Presentation on theme: "Dissemination Workshop to Bota Stakeholders on VTF Survey Results 1 Presented By: Mr Tshepo E Nkitseng 24 November 2011 Presented By: Mr Tshepo E Nkitseng."— Presentation transcript:
Dissemination Workshop to Bota Stakeholders on VTF Survey Results 1 Presented By: Mr Tshepo E Nkitseng 24 November 2011 Presented By: Mr Tshepo E Nkitseng 24 November 2011 The Vocational Training Fund (VTF)
Introduction Administration of Fund Payment and Calculation of Levy Reimbursements 2 Presentation Overview
Introduction Informed by : 1993 Commission on Education Revised National Policy on Education (1994) National Policy on V E & Training (1997) Vocational Training Act (1998) Pre-Implementation Seminars (2007/2008) Vocational Training (reimbursement ) No8/08 Vocational training (levy ) no 101 0f 2008 Levy payments commenced October 2008 Informed by : 1993 Commission on Education Revised National Policy on Education (1994) National Policy on V E & Training (1997) Vocational Training Act (1998) Pre-Implementation Seminars (2007/2008) Vocational Training (reimbursement ) No8/08 Vocational training (levy ) no 101 0f 2008 Levy payments commenced October Introduction
To generate sufficient funds to support skills training by employers and therefore increase skills base at the workplace Support the goal of cost-sharing in skills development in Botswana To bring together supply and demand for training Create opportunities in the training market 4 GOALS
The amount of levy is based on the annual turnover of any Botswana company that is registered under the VAT Act or is liable for VAT at the following rates: –Annual turnover of P500,000 – P2 billion- levy = 0.2% of turnover –Annual turnover of more than P2 billion, contribution is 0.2% of turnover for the first 2 billion and 0.05% for any amount in excess of the P2 billion. –Oil Industry, contribution is a flat 0.05% on turnover relating to petroleum products 5 Payment Calculation
Company must be up-to-date in paying Levy Vocational Training that falls within the regulatory requirements (Accredited Institution or workplace) Only training of citizens is claimable except for special cases where training of non-citizens is approved in advance by BOTA. Prior approval by BOTA for training sourced outside Botswana 6 Reimbursement
There are two grant limits 1) Limit based on amount of Levy (Formula) –Every P1.00 paid as levy up to a maximum of P1, shall generate a grant of P5.00 –Every P1.00 paid as levy in excess of P1, but below P5, shall generate a grant of P2.50 Every P1.00 paid as levy in excess of P5, shall generate a grant of P1.25 2) The total training costs incurred The approved reimbursement is the lesser of the two limits. There are two grant limits 1) Limit based on amount of Levy (Formula) –Every P1.00 paid as levy up to a maximum of P1, shall generate a grant of P5.00 –Every P1.00 paid as levy in excess of P1, but below P5, shall generate a grant of P2.50 Every P1.00 paid as levy in excess of P5, shall generate a grant of P1.25 2) The total training costs incurred The approved reimbursement is the lesser of the two limits. 7 Reimbursement Formula/ Limit
Example: If turnover =P1,000,000 then Levy paid = P2,000 1) Grant limit based on levy is: P1000*5 +P1000*2.5 = P7, a) If training costs are P10,000 Then the approved reimbursement will be P7, b) But if training cost incurred is P4500 Then the approved reimbursement will be P4500 Example: If turnover =P1,000,000 then Levy paid = P2,000 1) Grant limit based on levy is: P1000*5 +P1000*2.5 = P7, a) If training costs are P10,000 Then the approved reimbursement will be P7, b) But if training cost incurred is P4500 Then the approved reimbursement will be P Reimbursement Formula/ Limit
Use the VTF claim form( from BOTA or and attach the following: Certified copy Omang for person(s) trained; Original receipts or certified copies showing payment for tuition, accommodation, transport, meals and stationary; Signed spreadsheet showing salary data; Certified trainee transcripts or certificates showing competencies; Certified copies of attendance register; Pre - Approval letter, if training was outside Botswana Application for Reimbursement
When can I Claim? Claims must have been lodged with the Authority on or before the 30 th of June of each year Window Period
Entities with an A nnual Turn-over of less than P500, ; Entities exempt from registering for VAT; Companies registered with Diamond hub; Companies registered with Innovation hub; (Exemption for the last two is for 5 years from date of registration ) EXEMPTIONS
At the beginning of each financial year, BOTA shall allocate funds as follows: 2.5% for special groups 1% for skills in emergent industries 5% for small micro and medium enterprises 12 Allocation to Special Groups
Claims as at 30 th Sep 2011
14 Levy Update Information Total number of Levy paying organisations ± Cumulative collection as at end of October 2011: P517 Million Cumulative claims paid as at end October 2011: P 84 Million Coming from 731 Companies: ≈ 7%
Vocational Training Fund Survey Results Presented By Mr Mathews Phiri
Objectives of the study 1)To assess the major achievements of the Fund to date in relation to its stated objectives and intended results: Assess what has been achieved, the likelihood of future achievements, and the significance/ strategic importance of the achievements. Opinions on the Fund’s effectiveness based on impressions and interviews with target groups. Describe any major failures to date
Objectives cont….. 2)The level and specific nature of the companies concerns in relation to the Fund. 3)Additional regulatory arrangements that can be done to promote the usage of the Fund and bring benefit 4)Any other relevant matter that can enhance the development of human capital through the Fund.
Target population All companies that were registered with BURS and eligible to contribute, claim or use the Vocational Training Fund by the end of December ±9000 companies
A self administered questionnaire was used to collect data for the study. Simple random sampling was used and 600 questionnaires were sent out to levy payers. 353 completed questionnaires were received back.
Analysis Data entry, cleaning and analysis were done using Statistical Package for Social Sciences (SPSS) and Microsoft Excel
Response by company type
Awareness of the VTF among companies
Effective means of disseminating information on VTF.
Training by Employer
Reasons for not training staff
Levels of training required by industry : Certificate Level
Employers perception on what they like about the VTF
Major Challenges faced by employers Reasons for dislikes about the VTF
Major challenges facing the VTF Division Few claims In complete submissions Use of non-accredited training providers Companies not seeking pre-approvals No training needs analysis/plan done Exorbitant Pricing of programmes by VTI’s when doing training for Levy payers; Limited scope of training; An influx of training providers in Botswana
Major challenges faced by Companies in their efforts to train
Suggested Improvement to the operations of the VTF
Suggestions to the funding scope
Suggestions to provide quality accredited training
BOTA should consider increasing the use of the and the website to communicate with levy payers. The Authority should provide adequate information and education about the VTF. The procedures and documentation guiding the application for reimbursement should be reviewed, with the aim of making them more user-friendly and quicker to applicants. The scope of the Fund should be reviewed to include other levels of training beyond certificate such as diploma, degree, masters, professional courses (CIMA, ACCA, AAT, MBA etc) and work improvement seminars.
The Fund should be used to support other training related activities such as: Internships, attachments and on the job- training Conducting training needs analysis for companies which pay the levy Paying for training materials To cover for product related training, such as those commonly carried out by manufacturers and distributors.
The Fund should pay for training costs upfront alongside the reimbursement approach. This will assist levy payers who are experiencing cash flow problems. For growth in quality training, the VTF should also be used to upgrade trainers for them to attain full accreditation. Lack of qualified trainers is a serious problem in Botswana
Considerations should be made for the Fund to cover employees who have paid for their own training, by allowing them to submit claims through their employers- if their employers are levy payers. BOTA should consider developing standardized forms which would be used when applying for training outside Botswana.