Umsobomvu Youth Fund Presentation to Portfolio Committee on Labour 25 October 2005

Outline  The UYF team  Key issues from the audited financials Three years – cumulative impact report  Leveraging opportunities – impact on commitments  Impact data  Commitments (contracted and non-contracted) Last year’s achievements  Some highlights  Target vs Actual  Financial Information  Challenges Consolidation of audited financials Access to UYF services – especially rural areas  Plans for 2005/2006

The UYF Team  Adv. R Moloko – Chairperson of the Board  Ms D Motau – Non-Exec. Director & Chair of Audit Committee  Mr J du Preez – Non – Exec. Director  Mr T Wixley – Independent Non Executive Member of Audit Committee  Mr M Kekana – Chief Executive Officer  Ms J Law – Chief Finance Officer

Approved & Projected Commitments Business Unit Approved & Contracted to Date Projected 2005/6Projected 2006/7Total Contact Information & CounsellingR 71,438,947R 27,646,047R 9,705,399R 108,790,392 Skills Development & TransferR 200,865,417R 92,417,674R 79,011,134R 372,294,226 Business Development ServicesR 83,608,396R 52,093,146R 33,954,299R 169,655,840 Enterprise FinanceR 394,745,248R 33,682,384R 36,182,384R 464,610,017 Communications & AdvocacyR 10,434,505R 8,606,946R 6,606,946R 25,648,396 Capacity Building & ResearchR 5,471,576R 4,112,542 R 13,696,661 IGM's & Youth in LEDR 11,117,421R 10,258,536 R 31,634,493 R 777,681,510R 228,817,275R 179,831,240R 1,186,330,025 These projections are done based on the Assumption that some projects will be scaled back The projections do not include UYF's Operating Overheads The commitment figures are up to 30 September 2005

Current Funding Situation  UYF received R855 million from govt. in  R780 million has been spent/committed contractually and will be paid out until 2006/7/8  Taking out Auditors definition of commitment, UYF is actually fully committed. Auditors only recognize those commitments that have been reduced to writing To protect itself against non delivery UYF signs normally for 1 year only. However, commitment – 3 years at least

Cumulative Report

Factors That Have Evolved  Lack of capacity in rural areas, govt. departments/ NGOs affect time it takes to implement a programme. Often a new organisation has to be established (e.g. National Youth Service Programme in Limpopo/ Free State)  Leveraging UYF resources with third parties has decreased the amount of funds needed from UYF to implement programmes. Raised R216 million in 2004/5 from third parties.

For Year Under Review (highlights)  Skills Development & Transfer Funding of 26 FET Colleges  More than 2000 youth receiving training in vocational skills  Succeeded in getting SETAs and FET Colleges working together in an unprecedented way  Assisting in integration of education and training  Rural outreach achieved due to location of FET Colleges  Strengthening of the Public Sector Education System

For Year Under Review (highlights)  Skills Development & Transfer Implementation of the National Youth Service Programme – launched August 2004  More than youth involved in service  The National Youth Service Unit established in less than 6 months  Effectively mainstreamed NYSP

For Year Under Review (highlights)  Business Development Support Expanded the Voucher programme into 9 from 5 provinces Launched the Entrepreneurship Education project – 30 schools, 180 teachers in 3 provinces (7200 learners) Implementing the National Venture Creation Learnership – 3 FET Colleges running a pilot programme

For Year Under Review (highlights)  Enterprise Finance First National Bank increased their exposure from R20million to R240million focusing on the same youth target. One of the largest Public Private Partnerships of its kind globally Our loan book surpassed the R100million and more than 1000 enterprises

For Year Under Review (highlights)  Contact Information & Counselling Implemented the Graduate Database as per President Mbeki’s directive in May The database is called “Jobs and Opportunities Seekers Database” (JOBS). Currently has CVs registered of unemployed graduates and placing into jobs since March ‘05 Launched the SA Youth Card in Dec 04. Currently has card holders & 90 companies providing discounts. Associated Youth Magazine in Sunday Times (to include Sowetan, etc) 17 new centres were established (in total 69 access points)

For Year Under Review

For Year Under Review (income statement)

Challenges  Consolidation of Audited Financial Statements GAAP requires application of AC132 which stipulates the consolidation of underlying investments due to control (why control by UYF?). Materiality level of UYF set at R due to small amount of assets under control and amount lent as at year end Reporting requirements - burden on SMEs. To Address:  Adopting International Financial Reporting Standards (fair value reporting i.s.o consolidation)- IAS 28  Eastern, Central & Southern Federation of Accountants (SAICA is part of) proposes New Guide on Financial Reporting for SMEs. Will reduce reporting complexities  SME regulatory burden more serious for young people

Challenges  Access to UYF services Issue is about scale Scale limited because UYF was set up with short term in mind. Therefore need to sustain few programmes instead of a “spray gun approach” Growth limited due to unavailability of viable service providers in rural areas. Therefore, growth dictated by presence of Service Providers  To address: Propose to set up UYF outlets Outlets will also facilitate integration of services

Plans (highlights)  Support government’s 6% growth target focusing especially on the second economy  Skills development & transfer Supporting more FET Colleges Support project consolidate (DBSA/ Dept of Provincial & Local govt.) Launch the Graduate Development Programme (Social Capital for the unemployed graduate) Implement Service Programmes along volunteer lines – e.g. teaching Maths and English, caring for orphans or child headed households

Plans (highlights)  Business Development Support Expand the Entrepreneurship Education project to more schools and provinces Increase Entrepreneurship Education for out-of-school youth Launch the Mentorship voucher product & reinstatement of the company registration voucher Launch the Business Opportunities Support Service (linking youth to business opportunities)

Plans (highlights)  Enterprise Finance Expand the Cooperative Programme both for production coops and savings coops Franchise Cadet Programme (with Sanlam & Business Partners) Training of loan officers (up to 500 to serve communities to improve access to finance)  Implementation of pilot UYF outlets at least by March 2006 Enable scaling up of UYF programmes; and Integration of UYF services.

Thank You unleashing the potential of youth