1. JOHANNESBURG Tel no: 011 234 2311 Fax no: 011 234 2350 Address: Tuscany Office Park, Building 2, Coombe Place, Rivonia, Sandton, 2128 DURBAN Tel no: 031 566 2790 Fax no; 031 566 1874 Address: Suite 1, EOH Mthombo, 6 rydallvale Park, La Lucia Ridge, 4319 CAPE TOWN Tel no: 021 910 3001 Fax no: 021 910 3080 Address: 7 th Floor, Manhattan Plaza, 100 Edward Street, Tygervalley, Bellville, 7530 2008/2009 Annual Report Labour Portfolio Committee Session 10 November 2009

2. Overview Background 2008/9 Developments Performance against 2008-2009 SLA Financial Performance Cash Resources Audit Findings Challenges Training Lay-off Scheme Impact of Skills Development

3. JOHANNESBURG Tel no: 011 234 2311 Fax no: 011 234 2350 Address: Tuscany Office Park, Building 2, Coombe Place, Rivonia, Sandton, 2128 DURBAN Tel no: 031 566 2790 Fax no; 031 566 1874 Address: Suite 1, EOH Mthombo, 6 rydallvale Park, La Lucia Ridge, 4319 CAPE TOWN Tel no: 021 910 3001 Fax no: 021 910 3080 Address: 7 th Floor, Manhattan Plaza, 100 Edward Street, Tygervalley, Bellville, 7530 Accounting Authority appointed in April 2008. Mechanisms for good corporate governance put in place. Executive Management Team appointed. New organizational structure implemented in July 2008. Strategic plan developed to, inter alia, curb over-expenditure, improve performance and enhance compliance. Background

4. JOHANNESBURG Tel no: 011 234 2311 Fax no: 011 234 2350 Address: Tuscany Office Park, Building 2, Coombe Place, Rivonia, Sandton, 2128 DURBAN Tel no: 031 566 2790 Fax no; 031 566 1874 Address: Suite 1, EOH Mthombo, 6 rydallvale Park, La Lucia Ridge, 4319 CAPE TOWN Tel no: 021 910 3001 Fax no: 021 910 3080 Address: 7 th Floor, Manhattan Plaza, 100 Edward Street, Tygervalley, Bellville, 7530 Compliance with AGSA, Dept of Labour and SAQA requirements. Impact of strict financial controls on over-expenditure. R38 million DG Call. Mandatory Grant payment backlog eradicated. R28,5 million disbursed against pre – 2008/9 projects. Strides made on provider accreditation and learner achievement. 2008/9 Achievements

5. JOHANNESBURG Tel no: 011 234 2311 Fax no: 011 234 2350 Address: Tuscany Office Park, Building 2, Coombe Place, Rivonia, Sandton, 2128 DURBAN Tel no: 031 566 2790 Fax no; 031 566 1874 Address: Suite 1, EOHMthombo, 6 rydallvale Park, La Lucia Ridge, 4319 CAPE TOWN Tel no: 021 910 3001 Fax no: 021 910 3080 Address: 7 th Floor, Manhattan Plaza, 100 Edward Street, Tygervalley, Bellville, 7530 Performance against 2008-9 SLA NSDS Indicator2008/2009 TargetsAchievedVariance 1.1 SSPAnnual updateAchievedNone 1.2 Training on SDF guide250156-94 2.5 BEE firms and Co-ops10414-90 2.7 ABET: Entered5101033523 ABET: Completed255549294 2.8 Employed: Entered65066919 Employed : Completed64071777

6. JOHANNESBURG Tel no: 011 234 2311 Fax no: 011 234 2350 Address: Tuscany Office Park, Building 2, Coombe Place, Rivonia, Sandton, 2128 DURBAN Tel no: 031 566 2790 Fax no; 031 566 1874 Address: Suite 1, EOHMthombo, 6 rydallvale Park, La Lucia Ridge, 4319 CAPE TOWN Tel no: 021 910 3001 Fax no: 021 910 3080 Address: 7 th Floor, Manhattan Plaza, 100 Edward Street, Tygervalley, Bellville, 7530 Performance against 2008-9 SLA NSDS Indicator2008/2009 TargetsAchievedVariance 3.2 NLPs, NGOs, CBOs & Co-ops3818-20 4.1 Unemployed: Entered3001250950 Unemployed: Completed15015041354 4.2 FET/HET Workplace Exp.0117 4.3 NVC: Entered10081-19 NVC: Sustainable Ventures200-20 5.1 ISOEs330 5.2 NVC Training Providers330

