1 Presentation to the Portfolio Committee on Higher Education and Training 2015/ /20 SP & 2017/18 APP 21 June 2017

2 Outline of the PresentationPART A: Mandate Wholesale and Retail Sector Context Organisational Environment New Delivery Model and the Proposed Operating Model Key Achievements for 16/17

3 Outline of the PresentationPART B: 2014/15 & 2015/16 Audit Opinion and Progress against the plans to address the Qualification Financial Performance Expenditure versus Budget for 16/17 PART C: Strategic Plan (2015/16 – 2019/20) Annual Performance Plan 2017/18 against government priorities

4 PART A

5 Mandate Policy mandateThe W&RSETA Strategic Plan is aligned to Government National Policies and Strategies Legislative Mandate The Wholesale and Retail Sector Education and Training Authority(W&RSETA) was established in 2000 in terms of the Skills Development Act 97 of 1998 (as amended) Constitutional Mandate As a public entity of the Department of Higher Education and Training the W&RSETA is mandated through the constitution to fund and facilitate skills development in the wholesale and retail sector

6 Mandate (Continued) VisionTo be the leader in skills development in the country Mission To develop a skilled, capable, competent and professional workforce to transform the wholesale and retail sector Value Proposition To develop the best qualifications framework for the sector through innovative intellectual capital, knowledge and understanding of the sector and deliver to our stakeholders through our skills and expertise

7 Wholesale and Retail ContextRecent transfer of the petrol retail subsector from Merseta to W&RSETA resulting in a total of 8 subsectors Wholesale of solid, liquid , gaseous fuels and related products dominate the sector followed by food, beverages, tobacco, machinery, equipment and supplies wholesalers Only 2% of precious stones, jewellery and silverware wholesalers make up the total number of wholesalers in the sector. The proportion of retailers in the sector is such that 42% are general dealers while 4% comprises of household furniture, appliances and equipment.

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11 NATIONAL TOP 10 SCARCE SKILLS

12 NATIONAL TOP 10 CRITICAL SKILLS (Continued)No. Critical Skills 1 Management 2 Leadership 3 Life Skills 4 Customer Service 5 Selling 6 Product Knowledge 7 Supervisory 8 Financial acumen 9 Numeracy and Literacy 10 IT Skills Computer (Advanced)

13 Organisation EnvironmentTwo qualifications in 2014/ /16 The Seta was put under Administration in October 2016 Ongoing Court case between the dissolved W&R Seta Board and the Minister for Higher Education and Training

14 The New Delivery Model Adopted in 2014 and revised in 2016 Aim:Alignment of the training and skills development value chain Increase footprint to ensure access to training and skills development Focus on providing support to Small and Medium Enterprises Improved turnaround times in terms of support to companies

15 Challenges in the External Operating EnvironmentMisalignment of the Government financial year in line with W&R sector’s financial and operational calendar = low annual take up Company applications for the Mandatory and Discretionary Grants not aligned to the Sector Skills Plan= under and over subscriptions in terms of Annexure II applications Influence of Training Providers on companies in terms of which programmes to apply for = skewness in the skills supply and demand in the sector Slow pipeline development of BBBEE training providers, moderators and assessors to be able to service the W&R sector= monopoly in the sector Recent contraction of the economy 0,7% also affecting the wholesale and retail sector = reduced revenue in terms levies collected

16 Challenges in the Internal Operating Environment (Continued)Ageing IT systems that do not have capacity to support the current operations = operational inefficiencies Inadequate monitoring and evaluation systems Silos within the divisions= processes that are not integrated and duplication of effort Organisational structure not aligned to the current strategy = skills mismatch Most business processes are still manual= operational inefficiences Non alignment of the SETA’s planning system e.g. project management cycle not aligned to the organisational planning cycle= late project approvals, late contracting, delays in training Regional growth in terms participating companies and SETA programmes which are not supported by the current structure and systems = operational inefficiencies

17 SERVICE DELIVERY MODEL

18 Proposed Operating ModelControl Mechanisms DHET DoL SAQA Legislation and Regulations Organised Business Organised Labour Internal Audit Enterprise Risk Management W&R Seta Board Strategy Development Research and Development Implementation Regional Operations Specialised Operations Bursaries and Placements Education and Quality Assurance Core Business Process Finance and Procurement Support Mechanisms Corporate Services

