1. 1 Local Government Sector Education Training Authority PORTFOLIO COMMITTEE ON HIGHER EDUCATION AND TRAINING (PCHET) PRESENTATION ON THE LGSETA ANNUAL REPORT 2011/12 27 FEBRUARY 2013

2. Background context & state of the LGSETA o Submitted 2011/12 annual report in September 2012 o Engaged with DHET formally in November 2012 o on the areas of the LGSETA’s underperformance o Outcome of the engagement were formal representations to the Minister for a section 14 (a) intervention to be approved by the Minister as a basis for turning around the performance of the LGSETA 2

3. Background context & state of the LGSETA (continued) o Currently the LGSETA is interacting with Minister on : o A revised 2012/13 and 2013/14 strategic plans that must be in accordance with the requirements as communicated to the SETA o This presentation to PCHET is made against the above mentioned context and specific organisational matters that emanate from the annual report 2011/12 read together with the audited financial statements of the same period. 3

4. Governance Matters o The meetings of the Board and its structures has been held as per the constitution o Majority of Board members were appointed in September 2011 o Late submission of Annual Report one of the main challenges 4

5. High level summary of the 2011/12 Annual report  Contributed to the delivery of Government Outcomes 5, 9, NSDSIII and National Skills Accord.  Councillor Induction after Local Government election in 2011, almost eight thousand councillors (8000) inducted  Officials trained on minimum competency requirement, and on scarce and critical skills (Finance)  Registered 552 Artisan learners  Assist municipalities in achieving blue and green drop status by training 1795 Water Process Controllers in Municipalities 5

6. High level summary of the 2011/12 Annual report (continued)  Provided 181 Bursaries on various critical skill areas including Ichthyology with Rhodes Universities which also contributes to Rural Development.  Supported 86 Interns in Horticulture and Nature Conservation 6

7. Scarce and critical skills OFO Code OccupationInterventionLocation 111301Councillor7 498 inducted in a programme implemented through a partnership (LGSETA/ SALGA) National project 111403Local authority Manager/ Finance MFMA National Treasury competencies – various universities National Project 224502ValuerSA Council for Property Valuers- 27 interns & 11 Bursaries National Project 221204Internal Audit220 learnerships 40 interns National Project 232601Urban & Regional Planners 20 bursaries 5 interns National Project

8. Scarce and critical skills (continued) OFO CodeOccupationInterventionLocation 233202/233 3202 engineers/ technologists11 interns 25 bursaries (4 GCC ) National 334100Artisans – electrical, plumbing, fitters DBSA/ MISA partnership - 230 artisans Municipal partnerships - 332 National 551101Accounts clerksLocal Government Accounting Certificate 1000 learnerships National 712909Water plant operator1100 learnerships 400 skills programmes National Dept of water Affairs & EWSETA collaboration – 821101Builders workers ( road construction) 500 learnerships & skills programmes National 821102Drainage, sewerage & stormwater 300 learnerships & skills programmes National

9. Strategic Focus Areas (Rural Development ) o Discretionary grant focuses on 108 rural and vulnerable municipalities as identified by DCoG, plus 23 vulnerable districts ( SIPS 6) with particular emphasis on water and waste water treatment operations (learnerships & skills programmes) o Marine resource management training for municipal officials, subsistence fishermen & traditional leaders – OR Tambo, Port St Johns, Port Nolloth/ Richtersveld, Eden, Saldanha ( skills programmes – Rhodes university Dept of Icthyology) 9

10. Strategic Focus Area (Higher Education Institution Agreements): o University of Pretoria: Municipal Finance: R4,5m o North West : Municipal Finance: R2,7m o Stellenbosch: Municipal finance: R2,7m o Ft Hare: Municipal Finance: R 2,7m o NMMU: Municipal Finance : R2,7m o Rhodes : Marine resources: R980 000

11. Historical Audit Reports  2011/12 - Disclaimer  2010/11 - Unqualified  2009/10 - Unqualified  2008/09 – Unqualified 11

12. Administrative Interventions  CFO appointed for 6 months  HR & Corporate Manager appointed for 6 months  18 additional staff employed on temporary basis  Organisational redesign completed awaiting Board approval  Delegations revised awaiting Board approval  All HR & SCM Policies revised 12

13. Administrative Interventions (continued)  Working closely with the AG to avoid another disclaimer.  Meeting with National Treasury to finalise condonation of irregular expenditure on 28 February 2013.  A detailed action plan has been compiled and is attached to deal with the following: * Audit Findings on Supply Chain Management * Audit Findings on Human Resource matters 13

14. LGSETA Turnaround Plan of Action Board’s preliminary assessment of the LGSETA challenges :  Non-compliance to statutory obligations and underperformance  Board members not functioning as cohesive unit  Management underperformance  Non-compliance with auditing requirements 14

15. LGSETA Turnaround Plan of Action (continued) Key Actions indentified by the Board:  Appointment of turnaround specialist  Institutionalise organisational calendar  Institutionalise Board Quarterly Performance review sessions  Establish formal bi-annual Board dialogues with Minister  Review of delegations  Finalise organisational redesign  Dedicated attention to DHET compliance matters  Submit to Minister Board representation on LGSETA constitution  Monitoring of turnaround  Submit progress to DHET  Interim chairperson 15

16. STRATEGIC FOCUS AREA (FET Partnership) o To link FET’s with municipalities for training in Rural areas. o Signed provincial MOUs with FETs in KZN, Western Cape and Mpumalanga. o Individual MOUs o To establish offices and collaborate with FETs. Limpopo, Mopani offices confirmed to be opened in March 2013. (Office identified and agreed with management) Northern Cape Urban FET and Mpumalanga (Gert Sibande) by June 2013 MOUs to be finalised by 28 February with Esayidi, Umfolozi Mopani South, Sekhukhune. End of March Sekhukhune, Uitenhage, Northern Cape Urban FET. Taletso in Mafikeng has been identified for Artisan training. 16

17. STRATEGIC FOCUS AREA (Collaboration with FETs) o Bursaries o Environmental Practice training o Disaster management o Civil Education o Rural Development Fisheries project. o Training of traditional leaders o WIL placement with municipalities o Water process controller qualifications 17

18. Conclusion o Turnaround actions have been successfully implemented and we are expecting an unqualified report in 2012/13 18

19. THANK YOU 19