Blade Nzimande, the Minister of Higher Education and Training, has proposed changes to the National Skills Development Strategy (NSDS) and the Sector Education and Training Authorities (SETA) landscape that will affect all organisations with employees.
The Gazetted changes are illustrated in a 46 page document which was released to the public 10 November 2015 for comment.
Simply put, some of the proposed changes are as follows:
- SETA’S – the current Sectoral Education Training Authorities (SETA’S) are to change to Advisory Boards (to be called SETAB’S) and lose their power to award training Grants to organisations within their jurisdictions. It is proposed that companies will continue to submit their plans and reports to the SETAB’s, they would motivate these to the National Skills Fund (NSF), who would make the final decision as to whether the companies will be granted any of the grants. If granted, the NSF will then pay the SETAB’s who will pay the companies. In addition to this, it is suggested that a number of SETA’s will be grouped together in one SETAB, combining industries and jurisdictions.
- Skills Development Levies – All SA companies who employ people, and whose annual payroll exceeds R500,000.00, are required to pay 1% of their monthly payroll to SARS in the form of a Skills Development Levy (SDL). 2% of this amount is kept by SARS for administrative purposes, and the remaining 98% is given to the (NSF). NSF then keeps 18% for its own administration; 10% goes to the SETA’s for their administration, and 0.5% is allocated to the Quality Assurance Board (QCTO). The remaining 69.5% was previously set aside for the companies to access for training and development. This amount was divided into the Mandatory and Discretionary Grants.
- Training Grants – It is proposed that the Mandatory Grants will go back to being 20% of annual SDL’s paid, Discretionary grants will decrease to 9.9% annual SDL’s paid, and the remaining 39.6% would be allocated to Professional, Vocational, Technical and Academic Learning (PIVOTAL) Grants to be distributed by the National Skills Fund instead of the SETA’S. Currently SETA’s award these Grants to organisations but the new proposals change this to the NSF deciding on whom to award Grants.
In summary, it would seem as though it is the intention of the Minister to centralise the control and distribution of all Skills Development Grants, and allocate a large portion of the funds to National Education, increasing Company’s responsibility to develop their workforces and pay for this in addition to the SDL’s.
By Andrea Grant-Smith – Senior HR Consultant