1. PORTFOLIO COMMITTEE ON HIGHER EDUCATION & TRAINING PRESENTATION BY DHET 21 April 2010 09h30 – 12h30

2. REQUEST FROM THE COMMITTEE – LETTER OF INVITATION BY THE PORTFOLIO COMMITTEE ON HIGHER EDUCATION & TRAINING The committee requests the presence of your leadership in its proposed meeting next week Wednesday. The committee would like to be briefed on: – The Budget and Strategic Plans 2010/11 of the National Skills Fund (NSF) and – The Budget and Strategic Plans 2010/11 of the National Skills Authority (NSA).

3. STRUCTURE OF PRESENTATION NATIONAL SKILLS FUND – Preliminary comments: DG DHET, Prof. Mary Metcalfe – Presentation: Acting CD NSF, Mr Eubert Mashabane NATIONAL SKILLS AUTHORITY – Preliminary comments: DG DHET, Mary Metcalfe – Preliminary comments: Chairperson NSA, Mr Edward Majadibodu – Presentation: Acting EO NSA, DDG Mr. Firoz Patel – In support: NSA Secretariat, Mr. Thabo Mashongoane

4. THE BUDGET AND STRATEGIC PLANS 2010/11 OF THE NATIONAL SKILLS FUND

5. INTRODUCTORY COMMENTS BY THE DG Period of Strengthening – Intention to appoint Acting EO ASAP – Intention to bring in a high-level temporary team to review and make proposals to strengthen and modernise systems and processes Review will be informed by a work on NSF as high-level grant-making body with capacity to advise and monitor NSDS3 envisages the NSF as a catalytic fund that leverages the progress we need nationally In discussion with Treasury re the NSF as a public entity or public service component

6. STRUCTURE OF NSF PRESENTATION Acting CD NSF, Mr Eubert Mashabane 1.Overview and mandate of the National Skills Fund (NSF) 2.Context of NSF Strategic Plan 3.Key NSF Strategic Objectives 4.NSF MTEF BUDGET & Outputs 5.Conclusion 6

7. 1. OVERVIEW AND MANDATE OF THE NATIONAL SKILLS FUND 7

8. LEGISLATIVE MANDATE: Established & mandated by the following acts: Skills development Act,1998 (as amended in2008) Skills development Levies Act,1999 Public Finance Management Act,1999 Public Service Act,1994 as amended Mandated Purposes Fund Projects identified in the National Skills Development Strategy (NSDS) as National Priorities or Fund other projects related to the achievement of the purpose of the Act as the DG determines Administration of the NSF within prescribed limit 8

9. LEGISLATIVE MANDATE (continued) Governance: Director-General: DHET is the accounting authority of the NSF and must 1.Control the fund 2. keep proper records (financial, assets & liabilities) 3. prepare annual financial statements 4. Appoint executive officer who is in the public service 9

10. Other legal obligations NSF to be managed in accordance with PFMA The NSA to advise Minister on the strategic framework and criteria for the allocation of funds from the NSF Investment of surpluses DG to submit annual financial statements to NSA for information Unexpended balances can be carried over to next financial year 10

11. CONTEXT OF NSF STRATEGIC PLAN

12. DHET STRATEGIC PRIORTIES Informed by MTSF PRIORITY NO 4 namely STRENGHEN THE SKILLS AND HUMAN RESORUCE BASE DHET Seeks to develop and support a quality post-school education and training sector, and to promote access to higher and vocational education and skills development training opportunities which responds to needs of economy, rural development and social integration

13. NATIONAL SKILLS DEVELOPMENT STRATEGY (NSDS) 2005-2011 NSDS INFORMS THE NSF Objective 1: Prioritising and communicating critical skills for sustainable growth, development and equity. Objective 2: Promoting and accelerating quality training for all in the workplace. Objective 3: Promoting employability and sustainable livelihoods through skills development. Objective 4: Assisting designated groups, including new entrants to participate in accredited work, integrated learning and work-based programmes to acquire critical skills to enter the labour market and self-employment. Objective 5: Improving the quality and relevance of provision.

