1. COOPERATIVES WITHIN COMPREHENSIVE RURAL DEVELOPMENT FRAMEWORK Presentation to the Portfolio Committee on Rural Development and Land Reform 23 April 2013

2. COOPERATIVES WITHIN COMPREHENSIVE RURAL DEVELOPMENT FRAMEWORK STRATEGIC OBJECTIVE: Integrated service delivery facilitated through the coordination of government and development stakeholders by 2014. There are 658 cooperatives that were registered by the Chief Directorate Institution Building and Mentoring.

3. Audit of Cooperatives  A PROCESS TO AUDIT COOPERATIVES INITIATED: to form part of the enterprise development programme and towards attending to in the Chief Directorates for Primary and Secondary and Tertiary Cooperatives. (as per plans)

4. AUDIT PLAN ObjectivesActivitiesEstimated Regularity Initiation activitiesCo-operative desktop analysis (658 cooperatives)  Classification in terms of production areas and geographical distribution  Membership verification  Verification of registration  Verify management systems and capacities  Determination of functionality Apr-Jun 2013 Provincial site visits, interaction and due diligence exercise with the existing co-operatives that can benefit most for final recommendation to the steering. April-June 2013 Identify and list probable construction cooperatives that will flow from the NARYSEC Programme April-June 2013 Business Plan development for small scale enterprises Business Plans for the functional cooperatives selected in collaboration with the client April – June 2013

5. Rural Cooperatives within the 23 Districts and CRDP Sites

6. RURAL COOPERATIVES Vision Towards a growing, sustainable and integrated cooperative sector, supported by all stakeholders, contributing to economic growth, poverty reduction and employment creation, as well as bringing about economic transformation and equitable society. Cooperatives Development Policy (2004).

7. Purpose: To facilitate rural cooperatives as vehicles that can contribute to job creation, poverty reduction through income generation as well as contribute to economic growth Legislative Framework: The legislative framework sets out the parameters for the registration and management of cooperatives in South Africa. The following instruments form the basis for all the work relating to cooperatives and the Cooperative Development Strategy: Cooperatives Development Policy of 2004 Cooperatives Development Act, No. 14 of 2005 Cooperatives Regulations 2007 Cooperatives Bank Act, No. 40 of 2007 PURPOSE & LEGISLATIVE FRAMEWORK

8. Status of Cooperatives in SA DatesRegistered Cooperatives as per CIPRO (CIPC) Data 2007 - 2009Total of 22030 registered cooperatives in the CIPRO data. More than 50% of these coops are in rural areas 2007 – 2009:Current DataThe Dept of Trade and Industry baseline confirmed only approximately 2644 to be economically operating During 2010 only 132 cooperatives complied with the requirements of submitting their financial statements to CIPRO SourceDTI Base Line Study

9. Provincial Breakdown Status of Cooperatives Province Data from CIPRO Register No of surviving Coops No of dead Coops Survival Rate Mortality Rate KZN86971044765312%88% EC412428739577%93% WC1003699347%93% NC798209342.5%97.5% Limpopo1779405147422%78% Mpumalanga1396187130912.5%87.5% Gauteng2265394197117%83% FS850718298%92% NW1208167109013%87% National Total2203026441938612%88%

10. Overview of the Tasks in Rural Co- operative Development Inception phase Scoping Auditing of compliance with the Cooperatives Act Development of database Organization Awareness raising Needs Assessment Households and Commodity /Sector Cooperatives Education and training Training ( Cooperative governance, marketing, ICT, business skills) Operational Financial Infrastructure needs Market access Mentoring Monitoring and evaluation Economic Enterprise Job creation Contribute to economic growth Food security

11. Key Activities : Primary Cooperatives Receive referrals from knowledge unit Identifies, establishes and registers Facilitation of social cooperatives (burial societies, consumer and savings coops ) Provide start-up support Facilitate internal/coop governance, compliance, constitution Facilitate Compliance with Cooperative legislation and policy and liaison with relevant departments national and provincial Facilitate internal planning (feasibility studies and business plans) Facilitate access to Coop Incentive Scheme ( CIS) at DTI Facilitate access to sector-specific training and other skills Support agricultural and non-agricultural cooperatives(inputs, production management, harvesting and storage Ongoing support to primary cooperatives