19 Organisation Performance for 2016/17The W&RSETA had four programmes with a total of 56 Performance Indicators in the 2016/17 financial year. Thirty two (32) of the fifty six (56) Performance Indicators were fully achieved. The performance results for the 26 Performance Indicators that were not achieved range from a partial achievement of 1% to 94.3%. SLA achievements, based on the quantitative output indicators in terms of learner registrations and completions, reached a performance result of 89%.

20 Organisational Performance

21 Key Achievements for 2016/17 Over 3000 employed and unemployed learners certified though learnerships; 56 senior executives successfully completed the ILDP; 341 middle managers graduated from the RMDP; Launched 2 Retail Simulation Centres in at Ekurhuleni TVET College and Gauteng North and Free State; 773 TVET College and 412 University students provided with bursaries;

22 Key Achievements for 2016/17 563 TVET college and 495 HET graduates provided with work experience 595 young people trained through the Rural Youth programme on the NQF level 5 Management Learnership 17 MBA and 5 PHD bursaries awarded 46 TVET Lecturers registered in Development Programmes for W&R Qualifications 400 Informal Traders trained in partnership with the Community Retail Development Project and Tshwane Business Forum

23 The International Leadership Development Programme (ILDP)

24 The International Leadership Development Programme (ILDP) Continued56 of 58 Delegates registered with Gordon Institute of Business School and Henley Business School Africa, have successfully completed the prestigious ILDP, aimed at developing senior managers within the sector through its international and local immersions. The completion of the 2016/17 programme boosts its Alumni to 290 since its inception.

25 Retail Management Development Programme (RMDP)

26 Retail Management Development Programme (RMDP) ContinuedLaunched in 2012, the RMDP marked its 5th – year successful milestone in 2016/17 FY during which 382 delegates were registered and 341 successfully completed the inaugural programme. In partnership with Enterprises University of Pretoria, the RMDP certified 1383 supervisors and middle managers.

27 Community Retail Development Project (CRDP)

28 Community Retail Development Project (CRDP) ContinuedLaunched in 2014, the CRDP was targeted at developing and training Informal, small, micro businesses and cooperatives. 400 traders were trained through a training conducted by the South West TVET College (SWGC). 320 successfully completed the project and certified.

29 W&RSETA Informal Small Business Practice NQF Level 3

30 The SETA has partnered with Traditional Councils to Implement the Rural Villages Project.As a result , 255 learners from were registered with KwaNdebele Royal Mgibe II and Jalamba Traditional Council. Another group of 180 learners from Amahlathi Local Municipality were enrolled into the programme.

31 Capacitation of TVET LecturersThe Capacitation of TVET Lecturers project was implemented after the W&RSETA, TVET Directorate and the DHET took an initiative to develop retail elective subjects for the National Certificate Vocational (NCV) qualification offered by public TVET colleges. However, it was mentioned that TVET lecturers are not familiar with the retail subjects and this has resulted in the need to capacitate the lecturers on the developed retail subject’s curriculum, guidelines and integrated assessment tools. 6 out of 13 Lecturers were certified for National Certificate Vocational Retail subject on NQF level 2 and 24 of out 33 Lecturers were certified for National Certificate Vocational Retail subject on NQF level 3.

32 TFG Supply Chain Transformation ProjectThis Project targeted unemployed youth from the previously disadvantaged communities around Cape Town. The project was implemented in four different phases of training which included learnership, Recognition of Prior Learning (RPL), a Management Development Programme (MDP) and the Lean Manufacturing Programme (LMP).

33 TFG Supply Chain Transformation Project (Continued)This Project targeted unemployed youth from the previously disadvantaged communities around Cape Town. The project was implemented in four different phases of training which included learnership, Recognition of Prior Learning (RPL), a Management Development Programme (MDP) and the Lean Manufacturing Programme (LMP). The project successfully trained learners as follows: 130 unemployed learners on Sewing Machine Operation Qualification. 20 unemployed learners on Sewing Machine Mechanic qualification.

