1. Manufacturing, engineering and related services SETA (merSETA) Strategic Plan 2013/14 merSETA Presentation to the Parliamentary Portfolio Committee on Higher Education and Training 21 August 2013

2. The Skills Development Ecosystem 2

3. Priority 5 is to develop the skills of the existing workforce as this is of primary importance for the development of the sector and for achieving outcomes that are consistent with decent work, equity, and sector economic growth and employment Priority 1 is to develop a sector labour market intelligence (LMI) system. Priority 2 is the continued and increased focus on artisan development Priority 3 is to establish and facilitate strategic partnerships that will impact on both the funding available for skills development and the improved quality of skills development merSETA has five strategic skills development priorities: Sector Skills Development Priorities Priority 4 is to increase the flow of newly skilled workers into the sector, through increasing the skills available to the sector to meet its short-term needs and improving the base level of learning

4. Performance in previous year (2012/13) Part 1 4 Figure 1: Performance against numerical targets (part I)

5. Performance in previous year (2012/13) Part 2 5

6. Performance in previous year (2012/13) Part 3 6

7. Target Comparison between previous & current year 7 PERFORMANCE INDICATORTARGET 2012/13TARGET 2013/14 Employed Bursaries Entered116132 Employed Bursaries Completed6110* Unemployed Learnerships Entered20214500 Unemployed Learnerships Completed11841600 Unemployed Skills Programmes Entered8061500 Unemployed Skills Programmes Completed1881690 Unemployed Bursaries Entered194350 Unemployed Bursaries Completed4347 Internships Entered180221 Internships Completed63110 Employed Artisans Entered15042400 Employed Artisans Completed5631200 Unemployed Artisans Entered22043600 Unemployed Artisans Completed13902000 * Reporting mechanism for bursaries was changed by DHET during quarter 3 of previous year. Now can only report entry & completion once rather than for each level in the programme.

8. Target Comparison between previous & current year cont....d 8 PERFORMANCE INDICATORTARGET 2012/13TARGET 2013/14 Work Experience555662 Work Placement2101350 FET College Partnership614 Employed Skills Programmes Entered30993400 Employed Skills Programmes Completed14482380 Employed Learnerships Entered17324500 Employed Learnerships Completed9402200 Mandatory Grants Paid to Large Companies400500 Mandatory Grants Paid to Medium Companies777833 Mandatory Grants Paid to Small Companies17181812 Cooperatives216 Small Business Support20872315 NGO, CBO, CBC (NLPE)9215 Career Guidance11781720

9. Performance Highlights 9 i.All targets achieved and exceeded with the exception of one (employed bursaries entered) ii.Contributions to peer interaction and policy discourse resulting in positive contribution toward improving overall effectiveness of collective SETA system iii.Artisan Training Programme has placed merSETA at forefront of SETAs that are responsive to the most urgent strategic priorities (programmes such as AATP, and Dual System Apprenticeships) iv.merSETA has been successful in addressing a number of key priorities, linked to the National Skills Accord and National Development Plan, particularly with regard to artisan training

10. AATP Post Trade Test Tracer Study merSETA conducted a Tracer Study in Sept 2012, which yielded the following results. Employed Group 80% indicated they were working (53% permanently employed; 44% on contract; 3% part time) Limpopo, Eastern Cape and Mpumalanga regions were the highest absorbers of artisans Riggers, Fitters, Millwrights, Mechanics and Fitters and Turners are more likely to be employed (85% and above) Of the artisans who left their original training company, 72% stated this was because the company could not take them on as employees.

11. AATP Post Trade Test Tracer Study Unemployed Group 20% indicated they were not working. 0.78% were not looking for work; 3.92% had not worked in less than 3 months. Thus 15.69% could be classified as unemployed. 33% of female artisans were not working compared to 18% of their male counterparts. 73% cited the main reason for not having found employment yet was because more experienced people were getting the jobs. Of the total unemployed, 58% had worked for a while after completing their apprenticeships, with 65% stating their contracts had expired. The most popular way of looking for work is advertisements, internet and word of mouth.

