VOTE 16: HIGHER EDUCATION AND TRAINING Presentation to Portfolio Committee on the 2010 ENE 10 March 2010

Presentation Structure Background to the establishment of the Department and distribution of the budget 2010 MTEF Allocations Departmental Programmes and Objectives

Part 1 Background to the establishment of the Department and distribution of the budget

The Department was established in May 2009 through proclamation as part of the restructuring of Government Legal functions were transferred from the Departments of Education in July 2009 and Labour in November 2009 Department receives staff associated with these functions, and its first budget on 1st April The Department aims to develop and support a quality post-school education and training education sector, and to promote access to higher and vocational education and skills development training opportunities. The budget consists of funds based on the split of the Department of Education as well as the transfer of functions from the Department of Labour

The splitting of funds from the Department of Education was done on agreed framework in line with the allocation of functions as well as the distribution of the staff compliment (Next slide is an extract from the Distribution Framework) The shifting of funds from the Department of Labour was done by the National Treasury based on the functions allocated to the Department A service level agreement as required by Adjustments Appropriation Act was signed with the DG Labour on 3rd February and matters such as the budget, assets, accommodation and staffing are currently being verified When the splitting of functions is complete, adjustments may be necessary in the Adjustments Estimates Bill

Budget Distribution Framework: Education Budget was split according to agreed framework based on functionality between the DGs of Education, Basic Education and Higher Education and Training Compensation of employees were distributed according to agreed ratios for each directorate Earmarked Funds were allocated based on final Treasury allocations Commitments such as audit fees, rental machines, computer services, bank charges, etc. were determined for both departments and allocated to the respective directorates Funds for operational and projects were dealt with as follows: MTEF amounts for all components were split in agreed ratios between the two Departments. Operational costs of Directorates/components were allocated based on needs, but limited to an allowed average fixed amount. The balance was reserved for projects.

PART 2 2010 MTEF ALLOCATIONS

TREASURY ALLOCATIONS 2010/11 2011/12 2012/13 R'000 Baseline allocation   2010/11 2011/12 2012/13 R'000 Baseline allocation 19 758 642 21 615 071 22 696 007 Additions to baseline: 3 793 778 4 303 290 4 968 098 Higher Education Subsidies - 300 000 700 000 Student Loans: Inflation adjustment 57 600 Funding for newly established department 20 000 30 000 40 000 Compensation of Employees adjustment 1 117 1 301 1 410 Further Education and Training (Shift from Provinces)* 3 372 661 3 541 989 3 719 088 Further Education and Training (College educators) 400 000 430 000 450 000 Adjustments to Baseline 8 592 506 9 336 195 9 799 735 Skills Function Shift from Department of Labour 166 077 184 915 190 800 Skills Function Shift: Compensation of Employees adjustment from Department of Labour 2 201 2 568 2 787 Function Shift: Direct Charges 8 424 228 9 148 712 9 606 148 Sector Education and Training Authorities 6 739 382 7 318 967 7 684 915 National Skills Fund 1 684 846 1 829 745 1 921 233 Less: ( 1 246) ( 1 563) Baseline Efficiency Savings 2010 ENE ALLOCATIONS 32 144 926 35 253 310 37 462 277 * National Treasury included this amount as part of the baseline in the ENE Chapter. However, in the allocation letter this is reflected as additional

The Department’s total budget of R32 The Department’s total budget of R32.145 billion includes a large amount of direct charges and transfers as follows in R’000: Total voted funds 32 144 926 Less: Direct charges (SETA funding and NSF) 8 424 228 Balance of voted funds 23 720 698 Less Transfers: Universities 17 516 740 NSF (Contribution by Exchequer) 51 731 Public Entities 1 986 740 FET Conditional Grant 3 772 661 Other ( such as SETA) 569 Less Compensation of Employees 228 901 Balance available for operational/project costs 163 356 The remaining slides focus on the amount of R23.7 billion, which is the actual voted funds excluding direct charges

2010 MTEF ALLOCATIONS AS IN ENE (EXCLUDING DIRECT CHARGES) Total per programme  2010/11 (R’000) 2011/12 (R’000)  2012/13 P1: Administration 100 545 106 086 115 742 P2: Human Resource Development, Planning and Monitoring Coordination 26 004 28 794 31 874 P3: University Education 19 493 353 21 638 037 23 163 149 P4: Vocational and Continuing Education and Training 3 932 518 4 144 198 4 351 777 P5: Skills Development 168 278 187 483 193 587 Total Allocation 23 720 698 26 104 598 27 856 129

2010 MTEF ALLOCATION SUMMARY 2010/11 R’000 2011/12 2012/13 Compensation of Employees 208 156 223 805 238 032 Examiners and Moderators 20 745 21 990 23 090 Transfers to Universities 17 516 740 19 302 723 20 652 860 Transfers to Public Entities 1 986 740 2 344 293 2 520 958 Other Transfers 52 300 60 505 63 531 Conditional Grants 3 772 661 3 971 989 4 169 088 Earmarked Funds 25 551 27 116 28 472 Departmental Operations 126 986 136 934 141 959 Projects 10 819 15 243 18 139 Total 23 720 698 26 104 598 27 856 129

