ATC120530: Report Budget & Strategic Plans 2012/13 of the Services Sector Education & Training Authority & Energy & Water Sector Education & Training Authority dated 30 May 2012

Higher Education, Science and Innovation

DRAFT REPORT OF THE

REPORT OF THE PORTFOLIO COMMITTEE ON HIGHER EDUCATION AND TRAINING ON THE BUDGET AND STRATEGIC PLANS 2012/13 OF THE SERVICES SECTOR EDUCATION AND TRAINING AUTHORITY AND ENERGY AND WATER SECTOR EDUCATION AND TRAINING AUTHORITY DATED 30 MAY 2012

 

The Portfolio Committee on Higher Education and Training, having considered the Budget and Strategic Plans 2012/13 of the Services SETA and Energy and Water SETA, reports as follows:

 

1. Introduction

 

The Portfolio Committee on Higher Education and Training considered the Budget and Strategic Plans 2012/13 of the Services SETA and the Energy and Water SETA (EWSETA) on 16 May 2012. This report gives a brief summary of the presentations made by both SETAs to the Committee, focusing mainly on the 2012/13 Budget and Annual Plans and an overview of allocations per programme. The report also provides the Committee’s observations.

 

Portfolio Committee on Higher Education & Training:

Present: Adv I Malale (ANC) (Chairperson), Ms N Gina (ANC), Mr S Makhubele (ANC), Prof S Mayatula (ANC), Mr C Moni (ANC), Mr S Radebe (ANC), Ms D Sibiya (ANC), Dr L Bosman (DA), Mr A Mpontshane (IFP) and Mr J Dikobo (AZAPO).

 

SERVICESETA: Dr S Moon: Administrator, Mr R Naidoo: Manager, Ms L Bogoshi: Executive Manager and Mr S Wasa: Consultant.

 

EWSETA: Mr S Zokwana: Chairperson, Mr N Ngobese: Acting Chief Executive Officer, Mr K Lephoto: Chief Financial Officer and Mr T Mmotla: Chief Operations Officer.

 

Department of Higher Education and Training: Ms L Mbombo: Acting Director-General, Mr C Mtshisa: Acting Deputy Director-General, Mr M Macikama: Chief Director, Ms V Qinga: Chief Director, Mr H Hoon: Director, Ms N Nqaba: Parliamentary Liaison Officer and Ms P Sekgobela: Acting Parliamentary Liaison Officer DGs Office.

 

 

 

2. Summary of presentations

2.1 Services SETA

Dr S Moon led the presentation which highlighted the following key issues:

· The Services SETA was placed under administration for the first time on 21 April 2011. The initial period of administration was characterised by court battles, executives and senior managers resigning and the SETA programmes not being implemented during this period. The court battles were settled in July 2011 and the period of the administrator was extended to 07 July 2012. The Sector Skills Plans (SSPs) of the SETA were of poor quality and the administrator revised them to respond to the National Skills Development Strategy (NSDS III) goals. The budget and strategic plan of the SETA had not yet been approved by the Minister two months into the financial year.

· The Services SETA sector comprised of 16 sub-sectors including business services, property services, household and personal services. The SSPs attached to the strategic plan was work in progress and would be completed in August 2012.

· The strategic plan of the SETA included: restructuring the SETA into six Chambers serving the needs of 16 sub-sectors, the prioritisation of the scarce skills programmes, the increasing quality of Workplace Skills Plans (WSPs) and, most importantly, the establishment of a new board.

· Budget: The total budget of the SETA for the current financial year was R868 million compared to R856 million in the previous financial year. The inadequate submission of WSPs and ATRs limited the payouts of mandatory grants to companies and the majority of the sector was dominated by Small Medium Enterprises (SMEs). The net surplus of the SETA was R324 million.

 

2.2 Energy and Water SETA

Mr N Ngobese, Acting Chief Executive Officer (CEO), led the presentation which highlighted the following key issues:

· EWSETA experienced serious challenges in governance and the management of the SETA during the 2010/11 financial year, to such an extent that the Minister placed the SETA under administration on 17 September 2010.

