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 LABOUR PORTFOLIO COMMITTEE

2. Overview Background Financial Performance Audit Findings Performance Against 2005-2010 SLA Current Activities Training Lay-off Scheme 2010-2011 Draft SLA

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 Turbulent times experienced in 2006/7 and 2007/8. Over-commitment of funds and resultant drying up of funds for new projects. Suspension of the Chief Executive Officer. Dissolution of the Board. Appointment of PricewaterhouseCoopers (PwC) as administrator by the Minister of Labour. External audit handled by a contracted service provider appointed by PwC prior to their departure. Adverse audit opinion expressed by the Office of the Auditor General for the 2007/8 financial year. Background

4. Background (Cont’d) |__ October 2007 to March 2008_ | Dissolution of MAPPP-SETA Board Appointment of PricewaterhouseCooopers as Administrator by Minister of Labour External audit contracted by PwC Adverse audit opinion expressed by Office of the Auditor-General |_April 2008__| Appointment of new Accounting Authority |____ June 2008 to March 2009____ | June - CEO appointed July - COO appointed July - New organisational structure implemented August - CFO appointed August – 2008-2010 strategic plan developed November – CFO resigned November - Financial reports encouraged Accounting Authority to issue a Discretionary Grant call _ R38m January – CFO appointed Emphasis on control measures and arresting expenditure

5. 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%

6. 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 249Accounting Authority decision to limit Discretionary Grant allocations to facilitate the correction of prior periods over-commitments Mandatory Grants21 77616 67921 282Mandatory Grant surplus is re- directed to Discretionary Grant Reserves annually. These Grants disbursements are currently paid quarterly in compliance with legislation.

7. Financial Performance Mandatory Grants It is the opinion of Management that the disbursement of 79% of Mandatory Grant receipts back to the levy-payers is above average and is an indication of the participation by the MAPPP-SETA stakeholders in the MAPPP-SETA processes. Discretionary Grants We acknowledge that the ratio of expenditure to revenue in this area is low. This was a strategic decision of the MAPPP-SETA in that it is acknowledged that the SETA was over-committed and, to rectify this situation, the SETA limited its Discretionary Grant call during the year to accommodate the over-commitment.

8. Notes on Expenditure Administration The deficit reflected is, in the main, the result of- Consultants engaged (attributable to the Administrators appointed for the period ending 31 March 2008 R 3,132m Staff retrenchments (Recommendation by Administrators) R 1,462m Write-off of installation costs at rented premises on early release from leases R 1,107m Irregular expenditure of R 4,651m reported in the 2008/2009 financial report is attributed to service providers engaged during the tenure of the Administrators who also performed the functions of the Accounting Authority (Board). The majority of these engagements were made prior to 31 st March 2008, whilst the performance and subsequent payment was completed during the 2008/2009 financial year.

9. 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 2005-2010 SLA NSDS Indicator2005/2010 Five- Year Targets Achieved to date Variance2009/10 Targets 1.1 SSPAnnualAchieved-Annual update 1.2 Training on SDF guide900821-79250 2.5 BEE firms and Coops36432-332106* 2.7 ABET20001385-615919 2.8 Employed27403572+8321050 3.2 NLPs, NGOs, CBOs, Community-based COPs. 4463+1936 * Target set on basis of projected funds in September 2008. Actual implementation is 196 BEE Firms and Cooperatives.

10. 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 2005-2010 SLA NSDS Indicator2005/2010 Five-Year Targets Achieved to date Variance2009/10 Targets 4.1 Unemployed70007270+270100 4.2 FET/HET workplace experience 175524+34950 4.3 Learners trained and mentored in NVC 500417-83100 5.1 ISOEs0503-0203 5.2 NVC accredited institutes 0603-0306

11. Current Activities Focus on re-establishment of MAPPP-SETA including Board strategic planning scheduled for 17 – 18 September. MAPPP-SETA participation in the QCTO Pilot regarding the development and review of apprenticeship qualifications. Impact study under way and due for completion by November 2009. Draft 2010/2015 Service Level Agreement with projected NSDS targets submitted to Department of Labour. Participation in the Government initiative for saving jobs. Draft 2010/2011 Service Level Agreement awaiting Board input and approval by 18 th September 2009.

12. Training Lay-off Scheme MAPPP sector susceptible to ramifications of the global economic crisis, e.g. Paarl Media, NAMPAK and performing artists are already taking strain. R5 million and infrastructure already committed to the scheme in response to Dept of Labour ’ s inquiry. Re-directing of committed and future discretionary and mandatory grants to be explored for additional funding. Application for NSF funding underway.

13. Training Lay-off Scheme Internal working group established. A draft roll-out plan near completion for implementation by mid-September 2009. Advisory Committees to be consulted by 15 th September 2009 Project expected to be up and running by end September/beginning of October 2009.

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, 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 2010/2011 Draft SLA NSDS IndicatorTargetBudget 1.1 SSPSSP updateR300,000 1.2 Training on SDF guide100R300,000 2.5 BEE firms and Coops70R1,050,000 2.7 ABET150R600,000 2.8 Employed450R7,850,000 3.2 NLPs, NGOs, CBOs, Community-based COPs. 15R150,000 4.1 Unemployed700R20,750,000

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, 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 2010/11 Draft SLA (Cont’d) NSDS IndicatorTargetBudget 4.2 FET/HET workplace experience 50R1,000,000 4.3 Learners trained and mentored in NVC 75R2,625,000 5.1 ISOEs04R4,000,000 5.2 NVC accredited institutes 02R100,000 5.3 Assuring Quality Education and Training Compliance with SAQA/ QCTO Requirements R2,000,000 TOTALR40,725,000

16. Thank You