FUNDING TO SKILL OUR NATION THE NATIONAL SKILLS FUND IS PROUDLY PART OF THE DEPARTMENT OF HIGHER EDUCATION AND TRAINING 1

FUNDING TO SKILL OUR NATION

THE NATIONAL SKILLS FUND IS PROUDLY PART OF THE DEPARTMENT OF HIGHER EDUCATION AND TRAINING1

Content1. NSF Mandate2. Brief Strategic Overview3. Programme Performance on Pre-Determined

Objectivesi. Programme 1: Skills Development Fundingii. Programme 2: NSF Operations

4. Auditor-General Report5. NSF Financial Overview

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To fund

SKILLS DEVELOPMENT PROJECTS OF NATIONAL PRIORITY AS PER NSDS III – sec 28 of SDA

SKILLS DEVELOPMENT PROJECTS FOR THE ACHIEVEMENT OF THE SDA WITHIN DISCRETION OF DG – sec 28 of SDA

ACTIVITIES TO ACHIEVE NATIONAL STANDARD OF GOOD PRACTICE IN SKILLS DEVELOPMENT – sec 30B of SDA

1. NSF’s MANDATE

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2. BRIEF STRATEGIC OVERVIEW

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Highlights for 2013/14

R3.138 BILLION DISBURSED TOWARDS SKILLS DEVELOPMENT

BRIEF STRATEGIC OVERVIEW

2011/12: Increase from R0.564bn to R1.304bn = 131%



CONSISTENT INCREASE IN GRANTS DISBURSEMENTS TOWARDS SKILLS DEVELOPMENT SINCE NSF’S MOVE FROM DOL TO DHET AND IMPLEMENTATION OF NSDS III

CONSISTENT INCREASE IN GRANTS DISBURSEMENTS TOWARDS SKILLS DEVELOPMENT SINCE NSF’S MOVE FROM DOL TO DHET AND IMPLEMENTATION OF NSDS III

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NSDS III NSDS IVNSDS IINSDS I

Current Position (2013/14): Grants disbursements of R3.594 billion exceeding total revenue of R3.321 billion by R0.272 billion.

2011/12: Increase from R0.564bn to R1.304bn = 131%2012/13: Increase from R1.304bn to R2.579bn = 97%2013/14: Increase from R2.579bn to R3.603bn = 40%

OVERALL FUNDING INCREASE SINCE NSDS III = 538%

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Highlights for 2013/14

R3.138 BILLION DISBURSED TOWARDS SKILLS DEVELOPMENT

BRIEF STRATEGIC OVERVIEW…..

R2.585 BILLION TOWARDS FUNDING OVER 77 OOO LEARNERS FOR TRAINING

R528 MILLION TOWARDS KEY SKILLS INFRASTRUCTURE DEVELOPMENT

R25 MILLION TOWARDS ESTABLISHING A CREDIBLE SKILLS PLANNING

MECHANISM AND STRENGTHENING THE PSET SYSTEM

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3. PROGRAMME PERFORMANCE ON PRE-DETERMINED

OBJECTIVES

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Programme 1: Skills Development FundingPurpose: To invest in projects identified in the National Skills Development Strategy (NSDS) as national priorities and invest in projects related to the achievement of the Skills Development Act as per the discretion of the Director-General.

Refer: Pages 28 to 35 for detailed outline

Performance Status as at 31 March 2014 Targets Achieved 12 Partially achieved 6 Not achieved 3 Total targets 21

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OVER 77 000 LEARNERS FUNDED FOR TRAINING (R2.607 BILLION)

R1.272 BILLION = 29 136 UNDERGRADUATE BURSARIES &

1 026 POST GRADUATE BURSARIES (R1.715 billion remaining commitment)

Programme 1: Skills Development Funding

Key achievements:

R495 MILLION = 25 850 TVET COLLEGE LEARNERS (R1.702 billion remaining commitment)

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Key achievements:

R428 MILLION = 28 NEW GROWTH PATH PROJECTS, BENEFITTING 8 803 LEARNERS

(R488 million commitment remaining)

TRANSNET Rail Engineering = 994 artisans on SA railways

SAMSA Project = 376 learners on variety of maritime skills (cadetships etc.) AGRISETA Project = 551 learners on farming linked to land rights restitution

(farm management, technical farming skills, governance etc.)

Pilot Training & Aviation Project = 51 learners on national aviation cadet SAICA Municipality Project = Financial skills for 1 117 municipal staff

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Key achievements:

R101 MILLION = 9 RURAL DEVELOPMENT PROJECTS, BENEFITTING 3 156 LEARNERS


EPWP = Training 418 unemployed people on variety of skills to participate in EPWP projects rolled out country-wide.

NARYSEC project = Training 304 rural youth on variety of skills

SISONKE Economic Development Agency = Training 396 previously disadvantaged people on variety of skills

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Key achievements:

R65 MILLION = 3 IPAP PROJECTS, BENEFITTING 626 LEARNERS


National Tool and Die Initiative = 626 tool and die makers (In partnership with

DTI, rolled out in 12 Public FET Colleges and Private institutions).