12. Key Activities: Secondary and Tertiary Cooperatives Mobilise and facilitate the establishment of secondary cooperatives Provide support to secondary cooperatives(registration, constitution, build administrative capacity ( compliance), facilitate training and mentoring Facilitate the dissemination of market information and market linkages Facilitate training to capacitate secondary cooperatives to engage in bargaining at bulk buying practice Facilitate training in marketing and market development Mobilise and facilitate the establishment of tertiary cooperatives Build capacity to tertiary cooperatives to support the secondary and primary cooperatives

13. Guide to Rural and Economic Development Fostering Rural Economic and Enterprise Development 1. An enabling Environment that provides for an attractive climate 2. Adequate mechanism, processes and structures that address local needs 3. Active private partnerships and linkages 4. Functioning and effective infrastructure (hard & soft) 5. Access to integrated and local markets 6. Access to effective and efficient support services and resources 7. Adaptive management capacity and entrepreneurial competence within business and enterprises 8. Local organisation, groups and associations (representing the poor) as building. blocks 9. Active participation and ownership of development processes by well-linked stakeholders 10. Ongoing learning from success and failures by all stakeholders

14. Value Chain Approach processing/industries Primary coop 1 Primary coop 2 Local and external markets Secondary /tertiary coop

15. Coordination and Partnerships RID(opportunities for the youth and infrastructure requirements of cooperatives) NARYSEC(opportunities for participation in economic activities) LAND REFORM ( Coop for land reform projects) Government departments e.g DTI, DAFF, Provincial & Local government Public entities and agencies e.g Seda, DBSA, ARC Tertiary institutions, NGOs and Private Sector INTERNAL EXTERNAL

16. NARYSEC (NATIONAL RURAL YOUTH SERVICE CORPS) Current enrolment? How many youth have been trained, where and on what? Are there youth that are trained but currently not involved in any activity while receiving a stipend? Are there any youth that have been recruited, receiving stipend t sitting at home and doing nothing and why? An age analyses of the current intake i.e. how many are in the programme from its inception, when will they exit, same information for each of the groups. How many per province and provincial distribution? What projects are those that have been trained currently involved in and where? What is the Departments long term plan with the programme? What are the challenges and what will be done to overcome the 16

17. BACKGROUND TO NARYSEC Job creation and skills development of youth are national priorities. Unemployment of youth in rural areas even more serious. The Comprehensive Rural Development Programme (CRDP) was developed in 2009. In response to the plight of youth in rural areas the National Rural Youth Service Corps (NARYSEC) was established on 1 September 2010. Emphasis of NARYSEC is the development of the skills of rural youth. 17

18. NATIONAL RURAL YOUTH SERVICE CORPS (NARYSEC) Know Your People! Know Your Village! Live Up To Your Responsibility!

19. THE OBJECTIVES OF THE NARYSEC PROGRAMME Nation building and community service through the initiation of district life skills hubs that serve as rural youth empowerment centres. Enabling rural youth to play a strategic and significant role in the transformation of rural communities by participating in the roll out and implementation of the CRDP. Creating a major countryside revolution for socio-economic freedom with special emphasis on rural areas. 19

20. THE OBJECTIVES OF THE NARYSEC PROGRAMME Enhancing the spirit of ubuntu through whole-person self- development, economic participation, community values and personal empowerment among young people. Promoting a result oriented national rural youth service and thereby build patriotism, social cohesion and stable rural communities with viable institutions, sustainable economies and access to social amenities able to attract and retain skilled and knowledgeable people who will contribute to growth and development of the rural communities. Investing in the future by investing in the youth today. 20

21. CLARIFICATION OF NARYSEC ROLES DRDLR play role of Initiator and Coordinator. Project is nationally led by the Minister of Rural Development and Land Reform and led provincially by MEC with Rural Development function. Included in the delivery agreement with President. Implementation at municipal level by synchronizing community needs with the objectives of the municipalities. Establish provincial project team to manage implementation. Ward councilors, representatives council of stakeholders at CRDP sites and community leaders form part of implementation structures at municipal level. 21