12. Challenges in current environment 12  Aligning industry needs with national development imperatives, policy directives, and DHET priorities.  Financial and Budgetary Constraints, e.g. year on year, applications for Discretionary Grants by companies significantly exceeds available funds.  Expenditure ceilings for SETAs  Improving the efficiency and effectiveness of skills development in the sector.  Co-funding training, with employers, provinces, the UIF and various state departments, including ‘cluster’ SETAs.  Improving employer buy-in through engaging industry associations on the challenges facing the industry.  Development of adequate management information systems to ensure improved data recording & reporting  Multi-year funding commitments give rise to accumulation of financial reserves

13. 8 Strategic Programmes Administration Skills Planning Increase access to occupation directed programmes Promoting the responsiveness of FETs to the intermediate skills needs of the sector Addressing the low level of youth and adult literacy and numeracy skills to enable additional training National Priorities NDP - SIP NSDS III Promote workplace skills development within the sector Encouraging and supporting cooperatives, small enterprises, worker-initiated, NGO and community training Initiatives Career Development merSETA Operations

14. Programme 1: Administration (Effective & Efficient Governance) Best practice is effected in line with King III merSETA resources are aligned to effectively execute the strategy Compliance with all relevant legislation and regulations Customer/stakeholder expectations met or exceeded Sound financial accountability Unqualified external audit reports Clearly defined business processes Monitoring and evaluation of operations and projects Established, annual Governance Capacity Building Programme in place, linked to King III, for Board and Board Sub-committees as well as Committee effectiveness assessments 14

15. Programme 2: Skills Planning Internal capacity is built - established research inventory hub. Capacitated merSETA internal/ external stakeholders (including Chambers and company stakeholders) Sub-sector / chamber focused research agenda Labour market information generated Interventions with organised labour on skills planning issues Collaboration with other SETAs Provincial collaboration on skills issues and skills planning merSETA sector awareness created with reference to the SSP Grants aligned to the SSP (DG and mandatory) Strategic partnerships implemented for skills planning.

16. Programme 3: Increasing Access to Occupation- directed Programmes 16 Skills development initiatives implemented List of identified immediate skills needs that are specific to merSETA sub-sectors Artisan development strategy List of identified high level national scarce skills Innovation, Research & Development plan Supporting Strategic Infrastructure Programmes (SIPs)

17. Programme 4: Promoting Responsiveness of FETCs to intermediate skills needs Sector participation in the relevance of curricula and qualifications offered by FETs FET participation in Development Quality Partner (DQP) processes Established partnerships that result in increased capacity to meet industry needs throughout the country Mechanisms aimed at bridging the gap between industry and institutional provision Lecturer Development Programme Harnessing the potential of FETs to strengthen the artisan development pipeline through Dual System Apprenticeships Work Placement for FET graduates

18. Programme 5: Addressing the low-level of youth & adult literacy & numeracy skills STEM (Science, Technology, Engineering and Mathematics) Programme aligned to Career development Established partnerships with schools and relevant institutions Increased entrance to tertiary education in merSETA sector Increased entrance into additional training programmes Foundational Learning Competence (FLC) programmes

19. Programme 6: To promote workplace skills development within the Sector Grants allocation aligned to equity targets and workplace productivity Instruments to measure return on training investment (i.t.o Efficiency, Effectiveness and Equity) Sector projects supported to address skills gaps & imbalances towards improved productivity Cross-sectoral partnership projects supported to address skills gaps towards Local Economic Development (LED).

