Manufacturing, Engineering and Related Services SETA (merSETA) and the Mining Qualification Authority 2013 Strategic Plan

Meeting report

The Chairperson welcomed the Committee and the presenters.   The purpose of the meeting was to hear presentations by two Sector Education and Training Authorities (SETAs) on their strategic plans and progress.  The two entities were the Mining Qualifications Authority (MQA) and the Manufacturing, engineering and related services SETA (MerSETA).

Mining Qualification Authority (MQA) presentation
Mr David Msiza, Chairman of the Board, Mining Qualification Authority, thanked the Committee and introduced the members of the MQA delegation.  The MQA had been affected by the global economic downturn and were working with the challenges of youth unemployment to try and gain momentum for the future.  It wanted to challenge the mining industry culture of spending money without measuring its impact, and rather to implement funding that would create long-term successes.   He noted that board members were not paid board fees, as this money had been diverted to research and development.  The MQA had looked at the role of consultants and the outsourcing of some of their processes.   It expressed the desire to train these consultants internally so that it could address its own issues with specificity.

Mr Msiza expressed concern with the pass rate of students in some of their university-run courses -- it was as low as 30% in some classes.  In this situation, the MQA felt as though it was losing money on the 70% who did not pass, and had to work in collaboration with the universities to increase the pass rate and help graduates to find work in the mining industry upon completion. At the request of the Minister, the MQA had also established offices in rural areas, instead of remaining in urban centres, and had spread their offices across most provinces. 

Mr Sam Seepei, Chief Executive Officer, MQA, said the binding vision of the MQA was to create a competent, health and safety-oriented mining and minerals workforce.  Its mission was to provide the mining and minerals sector with competent employees who would improve health and safety, employment equity and productivity standards within their companies.  The values that accompanied the MQA’s mission were continuous learning, empowerment, professionalism, honesty and mutual respect, and service excellence.

The MQA had six strategic objectives for the year:

• Transformation.  The MQA wanted to ensure that there were sufficient skills and competencies for historically disadvantaged South Africans (HDSAs) for them to increase their presence in the mining sector.

• Decision-making through research -- working towards the strengthening and improvement of the research functions to support decision making, increasing the reliability of the information it provided.

• Enhance knowledge and information management.   This has been a challenge in the sector, as the existing systems for management had caused problems and needed to be fixed in order for mining functions to flourish.  This would be accomplished through increased monitoring and research.

• Core skills development programmes aligned with sector qualifications.  The MQA wanted to ensure that employees had the necessary competencies required for their specific occupation.

• Enhance the monitoring, evaluation, review, delivery capacity and quality of skills development through the delivery of quality programmes.

• Efficient, effective and transparent corporate governance system, with the legal framework:  This required looking internally at the business processes of MQA to ensure that it was equipped to meet is strategic objectives.

Mr Yunus Omar, Chief Financial Officer, MQA, provided an overview of the entity’s financial management for the previous year and the upcoming financial year.  Despite the strain on funding, it had performed quite well and skills development funding remained strong.  The entity had received an unqualified audit for 2012-13.   A large area of focus was discretionary funds, where the budgeted expenditure was expected to double, from R302m to R604m, owing to new regulations.  The MQA would be operating at an R84 million deficit because of the increased spending on discretionary grants, but would still have an accumulated surplus of R309m at the end of the year.

Mr Seepei showed the progress the MQA had made against its targets.  It had been successful in the development of HDSA employees, and had not only exceeded its 2012-13 targets, but had also increased its targets for 2013-14 accordingly.   Higher Education and Training lecturer support was an area of issue, as the MQA realised that many institutions it worked with were not putting an emphasis on mining.  The MQA sought to support mining-oriented lecturers.  Targets had been reached with regard to learners with disabilities and artisan aides, and the targets set out for Broad-based Black Economic Empowerment (BBBEE) service providers were also being met.

In the decision-making through research objective, the MQA had successfully hit its Skills Development Facilitators support target.  Prioritised research targets had also been raised from 2012-13, as were the targets for workplace skills plans (WSPs) and annual training reports (ATRs).  In some cases, target numbers appeared to not have been reached but that was misleading -- it was due to some strategies being given extensions, thus making them ineligible to have their final numbers included for 2013-14. The goals for post-graduate students had not been met, as the MQA had decided to reconsider what sectors required these graduates.  It had subsequently been decided that research needed the most focus. 

