Presentation to Portfolio Committee on Labour Annual Report 2005/6 31 October 2005

Portfolio Committee Outline  Introduction  The First Five Years: Highlights  Key issues from the audited financials Commitments (contracted and non-contracted) Impact data 2005/6 Year Under Review  Challenges  Next Three Years

Portfolio Committee Introduction  UYF marked its 5th anniversary in March 2006 with an established, solid foundation which can be taken to scale;  An effective organisation, institutionalising the following: A clear strategic framework; Scalable programme models and products; Policies, Systems, Procedures and processes HR capacity of skilled, committed women and men with common a vision;  A network of service providers and YACs for nationwide access;  A strong, recognisable brand; and  A world class institution with ISO9001:2000 certification

Portfolio Committee Situational Analysis* Employment status % Change Not economically active3.3m3.2m3.6m3.7m10.9% Employed5.4m5.1m 5.3m-2.1% Unemployed5.1m5.6m5.9m6.0m18.4% Total13.8m13.9m14.6m15.0m8.6% Unemployment rate 48.5%52.5%53.8%53.3% * Based on Labour Force Survey

Portfolio Committee Unemployment in South Africa  Biggest challenge facing post-democratic SA;  A threat to the sustainability of our democracy;  There has been considerable economic growth since 1994 but not sufficient to create enough number of jobs;  There has been 17% increase in employment between 1995 and 2002;  Overall unemployment rate is 26%, with a youth unemployment rate of 70% (LFS 2005).

Portfolio Committee Unemployment Trends ( )

Portfolio Committee Unemployment by Age

Portfolio Committee Unemployment by Education

Portfolio Committee UYF’s Approach to Youth Development

Portfolio Committee Approved & Forecasted Commitments to 31 March 2007 PRODUCT OR SERVICE AS AT 31 MAR2006 R’M TO DATE 31 AUG 06 R’M TOTAL FORECAST 31 MAR 07 R’M TOTAL R’M Contact Information and Counselling (Budget 18.5) 62.2 (Budget 46.5) Skills Development and Transfer R34.98 (Budget 54.43) 68.7 (Budget 48.5) Business Development Services (Budget 18.8) 78.9 (Budget 52.8) Enterprise Finance (Budget 37.66) 12.0 (Budget 55.9) Capacity Building and Research (Budget 20.5) 35.4 (Budget 38.1) 82.5 Process Cycle Management (Budget 9.1) 19.8 (Budget 21.9) 47.1 Communications (Budget 2.7) 2.5 (Budget 4.5) 26.8 TOTAL (Budget 161.7) (Budget 268.2) 1,288.2

Portfolio Committee First Five Years: Highlights and Achievements CONTACT, INFORMATION & COUNCELLING  Youth Portal 4,914,277 hits  Call Centre 189,622  YAC Mobile – 110,731 Youth  Youth Advisory Centre Beneficiaries - 396,073 Youth  SAY Card/Members - 68,037 Youth

Portfolio Committee First Five Years: Highlights and Achievements ProvinceNumber of YACs Gauteng2 YACs; 12 YAC Points Free State7 YAC points Limpopo2 YACs; 17 YAC points Mpumalanga8 YAC Points Western Cape2 YACs; 19 YAC Points Eastern Cape21 YAC Points Northern Cape1 YAC; 5 YAC Points Kwa Zulu Natal1 YAC; 9 YAC Points North West1 YAC; 8 YAC Points

Portfolio Committee First Five Years: Highlights and Achievements SKILLS DEVELOPMENT & TRANSFER  National Youth Service – 15,023 youth  School to Work – 4,667 youth  STW FETCs – 1,296 youth  GDP & partnership related training– 650 youth  Entrepreneurship Education – 30,629 youth  Total = 52, accessed exit opportunities  Attrition rate = less than 5%  Accreditation NQF level 2-4

Portfolio Committee First Five Years: Highlights and Achievements Business Consulting Services# of AAs Total BeneficiariesJobs CreatedLoansTenders Eastern Cape1 1,7673,703R 28,630,220R 23,996,393 Free State R 991,000R 125,000 Gauteng2 2,3087,023R 6,764,500R 21,561,600 KwaZulu Natal1 1,7312,151R 25,989,000R 20,932,170 Limpopo1 9982,033R 7,136,000R 16,050,000 Mpumalanga R 754,093R 791,000 Northern Cape R 625,000R 0 North West* (figures not yet available) R 0 Western Cape1 1,2301,690R 20,512,300R 5,600,000 Subtotal (inception – )11 9,53117,167R 155,672,113R 89,056,163 1 ST Quarter 2006 National Data11 1,661426R1,700,000R1,750,000 Total11 11,19217,593157,371,113R90,806,163