34 TFG Supply Chain Transformation Project (Continued)77 employed learners at operational level on technical programmes aligned to NC: Clothing Manufacturing Processes NQF level 2 and NC: Sewing Machine Mechanics NQF level 3. 33 employed learners on NC: Product Technology NQF level 3 qualification. 12 TFG participating supply chain companies were supported through Lean Manufacturing Systems.

35 Retail Business Management Diploma Bursaries

36 Retail Business Management Diploma Bursaries (Continued)This initiative was implemented to encourage and fund students who are willing to study National Diploma in Retail Business Management course across the country, 388 students benefitted from this initiative. Participating universities; Tshwane University of Technology (118), Cape Peninsula University of Technology (35), Durban University of Technology(143), Vaal University of Technology (44), Sol Plaatje University (39) and Nelson Mandela Metropolitan University (9).

37 PART B : FINANCIAL PERFORMANCE

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41 MTEF 2017/18

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43 Audit Outcome 2014/2015 – Qualified Audit Opinion based on material misstatements on the commitment disclosure 2015/2016 – Qualified Audit Opinion based on material mistatement on the commitment disclosure

44 Audit Action Plan 2014/15 – After the qualified audit opinion, the Board approved a decision to outsource the reconstruction of the Contract and Commitment Registers to Deloitte. The Acting CFO was the project manager for the reconstruction of the Contract and Commitment Registers by Deloitte. However, this never yielded anyresults. 2015/16 – After the second qualified audit opinion, the Minister put the SETA under Administration during October 2016. A detailed project plan was developed to reconstruct the Contract and Commitment Registers in-house under the supervision of the CFO and the Advisor to the Administrator. As a result of internal usage of staff, the SETA saved R4 million and employed more than 5 unemployed graduates.

45 Audit Action Plan (continued)A comprehensive Audit Action Plan was developed and closely monitored by internal control unit during the year to prevent a recurrence of the various audit findings in general.

46 Progress on Audit Action PlanDue to the comprehensive Audit Action Plan and the continued monitoring on the progress to limit recurring findings, several internal control measures were put in place. Such as: expiry of contract reminder. Policies and Standard Operating Procedures were updated and approved to address the shortcomings in the control environment, e.g. A total of xx policies were approved by the administrator. Enterprisewide risk assessment Establishment of Financial Misconduct Committee Internal Audit did a review on the reconstructed commitment register and findings were addressed before the finalisation of AFS.

47 PART C: STRATEGIC PLAN (2015/16-2019/20)

48 Strategic Changes in Developing the PlanReviewing of the W&RSETA’s vision and mission Restructuring our strategic goals to ensure that these enable us to address: challenges identified through our research activities and the SSP; risks; and the W&RSETA’s aims to ensure that our skills development programmes have a greater impact on our beneficiaries. Reducing the number of strategic objectives and performance indicators while ensuring that our strategy retains its alignment to the SLA we have signed with DHET and effectively responds to national imperatives and relevant legislation. Monitoring and evaluation of interventions and measurements of pre-determined objectives will be improved due to the substantial reduction in the number of Strategic objectives and performance indicators. Proposed programme strucuture

49 Programme Structure Proposed ChangesDHET Proposals W&RSETA Programme 1 Administration To be created Programme 2 Skills Planning Programme 1: Research and Skills Planning Programme 3 Learning Programmes and Projects Programme 2: Pivotal Programmes, Programme 3: Bursaries and Placements, Programme 5: Projects supporting Co-ops, SME, NGO/NPO and Programme 7: Critical Skills Development Programme 4 Quality Assurance Programme 4: Partnerships and Programme 6: Building career and vocational guidance

50 Key Drivers of Change for Skills within the W&R SectorGrowth into Africa An increasing focus from the South African retail industry on expansion north of the country’s borders requires appropriate skill to deal with the international trading environment and varied market conditions, language and regulations. Speed to Market Staying abreast of rapidly changing consumer demand requires retailers to improve their skill base with regard to areas such as small batch production in order to ensure the speed to market to respond to these challenges. Digital Revolution The increasing uptake of online shopping, together with opportunities presented by social media, requires a new set of skills, particularly in IT development, virtual marketing and sales.

