NATIONAL YOUTH DEVELOPMENT AGENCY QUARTERLY REPORTING: PORTFOLIO COMMITTEE ON PUBLIC SERVICE AND ADMINISTRATION

Agenda Situational analysis Quarter two performance Quarter two financials Youth labor market insights Questions

Situational analysis

Situational analysis The NYDA has for quarter two achieved 77% of its Key Performance Indicators and has spent 44% of its allocated budget. The Agency was allocated an additional R31 million in the Medium Term Budget Policy Statement for the grant program specifically. This will be used to address the demand for the program. Provincial DESTEA has further committed R1.5 million to our grant program. The Agency contributed to both the JOBS Summit and Investment Summit, releasing its position papers on the labor and capital markets and its need to address the national crises of youth unemployment. We have thus far established eight of our planned seventeen district centers for the financial year under consideration.

Detailed quarter two 2018 / 2019 performance report

SUMMARY OF PERFORMANCE More stringent verification measures were applied in 2018/2019 Quarter 2 based on inputs from the External Audit process. Data collection measures have been applied across all programmes.

PROGRAMME AREA 1: ECONOMIC PARTICIPATION KEY PERFORMANCE INDICATOR STRATEGIC OBJECTIVE KEY PERFORMANCE INDICATOR YTD TARGET YTD ACHIEVEMENT REASON FOR VARIANCE To provide socio- economic empowerment interventions and support for young people in South Africa Number of youth owned enterprises supported through the Grant Programme 335 315 Individuals – 347 Enterprises – 238 Cooperatives – 30 Target was not met due to a gap between approval and disbursements. Number of beneficiaries supported with business development support services offered by the NYDA   9 900 9 938 BMT – 4141 Governance Training – 583 Sales Pitch – 1398 BBBEE – 715 Linkages – 129 Mentorship – 2412 Vouchers – 560 YTD target met and exceeded Number of jobs created and or sustained through supporting entrepreneurs and enterprises 1660 1927 MKL - 193 Voucher – 834 Grant - 900 Number of jobs facilitated through placements in job opportunities 1550 3065 Target was overachieved due to more individuals as compared to co-ops and entrepreneurs supported which created more jobs than expected

PROGRAMME AREA 1: ECONOMIC PARTICIPATION KEY PERFORMANCE INDICATOR STRATEGIC OBJECTIVE KEY PERFORMANCE INDICATOR YTD TARGET YTD ACHIEVEMENT REASON FOR VARIANCE To provide socio- economic empowerment interventions and support for young people in South Africa Establishment of the NYDA Youth Fund Approved project plan by management  Project plan approved by management (EXCO) Target met  Establishment of the NYDA Skills Fund Implement approved project plan Implemented the approved project plan To provide increased information and universal access to young people Number of young people provided with youth development information 389 250 115 547   Outreach – 90 956 CRM – 20 950 NSFAS - 3641 Target was not met due to mid-year changes to align to AG requirements Remedial Action Workshops conducted for outreach officers and developed business processes in order to rectify the collection of evidence Number of new Service Delivery Channels established and operationalised for young people to access NYDA information 2 7 Kiosks - 0 Satellites - 5 Branches - 2 Outreach vehicles -0 Target was overachieved due to good relations with municipalities and preparations for new service delivery channels that started from the previous financial year To lobby key stakeholders to support and implement youth development programmes Number of public and private key stakeholders lobbied to implement youth development programmes 10 15 Target was overachieved due to willingness of stakeholders to partner with NYDA

KEY PERFORMANCE INDICATOR YTD TARGET YTD ACHIEVEMENT  PROGRAMME AREA 2: EDUCATION AND SKILLS DEVELOPMENT STRATEGIC OBJECTIVE KEY PERFORMANCE INDICATOR   YTD TARGET YTD ACHIEVEMENT REASON FOR VARINACE To facilitate and implement skills programmes for young people Number of young people trained to enter the job market 36 000 38 596 Life Skills – 23 249 Job Preparedness – 15 347 YTD target met and exceeded To facilitate and implement education opportunities in order to improve the quality education attainment for the youth Implement the Solomon Mahlangu Scholarship programme Monitoring of the existing scholarship recipients who are in the 1st, 2nd, 3rd and 4th year of their study Monitored the existing scholarship recipients who are in 1st, 2nd, 3rd and 4th year. Monitoring report submitted Target met

PROGRAMME AREA 3: RESEARCH AND POLICY KEY PERFORMANCE INDICATOR STRATEGIC OBJECTIVE KEY PERFORMANCE INDICATOR QUARTER 2 TARGET QUARTER 2 ACHIEVEMENT REASON FOR VARIANCE To create and produce information and knowledge for better youth development planning and decision making Number of stakeholders satisfaction surveys conducted 1 Quarter 2 target met Design Corporate Strategy and Planning structure aligned to the Integrated Youth Development Strategy (IYDS) Approved Corporate Strategy and Planning (CSP) structure by Board  Target deferred to Quarter 4 The Board will review all structures in the last quarter and the target will be met in the last quarter Review of M&E Framework and aligned to the Integrated Youth Development Strategy (IYDS) Implement approved M&E Framework M&E Framework approved