Detail of earmarked allocations/transfers (R’000) 2010/11 (R’000) 2011/12 2012/13 Transfers to Universities 17 516 740 19 302 723 20 652 860   Transfers to Public Entities 1 986 740 2 344 293 2 520 958 NSFAS 1 909 359 2 260 859 2 431 502 CHE 36 046 39 619 43 450 SAQA 41 335 43 815 46 006 Other Transfers 3 824 961 4 032 494 4 232 619 SETA 141 150 158 India-Brazil-South Africa Trilateral Commission 428 454 477 National Skills Fund 51 731 59 901 62 896 FET Conditional Grant 3 772 661 3 971 989 4 169 088 Earmarked Funds 25 551 27 116 28 472 Office Accommodation

Departmental Programmes and Objectives

The Department is organised into five budget programmes as follows: 1. Administration 2. Human Resource Development, Planning and Monitoring Coordination 3. University Education 4. Vocational and Continuing Education and Training 5. Skills Development 2. Detail of the functions performed in each Programme is summarised in the following slides

Programme 1: Administration (R100,545 million) Overall management and administration of the Department Minister, Management, Corporate Services and Office Accommodation The budget for the Programme increases at an annual average rate of 4,0 per cent over the 2010 MTEF period from R103.378 million in 2009/10 to R115.742 million in 2012/13 The increase over the medium term is due mainly to inflation related adjustments as well as additional allocations for required computer services for the Department

Programme 2: Human Resource Development, Planning and Monitoring Coordination (R26.004 million) Provide strategic direction in the development, implementation and monitoring of departmental policies. Coordinate activities regarding HRDS-SA Functions Human Resource Development, Strategic Planning and Coordination Planning, Information, Monitoring and Evaluation Coordination International Relations Legal and Legislative Services Social Inclusion in Higher Education and Training The budget for Programme 2 increases at an annual average nominal rate of 5,0 per cent over the 2010 MTEF period from R27.832 million in 2009/10 to R31.874 million in 2012/13.

Key Strategic Objectives Programme 2: Human Resource Development, Planning and Monitoring Coordination Key Strategic Objectives Ensure coordination, integration and facilitation amongst stakeholders, role-players and authorities with regard to the HRDS-SA Establish HRD Council and support its workplan Develop an integrated operational management information system and decision support system Identify and monitor curriculum innovations in citizenship and values education in the higher education and training system

Programme 3: University Education (R19 534 Programme 3: University Education (R19 534.688 million) Develop and coordinate policy and regulatory frameworks for an effective and efficient university education system Functions University: Academic Planning and Management University: Financial Planning and Information Systems University: Policy and Development Teacher Education University: Subsidies Programme 3 includes the subsidies to universities, the National Institutes for Higher Education as well as the NSFAS, CHE and SAQA. The budget increases substantially at an annual average rate of 10,7 per cent over the 2010 MTEF period from R17.138 billion in 2009/10 to R23.209 billion in 2012/13. The increase is mainly due to increased block grants for universities and an increase in the funding of student loans through NSFAS.

Programme 3: University Education Key performance measures Improve enrolment planning so as to produce quality graduates Provide financial management support to universities, NIHEs and public entities Provide appropriate policy frameworks for improvement of teaching and learning Ensure that HEMIS meets the needs for management information across the sector and is properly maintained with the required data Provide regulatory support to universities and support them in improving governance Ensure the appropriate registration of private higher education institutions Ensure an adequate supply of quality teachers for the Basic Education System

Programme 4: Vocational and Continuing Education and Training (R3 891.183 million) Plan, develop, evaluate, monitor and maintain national policy, programmes and systems for vocational and continuing education and training Functions Planning and Institutional Support Programmes and Qualifications The budget for the Programme increases at an annual average rate of 10,75 per cent over the 2010 MTEF period from R3.256 billion in 2009/10 to R3.856 billion in 2012/13. The biggest portion of the budget is for the conditional grant The increase is mainly due to increased subsidies to FET Colleges including salary increases at college level in line with the central bargaining process.

Programme 4: Vocational and Continuing Education and Training Key performance measures Support the development of college institutional capacity in order to achieve transparency, enhanced performance, accountability and efficiency Develop and maintain a diverse range of high quality responsive vocational programmes for colleges Review Adult Education and Training to ensure that responsive and enabling policies and programmes can be put in place

Programme 5: Skills Development (R168 Programme 5: Skills Development (R168.278 million) Promote and monitor the national skills development strategy Functions SETA Coordination National Skills Development Services Quality Development and Promotion Artisan Development The budget for Programme 5 increases at an annual average rate of 9,0 per cent over the 2010 MTEF period from R152.331 million in 2009/10 to R193.587 million in 2012/13. The above average increase is mainly to the additional allocation for the National Skills Fund as well as general inflationary increases.

Programme 5: Skills Development Key performance measures Promote the alignment of skills development outputs with the needs of the workplace and with the broader growth needs of the country’s economy Provide funds to support projects identified as national priorities in the context of the NSDS II and III Develop the first draft of the National Skills Development Strategy III (2011/12 – 2014/15) Ensure quality learning at and for the workplace

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