Briefing by the Audit & Risk Committee of the NYDA for 1st, 2nd & 3rd quarterly reports for 2022/23

Women, Youth and Persons with Disabilities

21 February 2023
Chairperson: Ms C Ndaba (ANC)
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Meeting Summary

Video (Part 1)

Video (Part 2)

The Committee met virtually to hear from the National Youth Development Agency (NYDA) and its Audit and Risk Committee‘s (ARC) on the 1st, 2nd, and 3rd quarter reports for the entity.

The ARC presented that it had reported on the 19 Key Performance Indicators due to be reported on during Quarters 1-3. Out of 19, 17 KPIs were achieved (89%) and two were not achieved (11%). As a recommendation, the ARC recommended the reports for Board approval and recommended a catch-up plan for the KPIs that were not achieved to be developed so that those KPIs would be achieved in the 4th quarter.

The KPIs that were not met included: Number of beneficiaries supported with Business Development Support Services offered to young people by NYDA (600 vs 229); and number of organisations and departments lobbied to implement National Youth Service (NYS). Out of 60 that were targeted, 40 were achieved.

Giving an updated on an investigation into allegations levelled against the NYDA, the entity presented that:

- The NYDA Board of Directors commissioned an independent investigation into allegations levelled against the CEO in May 2022.

- In total, eight witnesses who were relevant to the allegations provided evidence.

- Witnesses had been forthcoming and cooperative.

- Twelve sets of documentary files had been reviewed concerning the allegations.

- One witness was remaining to be interviewed which would complete the investigative process.

- The final report was expected to be ready by end of February 2023.

- Once the Board had received the report, it would be released to the Executive Authority, Presidency, and the Portfolio Committee

The Committee asked how many people living with disabilities were employed by the NYDA as of 21 February 2023. The system grant went to beneficiaries with disabilities; how many of those were identified as male and how many were identified as female? What was NYDA doing to ensure that more young people living with disabilities had access to the NYDA’s financial and non-financial opportunities? What was the role of the Branch Disability Champions if they could not get more people with disabilities to access their services? The Committee asked how the NYDA had implemented the ARC recommendation(s) regarding its financial management. Had the NYDA utilised the R224.2 million of funds sourced from public and private sectors to support Youth Development Programmes optimally? What had been the user feedback regarding the application platform interface? How many young people had accessed the platform and completed the ERP application? In Programme 2, what was the total cost of supporting 1198 Youth-Owned Enterprises financially by end of Quarter 2 and 2074 youth at the end of Quarter 3? What was the average cost per beneficiary?

Meeting report

The Chairperson welcomed all the attendees. She explained what the meeting was about and mentioned that the chairperson of the Audit and Risk Committee (ARC) had resigned. The Chairperson had had advised the Agency to find a replacement as soon as possible. As the meeting was taking place, The Chairperson asked if there was someone who would be acting as the chairperson for the Audit and Risk Committee.

The ARC delegation confirmed that Adv Mary Rosey would be acting as the chairperson and delivering the presentation.

Adv Mary Rosey, Interim Chairperson, NYDA Audit and Risk Committee, said her presentation would be on the work that the Audit and Risk Committee had done between the first and the third quarter in 2022/23. She mentioned that she was acting as the chairperson of the ARC until the recruitment process of an independent chairperson would be complete. The Audit and Risk Committee received a letter dated 09 February 2023, which was an invitation from the Office of the chairperson at ARC; an invitation that stated that the ARC ought to brief the Portfolio Committee on Women, Youth and Persons with Disabilities on the past three quarters of the 2022/23 financial year.

First to Third Quarter Report for the 2022/23 Fiscal Year

The report provided feedback to the Portfolio Committee on the status of the work undertaken by the Audit & Risk Committee of NYDA for the 1st, 2nd & 3rd quarter of 2022/23.