Portfolio Committee First Five Years: Highlights and Achievements BUSINESS OPPORTUNITY SUPPORT SERVICES (BOSS) PartnerDescription of business opportunityPerformance NestleIce cream vending business for the benefit of 3000 young entrepreneurs. 102 young entrepreneurs in 4 provinces have been trained in business management and motorbike driver licenses MTNRetail opportunity for 100 young people through cell phone container businesses An M-Charge business opportunity for 20,000 young entrepreneurs is also being negotiated with MTN for the sale of airtime from cellphones. 20 young entrepreneurs have been assessed and selected. Currently, 800 M-Charge vendors have been selected and trained. Massmart33 Hot Dog Franchises Retail (sausage roll vending) opportunity for young people. 12 clients have been financed by UYF for a total of R2 million and commenced their trading activities. Department of Public Works Roads and Transport Availing procurement opportunities to BOSS clients 35 Beneficiaries have been accessed procurement opportunities. They will be involved in Construction Industry Development Board (CIDB) level 1-6 opportunities NuMetroAvailing retail opportunity to BOSS clients (rehabilitation of dilapidated Nu Metro Cinema in Hillbrow). The structuring of the deal is being finalized by General Finance.

Portfolio Committee First Five Years: Highlights and Achievements Graduates Database (JOBS)  To date 123,000 CVs have been registered on the Graduates Database. Since its implementation in 2005, over 700 young people have been placed in jobs. BDS Mentorship and Incubation Services  These are relatively new services that are being implemented. No historical information is available for these services.

Portfolio Committee First Five Years: Highlights and Achievements ENTERPRISE FINANCE MICRO FINANCESME FINANCE PROVINCE No of Branche s Total Beneficiari es Jobs Created # of Branches Total Beneficiari es Jobs Created Eastern Cape23,5544, Free State Gauteng ,214 KwaZulu Natal Limpopo12,9683, Mpumalanga Northern Cape North West Western Cape Sub Total (inception – )87,96410, ,279 National 1 st Quarter Not yet available1727 Not yet available Total88,25210, ,279

Portfolio Committee /6 Impact Report: Content Information & Counselling

Portfolio Committee /6 Impact Report: CIC (cont)

Portfolio Committee /6 Impact Report: Skills Development and Transfer

Portfolio Committee /6 Impact Report: Business Development Services

Portfolio Committee /6 Impact Report: Business Development Services (Cont)

Portfolio Committee /6 Impact Report: Enterprise Finance

Portfolio Committee /6 Leveraging of external funding

Portfolio Committee For Year Under Review (Income Statement)

Portfolio Committee For Year Under Review (Assets)

Portfolio Committee Cash Reconciliation at 31 March 2006 R’m  As at 31 March m  Less: Undrawn Commitments242.05m  Less: Restricted cash 12.76m Unencumbered Cash 31 March m Unencumbered Cash at 31 Aug 2006 R169.63m

Portfolio Committee For Year Under Review (Reserves and Liabilities)

Portfolio Committee Challenges PFMA Sec 54(2)  Executive Authority approval required for Establishment of a company; Participation in significant partnership, JV etc; Acquisition or disposal of significant shareholding in a company; Acquisition or disposal of significant asset.  Transactions in the normal course of UYF’s lending business;  Onerous requirements on the Fund and turnaround on approval of deals;  Inadvertent non-compliance resulting in “emphasis of matter” on Group audit report and reportable item to IRBA;  To Address: Application to Minister for exemption in terms of Sec 54(4);

Portfolio Committee Challenges IFRS implementation First time adoption Limited specialist expertise (UYF & auditors) Costly: Time and Effort To address:  Capacitation of finance staff  IFRS reporting in management accounts

Portfolio Committee YTD Achievements  Five Year Anniversary;  UYF is SA’s first DFI to achieve ISO9001:2000 certification;  Implementation of fully-fledged one-stop YAC in Tshwane  Scaling-up of micro-lending activities through integration of TNT and NEF  Establishment of new partnerships, particularly with Private Sector and abroad  By 31 March 2007 UYF will exceed budgeted targets;  Allocation of R400m additional funding for 2007/8

Portfolio Committee Plans: Next 3 years  20.6 million interactions through service delivery channels;  212,500 young people acquiring skills training & 75% result in sustainable livelihoods;  84,000 young people in NYS projects, plus 90,000 unemployed youths in Cat1 NYS Govt dept projects;  525,000 unemployed graduates registered on JOBS to secure 26,250 job opportunities;  1,290 women- and youth-owned SME’s and 43,871 micro- enterprises funded by UYF to value of R533m, plus R390m from private sector, banks and DFI’s;  72,378 jobs created from UYF lending activities.  R206.2m of business and procurement activities accessed by 39,022 young entrepreneurs, creating 58,527 sustainable jobs; 60 youth owned SME’s established in incubators ; Result: 360,795 jobs created and 71,222 business supported.

Portfolio Committee YAC Expansion Plans  6 Regional Offices  298 Offices (in partnership with others)  32 Branch Outlets  260 Kiosks

Portfolio Committee Planned Spending for 2007/8 R’m Products and Services:381.2 Contact Information and Counselling61.3 Skills Development and Transfer85.3 National Youth Service64.5 Business Development Services40.3 Market Linkages (BOSS and JOBS) 5.7 Enterprise Finance124.2 Product Support29.1 Operational Costs and Overheads13.3 Capital Expenditure26.2 Income, interest and capital receipts(49.6) TOTAL400.2

Thank You unleashing the potential of youth