14. KEY STRATEGIC OBJECTIVES OF THE NSF 1.To fund projects identified as national priorities National Skills Development Strategy II and NSDS III 2.To fund other strategic projects as determined by the Director General 3.To develop internal and external structures and systems that effectively and efficiently enable the achievement of the above two goals

15. Strategic Objective one For NSDS 2005-2011 the NSF will implement disbursements under DoL arrangements except any new commitments approved by the DHET in the financial year 2010/11 For NSDS III, for each new strategic priority develop draft disbursement criteria and procedures Recommend criteria and disbursement criteria to the National Skills Authority Finalise criteria and disbursement procedure by end March 2011 Implement NSDS III priorities from 2011 – 2014. Monitor and evaluate impact of disbursements made.

16. Strategic Objective two Translate project directive into proposed disbursement criteria and procedures Recommend criteria and disbursement procedures to the National Skills Authority Finalise criteria and disbursement procedures within agreed timeframes Implement strategic projects as per criteria and disbursement procedures Monitor and evaluate impact of disbursements made

17. Strategic Objective three Improve the capacity and systems of the NSF to disburse funding in an effective and efficient manner; Address under-disbursement; Develop grant funding strategies appropriate to each project category

18. NSF MEDIUM TERM BUDGET & OUTPUTS

19. PLEASE NOTE This is a Departmental Draft that needs to be edited and verified it is therefore preliminary as the financial statements and reports are in the process of being prepared for auditing and that it MUST still be tabled at the NSA.

20. Revenue Estimates R thousand Statement of financial performance Audited outcome Revised estimate Medium-term estimate 2007/082008/092009/102010/11 ¹ 2011/12 ¹ 2012/13 1 Revenue Non-tax revenue 250 580400 741317 894327 431343 802378 182 Other non-tax revenue 250 580400 741317 894327 431343 802378 182 Skills development levy 1,301,6601,493,7761,598,9471,736,5771,889,6461,984,129 Total revenue 1 552 2401 894 51719168412 0640082233 4482362311

21. Expenditure estimates R thousand Statement of financial performance Audited outcome Revised estimate Medium-term estimate 2007/0 8 2008/092009/102010/11 ¹ 2011/12 ¹ 2012/13 1 Expenses Current expenses6506366277131 600159 485179 187198 417 Compensation of employees 10 94511 76425 65931 63835 11140,280 Goods and services5411854513105 941127 847144 076158 137 Transfers and subsidies732 978862 5493, 338,8792,858,7222, 612,6202, 163,962 Total expenses802 2759288263 470 4793 018 2072 791 8072362379 Surplus / (Deficit)749 965965691(1553638) ² (954 199 ² (558 359)(68)

22. Selected Indicators PastCurrentProjections 2008/092009/102010/112011/122012/13 #unemployed entering programmes 17 59996771840012400 Number completing learning programmes 40809 5707 3604 96011040 New undergraduate bursaries486948082 800 new postgraduate bursaries (Critical Skills Support) 99710881 200 new ABET learners registered73 43855 672*7500*5000 New ABET completing27 19415 840*3750*2500 Number of additional unemployed people trained (SDFW) 15 1690100 000 Number of additional trained unemployed people placed in employment (SDFW) 8885070 000

23. NSF: Conclusion The NSF will focus and respond to the following Challenges -Balancing continued performance in a period of change & Integration -Responding to increased challenges of poverty & unemployment -Building capacity and system to improve turnaround times -Improving communication with stakeholders

24. THE BUDGET AND STRATEGIC PLANS 2010/11 OF THE NATIONAL SKILLS AUTHORITY

25. INTRODUCTORY COMMENTS BY DG Period of strengthening Linkages to HRDSA Clarifying advisory and executive functions Key tasks: consultation in order to advise the Minster on SETA landscape and NSDS3