51 Key Drivers of Change for Skills within the W&R SectorSkills Shortage An evolving retail landscape has resulted in skills shortages at both management and elementary level which presents the sector with challenges requiring urgent remedial action. Responsible buying The emergence of socially responsible buying patterns (e.g. a preference for organic food, green technologies, and socially- conscientious purchases) requires an appropriate set of skills from the sector.

52 Outcome Oriented GoalsStrategic Outcome Oriented Goals Strategic Outcome Oriented Goal Goal Statement 1.Skilled, capable, competent and professional workforce in the wholesale and retail sector Strengthen skills development and training to meet the needs of the Wholesale and Retail Sector 2. Effective and efficient organisation Ensure effective management of the W&RSETA through proper governance, efficient use of resources , integrated systems and improved monitoring and evaluation 3. Effective Stakeholder Engagement and Strategic Partnerships Strengthen strategic partnerships with the public and private sectors to better align programmes and resources and facilitate placement of learners 4. A skilled, vibrant SME’s and Cooperative Sector To strengthen and develop new training models to meet the needs of he Small Cooperatives and Informal businesses in Skills Development 5. Responsive and Empowered Training Providers Effective capacitation of existing and emerging training providers to deliver on the sector skills

53 Key Interventions for 2015-2020Small Enterprise Development The W&RSETA has prioritised the development of small enterprises through partnerships with stakeholders that enable and facilitate skills development for SMMEs, including alternative approaches such as mentoring and coaching. Youth Employment Interventions in support of increased youth employment include increasing access through awareness strategies, improving skills development capacity, and workplace experience and work readiness.

54 Qualification DevelopmentThe need to develop required qualifications, which will focus on key skills requirements that have been identified. Sector Transformation The W&RSETA will support sector transformation by providing access to bursaries, through targeted initiatives, and through facilitation of linkages such as the Future Manager’s Programme in partnership with Pick and Pay and Wits University. .

55 Disability ProgrammesLearning Programmes Learning programmes will focus in particular on enabling supervisory skill development. Disability Programmes The W&RSETA will be implementing learning programmes targeted at the people with disability representation in the sector as well as sensitization programmes to employers within the sector. The bursaries and learnerships are among the targeted interventions in empowering people with disability within the sector. Green Skills The W&RSETA interventions will also be aimed at promoting green skills in the sector by establishing necessary and relevant partnerships with other organizations. The capacity development sessions and awareness programmes will be used in addressing the green skills in the sector.

56 FIVE YEAR PLAN

57 Plan Ahead: Strategic Objectives to Achieve SETA Outcomes Oriented Goals 2015/16 to 2019/20 Strategic Outcome Oriented Goal Strategic Objective NSDS III Linkages 1.Skilled, capable, competent and professional workforce in the wholesale and retail sector A consultative, quality and relevant SSP is developed and approved Programmes to address Scarce and Critical Skills needs are implemented Workplace exposure Internship programme Strategy to develop new growth and niche areas Develop and implement a seamless integrated Career guidance programme NSDS III Goal 4.2: Increasing access to occupationally directed programmes. NSDS III Outcome 4.2.1: Middle level skills needs are identified and addressed in all sectors. 2. Effective and efficient organisation Effective, well governed organisation with efficient use of resources Effective and Efficient organisational system Efficient Grant System Effective Monitoring and Evaluation System NSDS III Goals 4.2, 4.3, and 4,5 PFMA Section 51 3. Effective Stakeholder Engagement and Strategic Partnerships Priority Learning Programmes Formal agreements with strategic partners The Academic Excellence Programme NSDS III Output : Projects are established to address middle level skills in each sector NSDS III Output : Agreements are entered into between SETAs, university faculties and other stakeholders