Core skills objectives were being met in respect of mathematics and science.  The MQA had set up programmes in mining communities to increase these skills, and this had been reflected in the numbers. Some students who had entered MQA’s programmes had achieved great success, and were among the top ten students in the country in their fields.  In terms of career guidance objectives, the MQA noted that if they were to transform the mining sector for the better, then they had to create interest among students to do so, and this was where career guidance initiatives were of great importance.  In 2012-13, it had achieved great success in the area of occupational health and safety core skills development, and for 2013-14 it had set its goal at 5 000 students.  At the time of the presentation, it had reached 1 336 of the targeted 5 000. 

Mine community capacity-building targets had shown a great leap, from an achievement of 100 in 2012-13, to a target of 2 000 in 2013-14.  This was due to the changing landscape of the mining communities, and the need for community involvement.  This was viewed as an essential tool that MQA was striving for, in the transformation of the sector.  Targets for Department of Mineral Resources (DMR) mine inspector training had been met the previous year and were being reached for 2013-14. 

The MQA presentation emphasised the training of lecturers, and the importance of an increased lecturer capacity.  It was currently working with 10 lecturers, in partnership with their universities.  In terms of the objectives for the core skills development of artisans, it had exceeded its targets in 2012-13 and had raised them accordingly -- to 2 500 entered, and 1 200 completed, for 2013-14.  It was confident that it would reach these targets in the coming year.

Mr Seepei then spoke on Higher Education Institute (HEI) partnerships.  The MQA had partnered with a number of HEIs to develop HDSA lecturers.  These HEIs were UNISA and the Universities of Witwatersrand, Johannesburg, Venda, Fort Hare, Rhodes, Pretoria, Limpopo and Cape Town.  There were 26 lecturers being trained under this programme.  A need for university engagement was noted with regard to the review of the Sector Skills Plan (SSP), and for WSP/ATR analysis.  The MQA was working with the University of Johannesburg to determine why so many students were studying for a long time, but were not obtaining Government Certificates of Competence.  It had signed six memorandums of understanding (MoUs) with further education and training (FET) colleges, to host them in their areas. Its goal was to reverse the perception that the mining community was not welcoming to graduates of these programmes. The College of Cape Town had also been accredited as a trade test centre for the Goldsmith qualifications.  The MQA had established six regional offices, all located in rural areas, which had been partnered with an FET College.

MQA revealed its plan to address the problem of unemployed youth in the mining sector, stating that 90% of MQA projects were targeting youth development through bursaries, artisan training, learnerships and internships.  Of the 2 500 artisan learnerships, 2 000 were to be filled by youth.  MQA also provided support to current employees through their artisan aide and recognition of prior learning (RPL)projects.

To improve its efficiency, the MQA had established a monitoring and evaluation unit.   This had the responsibility of tracking all MQA projects and ensuring that funds were being used properly.  This would ensure that MQA projects had the impact and effects it intended.  The capacity of the MQA was also being studied and the results would be presented at the next board meeting.  The study was to ensure the quality and capacity of key departments within the MQA.  Initiatives had also taken place in regard to supply chain management.  These processes had been centralized to ensure efficiencies, prevent fraud and corruption, and to improve BBBEE spending.

Discussion
The Chairperson thanked the MQA for its presentation and opened the floor for questions.

Ms N Gina (ANC) asked why they had not reported on the R25.8 million tender that had been in the media.  This had to be addressed, as it was a big story.   Was the MQA surpassing its targets because it had set them too low?  Was it painting an untrue picture?

Mr S Makhubele (ANC) asked what the reasoning was behind remaining quiet in regards to the tender. What instruments was the MQA using to measure its progress, how was this done?  Concern was also expressed about the lack of consultants used by MQA -- did they have the internal capacity to not use them?  In regard to graduate students, why had it set a target without knowing how many it would actually need, or had?

Mr S Radebe (ANC) then questioned the budget and asked how MQA planned on operating with a deficit, and why they would do that? Clarification was needed.  His appreciation for MQA’s commitment to teaching maths and science was noted, as well as the fact that its skills development in youth had increased their presence in the mining sector.  He suggested that the MQA expand the locations of its schools, and also asked for clarification on the MQA’s rural development partnerships.