7. Financial Performance Total Income Administration reserve Mandatory Grants Discretionary Grants Total revenue184 06619 94899 59153 193 Total expenses 132 151 27 561 78 309 14 947 Net surplus/(deficit) 51 915 (7 613) 21 282 38 246 Expenditure as % of revenue72%138%79%28% Prior year comparative %95%193%81%158%

8. Financial Performance (Cont’d) Record of Surplus/(Deficit ) 2006/072007/082008/09Comment Administration(20 738)(16 238)(7 613) Deficit predominantly attributed to completion of Administrator engagements Discretionary Grants(19 310)(27 687)38 249 Accounting Authority decision to limit Discretionary Grant allocations to facilitate the correction of prior periods over-commitments Mandatory Grants21 77616 67921 282 Mandatory Grant surplus is re-directed to Discretionary Grant Reserves annually. These Grants disbursements are currently paid quarterly in compliance with legislation.

9. Cash Resources R'000 MAPP-SETA Cash at bank 172 749 MAPPP-SETA current liabilities 33 532 Mandatory grants 24 305 Discretionary grants 3 473 Inter-SETA transfers 216 Administration expenses 5 538 139 217 Provision-refundable to employers under the threshold of R500 000 6 980 132 237 Post-retirement benefit obligations 3 019 129 218 Commitments 94 549 R 34 669

10. Audit findings based on three factors: Inaccuracies of records maintained during 2007/2008 which were highlighted in the Audit Report for the year ended 31 March 2008; Inadequate hand-over of the MAPPP-SETA affairs from the Administrator to SETA Management; and Initial staff instability during the appointment of the new Accounting Authority. Significant portion of irregular expenditure of R 4,651m, whilst incurred during 2008/2009 financial year, resulted from service providers engaged by the Administrator prior to completion of their term of office and can thus be considered as a continuation of the costs incurred whilst the SETA was under administration. Audit findings

11. Annual General Meeting Section 51(1)(a) of the PFMA states that “An Accounting Authority for a public entity must ensure that the public entity has and maintains effective, efficient and transparent systems of financial and risk management and internal control”. The SETA is required to provide its stakeholders with information on its progress insofar as financial and non-financial performance. The SETA must gain acceptance and approval of its Annual Report from the stakeholders. To comply with the above, the SETA held an Annual General Meeting on 28th November 2009 to which stakeholders were invited. The cost of attending to this requirement was R22 681,11 for the hire of the venue

12. JOHANNESBURG Tel no: 011 234 2311 Fax no: 011 234 2350 Address: Tuscany Office Park, Building 2, Coombe Place, Rivonia, Sandton, 2128 DURBAN Tel no: 031 566 2790 Fax no; 031 566 1874 Address: Suite 1, EOH Mthombo, 6 rydallvale Park, La Lucia Ridge, 4319 CAPE TOWN Tel no: 021 910 3001 Fax no: 021 910 3080 Address: 7 th Floor, Manhattan Plaza, 100 Edward Street, Tygervalley, Bellville, 7530 Communication. Battered image. Limited revenue. Board and staff development. Apprenticeship administration. Review of trades and qualifications. Certification backlog. Challenges

13. JOHANNESBURG Tel no: 011 234 2311 Fax no: 011 234 2350 Address: Tuscany Office Park, Building 2, Coombe Place, Rivonia, Sandton, 2128 DURBAN Tel no: 031 566 2790 Fax no; 031 566 1874 Address: Suite 1, EOH Mthombo, 6 rydallvale Park, La Lucia Ridge, 4319 CAPE TOWN Tel no: 021 910 3001 Fax no: 021 910 3080 Address: 7 th Floor, Manhattan Plaza, 100 Edward Street, Tygervalley, Bellville, 7530 R5 million seed funding and infrastructure committed to TLS Project. Project Team appointed and project plan put in place. Board TLS Task Team appointed to serve a sounding board to the Project Team. Service provider to assist with pilot and skills transfer appointed. Working relationship established with CCMA and NSF. CCMA updates received weekly. To date no companies in our sectors have applied for enrolment into TLS. Training Lay-off Scheme