20. Programme 7: Encouraging & Supporting Cooperatives, Small Enterprises, worker-initiated NGO & Community training initiatives Participation of SMEs in relevant learning programmes, especially artisan development SME Skills Audit Technology-based entrepreneurship support Established partnerships, programmes, grants and incentives Sustainable Rural and Township Development Strategy (Training for Economic Empowerment) Established sector NGOs, CBOs and Cooperatives Mechanisms and models for skills development support (grant and project-based) Meaningful linkages between Co-ops, NGOs, CBOs and business

21. Programme 8: Career Development Integrated career and learner development strategy Alternative mechanisms including national and international partnerships to enable career-pathing & personal development. Established learning pathways to support career development merSETA conducts annual learner tracer study to determine trends in learner placement Enhanced awareness of workplace and post-school and education institutions for career development opportunities e.g. NMMU project and discussions with UNISA, around graduate placement and greening the engineering disciplines Enhanced profile of merSETA careers nationally Support initiatives of complementary entities including government, NGOs and institutions through regional partnerships

22. Five Cross-cutting Strategies 1.Rural Development 2.Sustainable Green Skills Development 3.People with Disabilities 4.Further Education and Training Colleges (FETCs) 5.Recognition of Prior Learning (RPL) The merSETA has developed strategies and charters for each of these areas through a process of stakeholder “round-tables” and allocated supporting budgets for systems and capacity-building to support these cross-cutting priorities. In addition a research and knowledge management emphasis ensures dissemination of best practices, e.g. in the development of Case Studies on RPL in the merSETA sector, submitted to SAQA.

23. Links to other plans National Development Plan / National Growth Plan Human Resource Development Strategy SANSDS III ObjectivesIndustrial Policy Action Plan (IPAP)National Skills AccordMedium Term Strategic Framework (MTSF) Government-wide Framework for Monitoring & Evaluation National & Provincial Government Policies & Strategies merSETA SSP merSETA has offered skills development support towards the achievement of Strategic Infrastructure Projects (SIPs)

24. National Key Partnership Agreements

25. College of Cape Town Northlink College University of Cape Town University of the Western Cape West Coast FET College Western Cape Dept of Education SAQA Sci-bono Discovery Centre NYDA WorldSkills SA SATN National Institute for the Deaf Atlantis Foundries Dept of Economic Dev Dept of Labour - UIF NUMSA, MEWUSA CEPPAWU

26. Eastcape Midlands College Buffalo FET College Port Elizabeth FET College Lovedale College NMMU Office of the Premier Eastern Cape Dept of Labour – UIF East London Industrial Dev Zone ECSECC SAQA, Sci- Bono, NYDA Mercedes Benz Volkswagen SA SATN WorldSkills SA NUMSA MEWUSA CEPPWAWU

27. Dept of Education NC Province Dept of Correctional Services NC Dept of Labour – UIF Northern Cape Rural FET College Disabled People of SA SAQA Sci-Bono Discovery Centre NYDA WorldSkills SA NUMSA MEWUSA CEPPAWU

28. Office of the Premier KwaZulu-Natal Dept of Labour – UIF Dept of Public Works Presidential Youth Project Dept of land Reform and Rural Dev. Sheetech VW Naicker School for the Deaf Coastal KZN College Umgungundlovu FET College Esayidi FET College Mopani FET College Belgium Consulate Toyota SA SAQA, Sci Bono, NYDA WorldSkills SA, SATN Disabled People of SA NUMSA, MEWUSA, CEPPWAWU

29. Office of the Premier Free State Dept of Correctional Services Free State Motheo FET College SAQA, Sci Bono, NYDA SATN WorldSkills SA Disabled People of SA NUMSA, MEWUSA, CEPPWAWU

30. University of Johannesburg Central Johannesburg College Sedibeng FET College Tshwane University of Technology Human Sciences Research Council SAQA, Sci Bono, NYDA WorldSkills SA SATN Disabled People of SA NUMSA, MEWUSA, CEPPWAWU Mittal Steel SCAW Denel Aviation Volkswagen SA Jaguar Landrover Toyota SAGDA Gauteng Dept of Education Dept of Labour - UIF

31. Dept of Labour – UIF Small Enterprise Development Agency (SEDA) SAQA, Sci Bono, NYDA WorldSkills SA Disabled People of SA Taletso FET College Orbit College Vuselela FET College NUMSA, MEWUSA, CEPPWAWU