Ms D Chili (ANC) expressed concern over the MQA’s Adult Basic Education Training (ABET), which had previously yielded low success rates.  What types of monitoring processes were in place to ensure that those who receive bursaries and learnerships remained in the mining industry?  Not all learners could be employed by the government -- the private sector had to be a source of employment for these learners.

The MQA was asked what “achievement” meant in the tables of the presentation in regard to ABET -- what were they measuring, to determine achievement?  What type of assistance was given to artisans?  Mpumalanga and the Northern Cape were mining provinces, so how could the MQA ensure that the universities there were teaching mining-related courses?

Mr M Mpontshane (IFP) stated that the importance of this SETA was known and appreciated. He expressed his desire for the historically disadvantaged to be part of the mining system at a high level, not just in underground positions.   What steps had to be taken in the short and long term plan to ensure this?  What services would be provided in the six MQA offices noted in the presentation, and what kind of direction would be given, along with the funds, for rural development?  He mentioned his disagreement with the celebration of the board not being paid board fees, as he suggested that they could have found another way to be paid -- for example, the R28.5 million tender.

The Chairperson interjected and warned against making unwarranted accusations.  He asked the MQA to focus on the questions that were clear and previously unanswered, and not the ones that may have had another agenda behind them.

Mr Msiza noted that the issue of the R25.8 million tender had not been raised because many of the issues were still being sorted out.   However, the process had been transparent and there were records of all their dealings.  Some of the FET Colleges that had partnerships with the MQA had requested that their capacity be increased, as it would be necessary to train the numbers requested and subsequently increase youth involvement.  The biggest worry of the MQA was that they would invest in so much artisan training, and then these artisans would not be able to find work upon completion.  They were taking steps and working with mining companies to try and avoid this.  It was noted that many mines did not accept trained students, as they claimed they already had too much on their plate.

The Chairperson stated that the Committee expected a report from the Department in regard to the tender issue so that they could have clarification and answer media enquiries with precision and in their proper context.

Mr Msiza touched on the training of students and the targets presented.  The targets were an issue of importance, and would be discussed by the board in the near future. Monitoring of progress against targets was in place, not just to ensure that value was being obtained for their money, but also to ensure the functioning of the organisation and the presence of a balanced spread of action across the organisation.

Mr Seepei then touched on the training of students, as it was one of the serious defects they had discovered when they took charge of the MQA two years ago.  The entirety of the mission had to be looked at, rather than the current method of looking at specific parts, as this would help the MQA to understand better whether their student training initiatives were successful.  The large change in the MQA’s use of consultants was also a big challenge.  With this change, they had strayed away from the normal operational procedures and this had concerned many, but they viewed it as a fresh way to operate and would continue to monitor progress to determine success.

The MQA had held a special board meeting where they had discussed the past method of tieing targets to financial figures.  They had wanted to get rid of surplus, but still have an impact on the mining sector with the programs they initiated.  They needed to determine what strategies worked in meeting their goals with the financial plan that had been put in place.  The absorption rate of MQA students was one of their primary concerns, and to address this they had appointed a special stakeholder who was responsible for action in all the field offices and for furthering a harmonious relationship between the MQA and mining companies.  This stakeholder would perform reviews every six months to determine the success of their actions.  In regard to short and long-term courses, short-term courses were not what the MQA desired to do -- it preferred long-term courses in which depth of learning could be achieved.  The MQA intended to create a new type of mine worker.

Mr Omar then gave some clarification on the finances of MQA.  He pointed out the surplus of R393 million in 2012-13, and that for 2013-14 they had received R763 million, with an investment income of R23 Expenditure had been R869 million, which had left MQA operating with a deficit of R84 million.  This sum had then been subtracted from the initial surplus, which had left a surplus of R309 million at the end of 2013-14.

The Chairperson noted that this was a high level budget, and it was part of the Committee’s job to ensure that the money being spent was resulting in performance.  Qualitative and quantitative information, with specific targets and budget allocations, had to be presented so that the Committee could do its job.

Mr Msiza stated that this advice would be taken into consideration and brought forth in the next session with the Committee.  They would also do research into beneficiation issues for the next meeting.

The Chairperson thanked MQA for its presentation, and called for a lunch break.