The Audit and Risk Committee had the following meetings:

  • 25 July 2022 – Ordinary Meeting
  • 03 August 2022 – Special meeting
  • 28 September 2022 – Special meeting
  • 21 October 2022 – Ordinary meeting
  • 26 January 2022 – Special meeting

Performance information

The management had reported on the 19 Key Performance Indicators that were due to be reported on during quarters 1-3. Out of 19, 17 KPIs were achieved (89%) and two were not achieved (11%). As a recommendation, the ARC recommended the reports for Board approval and recommended a catch-up plan for the KPIs that were not achieved to be developed so that those KPIs would be achieved in the 4th quarter.

KPI not met as per 3rd Quarter:

1. KPI: Number of beneficiaries supported with Business Development Support Services offered to young people by NYDA (600 vs 229)

Reasons and Remedial Action: There were delays in appointing a service provider to implement the programme. The NYDA was developing a Memorandums of Understanding with the Finance and Accounting Services Sector Education and Training Authority (FASSET) and was trying to implement the project in partnership with 4 Universities: University of Pretoria, University of the Witwatersrand, University of Free State, University of KwaZulu-Natal. The training would cover digital skills, financial literacy, and Entrepreneurial Skills.

Solution: Management confirmed that the KPI would be achieved in the 4th quarter.

2. KPI: Number of organisations and Departments lobbied to implement National Youth Service (NYS). Out of 60 that were targeted, 40 were achieved.

Reasons and Remedial Action: The target was not met because some departments had not submitted or returned the MOUs as per the agreement. The MOUs were undergoing internal considerations at the various departments. A catch-up plan had been developed to encourage those Departments to accelerate their submission of the outstanding MOUs and the target would be met by quarter 4.

Solution: A catch-up plan had been developed and the KPI would be achieved in the 4th quarter.

Adv Rosey showed the Portfolio Committee the fundamental KPIs that had received a good improvement and unpacked more on the accounts of the NYDA. To close the presentation, Adv Rosey spoke about the reported progress on implementing the Auditor General’s (AG) Audit Action Plan. (see attached for details).

The Chairperson asked if the Members wished to engage with the report.

One Member asked if the Committee could receive another report before asking clarity-seeking questions.

The Chairperson said the reports were separated so the Members could engage on the report before the NYDA could present theirs. She said that if Members did not have clarity-seeking questions, the meeting could go ahead to the next item on the agenda.

The Members confirmed that they did not have clarity-seeking questions and the meeting moved to the next item on the agenda, which was a presentation from the NYDA.

NYDA’s Quarter 2 and Quarter 3 Report for the 2022/23 Fiscal Year

Investigation Update

Ms Asanda Luwaca, Executive Chairperson, NYDA, said there had been developments on the allegations through anonymous letters, allegations that were levelled against the CEO. Two investigations commenced in May 2022. The investigations were at an advanced stage; the NYDA would receive feedback on the matter by the end of February 2023. The Committee would also be updated thereafter.

Salient Matters Raised by President Cyril Ramaphosa

Ms Luwaca stated that the presentation would provide progress updates on some of the salient matters that the President would have particularly raised in his State of the Nation Address (SONA) related to the youth of South Africa. The presentation would also outline the performance of the NYDA in its second and third quarterly reports for the year 2022/23.

1. Presidential Employment Stimulus Programme

The President outlined that the programme remained a crucial component for job creation. It managed to strengthen the livelihoods of young people while the labour market recovered (from COVID-19). In all its three phrases, the employment stimulus had managed to create over 1 million job opportunities. Of those opportunities, those taken by young people constituted 80% and those taken by women, 60%.

2. Prioritisation of the ICT.

The President mentioned that it was important for the South African Government to prioritise digital and ICT sector for targeted interventions. The NYDA welcomed the announcement and urged the Members to note that ICT remained the lowest in terms of applications received for grant support. The ICT sector ought to receive the necessary financial support and commitment in the public and private sectors. There were programmes that the NYDA had set to accommodate the integration and prioritisation of the digital sector. The Office of the Executive Chairperson had identified partnerships with National Electronic Media of South Africa (NEMISA) and with Mobile Telephone Network (MTN). Those partnerships would take place across all provinces and stood to grow in the 3rd quarter. The partnerships were to ensure economic growth in the digital era.