14. JOHANNESBURG Tel no: 011 234 2311 Fax no: 011 234 2350 Address: Tuscany Office Park, Building 2, Coombe Place, Rivonia, Sandton, 2128 DURBAN Tel no: 031 566 2790 Fax no; 031 566 1874 Address: Suite 1, EOH Mthombo, 6 rydallvale Park, La Lucia Ridge, 4319 CAPE TOWN Tel no: 021 910 3001 Fax no: 021 910 3080 Address: 7 th Floor, Manhattan Plaza, 100 Edward Street, Tygervalley, Bellville, 7530 Research on companies in distress underway to determine required information to feed into the CCMA process. To this end, following has been done:  Advocacy campaign which commenced on 2 November 2009.  Development of an instrument for measuring the impact of the recession.  A sample of 60 potential participant companies identified for assessment.  Assessment to commence on 5 November 2009. Training Lay-off Scheme (Cont’d)

15. JOHANNESBURG Tel no: 011 234 2311 Fax no: 011 234 2350 Address: Tuscany Office Park, Building 2, Coombe Place, Rivonia, Sandton, 2128 DURBAN Tel no: 031 566 2790 Fax no; 031 566 1874 Address: Suite 1, EOH Mthombo, 6 rydallvale Park, La Lucia Ridge, 4319 CAPE TOWN Tel no: 021 910 3001 Fax no: 021 910 3080 Address: 7 th Floor, Manhattan Plaza, 100 Edward Street, Tygervalley, Bellville, 7530 3850 learners certificated to date for 2005/2009 period. The provincial spread of these learners is as follows: Eastern Cape - 436; Gauteng – 1115; Free State - 58; KwaZulu Natal - 519; Limpopo - 231; Mpumalanga - 265; Northern Cape - 271; North West - 316; Western Cape – 639. Verification of results of approximately 2900 learners currently underway after a campaign of closing a large number of old projects. Newly funded projects on course to deliver more learner results in near the future. Impact of Skills Development

16. JOHANNESBURG Tel no: 011 234 2311 Fax no: 011 234 2350 Address: Tuscany Office Park, Building 2, Coombe Place, Rivonia, Sandton, 2128 DURBAN Tel no: 031 566 2790 Fax no; 031 566 1874 Address: Suite 1, EOH Mthombo, 6 rydallvale Park, La Lucia Ridge, 4319 CAPE TOWN Tel no: 021 910 3001 Fax no: 021 910 3080 Address: 7 th Floor, Manhattan Plaza, 100 Edward Street, Tygervalley, Bellville, 7530 Eastern Cape436 Gauteng1115 KZN519 Free State58 Limpopo231 Mpumalanga265 North West316 Northen Cape271 Western Cape639 Impact of Skills Development

17. JOHANNESBURG Tel no: 011 234 2311 Fax no: 011 234 2350 Address: Tuscany Office Park, Building 2, Coombe Place, Rivonia, Sandton, 2128 DURBAN Tel no: 031 566 2790 Fax no; 031 566 1874 Address: Suite 1, EOH Mthombo, 6 rydallvale Park, La Lucia Ridge, 4319 CAPE TOWN Tel no: 021 910 3001 Fax no: 021 910 3080 Address: 7 th Floor, Manhattan Plaza, 100 Edward Street, Tygervalley, Bellville, 7530. Impact of Skills Development Title of ProgrammeNumber 1.Bag Making18 2.Bookbinding Craft Cutting6 3.Cutting33 4.Can Making21 5.Carton Making33 6.Machine Minding29 7.Manufacturing Machine Minding24 8.Finishing Machine Minding34 9.Electronic Composition4 10.Electronic Origination108