PROGRAMME AREA 4: ENHANCED PARTICIPATION IN NYS STRATEGIC OBJECTIVE KEY PERFORMANCE INDICATOR QUARTER 2 TARGET QUARTER 2 ACTUAL REASON FOR VARIANCE To engage young people in service activities geared towards fostering patriotism, social cohesion and nation building Protocols, procedures and coordination tool developed and implemented for National, Provincial and Local Government   Approved protocols, procedures and coordination tool by NYS ED. Initiated implementation of protocols, procedures and coordination tool through a facilitation process Protocols, procedures and coordination tool approved by NYS ED. Facilitated a session on the NYS coordination tools, protocols and procedures YTD target met Facilitate the development of Annual Plans by Government Departments for 2019/2020 Finalise facilitation roll out plan Facilitation roll out plan finalised, approved and signed by the ED Number of National Youth Service programme (NYS) projects registered 30

PROGRAMME AREA 4: ENHANCED PARTICIPATION IN NYS STRATEGIC OBJECTIVE KEY PERFORMANCE INDICATOR QUARTER 2 TARGET QUARTER 2 ACTUAL REASON FOR VARIANCE To engage young people in service activities geared towards fostering patriotism, social cohesion and nation building Number of young people enrolled in the NYS Category 1 4000 1621 Target was not met due to postponement of projects by implementing partners Remedial Action Catch up plan in place, pursuing different partners to assist in implementing Category 1 skills programme Number of young people enrolled in NYS Category 2 and 3 Expanded Volunteer Programme (EVP) implemented   37 500 25 000 Catch up plan in place and confirmed dates of engagement with the implementing partners and embarking on alternative plan in case they renege from the partnership agreements

PROGRAMME AREA 5: GOVERNANCE AND ADMINISTRATION STRATEGIC OBJECTIVE KEY PERFORMANCE INDICATOR QUARTER 2 TARGET QUARTER 2 ACTUAL REASON FOR VARIANCE To establish a credible, efficient and effective organization Implement the Human Resource Strategy Implement 25% of phase 2 of HR strategy 25% of phase 2 HR strategy implemented YTD target met Implement an Integrated Marketing and communications Strategy Implement 25% of phase 2 of the Integrated Marketing & Communications strategy 25% of phase 2 Integrated Marketing & Communications strategy implemented Payment of legitimate service provider invoices within the 30-day period 100% of legitimate service providers paid within the 30-day period 100% of legitimate service providers paid within the 30 day period

GRANTS BREAKDOWN PER SECTOR These sectors are as defined in the Customer Relationship Management (CRM) system application used by the NYDA. Most grants (62%) were issued for personal services e.g. saloons, spas, car wash and catering Manufacturing services, e.g. brick, furniture and clothing manufacturing constitute 15% of grants that were issued Retail services, e.g., shops, exports and imports constituted 11% of grants that were issued The other sectors e.g. agriculture constitutes 6%, construction 3% and other non-specified business types constituted 3%.

GRANTS BREAKDOWN BY AGE In Quarter 2 grants were highly consumed by young people between the ages of 26 – 30 who constituted 40% of the grants issued, followed by those aged 31-35 at 39%. There was a lower consumption for young people between the ages of 20-25.

JOBS CREATED AND SUSTAINED In Quarter 2 jobs created and sustained were acquired from three programmes, namely; Market Linkages, Voucher and Grant Programmes. Grant programme contributed 47% to jobs creation. Voucher programme created 43% to jobs creation. Through Market Linkages jobs were created because the programme enabled young entrepreneurs to be linked with business opportunities.

JOBS CREATED AND SUSTAINED PER AGE In Quarter 2 jobs created and sustained through grant programme were highly consumed by young people between the ages of 26 – 30 who constituted of the jobs created and sustained, and the ages between 31-35 who constituted 25.1% followed by those aged 22-25 at 27.3%. There was a lower consumption for young people between the ages of 18-21 at 8.5%.

Quarter two 2018 / 2019 financial performance

Medium Term Strategic Framework outcome Annual Budget 2018 / 2019 Key Programmatic Area Budget allocation 16 / 17 17 / 18 18 / 19 Medium Term Strategic Framework outcome Economic Participation R59 253 300 R 76,551,615 R 73 853 745 Decent employment through inclusive economic growth Education and skills development R74 099 686 R 74,267,999 R 64 714 815 Quality basic education & decent employment through inclusive economic growth National Youth Service R56 802 100 R 33,960,882 R 27 849 802 Nation building and social cohesion Universal access to opportunities R24 611 821 R 21,654,216 R29 623 701 An efficient, effective and development orientated public service Research and Policy R10 173 573 R 5,421,600 R 9 730 000 Administration R69 283 719 R 70,737,670 R 76 593 810 Employee costs R145 529 300 R 163,500,000 R 170 000 000 CAPEX R12 000 000 R11,000,000 R 28 495 127 Total R451 753 500 R457 093 982 R 480 861 000