3. Department of Higher Education and Training, Department of Employment and Labour, and Department of Small Business Development tripartite partnership.

That programme related to skills development would place 10 000 unemployed graduates from TVET colleges. That started in April 2022 and the NYDA achieved the target. 250 000 placements had been targeted over the medium-term expenditure framework. The Presidential Youth Employment intervention, which the President announced in 2020, was now an implementation. The NYDA had taken a strong partnership approach to delivery with lead government departments working closely with the private sector.

The NYDA, through the Department of Higher Education, had plans to reorientate the skilling system towards approaches that were agile and towards approaches that were responsive to the current and emerging demands. The National Skills Fund was another area that the NYDA was working closely with. The plan was to see to it that the programmes that the NYDA had implemented succeeded. South Africa needed to equip people with the skills to build the economy. Skills that would match and were adaptable to the job market and therefore, drive and strive in that economy. The agency planned to grow its partnerships with SETAs; from the six that it had initially, to 21 SETAs by the end of 2024.

Conclusion

The NYDA had noted concerns from the Portfolio Committee on Women, Youth and Persons with Disabilities and had found ways to track Board members’ performances. The Board that was announced in 2021 by the President; had great achievements. It had implemented the revitalised National Youth Service program reaching 50 000 young people. The NYDA Board had secured funding for the NYDA grant programme to facilitate the transition to a digital organisation with NYDA products and services being available online. The NYDA has been able to extend its CWP programme in Mpumalanga to the other provinces.

2023 started with the NYDA rolling out its Back-to-School campaign which was implemented in various provinces. The project targeted the Grade 10s, 11s, 12s and went as far as targeting learners in elementary phases of their schooling. The Mvula Trust had been the implementing partner of the NYDA.

On 7 February 2023, the NYDA hosted a roundtable discussion in Cape Town to reflect on the implementation of the commitments made by the President on the 2022 SONA, to also serve as a platform for engagement with youth-led and women-led NPOs on ways to utilise the revitalised National Youth Service programme.

Lastly, the NYDA planned to air a 16-part documentary that would be aired on SABC 1, 2, and 3. That was part of the “I Am Proud to Serve” campaign, which focused on young people who were changing the lives of ordinary South African citizens in their communities.

The Chairperson asked when the documentary would be aired.

Ms Luwaca said the Committee would be informed as soon as there was a set date. The production team was still busy with some final touches. Ms Luwaca said that in 2022, the NYDA really looked forward to being able to build on the gains made and learning from the lessons to serve the young people of South Africa. The NYDA was committed to ensuring that young people gained access to jobs, to entrepreneurial opportunity, gender equity, and in areas of employment, equal pay for equal work. No young person would be left behind.

Mr Wassem Carrim, Chief Executive Officer, NYDA, presented the quarters 3 and 4 of the 2022/23 financial year.

Quarter 2 & 3, 2022 / 2023

Giving an update on an investigation into allegations levelled against the CEO, he said:

- The NYDA Board of Directors commissioned an independent investigation into allegations levelled against the CEO in May 2022.

- In total, eight witnesses who were relevant to the allegations provided evidence.

- Witnesses had been forthcoming and cooperative.

- Twelve sets of documentary files had been reviewed in relation to the allegations.

- One witness was remaining to be interviewed which would complete the investigative process.

- The final report was expected to be ready by end of February 2023.

- Once the Board had received the report, it would be released to the Executive Authority, Presidency, and the Portfolio Committee.

