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The Minister of Higher Education and Training, Dr Blade Nzimande, recently introduced new regulations that govern how Sector Education and Training Authorities (SETAs) manage grants from the skills levy contributions paid by employers. The Association of Accounting Technicians, South Africa [AAT(SA)] has welcomed the regulation, stating that effectively, the amended regulations will ensure that all role players contribute actively to skills development in the country.

The promulgated regulations stipulate the governance of SETA allocation of mandatory and discretionary grants from the skills levy contributions paid by employers. Essentially, the mandatory grant paid to employers for submitting their Workplace Skills Plans (WSPs) and Annual Training Report (ATR) is reduced from 50% to 20% of their levy contribution. The SETA’s allocation for administration costs in support of the implementation of its Sector Skills Plan (SSP) has been increased by 0.5% to 10.5%.  The allocation to the National Skills Fund remains at 20%.  The SETAs will pay the remaining skills levy to employers as discretionary funds.  It is imperative that discretionary grants ensure value-for-money and that funds are spent on skills development to meet sector needs.

Furthermore, SETAs are required to spend 80% of their discretionary funds on Professional, Vocational, Technical and Academic Learning (PIVOTAL) programmes that result in qualifications or part qualifications registered on the National Qualifications Framework (NQF). SETAs are also compelled to spell out how PIVOTAL programmes will be delivered through public education and training institutions.
“It is clear that the new regulations are aimed at addressing skills shortages, especially in critical and scarce skills areas and the Minister wants to use funding optimally in order to address national imperatives. The regulation now offers incentives to organizations that are serious about skills development,” says AAT(SA) Development Manager, Natalie Zimmelman.

The new funding regulations come into effect on the 1st April 2013.  This means that all levies received after this date, as well as all unallocated funding, must be allocated against the new percentages and criteria. A SETA must allocate a PIVOTAL grant to an employer for a learning programme at a level determined by the Director-General through a general circular to all SETAs to fund learners. This includes funding of University of Technology students and Further Education and Training (FET) College graduates subject to verification by the SETA to a maximum of 10% of total levies paid by the employer. A SETA may also allocate additional PIVOTAL grant funds to an employer for PIVOTAL programmes if the employer has spent more than 3% of its payroll on training.

“The new funding regulations make it clear that employers who pay only lip-service to skills development can no longer expect to get significant funds from the SETAs simply for completing a plan and a report.  The employer now actually has to build skills development into the plan and deliver on this to their employees.  Those who are proactively building skills can, however, gain even greater financial support.” says Zimmelman 

AAT(SA)’s qualifications develop competent entry to mid-level financial staff within the private and public sectors.  The need for accounting staff at this level has been identified through research conducted on behalf of the South African Institute of Chartered Accountants (SAICA) and is evidenced by these skills appearing on almost every SSP.  Through its design and alignment with scarce and critical skills needed by the economy, the AAT(SA) qualifications meet all criteria of PIVOTAL grants.  Zimmelman urges proactive employers to take advantage of existing programmes that support the development of much needed skills in South Africa.