Manufacturing, engineering and related services SETA (MerSETA) Strategic Plan
Ms Phindile Nzimande, Chairperson, MerSeta, said she would do a brief introduction and the CEO would follow with a condensed presentation.  MerSeta was aligned with all government strategies, policies, programmes and plans, and considered remaining aligned as a priority.  As an entity, MerSeta was meeting their targets, but that still continued to be a challenge.   A year and half ago, an impact assessment had been done and it had been determined that they were continuing to make progress and having a positive impact in their sector.  MerSeta had received an unqualified audit report and were happy to report that no matters had been raised.  From a governance point of view, the board had been stable and worked in cohesion.

Dr Raymond Patel, CEO, MerSeta, began by referring to the three pictures at the start of the presentation which were labelled “we care, we belong, we serve,”   and said these were the genuine thoughts of the company, and not just a slogan.  Working together would lead to more achievement and MerSeta intended on working above and beyond their call of duty.   Due to the constraints placed on their budget, they were required to forge good working relationships with other companies to achieve their goals. 

MerSeta took their cue from the National Growth Plan and worked towards fulfilling that.  They had five strategic skills development priorities:

• Develop a sector labour market intelligence (LMI) system.  This enabled proper training.

• Continued and increased focus on artisan development, MerSeta felt that artisan development was its niche.

• To establish and facilitate strategic partnerships that would have an impact on both the funding available for skills development and the improved quality of skills development.

• To increase the flow of newly-skilled workers into the sector, and how they would bring this about.

• To develop the skills of the existing workers.  MerSeta had partnerships with all the unions they worked with.

Mr Patel affirmed MerSeta’s commitment to ABET education, but they had found that ABET was a general qualification, and had done research into better suiting the needs of adult learners, such as their development of a programme on pension spending and computer use.  These programmes were more functional then previous programmes.  MerSeta also encouraged and supported small business cooperatives and the better use of workplace skills development.  MerSeta wanted to change the outlook on NGOs, to view them not just as handouts, but as tools to be used in collaboration in the sector. 

Mr Patel did not want to dwell on previous years’ performances, due to time constraints, but noted that they had exceeded all their targets the previous year.  The final numbers achieved had subsequently become the targets for the next year. The new targets were higher, to address the issue raised by the Department, which believed that if they were exceeding their initial targets so greatly it must be due to them being too low in the first place.  Their success rates were very high, sitting at 80%.  He presented their targets and achievements very briefly.  All targets in regard to artisan programmes had been exceeded. 

Comparing targets between 2012-13 and 2013-14, all had been increased substantially, except for employed bursaries entered, which had been decreased because of changed regulations in the Department.  MerSeta had a staff of 263, and the only processes that were handled externally were audits and IT work.  MerSeta wanted to establish effective co-operatives, and taxi co-ops were an example of this. 

Mr Patel then pointed out some of MerSeta’s performance highlights, including the targets that had been achieved and exceeded, including contributions to peer interaction and policy discourse which had resulted in a positive contribution towards improving overall effectiveness of the collective SETA system.  The Artisan Training Programme had placed MerSeta at the forefront of SETAs that were responsive to the most urgent strategic priorities.  The entity had been successful in addressing a number of key priorities linked to the National Skills Accord and National Development Plan. MerSeta reported on a quarterly basis on their progress towards these objectives.

In collaboration with universities, MerSeta had conducted a tracer study towards discovering the success rates of the Accelerated Artisan Training Programme (AATP) and had a full research team committed to doing so.  They had discovered that 80% of the group studied were working, 53% of whom were working permanently.    Limpopo, Eastern Cape and Mpumalanga were the regions with the highest absorption rate of artisans. This study also exposed the areas in which employment was more likely to be gained upon completion of training.  Of the 20% who remained unemployed, fewer than one percent were not looking for work and 15% could be classified as unemployed.  Rates of unemployment were higher among females (33%) than males (18%), which caused great concern within MerSeta.  73% of these people had claimed that they had not been hired because more experienced people had been chosen.

Aligning industry needs with national development imperatives still remained a difficult process, as there seemed to be a disjuncture between the two. Financial and budget constraints were also a serious issue as it created difficulty in long-term planning.  There was a great disparity between the amount they requested to complete their work, and the amount they received.  Another challenge that MerSeta dealt with was the number of black men and women in management roles, specifically women.  This was an issue that SETAs could deal with only to a certain extent, as bigger changes had to be made at a higher level. The sector needed to make changes, and absorb more women in management, as MerSeta provided them with the best training they could.

