Nineteen Seta bosses face the axe

The sector education and training authorities (Setas) are set for a major shake-up as government plans to reduce their number from 24 to five.

The Mail & Guardian has obtained a confidential document outlining the government’s plan to reduce the number of Setas to align them with the country’s industrial strategy.

Labour Minister Membathisi Mdladlana confirmed the move.

The reduction is likely to take place by a system of mergers rather than outright closures: hundreds of officials may lose their jobs while 19 chief executives may lose their top posts. There is a lot of duplication in the system. For example, there are at least six Setas in the services sector and these could be rationalised to one.

The new plan is a measure of the government’s frustration with the Setas’ failure to accelerate the implementation of skills development in the country. When the system started, it was billed as a skills revolution.

Skills shortages have been cited as the main reason for the high level of national unemployment. Poor employment growth appears to be linked primarily to the growing need for skilled and semi-skilled labour.

With an annual budget of R5-billion, the training agencies represent the most important attempt to address the skills crisis. However, since they were established in 2000 the Setas have been plagued by allegations of fraud and corruption amounting to millions of rands.

The government’s rationalisation plan follows calls from various quarters, including the African National Congress and the Democratic Alliance, for radical measures to improve the performance of Setas.

The internal report, drafted by officials within the department of labour, proposes drastic changes, recommending that the Seta system be aligned with the national industrial policy framework, which is being fine-tuned by the department of trade and industry. The ANC made the same proposals in its policy discussion documents at its recent policy conference.

The industrial strategy is at the heart of the government’s drive to push economic growth to 6% and halve unemployment by 2014. The policy focuses on sectors seen as key areas for growth and job creation, such as automotive, agri-processing, chemicals, clothing and textiles and biofuels.

The five industrial areas the government seeks to align include natural resource exploitation, downstreaming, advanced manufacturing, all labour intensive sectors and the services sector.

Nimrod Zalk, chief director of the trade and industry department, said the new Seta landscape would improve coordination with industrial policy objectives. ‘It is critical that we have [a] supportive skills system to implement the industrial strategy,” he said.

In its policy discussion documents, the ANC argued that clustering Setas into five industrial groupings would allow the state to economise on the administrative resources needed to deal with various sectors in the economy.

‘The plethora of institutions increasingly spiralling out of strategic control in South Africa has begun to feature as a source of concern. There are simply too many training institutions in the country all engaged in separate and uncoordinated skills development. This institutional proliferation has created all types of unwarranted institutional dilemmas, including corporate governance problems, maladministration and fraud and a generally insignificant impact on skills development.”

Although government officials are confident that the rationalisation is a step in the right direction, labour and business have raised concerns about the extent of the overhaul.

Trade union federation Cosatu’s policy coordinator, Rudi Dicks, said reducing Setas would not make the problems go away. ‘The best approach is to do an adequate review to establish what is required to reduce the skills deficit. It is not the question of numbers, but what we need to make the institutions work.”

Business Unity South Africa (Busa) chief operating officer Vic van Vuuren said he would have preferred government to look at the existing Seta system and establish where failures had occurred to fix the problem. ‘To take 23 Setas and reduce them to five is going to be a mammoth task,” said Van Vuuren.

Paul Lundall, an independent researcher on skills development, said that although there were too many Setas, reducing them to five would create even more chaos, because statistical data collection was not aligned with the five proposed new Seta areas.

‘Once the data is organised in the format of the new divisions it will be less useful internationally for comparative purposes.”