BANKSETA Presentation To Portfolio Committee on Labour 14 October 2004 By Frank Groenewald

The BANKSETA mission is to support transformation and people development and, through partnerships, to enable stakeholders to advance the national and global position of the broader banking and microfinance industry.

BANKSETA STAFF = 18 White African Coloured Male 2 3 Female 5 Disabled Female 5 Disabled 1 Total 7 8

BANKSETA Scope Central banking Discount houses, commercial and other banking Building Societies Financial mediation Lease financing Securities dealings Activities ancillary to financial mediation

Employment by Organisation Size Type of Organisation Number of Organisations Employees Small 1217 5314 Medium 37 3128 Large 77 137 707 Total 1331 146 149

Skills Development Priority Areas (critical skills) Information Technology related skills development Management and Leadership skills development Customer Interface related skills development Specialist Financial skills development Legislative Compliance relates skills development

BANKSETA Success Factors Committed and Informed Sector Competent Council/Board providing strategic direction. Strong culture of corporate governance, ownership and ethics. Clear vision and objectives. Knowledgeable, competent, committed staff. Strong culture of needs driven delivering. Strong focus on evaluation and feedback

BANKSETA Strategic Focus (Sector and National) Finance Sector Charter Youth development Consumer Education SMME Development Research, Benchmarking and Communication

BANKSETA Principles of Operations Accelerate social transformation through skills development: (85%,Black, 54% women, 4% disabled.) Leverage the skills levy funds for the strategic benefit of the sector and the NSDS Be cost-effective and co-source non-core delivery mechanisms. Employ leading edge technology and best management practices. Conduct research and benchmarking in order to improve the sector’s competitiveness through skills development. Be a hub for sector collaboration.

Governance - BANKSETA Council Employer Forum Sipho Ngidi SBSA (Chair Person) Lawrence Mlotshwa ABSA Sheila Motsepe SARB Francois Hugo FNB Hennie Ferreira MFSA Shirley Zinn Nedcor Employee Forum Eugene Ebersohn SASBO (Deputy Chair) Ben Venter SASBO Eugene Zeeman IBSA Jo Kokela SASBO Trevor Dell SASBO Vanessa Hatting SASBO

Governance Fully constituted Council Constitution and Code of conduct Public Finance Management Act (PFMA) King ll Audit Committee and Finance committees Internal Audit ( Gobodo &OMA) Unqualified Audit Reports x4 (Auditor General) External Expertise (Chief Financial Officer and Audit managers from big banks) Remuneration Committee Formally agreed processes Annual research conducted by experts Business & Labour represented

Major issues for Banking Most Important Developments (Finance Sector Charter (HR most difficult) and Compliance) Bankers criticism of the Financial System (Cartel behaviour) Market Competition (Corporate vs Merchant and Investment banking, Retail, Home loans and Vehicle finance extremely competitive, Internet banking – not so much) Drivers of Change (Foreign Entrants replace Technology) Pressing Issues (Revenue growth and Compliance) Emerging Issues ( BEE funding structures?

Employment Trends

OCCUPATIONAL SHIFTS BY GENDER Occupational Band 2001 2004 Male Female Senior Officials and Managers 76% 24% 64% 36% Professionals 62% 38% 55% 45% Associate Professionals 34% 66% 35% 65% Clerical Workers 27% 73% 26% 74% Service Workers 46% 54% Labourers 69% 31% Total Employment

RACE DEMOGRAPHIC SHIFTS Occupational Band 2001 2004 Black White Senior Officials and Managers 13% 87% 24% 76% Professionals 22% 78% 31% 69% Associate Professionals 41% 59% 46% 54% Clerical Workers 49% 51% 66% 34% Service Workers 70% 30% Labourers 92% 8% 94% 6%

BANKSETA Delivery

947 workers received training NSDS success indicators SETA five year target SETA target achievement 2001/2 SETA target achievement 2002/3 SETA target achievement 2003/4 SETA target achievement 2004/5 NSDS Objective 1 : Developing a culture of high quality lifelong learning 1.1 By March 2005, 70% of all workers to have at least a Level 1 qualification on the NQF 80% of all employed workers have an NQF Level 1 qualification 973 workers received training 709 workers received training 813 workers received traing 947 workers received training 1.2 By March 2005, a minimum of 15% of workers to have embarked on a structured learning programme, at least 50% of whom will have completed their programme satisfactorily 20% of workers to have embarked successfully on a structured skills development programme 141 335 workers received training 101 026 workers received training 98752 118 277 workers received training [update with new information] 1.3 By March 2005, an average of 20 enterprises (to include large, medium and small enterprises) and at least national government departments, to be committed to, or to have achieved the Investors in People standard 30 private sector firms to have committed to or to have achieved an agreed national standard for enterprise-based people development (5 large, 15 medium, 10 small) No targets required in this period 50 sites from 4 large banks and 5 medium and small banks have committed 66 sites from 4 large banks, and 18 medium and small banks, including micro-finance, have committed NB: Cumulative totals