Quarter two financial performance – Annual budget Key Programmatic Area Annual budget Q2 Actual Percentage Budget classification Economic Participation R 73 853 745 R36 133 145 49% Decent employment through inclusive economic growth Education and skills development R 64 714 815 R26 123 220 40% Quality basic education & decent employment through inclusive economic growth National Youth Service R 27 849 802 R 8 984 595 32% Nation building and social cohesion Universal access to opportunities R29 623 701 R10 088 013 34% An efficient, effective and development orientated public service Research and Policy R 9 730 000 R3 038 325 31% Administration R 76 593 810 R34 613 928 45% Employee costs R 170 000 000 R80 224 162 47% CAPEX R 28 495 127 R14 019 122 An efficient, effective and development orientated public service Total R 480 861 000 R213 224 510 44%

Quarter two financial performance – YTD budget Key Programmatic Area Q2 budget Q2 Actual Percentage Budget classification Economic Participation R36 926 873 R36 133 145 98% Decent employment through inclusive economic growth Education and skills development R26 048 224 R26 123 220 100% Quality basic education & decent employment through inclusive economic growth National Youth Service R14 525 519 R 8 984 595 62% Nation building and social cohesion Universal access to opportunities R11 767 211 R10 088 013 86% An efficient, effective and development orientated public service Research and Policy R4 865 000 R3 038 325 Administration R36 296 905 R34 613 928 95% Employee costs R81 000 000 R80 224 162 99% CAPEX R14 000 000 R14 019 122 An efficient, effective and development orientated public service Total R225 429 732 R213 224 510

Budget analysis Description Annual Budget 2018 / 2019 Quarter 2 Actual Administration R6 641 836 R2 290 667 Communications R17 295 400 R11 294 383 Information, Communication and Technology R22 885 550 R8 561 558 Audits R5 800 000 R4 259 796 Risk and legal R1 858 000 R1 505 608 Research costs R2 000 000 R1 057 270 Youth development disbursements R79 709 137 R37 592 864 Training R37 325 551 R12 550 943 Travel R19 467 664 R8 482 129 Overheads R32 611 983 R15 022 030 Grants and vouchers R56 770 752 R16 363 978 CAPEX R28 495 127 R14 019 122 Goods / services R310 861 000 R133 000 348 Compensation budget R170 000 000 R80 224 162 Total R480 861 000 R213 224 510

Quarter 2 Financial Performance – Budget Chart

Youth labor market insights

Insights Employment rates tend to increase with more education, but less so for young, low-income or female work seekers One of the reasons why Matric is so celebrated in South Africa is that we have a chronic unemployment problem, and, in general, more education makes finding a job easier. However in addition to education, employment rates also depend on other characteristics such as race, age and gender. It is clear that employment rates increase consistently with more education, but there is also a persistent employment gap between younger and older work-seekers. This gap is usually explained as a requirement for work experience. Thus although education increases the likelihood of finding a job, it does not erase other barriers to employment

Insights In looking for work, young people face barriers tied both to job requirements and to soft skills. Employers are often concerned that Matric is not a guarantee of foundational skills like numeracy and literacy as the quality of basic education is generally low. Thus employers may ask applicants for further academic requirements for entry-level jobs as a signal of quality. For example, only 21% of the approximately 400 000 learners who passed Matric in 2017 also passed Mathematics with 40% or more). Employers are also increasingly looking for soft skills, such as initiative, persistence and leadership, in the people that they hire - qualities that are difficult for young people to signal without a point of referral such as prior work experience. Organisations such as the OECD have commented on the high levels of mismatch in the SA labour market, implying that, in many cases, employees chosen are not the most suitable for the job in question. We must challenge employers to look beyond academic qualifications and focus instead on the specific characteristics required by their jobs and businesses in hiring young employees to improve their matches. Employers could consider developing job profiles that include both hard and soft skill requirements, and using appropriate matching and assessment tools to identify these traits in potential hires. In many cases this approach has paid off, and employers have acknowledged the positive impact of holistically matching candidates with job requirements instead of searching for the highest qualified candidate overall.

Insights Practical, non-tertiary solutions are needed to provide school-leavers with functional work skills so that they can earn an income. Formal education is obviously important, but it is not a silver bullet to solve youth unemployment. The high premium that employers place on work experience shows gaps between formal education and work readiness. Many people learn their most valuable skills on the job. Yet the traditional success model in South African labour markets remains school to university to employment. We must envision a new paradigm for the labour market, which includes multiple paths to economic engagement. The main message of this paradigm is that everyone should be able to find a way to sustainable income through work. For some, it might come through short-term work experiences such as internships and learnerships that either convert to permanent employment or make it easier to find a job by serving the work requirement. Existing structures could be made more inclusive to expand paths to employment, e.g. skills development programmes funded by SETA levies could be expanded to include new entrants and the unemployed. To move towards this model we would need better alignment between education, training, and workplace requirements so that all the paths definitively increase employability. That means better coordination between employers and the broad education system to ensure that young people are more prepared for the world of work beyond formal education.

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