26. STRUCTURE OF NSA PRESENTATION Acting EO, DDG Mr Firoz Patel Function of the NSA Composition Administration and Support December 2009 Strategic Planning NSA Workplan 2010/11 (document distributed) NSA Budget 2010/11

27. Functions of National Skills Authority (1): (a) to advise the Minister on – (i) a national skills development policy; (ii) a national skills development strategy; (iii) guidelines on the implementation of the national skills strategy; (iv) the strategic framework and criteria for allocation of subsidies funds from the National Skills Fund; and (v) any regulations to be made; (b) to liaise with SETAs on – (i) the national skills development policy; (ii) the national skills development strategy; and (iii) sector skills plans;

28. Functions of National Skills Authority (2): (c) to report to the Minister on the progress made in the implementation of the national skills development strategy; (d) to conduct investigations on any matter arising out of the application of this Act; (d) to liaise with the QCTO on occupational standards and qualifications; and (e) to exercise any other powers and perform any other duties conferred or imposed on the Authority by this Act. (2) For the purposes of investigations referred to in subsection (1) (d), the Authority has the prescribed powers of entry and to question and inspect. (3) The Authority must perform its functions in accordance with this Act and its constitution.

29. Summary of NSA Functions Advising the Minister (policy, strategy, implementation, NSF allocations) Liaising with SETA (policy, strategy, sector skills plans) Reporting to Minister on progress in the implementation of the national skills development strategy Review Accounts and Balance Sheet of NSF annually

30. NSA COMPOSITION: 25 voting and 7 non voting Chairperson (Appointed by the Minister) - 15 members nominated through NEDLAC and appointed by Minister (5 each) from : – Labour, – Business – Community and development interests (women, youth, people with disabilities, urban and rural: civic). 5 State representatives appointed by the Minister (DoL, DTI, DHET, DPSA and DCogTa) 4 Education & Skills Development providers – Public – Private – FET/ABET – HESA (Universities) 6 Ministerial ( Non-voting) appointments (2 with expertise in skills development, 2 with expertise in employment services, 1 SAQA, 1 QCTO) 1 Executive Officer (Non-voting) 30

31. ADMINISTRATION AND SUPPORT NSA is led by a Chairperson appointed by the Minister and supported by an Executive Officer appointed by Department NSA work is broken-down into subcommittees for efficiency and effectiveness All NSA activities are supported by the Secretariat Secretariat renders administration and logistic services to the NSA Provides liaison functions between DHET, NSA and other stakeholders

32. Key Outcomes of NSA Strategic Planning, December 2009 Strengthening the NSA to perform its advisory functions Providing a realistic budget to a work plan proposed by the NSA Process to align HRDSA and NSDS: – Content – Reporting/ communication between HRDSA and NSA New NSA Chair had to be appointed before February NSA Meeting Job description for NSA EO had to be approved at the February NSA meeting after which the post will be advertised and filled 32

33. NSA PROGRESS ON OUTCOMES OF WORKSHOP Mr Edward Majadibodu was appointed the Chairperson by the Minister Alignment of NSDS to HRD SA underway through the development of NSDS3 and establishment of the HRD Council under the leadership of the Deputy President Chairperson and EO to be appointed to HRD council OD exercise is being undertaken to strengthen the organizational and research capacity of NSA EO post in the process of being advertised

34. Strategic Plan and Budget of NSA See Document distributed: DRAFT NSA WORK PLAN 20010 – 11, tabled at NSA Meeting of 16 th April, was noted and referred to Sub-Committees of NSA The estimates of national expenditure for 2010/11 allocate the NSA National Skills Authority Secretariat R5,278m (including compensation of employees, goods and services and capital) Additional funds from the NSF will be allocated once the DG considers proposals from the NSA on its work plan

35. THANK YOU 35