with the top echelons of government. He said the SETA did have a plan, but unfortunately the decisions involved in implementation of the plan were mostly political. One had to ask when farmers were only able to generate 10% of their income through agriculture, whether their efforts were worthwhile. He questioned whether the SETA should be serving land reform beneficiaries. He said that the SETA only had one office in the Western Cape, which would be closing shortly anyway, as this seemed an unnecessary expense. He said ABET provided computer based training, which was evaluated at a cost of R120 per learner. They allocated fifty bursaries per annum, fifty workplace experience grants and fifty internships and 250 apprenticeships. He would make the geographical information available in this regard. He said that 60% of their income came form the Western Cape.
He said that even though the SETA had R100 million in the bank, one had to look at the obligations they still stood to fulfil. Most of the money had been allocated through signed contracts. He agreed the sector needed a rescue package. He cited an example of cotton farmers where they could be practically assisted through teaching them how to prepare the soil, although something like that would be outside the formal training framework. He realized the problem with extension officers and that they mostly lacked experience. Ideally one needed experienced farmers to mentor emerging farmers. There was no quick solution in this regard. Matriculants could not be expected to be effective extension officers. He said that ABET could not be ignored, as minimum levels of standard seven was required for learnerships. He said that R6 billion was being invested in ABET by the government and that some of that should be given to the SETA, who were involved in providing ABET. The SETA also needed to look closely at whom they should serve in order to be most effective.
Mr J van Dyk said the retrenchment of Ms Mpo Matelamusi had been an unfortunate one where as a result of the merger between the primary and secondary sector SETAs, certain positions had become obsolete. While not one person had needed to lose their job, there had been a disparity in salaries and the new positions entailed an adjustment of salaries in order to bring them into alignment with all the other salaries. Ms Matelamusi had been offered a reduced package which she had refused to accept. She had taken the SETA to the CCMA, which had ruled in favour of the SETA. She then appealed the matter in the Labour Court, which also ruled in favour of the SETA. She thus chose to take a retrenchment package.
Mr Khumalo noted that he had met with Ms Matelamusi and had advised her to bring along a witness, as this followed correct procedure and only counted in her favour. She had not followed his advice.
He said they did offer short courses which consisted of unit standard credits. One credit represented ten notional hours, so five credits constituted fifty hours of training. Courses were 30% theory and 70% practical in their nature. There had been no research on the impact of the training. Also life skills had not yet been incorporated into these courses. Most of the money in the SETA flowed from the Western Cape and therefore most of their providers were in that province. Regarding evaluation of providers, they were looking at approaching certain Education institutions to become evaluators. Elsenberg was one of these.
Prof Dan Prinsloo was responsible for Education Training Quality Assurance. He was a professor at UNISA and was assisting in the evaluation of the learning material. Regarding entertainment fees Mr van Niekerk said that restructuring in the Department of Labour to an occupational framework and entailed the formation of nineteen working groups, which had to facilitate this restructuring. The provision of teas and lunches for this groups made up part of the entertainment expenses. He agreed that better coordination between various relevant departments was needed. He said that ABET had tried to use teachers to do their training, but that the dynamics of teaching adults was completely different to teaching children and this required different people. The government had allocated R6 billion for the ABET programme, but did not seem to have a roll out plan. He asked whether employers should be carrying this responsibility. He said that 85% of commercial farmers had fewer than eleven people in their employ and therefore did not fall into the contributing category for the NSF.
Mr Khumalo said he did not rate the government very highly in terms of their commitment to the development of the sector, from experiences he had had with government officials in various instances. He had found them often negative and arrogant in their approach and for example, where the SETA had pleaded for the continuation of massive tea plantations in KZN and Limpopo on the basis of a small government subsidy, no notice had been taken of their appeals. These plantations now lay neglected and unproductive and the economies that had grown around these areas had been completely eradicated, only adding to the poverty of the people. It had therefore been his experience that while the intentions by government seemed good on paper, the reality had not borne this outcome. Farms once productive and which had been given to land reform beneficiaries were now dry and neglected, because they did not have the means to maintain them, He said that while it was not in the mandate of the SETA to provided any infrastructure , practicality often dictated otherwise, since without certain infrastructure no effective training could take place.