58 Strategic Objectives to Achieve SETA OutcomesOriented Goals 2015/16 to 2019/20 (Continued) Strategic Outcome Oriented Goal Strategic Objective NSDS III Linkages 4. A skilled, vibrant SME’s and Cooperative Sector Strategy to Increase participation of small and medium companies in the skills planning process Strategic Projects developed to deliver scarce and critical skills to effect transformation and access in the wholesale & retail sector NSDS III Goal 4.5: Encouraging and supporting cooperatives, small enterprises, worker-initiated, NGO and community training initiatives 5. Responsive and Empowered Training Providers Effective transformation strategy and programme to support existing emerging training providers NSDS III Goal 4.8: Building career and vocational guidelines NSDS III Output : Sector Stakeholders are engaged and programmes are adjusted to meet the skills and qualification needs to promote comprehensive career development

59 ANNUAL PERFORMANCE PLAN 2017/18

60 Programme 1 - Administration Performance IndicatorPlan Ahead Strategic Plan (APP) Programme 1 - Administration To provide effective and efficient support functions within the organisation Objective Performance Indicator Target 2017/2018 Effective, well governed organisation with efficient use of resources An efficient and effective Automated Contracts Management System developed and implemented Contracts Management System An effective and efficient Contracts Management User Manual developed and approved Contracts Management User Manual Training and capacitation sessions conducted for all internal users on the use of Contracts Management User Manual Training and Capacitation Session 100% reduction in audit findings on SCM processes and activities 90% reduction in audit findings 24.4% improved achievement of the Annual Performance Plan from 78% to 95% over 3 year period 88% achievement of Annual Performance Targets Develop and implement an organisational Succession Plan by 31 March 2017 to 31 March 2020 Succession Plan developed and approved % satisfaction rate indicated by W&RSETA employees in Employee Satisfaction Survey conducted 75% Clean Audit achieved by end of financial year 31 March 2020 Unqualified Audit Compliance to ICT Governance Framework and Regulations as set by DPSA achieved and maintained Achieve 80% Compliance to ICT Governance Framework during compliance audits Integration of ICT Systems by 31 March 2019 65% of all IT systems integrated

61 Programme 1 - Administration Performance IndicatorPlan Ahead Strategic Plan (APP) Programme 1 - Administration To provide effective and efficient support functions within the organisation Objective Performance Indicator Target 2017/2018 Effective and Efficient Organisational System Organisational Systems and Processes automated by 31 March 2018 10 Organisational Systems and Processes automated Newsletter published during the period 01 April to 31 March 2020 10 Newsletter Published Participations in exhibitions, conferences and trade related expositions organised by constituent organisations, DHET and other relevant stakeholders Participated in 10 exhibitions and conferences Stakeholder recognition initiative implemented 1 stakeholder recognition initiative Efficient Grant System Levy paying compliant companies benefit from Mandatory Grants 6 000 Effective Monitoring and Evaluation System An effective and efficient monitoring and evaluation system that ensures the integrity of the SETA’s performance information implemented Zero findings on quarterly performance information reports

62 Programme 2 – Research and Skills Planning Performance IndicatorPlan Ahead Strategic Plan (APP) Programme 2 – Research and Skills Planning To produce a credible Sector Skills Plan through comprehensive research that represents the dynamics of the sector and accurately identifies skills shortages Objective Performance Indicator Target 2017/2018 A consultative , quality and relevant SSP is developed and approved Stakeholders consulted across all sub-sectors in all regions. 800 stakeholders consulted A minimum of 60% satisfaction rating achieved in the stakeholder survey conducted on the consultative process and outcomes of the Sector Skills Plan 60% satisfaction of returned questionnaire Robust research methodology reflective of different sub-sectors Qualitative and Quantitative research papers produced using primary and secondary data sources 4 Strategy to increase participation of small, medium and large companies in the Skills Planning Process developed and implemented Small, medium and large organisations are assisted with the Skills Planning Process by W&RSETA ISDFs and/or internal staff and submit Annexure 2 documents S - 5 698 M – 1 302 L - 550