MerSETA had eight strategic programmes based upon national priorities. The first of these dealt with administration -- in order for a SETA to be effective, good governance must be in place, compliance with relevant regulations and legislation must be adhered to and customer and stakeholder expectations must be met.  The administration of MerSeta must provide sound financial accountability accompanied by unqualified external audit reports.  The second programme was to put proper skills planning in place, and this commenced with internal skills capacity being built.  The right people also had to be trained to ensure that sector needs and national priorities were met.  The third programme sought to increase access to occupation-directed programmes by implementing skills development initiatives and comprehensive artisan development strategies.  The fourth programme was to promote responsiveness to the FET colleges.  MerSeta ensured that their programmes were not just in place to give out money, but also to promote curriculum development.  They had entered short international programmes to further develop the curriculum.  The fifth programme was formed to address the low-level of youth and adult literacy and numeracy skills.  Partnerships had been established with schools and institutions, and the STEM (Science, Technology, Engineering and Mathematics) programme would continue and align with career development.  This programme had proved quite successful in the past, as it increased the pipeline into engineering.  Foundation Learning Competence programmes had also been established, which were different from ABET’s because they focused on those who expressed a desire to enter the engineering industry.  Programme six was to promote workplace skills development within their sector through grants and co-operative agreements.  Programme seven was put in place to encourage and support co-operatives, small enterprises, worker-initiated NGO and community training initiatives.   These initiatives revolved mainly around the engineering sector.  The eighth and final programme was the career development programme, which would be achieved through youth exposure to the sectors of MerSeta and the initiatives they had in place.

Mr Patel acknowledged MerSeta’s five cross-cutting strategies, which included rural development, sustainable green skills development, people with disabilities, further education and training colleges (FETCs) and recognition of prior learning (RPL).

Linking to other government plans was also of importance to MerSeta.  These plans included the National Development and Growth Plans, Human Resource Development Strategy of South Africa, the NSDA III Objectives, Industrial Policy Action Plan (IPAP), National Skills Accord, Medium Term Strategic Framework (MTSF), Government-wide Framework for Monitoring and Evaluation, and National and Provincial Government Policies and Strategies.

Mr Patel then gave a breakdown to the many offices of MerSeta as well as the locations of their partnership institutions via maps.  MerSeta had a wide presence across the country and a great focus on rural areas.  The international relationships had been entered into with Bremen University in Germany, Blackburn College in the UK and HAMK University in Finland.  They had international non-university relationships with the Namibian Training Authority, the British Council, GIZ Germany, Kadar Asmal Foundation at the Embassy of Ireland and the Mitchells Plain Youth Unemployment Prevention Project in the UK.  National SETA partnerships included Services SETA, MICT SETA, FP & M SETA, LG SETA, Wholesale and Retail SETA and FOODBEV SETA.

The Chairperson interrupted and asked Mr Patel to wrap up his presentation so that Members would have the chance to ask questions before they had to vacate the room on account of another meeting.

Ms Lindiwe Ndlela, Chief Financial Officer, MerSeta, then gave a brief summary of the budget and demonstrated the affordability of the targets presented.  They had budgeted for a deficit because of the belief that the financial burden did not rest on MerSeta alone, and many of their partnerships would provide core funding arrangements to address their targets.  A bulk of their funding was sitting in discretionary grants, and a graph was presented to demonstrate the provincial breakdowns of their commitments.  As of March 2013, there were over 50 000 learners to whom MerSeta had committed funding. 

Mr Patel reiterated their goals and their successes, and thanked the chairperson of the MerSeta board for her commitment to good governance and accountability.  He thanked the Committee for their time.

Discussion
The Chairperson thanked MerSeta and turned it over to the Members for a brief question period.

Ms D Sibiya (ANC) noted that the CEO was surrounded by women, which brought her to her point of striving for gender balance in employment.  What skills did MerSeta provide for ABET learners besides those mentioned, such as pension knowledge and computer training? 

Mr G Radebe (ANC) asked why they would budget beyond their means. Why did they have a R70 million reserve, and not spend it elsewhere? 

Mr Patel said MerSeta provided ABET learners with occupational, accelerated learning and business skills in their programmes.  With accelerated learning, ABET took into account the previous knowledge of learners and catered for speeding up the process in order to obtain results more quickly, and for results specific to the industry.

The Chairperson had to cut off Mr Patel due to the time constraints, but noted that they were in this together with the SETAs.   The Committee was present to ensure oversight and an adherence to the law. He thanked those present for their contributions.  The meeting was adjourned.