SA’s workplace training is a shambles. More than 25 years after the sector education and training authorities (Setas) were created, they have had no meaningful effect on unemployment, nor alleviated the need for companies to import artisan skills.
Fixing the mess should be the newly appointed minister of higher education and training Buti Manamela’s top priority.
It’s hard to find fault with the original aim of the Setas, which were established by the 1998 Skills Development Act. They were intended to ensure SA’s workforce was equipped for the needs of the market and thus help drive economic growth. Employers were to pay a skills development levy earmarked for workplace training, channelled through sector-specific Setas ranging from manufacturing to hospitality. The Setas were expected to ensure the training was appropriately accredited and met employers’ needs.
The skills development levy is now set at 1% of payroll and will in 20225/26 generate R26bn in funds ring-fenced for skills development, according to the Treasury. This would be perfectly acceptable if the money were put to good use. But it isn’t.
Corruption, mismanagement and jobs for pals are the order of the day, rendering most of the 21 Setas anything but fit for purpose. The unemployment figures say it all: the rate of joblessness rose from 22.7% in 1998 to 32.3% in 2024, according to the World Bank.
The board appointment scandal that cost former higher education minister Nobuhle Nkabane her job earlier this week is just the latest chapter in a long and ugly saga of incompetence and malfeasance. She was axed by President Cyril Ramaphosa after allegedly lying to parliament about making ANC-aligned board appointments.
Over the past five years, the only Seta that consistently achieved a clean audit is the Public Service Seta, according to analysis by the Organisation Undoing Tax Abuse (Outa). A clean audit is the bare minimum one should expect from a state-funded entity, as it merely indicates that its financial records are in order and does not reflect whether it delivers on its mandate. In 2023/24, the most recent year for which data is available, only nine Setas received a clean audit.
Both business and labour have been urging the Seta to let them have a greater say in determining the training required for their sectors, to little avail.
Most Seta CEOs earned almost as much as the president in 2023/24, with an average income of R2.8m, compared with the president’s R3.1m salary, Outa’s research shows. The highest paid CEO was the Transport Education Training Authority’s Nmaphefo Anno-Frempong, who raked in R4.4m despite her organisation receiving a qualified audit for the second consecutive year.
Not only is money blatantly squandered, but a staggering amount is not spent at all: the Seta’s were sitting on an accumulated surplus of R6.49bn at the end of 2024/25, Treasury documents show. This would be bad enough if the government was cash flush, but given the budget constraints facing the basic education sector it is verging on the criminal for this money to be sitting idle. Provincial education departments cannot hire the teachers they need, upgrade infrastructure or fully meet their new obligations under the Basic Education Laws Amendment Act to extend primary schooling to grade R.
Few Setas monitor the impact of the training they fund, but what little data there is tells a sorry tale. A Media, Information and Communication Technologies Seta tracer study conducted in 2023/24 found that only half the people who completed its programmes found employment afterwards.
Part of the reason for this dismal performance is that employers seeking support for workplace training face bureaucratic, unwieldy Setas that can take up to three years to approve funding requests. In a dynamic global economy, that’s just not good enough. Worse still, both business and labour have been urging the Seta to let them have a greater say in determining the training required for their sectors, to little avail.
For more than a decade, media investigations, probes by the Special Investigating Unit and work by Outa have exposed serial governance failings and egregious corruption at Setas. And yet few heads have rolled, as their boards have enjoyed longstanding political protection. That needs to change, and fast.
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