63 Programme 3 – Learning programmes and Projects Performance IndicatorPlan Ahead Strategic Plan (APP) Programme 3 – Learning programmes and Projects To facilitate and manage the implementation of learning programmes and support improved entry to priority programmes Objective Performance Indicator Target 2017/2018 Programmes to address Scarce and Critical Skills needs are implemented 1 Employed (18.1) and Unemployed (18.2) learners registered and Certificated on NQF 2 to 5 learnership programmes addressing Wholesale and Retail Scarce Skills as identified in SSP, Registered 18.1 2000 Certificated 1200 18.2 2100 Employed (18.1) and Unemployed (18.2) learners registered and Certificated on NQF 2-5 skills programmes addressing Wholesale and Retail Scarce Skills Occupations as identified in the Sector Skills Plan 1000 800 500 400 Employed learners registered and Certificated on RPL Learning programmes 300 250

64 Programme 3 – Learning programmes and Projects Performance IndicatorPlan Ahead Strategic Plan (APP) Programme 3 – Learning programmes and Projects To facilitate and manage the implementation of learning programmes and support improved entry to priority programmes Objective Performance Indicator Target 2017/2018 Programmes to address Scarce and Critical Skills needs are implemented Employed learners are registered in programmes addressing critical skills as identified in the SSP 1 000 Unemployed bursars registered at TVET Colleges and/or HETI during the period Awarded 18.2 3000 Completed Nil Employed and Unemployed learners registered and certificated in Learnerships and/or Apprenticeships addressing Wholesale and Retail Scarce Skills artisan occupations as identified in the SSP Registered 300 Certificated 180 Employed learners registered and certificated on MBA/Masters or Doctoral degrees at HETIs during the period 25 12 Employed students registered and certificated in programmes in Wholesale and Retail Scarce Skills at HETIs Registration 1 200 840

65 Programme 3 – Learning programmes and Projects Performance IndicatorPlan Ahead Strategic Plan (APP) Programme 3 – Learning programmes and Projects To facilitate and manage the implementation of learning programmes and support improved entry to priority programmes Objective Performance Indicator Target 2017/2018 Workplace Exposure Graduates from TVET Colleges and/HETI placed and complete workplace experience Placed HETI 2000 Completed 1200 TVET Internship Programme Interns from TVET Colleges and/or HETIs placed and complete their internship programme 350 245 Strategic Projects developed to deliver scarce and critical skills to effect transformation and access in the wholesale and retail sector Unemployed learners from Rural Areas registered and certificated on Learnerships Registered 500 500 informal businesses participate in W&RSETA business upliftment skills development projects 1500 Cooperatives participate in W&RSETA upliftment initiatives to address the Cooperatives skills development needs 20

66 Programme 3 – Learning programmes and Projects Performance IndicatorPlan Ahead Strategic Plan (APP) Programme 3 – Learning programmes and Projects To facilitate and manage the implementation of learning programmes and support improved entry to priority programmes Objective Performance Indicator Target 2017/2018 Programmes to address Scarce and Critical Skills needs are implemented Cooperatives participate in W&RSETA upliftment initiatives to address the Cooperatives skills development needs 20 NGO/CBOs participate in W&RSETA upliftment initiatives to address the NGO/CBO skills development needs 9 Trade Union Officials trained and certificated on programmes that address Trade Union skills needs Trained 5 Completed SME companies benefit from Skills Development initiatives 3500 Employed and unemployed learners registered and certificated on NQF 1 (AET) Qualification/ Learnership Registered 500 Certificate 200

67 Programme 3 – Learning programmes and Projects Performance IndicatorPlan Ahead Strategic Plan (APP) Programme 3 – Learning programmes and Projects To facilitate and manage the implementation of learning programmes and support improved entry to priority programmes Objective Performance Indicator Target 2017/2018 Strategy to develop new growth and niche areas Qualifications updated to include green economy areas identified in the SSP for the W&R sector and submitted to QCTO 2 Formal Agreements with strategic partners Chair of Retail is appointed within a HETI 1 Establish Schools of Excellence (SOE’s) in TVET colleges 4 Expand the delivery of Wholesale & Retail Qualifications to TVET Colleges by awarding Extension of scope to TVET Colleges 9 Wholesale and Retail Academies established at HET Institution Develop and implement a seamless integrated Career Guidance strategy Events supported with career guides and initiatives implemented 100 LO lecturers participate and complete lecturer capacitation programmes Participated 30 Completed 20

68 THANK YOU Q&A