32. Sedibeng FET College Gert Sibande FET College SAQA, Sci Bono, NYDA WorldSkills SA Disabled People of SA NUMSA, MEWUSA, CEPPWAWU Dept of Labour - UIF

33. SAQA, Sci Bono, NYDA NUMSA, MEWUSA, CEPPWAWU WorldSkills SA Disabled People of SA

34. International Universities & Colleges Bremen University Germany Blackburn College UK HAMK University Finland International Relationships Namibian Training Authority British Council UKGIZ Germany Kadar Asmal Foundation, Embassy of Ireland Mitchells Plain Youth Unemployment Prevention Project, UK National SETAs Local Government SETA Services SETAMICT SETAFP & M SETALG SETA Wholesale & Retail SETA FOODBEV SETA

35. Budgetary Overview 2013/2014 Total costs per target DescriptionTargetUnit CostValue of Commitment Employed/unemployed artisans entered 6 000 140 000 840 000 000 Employed/unemployed learnerships entered 9 000 33 000 297 000 000 Unemployed Interns entered 221 6 000 1 326 000 Employed/unemployed skills programmes entered 4 900 9 000 44 100 000 Unemployed bursaries entered 350 35 000 12 250 000 Employed bursaries entered 132 15 000 1 980 000 Work Experience entered 662 15 000 9 930 000 Workplace Placement 1 500 6 000 9 000 000 1 215 586 000 Cost of existing bursaries 2013/14 28 300 000 Total Cost of Training 2013/14 1 243 886 000 Administration Costs Budget 128 760 674 Total Costs 1 372 646 674 Projected Income Projected Levy Income 1 046 669 882 Other Income projected 119 909 740 Total Projected Income 1 166 579 622 Projected Shortfall -206 067 052

36. Commitments at 31 March 2013 Balances as at 31 March 2013 R'000 Bank Reserves 1 135 207 Total commitments 914 187 Total current liabilities 203 856 Available reserves 17,164

37. Learning Interventions Committed

38. Cost Analysis per Priority The essential but non-focus learning areas consists of interventions such as: - Training Layoff Scheme - HIV/Aids in workplaces - People with disabilities - Foundational Learning Certificates - Co-operatives projects - Non-levy paying CBOs and NGOs - SME Project

39. Planned Performance 2013/2014 LEARNING PROGRAMMESTARGETS Workers Entering Learnerships4 500 Workers Entering Bursaries132 Workers Entering Skills Programmes3 400 Workers Certificated in Learnerships2 200 Workers Certificated in Bursaries10 Workers Certificated in Skills Programmes2 380 Unemployed Entering Learnerships4 500 Unemployed Entering Bursaries350 Unemployed Entering Internships/Workplace Experience221 Unemployed Entering Skills Programmes1 500 Unemployed Certificated in Learnerships1 600 Unemployed Certificated in Bursaries47 Unemployed Certificated in Internships/Workplace Experience110 Unemployed Certificated in Skills Programmes1 690 Artisan Entered Employed2 400

40. Planned Performance 2013/2014 cont...d LEARNING PROGRAMMESTARGETS Artisan Certificated Employed1 200 Unemployed Artisans Entered3 600 Unemployed Artisans Completed2 000 Total Artisans Entered6 000 Total Artisans Completed3 200 FET Graduate Placement1 350 Work Integrated Learning (Universities) Experiential Learning (work experience) 662 FET College Partnerships14 AET Programmes Entered1 500 AET Programmes Certified1 050 Cooperatives Supported16 Small Business Supported2 315 NGOs10 NLPE200 CBO5 Career Guidance Provided1 720

41. THANK YOU Ms Phindile Nzimande: Chairperson Dr Raymond Patel: CEO Mr Wayne Adams: COO Ms Lindiwe Ndlela: CFO Mr Derrick Peo: GM: IRD Ms Valerie Ndou: Acting GM: HRS&C Tel: 010 219 3338 Email: ceo@merseta.org.za www.merseta.org.za