22. PRESENT TARGET GROUP AND PERIOD Rural ward focused. Age group 18 to 35 – (working age). Completed grade 10 (std. 8) or higher (completed school). Stipend of R1 320 per month. Gender balance of 50/50 even though distribution in provinces may be different. Four years – can migrate to better employment or business opportunities earlier. 22

23. FINANCIAL EXPENDITURE 23 DESCRIPTION2011/20122012/2013 Persal (stipends)114 300 000155 549 418 FET Colleges115 600 000 74 617 343 Construction Tools 640 684 1 530 440 Uniforms 6 996 102 10 108 725 Logistic (venues & facilities, accommodation, catering and transport) 41 402 931 55 909 374 Practical training (Transport, accommodation and meals for participants) 40 000 000 Induction for new intake in Limpopo, North West and Western Cape in January 2013 10 500 000 Project management (DBSA NTSU) 6 000 000 Department of Defence (Character building training - NYS) 56 367 444 Total278 939 717410 582 744

24. GROWTH IN NARYSEC AND EXIT INFO START DATENUMBER OF YOUTHEXIT DATE 1 September 2010 7 95631 August 2014 30 April 2012 8 04129 April 2016 31 May 2012 9 37130 May 2016 30 June 201210 47829 June 2016 31 August 201211 14030 August 2016 30 September 201211 54029 September 2016 31 March 201312 88130 March 2017 24

25. CURRENT ENROLMENT: NARYSEC PARTICIPANTS PER PROVINCE PROVINCEFEMALEMALE TOTAL EASTERN CAPE1 3881 0212 400 FREE-STATE 232 148 380 GAUTENG1 171 6731 844 KWAZULU-NATAL 931 5301 461 LIMPOPO1 166 7931 959 MPUMALANGA 572 389 961 NORTH WEST 735 5451 280 NORTHERN CAPE 582 343 925 WESTERN CAPE 990 6811 671 Grand Total7 7575 12412 881

26. YOUTH TRAINED WHERE AND ON WHAT Agriculture Fort Cox: 69 youth trained on Animal Production: NQF Level 2. 38 FETC nationally: 5057 youth were trained in the various fields of construction: – Building & Civil Construction: NQF Level 3. – Plumbing: NQF Level 2. – Welding: NQF Level 2. – Electrical Engineering for construction: NQF Level 2. – Community House Building: NQF Level 2. 26

27. CONT, FETC: Business Administration Services: Level 2 & Level 4. South African Wildlife College and Wilderness Foundation trained 300 youth on Farm Management: NC Level 1. StatsSA and Social Dev trained 4000 youth on HouseHold Profilling. SANDF trained 4700 youth in Character Building. Bytes Technology trained 300 youth on Computer data capturing. 27

28. CONT, Chief Directorate Rural Disaster trained 88 youth on various courses: – Community based disaster risk management. – Disaster risks. – Handling of dangerous goods. – Basic Computer skills. – Communication. – Office Administration – First Aid course I and II. These youth are based at various Thusong Centres. 28

29. NEW SKILLS PROGRAMMES 2013 AND BEYOND NC: Animal Production: NQF Level 2 NC: Automotive Repair & Maintenance: NQF Level 2 NC: Building & Civil construction: NQF Level 3 FETC: Plumbing: NQF Level 4 FETC: Welding: NQF Level 4 NC: Business Administration Services: Level 2 & Level 4 Renewable Energy: NQF Level 3 Agri-business: NQF Level 3 Solid Waste Management: NQF Level 3 Waste Water Management: NQF Level 3 Hospitality: NQF Level 3 29

30. YOUTH TRAINED BUT NOT INVOLVED IN ANY ACTIVITY WHILE ON STIPENT Learnership and other skills programs require that after 30% training in theory at the College, a learner must undergo practical work training at a host employer to complete 70% work practical experience part. DRDLR does not have facilities to host learners as per their area of training. Initially this was a huge challenge to persuade relevant host employers to do the 70% practical training. This is a problem even outside the NARYSEC programme. To date 80% of the participants who completed construction training have been placed with host employers. Sites for the remaining 20% are still sought. 30