· The SETA was currently in the performance phase, with a new Board being appointed on 01 April 2011 and, the key recommendations of the administrator were being implemented by the new board and the management team.

· Budget: The total budget of the SETA for the current financial year was R172 million which was insufficient. Some sic codes transferred to the SETA had not yet been paid owing to the insufficient budget. The levy income of the SETA was dominated by the energy sector (91% of levies 2011/12) and the water sector contributed (9% of levies 2011/12).

· The SETA targeted 500 unemployed learners to enter into training programmes this financial year. The target for the artisan training programme was 1375 learners. Partnerships with three FET colleges with relevant programmes had been signed to offer vocational course and work experience for learners. In relation to bursaries, 50 students were awarded bursaries in higher education institutions and a partnership with three universities was signed.

· The main challenges of the SETA included inadequate capacity in financial and human resource management, instability in governance and leadership roles.

 

3. Observations

From the interactions with the above mentioned SETAs, the Committee observed the following:

3.1 It was noted with concern that the strategic plan, annual performance plan and budget for 2012/13 of both SETAs that appeared before the Committee were not yet approved by the Minister two months into the new financial year.

3.2 Both SETAs had previously been placed under administration owing to the serious challenges they faced and, they were both in the recovery stages. EWSETA appointed a new board and was in the process of appointing a new permanent CEO during the course of the year. The contract of the Administrator of SERIVCESETA would expire in July 2012.

3.3 The Committee noted with concern that there was inadequate information on the number of bursaries awarded or to be awarded to deserving students in critical skills in the annual performance plan of both SETAs. Most importantly, the number of University of Technology , FET colleges and university graduates placed or to be placed in employment or work integrated learning programmes were not reflected in the annual performance of both SETAs.

3.4 The over-reliance by the SETAs on the private skills training consultancy industry and the continued neglect of the easily accessible public FET college sector remained a serious concern for the Committee. This was further viewed to be in direct contrast to the spirit of growing and developing FET colleges so that they could respond to local, regional and national skills priorities.

3.5 The lukewarm response by the SETAs to government policies such as the Industrial Policy Action Plan (IPAP), Human Resource Development Strategy South Africa (HRDSA), NSDS III, and National Growth Plan (NGP) which seek to address the lack of skills and the growing concern of unemployment among young people remained a serious concern to the Committee.

3.6 The notion of disbursement of mandatory grants to companies with inadequate Work Place Skills Plans (WSPs) and insufficient plans for growth imperatives to transform the challenges of society remained a concern for the Committee.

3.7 The declaration of South Africa as an arid region coupled with the growing concern of the deteriorating drinking water quality and inaccessible clean running water, particularly in rural areas, were some of the concerns highlighted by the Committee to EWSETA.

3.8 The delay in issuing of certificates to learners that completed their training programmes remained a serious concern of the Committee. The challenges in the transfer of sic codes from EWSETA to the Construction SETA was affecting both sectors negatively.

 

4. Conclusion

The Committee agreed that it would find it very difficult to consider any Budget and Strategic Plans of SETAs that have not yet been approved by the Minister in future. Of serious concern to the Committee was the “business as usual” approach in the work of SETAs that had been a trend over the past few years, despite the deliberate transformation driven by the Minister, which sought to magnify the theme of work placement, integrated learning, rural development, RPL and the transformation of the entire post school education and training system to respond to the growth imperatives of the country.

 

The Committee emphasised the importance of public higher education and training institutions in advancing the work of the SETAs. This was not new to the SETAs as the Committee raised this concern in the previous financial year and, this year SETAs were expected to bring about substantive and qualitative changes identified in the NSDS III to increase employment opportunities for young people. The Committee further proposed that the mandatory grants paid to companies should be reviewed and, if legislation required to be amended to ensure that companies adhered to the notion of increased opportunities of employment for young people, it would initiate this process.