Mr Cassim mentioned that the NYDA Board of Directors would divide its work among six Board Committees, namely:

- Executive Management Committee

- Audit & Risk Committee

- Investment Committee

- Human Resources and Remuneration Committee

- Information, Communication and Technology Steering Committee

- Social and Ethics Committee

- Board

For members in each Board Committee, Board activities, and more detailed information on the progress and performance of the NYDA in 2nd and 3rd quarters - see the attached document.

Budget Review and Recommendations

Recommendation

He said the Committee had noted the need to align with the 4th Industrial Revolution and therefore asked the NYDA how it influenced government to shift to the 4th Industrial Revolution insofar as youth development was concerned.

Resolution

The NYDA had shifted to an entirely digital system. The NYDA had also developed a single sign-on with SAYouth.Mobi, making it easier for young people to access Government services. The NYDA was revamping its call centre to be the central point of contact. In both basic and higher education, the NYDA was monitoring the progress of the IYDS in the reform of the curriculum to adjust to the 4IR. The NYDA was also lobbying for more government services to young people to be digital.

Recommendation

The Committee welcomed the programmes and services rendered by the NYDA and questioned how the NYDA was measuring the impact of its programme on the community.

Resolution

The NYDA provided the Committee with four evaluation reports on NYDA products and services.

Recommendation

The Committee had noted with concern that no provision has been made for youth over 18 years of age living in shelters and identified that as a gap. Hence the Committee, enquired whether the NYDA had an exit strategy to deal with youth who had no alternative support structures, and who left shelters at the age of 18 years.

Resolution

The NYDA conceptualised a programme with the metros to address the homelessness of young people.

Recommendation
The Committee was impressed with the businesses that were visited that were supported by the NYDA and reiterated that the NYDA needed to market those businesses within government. Hence the NYDA would have to facilitate, having NYDA-funded businesses on government’s supplier databases.

Resolution

Through the NYDA market linkages programme and youth entrepreneurs’ database, the NYDA vigorously opened access to market opportunities for young people in the public and private sectors.

Recommendation

The Committee had questioned whether merely accepting CVs was enough for job placement and what else needed to be done to ensure an increase in the success rate and uptake. The Committee was not satisfied with the NYDA just receiving CVs and indicated that emphasis had to be placed on active lobbying and matching youth in search of employment with industry opportunities. The Committee was concerned about the workload of a job placement officer and therefore queried whether those persons had the time to link CVs of applicants to other stakeholders.

Resolution

The NYDA was moving beyond just accepting CV’s and was actively meeting with employers/employer groups and developing tailor-made recruitment solutions for individual employers and where skills gaps existed, the NYDA was working with the SETAs to fill those skills gaps.

Recommendation

The Committee had remained concerned about youth in rural areas and as such, enquired how the NYDA reached out to communities, especially rural communities, to advertise the products and services of the NYDA.

Resolution

The NYDA was actively marketing itself in rural areas through community radio and outreach programmes and collaborating with local municipalities.

Recommendation

The Committee had noted with concern that the challenges experienced by the owner of laundrette, which was largely attributed to poor mentorship, lack of business management, inadequate record-keeping skills, inappropriate procurement of equipment for the intended business use and suitable premises to conduct the business.

Resolution

The NYDA had strengthened its aftercare programme, providing more ongoing support to beneficiaries even beyond two years and was reforming its mentorship programme, focusing on the quality of the mentors and rating them.

Discussion

The Chairperson asked Members to raise clarity-seeking questions and asked if Mr Ndlela was present.

Mr Thulisa Ndlela, Chairperson, NYDA: ICT Steering Committee, confirmed that he was present.

The Chairperson asked if Mr Ndlela had started a programme in KZN for the families that the Portfolio Committee had visited in KZN. There had to be programmes for the families. There also had to be a meeting secured for the Board members to receive the status update on the situation. The Chairperson mentioned that there was someone from KZN who was in communication with her; in her communication, she mentioned that the Department of Basic Education had assisted with transportation for the learners to be able to attend school.