31. YOUTH RECRUITED, RECEIVING STIPEND BUT SITTING AT HOME, WHY? Although host employers are carefully selected conditions are not always conducive for youth to get practical experience. Such youth would be removed to avoid putting them at risk. FETC start programmes at set dates. Youth waiting to enroll would not necessarily be kept busy. Youth are linked to local municipalities to work in community projects of Municipality as Community Development Volunteers. Not all municipalities utilise youth actively. 31

32. AGE ANALYSIS OF THE CURRENT INTAKE AND EXIT INFORMATION? Intake into the NARYSEC Programme is of a rolling nature. Provinces recruit at dates when different skills programmes can resume. The NARYSEC youth is contracted for four years from the date he or she is enrolled into the programme. The first intake of youth will exit from the programme at the end of August 2014. 32

33. CHALLENGES AND STRATEGIES TO MITIGATE The challenge remains in linking skilled young people to relevant job opportunities. Various institutions are in place to address this. The most significant intervention is the NARYSEC Technical Support Unit (DBSA). Their purpose is to oversee activities at colleges and at the various workplaces where youth are trained. The NTSU has now become fully operational. Municipalities not utilising youth lead to youth not being engaged. Although several engagements at especially Ministerial level took place progress is slow. These engagements continue. 33

34. NARYSEC PROJECTS Ablution facilities Limpopo school. Pack house Madzivandila. Houses Malamulele. Children's ward Addington Hospital. Renovate nurses residences Addington Hospital. Low cost housing Paarl. Paving Beaufort West. Household profiling. 34

35. EARLY SUCESSES 35

36. COLBERT MABASA LIMPOPO Colbert Mabasa completed his workplace training at the Malamulele construction site. Colbert did not think that the NARYSEC training would impact his life and that of the entire community. The local chief witnessed Colbert's contribution in job creation for some of his villagers and decided to offer him 5ha piece of land as a token of appreciation for community service. Colbert bought himself a brick making machine and started manufacturing bricks and selling them in his village. NARYSEC encouraged him to register his own business. He sells bricks in and around Malamulele area. He has currently completed building works for a clergy man in his community. 36

37. MOEKETSI DEANE NORTH WEST Moeketsi Deane, a NARYSEC participant, formed a business with other participants in North West. They were awarded a sub-contract to build a Health Centre in Moretele in Bojanala District. 20 other community youth has been employed by the participants in the project. Low cost housing in Randfontein Johannesburg has been earmark to be built by the same NARYSEC participants. 37

38. WENDY TSOTETSI GAUTENG Wendy Tsotetsi, is a NARYSEC participant who have formed an agriculture cooperative in piggery, vegetable production and cropping. These youth are based in Kaalfontein where they operate under Emfuleni Local Municipality. They also train members of the community on climate change and adaptation especially for agricultural purposes. They have planted maize for the first time this year and should harvest in May/June 2013. 38

39. IMPACT Direct economic impact to unemployed youth through the stipend. Youth support between three to five people with the stipend, impacting on between 35 000 to 50 000 people. Youth who left the schooling system early is provided with a SAQA/ NQF accredited qualification. Community service is performed throughout the NARYSEC programme of action. Household profiling provides a national database of rural people with a rich potential of research to guide future activities. 39

40. IMPACT The training programme by the Department of Defence instils discipline, patriotism, life skills, communication skills, leadership skills, etc. Enterprize development skills will assist the entrepreneurs to get a start in business. A well rounded young person will exit from NARYSEC with a qualification as well as a member of a cooperative. NARYSEC is still a young programme (two and a half years old) and the real impact will become evident over time. 40

41. SALIENT POINTS The programme will evolve over time. Community service is a key objective. Household profiling will guide future direction of this project. Skills development will include discipline, patriotism, life skills, rights awareness and specific skills areas empowering youth to change rural areas. Current area of focus is construction in rural areas. 41

42. LONG TERM PLAN WITH THE PROGRAMME In the short term the programme management is being strengthened by adding more staff and obtaining facilities. The concept of a pipeline has been developed meaning that youth is only recruited once the programme they will undergo is known. The utilisation of youth presently in the programme will be improved. Intergovernmental relations with local municipalities will be strengthened. During January 2014, 4 600 additional youth will be recruited. 42