REPORT TO THE PORTFOLIO COMMITTEE ON HIGHER EDUCATION AND TRAINING 18 January 2011

Background- process in brief DHET published a proposal in April 2010 NSA did across the country consultations on the proposal and advised the Minister DHET further advised the Minister taking into account the outcomes of the consultation process Minister applied his mind and weighed the various options presented to him Made a decision and announced on the 9 th November 2010

Purpose of the landscape process Landscape process is not meant to address performance of SETAs, although this may have impact due to efficiency gains It is a process related to (re)certification of SETAs as per the SDA The SETA recertification process is provided for in the Skills Development Act; and requires the Minister to re- establish the SETA’s every 5 years

Principles guiding the landscape Minister has indicated that ‘SETAs are here to stay’ Landscape proposals respond to this Question is in what form and doing what Responds to performance related issues It is based on the application of the criteria provided for in the Skills Development Act, 1998, Other broader considerations informed by the imperative of creating a post-school system aimed at addressing the skills needs of our country, for both the youth and adult sectors of our population.

Principles guiding the landscape Ensuring the broad coverage of skills development in all key sectors of our economy, Ensuring that each SETA is located as close as possible to its relevant economic sector. Introduced changes should not disrupt or have minimal disruption (where absolutely necessary) the closeness of each SETA to its relevant economic sector. Considerations were also informed by the New Growth Path recently adopted by government, as well as the imperatives of the Industrial Policy Action Plan 2 (IPAP 2) and other government priorities. Financial viability of the SETA

New landscape 18 SETA’s remain the same or have minimal sic code transfers as follows; 12 SETA’s are to be reestablished with no change 6 SETA’s are to be reestablished with sic code transfers; 2 SETA’s are affected by insignificant change based on receiving sub sectors from MAPPP; 3 SETAs are affected by significant changes; The PSETA is re-established for a year pending an inter ministerial task team process that Ministers Nzimande and Baloyi have initiated to investigate the viability and operational model of the PSETA.

Rationale for PSETA approach Public sector contribution to levy SDA says they are exempt Makes provision for 1% of wage bill to be budgeted for training Some departments and spheres of government ‘contributes’ to SETAs administration budget – not consistent History of PSETA teaches the complexities associated with participation of the public sector in the SD

Proposals to address the PSETA Change legislation – public sector pays the levy In effect it means channeling the 1% stipulated in the SDA through to skills development processes Also means all other agencies, whose 80% or more of their income comes from voted funds will start paying the skills levy Improve and enforce contribution of other departments to either a SETA relevant to their economic activity or PSETA Remove PSETA from DPSA to operate alongside other SETAs Clarify which skills sets in the public sector will be catered for by the PSETA vs. other SETAs

Addressing SETA performance - challenges The challenges are widely known, i.e. from the following sources for e.g. Nedlac, Singizi, HSRC, departmental internal reports Portfolio Committee reports and experiences based on engagement with SETAs AG reports In future we also have to take advantage of all the info from these sources to ensure that

Addressing SETA performance Significant changes are being made in the SETAs to address performance, i.e. There are immediate and short term measures that the Department can institute to address some of the challenges, as well as improve its oversight responsibilities Other measures are medium to long term and some may require legislative changes

Ministerial Task Team The Minister has appointed a task team to advice on how to improve the functioning and performance of SETAs. The team will amongst other things look at: refocusing SETA activities through the new National Skills Development Strategy (NSDS) III, initiating a process to strengthen the SETA Sector Skills Plans (SSPs) and aligning these to much tighter Service Level Agreements and reporting mechanisms; Ensure we build the capacity of the QCTO to be the main accreditor of training providers so that SETAs concentrate on their role as facilitators of education and training in the workplace Improve for the future the current model Constitution of SETAs as best practice guideline to improve accountability and performance of SETA boards and governance; Improve cooperation between and among SETAs

Refocusing training Through NSDS III strengthening the relationship between public colleges and universities and the SETAs, as well as with employers. achieve significant increases in qualifications and skills to support priorities and initiatives such as the New Growth Path, the Industrial Policy Action Plan, the Human Resource Development Strategy and, in particular, sector development plans encourage and actively support the integration of workplace training with theoretical learning Address the relevance, quality, cost and access to training facilitated in the SETAs. Ensure that the training facilitated by SETAs leads to a qualification, move away from bias towards short courses and skills programmes

Addressing governance of SETAs Introducing independent chairpersons Limiting the number of Board meetings to a reasonable number Reducing the size of Boards Participation of the Minister in the appointment of Board members Having a standard remuneration rate for Board and committee members Holding accountable Board members who do not carry out their duties as required The Minister’s participation in the appointment of SETA CEOs and other members of the Executive Committees of Councils, in line with similar practices in relation to public entities.

Improving capacity in the DHET Monitoring of SETAs and their functions To be informed by all of the above (and more). Should ensure that government through DHET plays its oversight role Improving the performance management system to encourage, foster and promote the continuous improvement of the SETAs There is an expectation that, as a collective, the Department and the SETAs should deliver sector specific skills interventions that help achieve the goals of the NSDS III, address employer demand and deliver concrete results and make a decisive impact

Conclusion How do we in future collaborate with PC to take advantage of the information they gather to assist the department and SETAs improve the performance