Mr S Ngcobo (DA) asked how many people living with disabilities were employed by the NYDA as of 21 February 2023. The system grant went to beneficiaries with disabilities, how many of those were identified as male and how many were identified as female? What was NYDA doing to ensure that more young people living with disabilities had access to the NYDA’s financial and non-financial opportunities? What was the role of the Branch Disability Champions if they could not get more people with disabilities to access their services? The Branch Disability Champions should have been able to reach more people with disabilities as they were in every branch.

Ms T Masondo (ANC) welcomed the presentation with its recommendations. On the overview financial performance for quarters 2 and 3, for 2022/23, she asked how the NYDA had implemented the ARC recommendation(s) in terms of its financial management. Had the NYDA utilised the R224.2 million of funds sourced from public and private sectors to support Youth Development Programmes optimally? What had been the user feedback regarding the application platform interface? How many young people had accessed the platform and completed the ERP application? In Programme 2, what was the total cost of supporting 1198 Youth-Owned Enterprises financially by end of quarter 2 and 2074 youth at the end of quarter 3? What was the average cost per beneficiary? Which MOUs were not concluded with the four universities? Why had the NYDA issued 37 grants in Western Cape and 40 grants in the Northern Cape in quarters 2 and 3? What were the key challenges experienced by NYDA in finding jobs for the youth? Why were few jobs sourced for the Limpopo and Eastern Cape provinces? What had hindered the four audit findings’ progress for six months? What was the NYDA doing to resolve the hindrances in quarter 4?

Ms F Masiko (ANC) said some of her questions had been covered by the Members before her. She explained that it was important to remember one fact about the oversight visit on Women and Persons living with Disabilities. The fact being that not all NYDA Board Members had been present. That was disappointing. What had been done since the Committee’s last visit? What had the NYDA intended to do about the tasks the Committee had given the NYDA to combat the challenges experienced by the youth and women in the centres?

The NYDA Board came into office at the end of 2021/22, and there had already been activities that were implemented around the outreach programmes and that were recommended. The Human Resources Remuneration Committee had only two meetings since the inception of the Board. There was still an 11.2% vacancy rate. The Committee welcomed that the strategic and important vacancies had been filled. The recruitment was said to be underway by the NYDA. 33 of the 64 vacancies had been filled and others were still in progress. It was concerning that only two meetings had been convened. Why were only two meetings from the Human Resources Committee held?

She said the Portfolio Committee understood that the investigation was still underway. The NYDA had commissioned an independent investigation, and commissioned a report into the allegations that were levelled against the CEO. The investigations started in May 2022. The progress indicated in the presentation was welcomed. The eight witnesses identified had provided evidence to assist with the progress. There was one outstanding witness pending to be interviewed. The Committee welcomed that the final report on the investigations would be issued by the end of February 2023. What caused the shift from December 2022? What caused the delay?

The Chairperson interrupted Ms Masiko to say that she had received a call from the NYDA stating that the entity needed more time. The Chairperson confirmed that she had allowed the NYDA to provide the report when it was ready.

Ms Masiko said the oversights needed to not have any clouds hanging over the Committee. She welcomed the feedback from the Chairperson. She iterated that it was important for the Board Members to be present during the oversights. In some months of 2022, nothing was recorded on some of the Board Members, about their participation in oversights. For Members that did international travels, it was important to indicate that they represented the NYDA. Groundwork was important but it was even more important for the Committee to create a synergy between the work being done and the NYDA strategic outcomes. The Committee needed to report in line with the programmes, especially on the target outputs, so that the activities done on the ground could match what the NYDA was trying to achieve.

On the Charter of the NYDA Board of Directors that was published in 2019; had it been updated? Could the NYDA provide a copy?

Could the NYDA provide a report on the grants that were provided for Persons with Disabilities? The NYDA had provided the Life Skills programme including the Job preparedness programme, and an understanding was needed of whether it would provide jobs for those that had attended.

 [due to loadshedding challenges, the end of the meeting was not captured in totality]

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