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Key achievements:

R317 MILLION = 22 OTHER NATIONAL PRIORITY PROJECTS, BENEFITTING 8 781 LEARNERS

R106 million = Justice & Crime Prevention Projects (Offenders in their last year)

R131 million = Co-ops, NGO’s and small enterprises Projects (i.e. SEDA) R8 million = Health and Education Projects (Nelson Mandela Children’s

Hospital) R9 million = Worker Education Projects (Ditsela & Workers’ College)

R12 million = Skills System Capacity Building

R17 million = Trainee Lay-off Scheme

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KEY SKILLS INFRASTRUCTURE DEVELOPMENT (R528 MILLION)


Key achievements:

R106 MILLION = EXPANSION OF MEDICAL & VETERINARY FACILITIES AT UNIVERSITY OF

PRETORIA (R344 million commitment remaining) Double the intake of students studying MBCHB and veterinary sciences

R96 MILLION = WORK-INTEGRATED LEARNING FACILITIES FOR ENGINEERING STUDENTS (UJ)


Includes training workshop, design centre and industrialisation centre Accessible to all engineering students irrespective of university of origin

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Key achievements:

R8 MILLION = SARETEC (Cape Peninsula University of Technology) (R100 million commitment remaining)

Renewable energy training facilities for production of green skills First of its kind in South Africa

R199 MILLION = TVET COLLEGE CAMPUSES (12 new and 4 refurbishments) (R2.438 billion commitment remaining)

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Key achievements:

R25 MILLION = ESTABLISHING A CREDIBLE SKILLS PLANNING MECHANISM


Labour Market Intelligence System (HSRC, Wits, EPU and ADRS)

Integrated Higher Education and Training Management Information System Developing skills plan for Strategic Integrated Projects of the National

Infrastructure Plan Prioritisation model for the development of artisan trades

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Key achievements:

R2 MILLION = STRENGTHENING ARTISAN DEVELOPMENT SYSTEM


Implementation of single national artisan development strategy and system (NAMB)

Developing single uniform funding and administration model for artisans Developing prior learning model for artisans

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Key achievements:

R92 MILLION = STRENGTHENING TVET COLLEGE SECTOR (R49 million commitment remaining)

Limpopo and Eastern Cape TVET college improvement project

Support of CFO’s (CA(SA)’s) and HR practitioners at all TVET colleges

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SKILLS PLANNING MECHANISM & STRENGTHENING OF PSET SYSTEM (R35 MILLION)


Key achievements:

SUPPORTING HUMAN RESOURCE DEVELOPMENT STRATEGY OF SOUTH AFRICA

(R20 million spent in 2013/14 and R29 million commitment remaining)

SUPPORTING WORK OF THE NATIONAL SKILLS AUTHORITY (R15 million spent in 2013/14 and R38 million commitment remaining)

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Programme 2: NSF OperationsPurpose: To drive the National Skills Fund towards increased excellence in skills development funding by enhancing the administrative and operational excellence of the National Skills Fund.

Refer: Page 36 for detailed outline

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Performance Status as at 31 March 2014 Targets Achieved 0 Partially achieved 0 Not achieved 2 Total targets 2

Programme 2: NSF OperationsKey reason for under achievement:

During the year under review, NSF experienced delays in appointment of a service provider to assist the organisation in establishing itself as a fully compliant schedule 3A Public Entity, within the SDA legislative frameworks.

The appointment took place shortly after year-end and the administrative targets will be achieved within the next two years.

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4. Auditor-General Report• The NSF received an unqualified audit opinion• Key matters raised by the Auditor-General:

– Restatement of corresponding figures for 31 March 2013 as a result of errors discovered during the year ended 31 March 2014.

– Two significantly important targets were not reliable when compared to the source information or evidence provided, due to lack of standard operating procedures for recording and monitoring of performance.

• The NSF developed an action plan to address the matters raised by the Auditor-General and in turn, incorporated into the performance agreements of all senior managers.

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Financial Performance for the year 2013/14

5. NSF FINANCIAL OVERVIEW

11.5% increase in SDL (consistent 10%+ increase for past 5 years)

SETAs contribution towards 16 TVET college campuses

8% expected decline in investment income from PIC investments due to decline in surplus funds24

Financial Performance for the year 2013/14

21.8% increase in skills development grants (consistent increase year-on-year)>>> NSF EFFICIENT FUNDER

Admin expenses (excl. SARS collection costs) = 1.8% of R2.5bn SDL>>> NSF COST EFFICIENT ORGANISATION

SARS collection costs = 0.4% of R12.5bn SDL>>> SDL COST EFFICIENT TAX

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Financial Position as at 31 March 2014

Assets consist mainly of:1.PIC investments (R5.7 billion)2.Funds in bank (R1.1 billion)3.Funds advanced to skills development projects (R2.3 billion)

Increase of R778 million in assets mainly due to funds received from SETAs towards TVET college infrastructure development26

Financial Position as at 31 March 2014

Expected decline in accumulated surplus as NSF uses both its revenue and historic accumulated reserves towards funding skills development

R2.4 billion from NSF and SETAs towards TVET college infrastructure development

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CURRENT COMMITMENTS = R 11.332 BILLIONCURRENT AVAILABLE RESERVES = R 8.462 BILLION

OVER-COMMITMENT = R 2.870 BILLION

Commitments vs Available Reserves

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NSDS III NSDS IVNSDS IINSDS I

Current Position (2013/14): Grants disbursements of R3.594 billion exceeding total revenue of R3.321 billion by R0.272 billion, resulting in the decline in accumulated surplus.

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THANK YOU

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Documents

FUNDING TO SKILL OUR NATION THE NATIONAL SKILLS FUND IS PROUDLY PART OF THE DEPARTMENT OF HIGHER EDUCATION AND TRAINING 1