94% enterprises have received grants (72 out of 77) NSDS success indicators SETA five year target SETA target achievement 2001/2 SETA target achievement 2002/3 SETA target achievement 2003/4 SETA target achievement 2004/5 NSDS Objective 2 : Fostering skills development in the format economy for productivity and employment growth 2.1 By March 2005, at least 75% of enterprises with more than 150 workers to be receiving skills development grants and the contribution towards productivity and employer benefits to be measured 90% of enterprises to have receive skills development grants 92% enterprises have received grants (50 out of 54) 98% enterprises have received grants (89 out of 91) 98% enterprises have received grants (84 out of 86) NB: linked levy numbers included 94% enterprises have received grants (72 out of 77) 2.2 By March 2005, at least 40% of enterprises employing between 50 and 150 workers to be receiving skills development grants and the contributions towards productivity and employer and employee benefits to be measured 80% of enterprises to have achieved skills development grants 86% enterprises have received grants (31 out of 35) 78% enterprises have received grants (31 out of 40) 69% of enterprises have received grants (25 out of 36) 84% or 27 out of 32 enterprises have received skills development grants NB: change in SETA transfers out have been omitted 2.3 By March 2005, learnerships to be available in every sector At least 5 learnerships to be available in the sector 3 learnerships developed and registered 5 learnerships developed and registered 16 learnerships developed

NSDS success indicators SETA five year target SETA target achievement 2001/2 SETA target achievement 2002/3 SETA target achievements 2003/4 SETA target achievement 2004/5 NSDS Objective 3 : Stimulating and supporting skills development in small businesses 3.1 By March 2005, at least 20% of new and existing registered small businesses to be supported in skills development initiatives and the impact of such support to be measured 20% of new and exiting to be supported in skills development 67 SMME SDFs received training 20% (188 out of 926) SMMEs supported, broken down as follows: 106 training support 82 WSP support 39% (466 out of 1183) SMMEs supported, broken down as follows: 216 training support (18%) 23 training vouchers (2%) 227 WSPs (19%) 46% (559 out of 1217) SMMEs supported, broken down as follows: 57 training support (5%) 161 training vouchers (13%) 341 WSPs (28%)

NSDS Objective 5 : Assisting new entrants into employment NSDS success indicators SETA five year target SETA target achievement 2001/2 SETA target achievement 2002/3 SETA target achievements 2003/4 SETA target achievement 2004/5 NSDS Objective 5 : Assisting new entrants into employment 5.1 By March 2005, a minimum of 80 000 people under the age of 30 to have entered learnerships 1976 people under the age of 30 to have entered into learnerships 59 learners had embarked on learnerships 153 learners of embarked on learnerships 903 learners had embarked on learnerships 2044 learners have embarked on learnerships NB: cumulative totals 5.2 By March 2005, a minimum of 50% of those who have completed learnerships to be employed 50% of people who have completed learnerships to be employed within 6 months of completion NA 90% of learners who have completed a learnership are employed 83% of learners who have completed a learnership are employed

Unemployed (18.2) Learner Breakdown Female Male Disabled A C I W Total 1127 16 1143 56% 872 29 901 44% 72 4%

Letsema Learnership Project Large number of learners: Year 1: 825 learners Year 2: 813 learners Year 3: 825 learners 2 Learnerships Financial Services Advice Learnership Management Development Learnership

Letsema I Successes NSDS Equity Targets : 98.5% Black (Target of 85% exceeded) 56.1% Female (Target of 54% exceeded) 4% Disabled (Target of 4% met) Letsema I successful completions: 86% Letsema I employment 77% (635 learners)

Letsema II All NSDS equity targets met 813 learners recruited 22 Employers participating Learners placed in 4 Provinces

Letsema III 825 learners to start the Financial Services Advice Learnership on 1 February 2006 16 Employers participating Learners placed in all 9 Provinces

BANKSETA Finances 2004/2005

2004/05 Financial Information Annual Financial Statements SDL Levy Income – 80% R192 911 Investment income R9 026 Total revenue (including 80% levy income, NSF income, investment income etc.) R239 886 Total expenses (including admin expenses, NSF expenses, grant and project expenses etc.) R250 327 Admin expense as % of admin levy income 72% Net deficit (R10 441) Cash and cash equivalents R136 892

Financial Overview 2001 2002 2003 2004 2005 PER YEAR R’000 Project expenses paid - 3 840 17 596 35 069 50 783 Adjusted income (#) 56 465 137 187 150 237 156 277 192 911 Income % variance 143% 10% 4% 23% Administration costs 5 487 10 534 12 254 13 258 15 715 Admin cost % variance 92% 16% 8% 19% Administration surplus - Rand 7 271 3 399 3 906 3 493 6 346 Administration surplus - % 57% 24% 21% 28%

Discretionary Funds Total surplus funds allocated: R162,2 Million Total surplus funds spent: R107,3 million 2001 2002 2003 2004 2005 CUMULATIVE R’000 Surplus funds available (A) 12 954 28 555 81 280 125 680 166 022 Surplus funds allocated (B) 69 276 126 617 162 219 (B) as % of (A) - 100% 85% 101% 98% Surplus funds spent (C) 3 840 21 436 56 505 107 288 (C) as % of (B) 13% 31% 45% 66%

Total mandatory grants approved: R501,316 million 2001 2002 2003 2004 2005 PER SCHEME YEAR R’000 Mandatory grants approved 35 224 106 148 106 766 118 298 134 881 Pay-out % 84% 96% 97%

BANKSETA Biggest Concerns Lack of focus Many small initiatives / no critical mass Negative public perception Unrealistic expectations (Cannot be all things to all people) Unrealistic performance expectation in relation to the NSDS Loss of Small organisations due to new threshold (R500 000.00)

THANK YOU