Mr Nkosi said the absence of integration and coordination should be handled by the Department of Education to ensure an adequate education from school upwards. We now had to import our tea. He asked whether there was any effort to identify common areas of concern and areas which pertained uniquely to one SETA, in order to ensure that all areas were covered adequately and not unnecessarily. Perhaps a discussion among the SETAs could generate proposals to the various departments that were involved. He commented that possibly the Departments of Agriculture and Land Affairs should be unified. Regarding failure of the SETA to contact the Minister, he suggested that the Committee might facilitate meetings with various people the SETA might wish to talk to on these concerns.
Ms M Nkompe-Nqwenya (ANC) said it was important to empower people on the ground, to ensure all had food on the table. She did not really see the use of extension officers in the communities, as they had functioned without them for so long anyway. Training of communities had been very effective in the past, without requiring formal education and various levels of training to be provided before practical skills could be imparted. She encouraged the SETA to get more involved at ground level and was impressed by their frankness, The question of additional funds should be discussed again.
Mr Mahlaloga said rural people were not stupid and had subsisted for a long a time.
Ms Ntuli asked how monitoring was done and since training was a grave concern, whether standards had been articulated comprehensively in order to evaluate training. The report spoke about the inability by the SETA to deliver training to the SMMEs and asked whether there had been any intervention in this regard. The training mentioned in the report did not mention in the field training. She said that the criterion of std 8 level education in extension officers merely served to exclude people. She said there should be an exact listing of the requirements for successful farming and production.
Mr Dlali referred to page 61 of the Annual Report questioning the amount paid to board members. He commented on information on page 54 of the report which seemed to indicate that the audit Committee consisted of one person.
Mr Abram reiterated the need for a list of urgent quick fix measures which the SETA should compile and forward to the Committee.
Mr Nel commented that the Department of Agriculture, with its budget of R2,6 billion, should take on some of the responsibility carried by the SETA. He said provinces should be getting more involved.
Mr Mohlaloga said that twenty board members seemed a bit cumbersome, but agreed that R500 000 was essentially miniscule.
Mr van Niekerk agreed that there was a lack of coordinated support among the SETAs and that this should be dealt with at the next forum meeting. The question of whether the SETA should be addressing food security versus commercial production was crucial in defining the real responsibility of the SETA. Food security was essentially a social welfare issue or a social problem, which should perhaps be addressed by other departments. The SETA had R136 million less 30% available to deliver on its mandate. This raised the question of how much should be set aside for the training of people to become self-sustaining. It was the SETA’s aim to develop emerging farmers into commercial farmers. The issue of extension officers would be addressed at their next meeting. The qualification for this would be defined by January. Monitoring was an ongoing challenge, but visits to providers were undertaken. He said each unit standard had very specific written outcomes, each unit standard having from five to eight outcomes attached to it.
He continued that the evaluation of service providers was also ongoing and those that had been inadequate had been suspended, until they improved sufficiently. They had six hundred assessors, although only two hundred were very active. Independent moderators checked whether training was adequate, but they were getting to about ten percent of their projects. Evaluation needed to be done more regularly. He said the SETA had developed learning material in unit standards, which did teach things like budgeting and human resources management, but he welcomed any input from the Committee in this regard. He would provide detail on the number of board meetings which had occurred as well as a break down of the expenses incurred. Regarding the amount of money paid to board members, he said that the board members were individuals working in their private capacities, who were earning on average R1000 per day for their work. He did not regard this as excessive. The size of the board was directly related to the number of representatives of which half were employers and half were employees. They represented institutions like AgriSA, National African Farmers’ Union (NAFU) and TAUSA (Transvaal Agricultural Union of South Africa), as well as five unions. The size of the board was not fixed and they were open to any suggestions. The board had four women members at present and the executive Committee consisted of 50/50 gender profile. The gender profile of the board was subject to the nominating parties. He said that he would take on the challenge of finding urgent quick fixes to tackle the problems that beset the agricultural sector.
Mr Khumalo said that literacy was a priority they had to deal with in order to be able to fulfil the criteria of their mandate. They therefore could not exclude people from training based on their lack of basic education, which in turn led to this burden being placed on the SETA at the moment.
Mr Mohlaloga reiterated his opinion that the Department of Education should be taking responsibility for the cost of ABET. He suggested that the Committee meet again with the SETA in the following year and that more regular such meetings should take place in order to deal with issues more effectively. He adjourned the meeting.
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