18. JOHANNESBURG Tel no: 011 234 2311 Fax no: 011 234 2350 Address: Tuscany Office Park, Building 2, Coombe Place, Rivonia, Sandton, 2128 DURBAN Tel no: 031 566 2790 Fax no; 031 566 1874 Address: Suite 1, EOH Mthombo, 6 rydallvale Park, La Lucia Ridge, 4319 CAPE TOWN Tel no: 021 910 3001 Fax no: 021 910 3080 Address: 7 th Floor, Manhattan Plaza, 100 Edward Street, Tygervalley, Bellville, 7530. Impact of Skills Development Title of ProgrammeNumber 11.End Making12 12.Gravure25 13.Gravure Machine Minding28 14.Gravure Cylinder Processing14 15.Laminating6 16.Decorating14 17.Lithography: Paper Section201 18.Photo Lithography5 19.Printers Electrician13 20.Printers Mechanic23

19. JOHANNESBURG Tel no: 011 234 2311 Fax no: 011 234 2350 Address: Tuscany Office Park, Building 2, Coombe Place, Rivonia, Sandton, 2128 DURBAN Tel no: 031 566 2790 Fax no; 031 566 1874 Address: Suite 1, EOH Mthombo, 6 rydallvale Park, La Lucia Ridge, 4319 CAPE TOWN Tel no: 021 910 3001 Fax no: 021 910 3080 Address: 7 th Floor, Manhattan Plaza, 100 Edward Street, Tygervalley, Bellville, 7530. Impact of Skills Development Title of ProgrammeNumber 21.Roll Label Machine Minding26 22.Rotary Off-set Machine Minding169 23.Paper Sack Making14 24.Flexography56 25.Ruling - Cutting3 26.Machine Adjuster7 27.FETC: Craft Enterprise – NQF 423 28.NC: Craft Production – NQF 2737 29.NC: Craft Operations Management - NQF 5270 30.NC: Journalism – NQF 554

20. JOHANNESBURG Tel no: 011 234 2311 Fax no: 011 234 2350 Address: Tuscany Office Park, Building 2, Coombe Place, Rivonia, Sandton, 2128 DURBAN Tel no: 031 566 2790 Fax no; 031 566 1874 Address: Suite 1, EOH Mthombo, 6 rydallvale Park, La Lucia Ridge, 4319 CAPE TOWN Tel no: 021 910 3001 Fax no: 021 910 3080 Address: 7 th Floor, Manhattan Plaza, 100 Edward Street, Tygervalley, Bellville, 7530. Impact of Skills Development Title of ProgrammeNumber 31.FETC: Live Event Technical Production – NQF 4167 32.FETC: Sound Technology – NQF 4119 33.FETC: Arts and Culture Administration – NQF 4163 34.FETC: Craft Enterprise: NQF 4348 35.FETC: Design Foundation – NQF 4423 36.FETC: Film and Television – NQF 4126 37.FETC: Heritage Practice – NQF 4187 38.NC: Music Industry Sound Technology – NQF 5202 39.FETC: Performing Arts – NQF 4102 TOTAL3850

21. JOHANNESBURG Tel no: 011 234 2311 Fax no: 011 234 2350 Address: Tuscany Office Park, Building 2, Coombe Place, Rivonia, Sandton, 2128 DURBAN Tel no: 031 566 2790 Fax no; 031 566 1874 Address: Suite 1, EOH Mthombo, 6 rydallvale Park, La Lucia Ridge, 4319 CAPE TOWN Tel no: 021 910 3001 Fax no: 021 910 3080 Address: 7 th Floor, Manhattan Plaza, 100 Edward Street, Tygervalley, Bellville, 7530 Zanele Zondi says: I joined DRAFTFCB as an intern in November 2007 … I worked on brands such as Eskom, Toyota, SABC… I have since been working on more brands such as Lexus, City Press, Sportstake, Adcock Ingram, Tiger Brands, FNB. I was fortunate enough to win myself a silver Loerie Award this year. Feziwe Tobi and Ncediswa Makuleni are running their own production house called Alpine Media with exclusive rights for making music videos as well as filming live performances for Hidden Prospects, a private music label producing 10 Digits (a hip hop group) in Uitenhage. 5 learners, Yvonne, Phumla, Ncumisa, Mantombi, and Nomfundo got together to form their own clothing and design business called Abenzi Clothing. These learners were on the Craft Enterprise and Craft Operations Management learnerships last year. ATI provided them space for about 6 months to start-up their business. Thereafter they moved to their own offices in North End. They are making casual wear,bedding, curtains and African wear for all age groups. Impact of Skills Development (Cont’d)

22. Thank You!!!