FP&M SETA Update

Skills Planning & ETQA WorkshopsJanuary 2014

New Grant Regulations

Introduction

• Grant Regulations regarding monies received by a SETA and related matters – published in Government Notice No. 35940,

3 December 2012– Came into effect on 1 April 2013

Intent of the New Regulations• Regulate admin fund• Provide for SETAs to contribute to QCTO• Discourage accumulation of surpluses• Improve quality and quantity of labour market

information• Promote NQF registered and quality assured

PIVOTAL programmes• Create framework for expanded use of public

education and training providers.

Significant Changes: Skills Development Levy Distribution

Skills Development Levy Distribution

• Applicable since 1 April 2013

2

18

10

0

50

20

2

18

10

0.5

20

49.5

0

10

20

30

40

50

60

Before 1 April2013

With effect from1 April 2013

Significant Changes: Mandatory Grants

The intention of Mandatory Grants is to incentivize employers to:• to plan & implement training for their

employees • to create training and work experience

opportunities for unemployed people (including Work Integrated Learning -WIL)

Work Integrated Learning (WIL)

• Public FET & HET learner and graduate placements– Work Experience / Internships

• Funded and managed by the FP&M SETA• Additional tax incentives • Contribute to BBBEE scorecard• Provides additional human resources to

support existing staff.

Significant Changes

• Mandatory Grant Applications– Mandatory Grant reduced to 20% of SDL– Year 15 (2014/15) onwards – submission due by

30 April• Better alignment with skills development and

financial year• Enhanced SETA planning cycle

– SSP Annual Update– Earlier Discretionary Funding Windows

Significant Changes

• Mandatory Grants (continued)– Increased monitoring of WSP implementation

against Board criteria• Criteria for approval • Evidence requirements• Quality & accuracy standards for WSPs & ATRs

– Evidence of consultation and sign-off by labour representative (unless explanation is provided)

Strategies to increase participation in workplace skills

planning

Current Status

26% 26%

32%

0%

5%

10%

15%

20%

25%

30%

35%

2011/12 2012/13 2013/14

WSPs Approved for Payment

242

45

121

71

60

30106

26

83

262

30138

46

27

2013/14 WSPs approved per sub-sector

ClothingFootwearForestryFurnitureGeneral GoodsLeatherPackagingPrint & Print MediaPublishingPrintingPulp & PaperTextile

Current Status

Improvement Strategies

• During Jan – April 2014– Conduct workshops nationwide– Newspaper advertisements– Submission via MIS– Regional Office liaison

• Deployment of Sector Skills Advisors• Company visits by Regional Staff• Consultation sessions at regional offices• Telephonic consultation• Email reminders

Significant Changes: Discretionary Grants

The intention of Discretionary Grants is to implement the

Sector Skills Plan

Discretionary Grants: Key themes

• Well researched set of scarce and critical skills to feed into SSP

• Recognition that current training provision has limited practical and workplace learning components

• Need to focus on occupational qualifications at all levels

Significant Changes

• Discretionary Grant Applications– Discretionary grant categories not specified– Alignment with SSP implementation – Funding of PIVOTAL Programmes - 80% of

discretionary funding • Address Scarce and Critical skills in the sector• Current programmes will qualify e.g. learnerships,

bursaries, work experience, internships, apprenticeships, credit bearing skills programmes

– Qualifying criteria –PIVOTAL plan/report to be completed with WSP/ATR and approved

Significant Changes

• Public Education and Training Institutions– Emphasis in NSDS III on use of public institutions for

delivery of scarce and critical skills.• Support to small enterprises

– Simplified mandatory and discretionary grant application processes

– Enhanced processing of grant payments due to small enterprises

– Projects designed to address skills needs of small enterprises.

Conclusion

• More discretionary funding– Address sector skills priorities– Renewed focus on meaningful training and education– Increased monitoring of training implementation– Redesigned SETA processes due to timeframes

• Will require support of all stakeholders to make full use of mandatory and discretionary grant application opportunities.

Progress made to address backlogs

Current Status

• Mandatory Grants

• Discretionary Grants / Special Projects Payments

0%10%20%30%40%50%60%70%

2011/12 2012/13

43%

66%

Discretionary Grant Expenditure

54%65%

0%

10%

20%

30%

40%

50%

60%

70%

2011/12 2012/13

Mandatory Grant Payout Rate

Mandatory Grants

• Year 2012/13• After 4th tranche payment, R32 million were still due to

companies. • Reasons for non-payment was absence of acceptable

proof of banking details and incomplete submissions– Progress to date:

• R30 million have been paid out• R2 million pending receipt of proof of banking details

• Year 2013/14– 1st & 2nd tranche payments totalling R21 million i.r.o.

approved WSPS received.

12%

5%

8%

3%1%

4%8%

5%16%

1%

9%

19%

9%

DG Allocations per Sub-Sector 2013/14 Amount = R139 million

Clothing Footwear ForestryFurniture General Goods LeatherPackaging Print Media PrintingPublishing Pulp and Paper TextilesWood products

Research Activities

FP&M SETA Research Update

• Key objectives / Focus Areas– Collaborative research interventions (all 13 sub-sectors)– International benchmarking– Up to date and reliable Labour Market Intelligence (LMI)

framework– SETA Resource Centre to facilitate sector research (SSP

updates, best practice studies, innovation)– Sustainable partnerships with Institutions of Higher

Learning– Sector baseline studies and project impact assessments

FP&M SETA Research Update• FP&M SETA Research Strategy

– Development of locally and internationally benchmarked SSP to address identified skills gaps

– Establishment of SETA Resource Centre• Sharing of sector intelligence

– Development of partnerships• Universities and Research Institutions

– Publication of FP&M academic papers / research studies to stimulate strategic skills dialogue

– Appointment of an internal Research Specialist (in cooperation with a reputable research/academic institution)

Organisational Capacity and Process Improvement

Current and Forward Looking Plans

• Organisational review has been conducted– Increase capacity– Improve service delivery– Enhance performance

• Organisational processes currently being reviewed to – Increase efficiencies– Enhance quality– Improve productivity– Meet (and exceed) stakeholder

expectations

Thank You