Briefing by the Quality Council for Trades and Occupations (QCTO) on its 2018/19 Annual Report

Mr V Naidoo, Chief Executive Officer, QCTO, outlined the vision, mission and values of the organisation in his opening remarks. The Council is appointed by the Minister and there are three Committees that reported to the Council.

On human resources management, the total staff complement for 2018/19 totalled 89 against a total of 243 posts (to be implemented in phases based on the budget). HR policies, procedures and systems were implemented as from 1 September 2014. As a challenge, of the 243 approved posts the budget permits not more than 108 posts to be filled. QCTO posts are funded mainly from the SET grant, however as these funds are allocated annually based on a submission made to the DHET. The amount received (if any) can vary considerably. The uncertainty this creates has negative consequences for the QCTO.

Mr Innocent Gumbochuma, Chief Financial Officer, QCTO, reported that revenue collected in 2018/19 amounted to R120 670 000. The bigger slice of the total revenue collected came from the SETAs at about R86.7 million, and the DHET allocated a grant of about R27.4 million.

The Council under-spent significantly in the year under review and it reported that QCTO business case for the revoking of delegated functions to the SETAs was not approved by the DHET which resulted in planned expenditure not being spent. The under-expenditure on staff costs amounted to R17 million. Some of the projects could not be completed during the year although they were approved. A cash surplus of R19 million was requested for retention approval from the National Treasury.

The Chairperson needed clarity on the R17 million on the remodelling of the office spaces. The entity plans on buying its own building.

Ms Mananiso sought clarity from QCTO because it seemed that it struggled to recruit people and there were issues around resignations. ‘So what were the causes of resignations’?

In the HR Report review, there was no mention of young people being included in the organisational structure. Members needed to be brought into the confidence on the transformation agenda of the entity. The SETAs have a tendency of recruiting older people with doctorates and many qualifications. Young people need to be recruited and included in the senior levels.

On the intervention planned to work with TVETs Ms Mananiso asked what would be the plan regarding assisting the TVETs in terms of skills development and experiential learning.

Dr W Boshoff (FF +) commented on the 173 assessment centres outlined in the Report; ‘is it possible to oversee 173 centres’? Secondly, he sought clarity on the relevance of the N-Diploma qualifications that were still being offered even though there were some talks in the labour market before that they were outdated. 

Mr Keetse, on SAQA, said that it is important to criticise other qualifications out there but some of those courses do not have positive throughput in terms of employment in certain courses. For instance, in the humanities faculty; there are a lot of courses that did not speak to the demand in the labour market. So people go around carry useless papers in the communities without getting employment.

There are universities that are not friendly to African people in terms of enrolment and application to certain courses because if one seeks to address the injustices of the past, one needs to zoom into that. For instance, the UCT can only take 200 students for medicine in the first year. They would apply their criteria which is fine but when over 1000 students apply, these universities use what they call ‘‘cosmopolitan policy’’ which speaks into class, ethnicity, race and so forth. You would find white students with lower marks compared to black students, but were being accepted in these programmes. Perhaps both entities could comment on this.

On the QCTO, the concept of closing the skills gap; ‘where are we now in terms of the skills gap in the country’?

‘What is being done about the fundamental realignment of our country’? ‘Where are we now’? And what can the entities say about the curriculum that is being offered versus the requirements in the labour market – do these speak to each other’?

Lastly, on the certification issues; perhaps to help the TVETs on this matter, Mr Keetse asked what kind of advice or assistance can the QCTO offer to that space.

Mr B Yabo (ANC) noticed in recent times that the number of cases of people with false qualifications has spiked. What is worrisome is that it does not seem that SAQA has teeth to bite when people falsify qualifications. If you have a state entity that is given a mandate but has no teeth to effect that mandate, that paralyses the entity. If someone gets a job based on lying and using fraudulent qualifications, that process must be rectified.

Students that study in TVETs are required to do the hands-on training to complete their qualifications but who bears the onus of that training? ‘Do we have the requisite capacity in the market that is able to absorb these students for that purpose in order to acquire that qualification’? ‘Is there a process that ensures those students were absorbed in the job market’?

Mr Naidoo said that the entity is putting together qualifications for the market by the market; he asked how is that process going to be implemented and how is that relationship handled to ensure that it is sustainable, and that the qualification given would not be rendered obsolete.

Mr Letsie said that there was good work happening in the SAQA entity. The presentation should be as comprehensive and detailed as possible for Members so that the engagements could be fruitful. He also congratulated SAQA on its fairly positive image and that there were no scandals in the organisation as well as the unqualified audit opinions.

It was mentioned that there were 14 resignations so he wanted to know why there were so many resignations. In the previous term, the Committee agreed that the SAQA was under-funded but now there was under-spending of 8.7% (over R10 million); he sought clarity on this.

On NRLD, the numbers look very good and convincing, but reality prevails which shows that there are a lot of “fly-by-night’’ institutions that claim to produce what SAQA produces. There are students that end in the periphery of studying in these bogus institutions due to “cosmopolitan policies” that would be applied by these “upper class” universities. He asked what plans would be put in place to do away with the bogus institutions.

Has SAQA considered establishing a system such as Block-chain where one can enter just an ID number of a person and one can ascertain whether that person has the credible qualifications that they claim to have and so on. NSFAS has started implementing a system like that in collaboration with other institutions such as SARS and SASSA.

To QCTO, there was only 55.2% expenditure and there was  significant under-spending. The entity was also working with a staff complement of just about 30% and this means that the entity might struggle to achieve its targets.

On slide 33, on office remodelling – it was approved in March, but the contract has not yet been approved. ‘Why has work not commenced if things are moving’?

“The QCTO claims to close the skills gap, but what practical intervention have been planned or implemented to address closing the skills gap in relation to the 4IR and technology?

Ms Mkhatshwa suggested that time frames were needed to be set regarding the failure of meeting targets by the entities. It is also important to ensure that the entities partnered with the private sector and engaged the private on the value of the qualifications offered in the TVET colleges.

Ms Mananiso asked SAQA to be more specific on its social responsibility outreach as well as outreach programmes. These activities should be included as part of plans not meagre activities on Mandela Day.

The Chairperson indicated that QCTO’s performance was not satisfactory (59%) especially considering that the entity had sufficient resources. The entity is indeed doing well financially but it is not meeting its targets and that was not satisfactory. He wanted to know about the R17 million that was provided for.

On SAQA, the entity did well as its audit outcome improved but Members were not happy with the presentation of its Report.

Mr Samuels said that on the number and kind of qualifications that have been produced by SAQA that Report would be furnished to the Committee. The entity has prepared a document supported by research that has looked at how qualifications have progressed over 20 years. The Report suggests that the biggest issue stemmed from economic conditions as opposed to the quality of the qualifications. The Report can be shared with the Committee.

The NQF amendment Act which was signed by the President on the 13th of August has brought teeth to SAQA and the President must now proclaim it. The legislation makes a distinction on fraudulent and misrepresented qualifications. As an entity one cannot declare a qualification fraudulent but only a court can do so.

Now, when it comes to government line function departments; there was a directive that was issued by the Minister of Public Service and Administration that compelled the departments to submit qualifications to SAQA for verifications. It was found that some of those qualifications were misrepresented and feedback was provided to the line function and it must be the one that acts.

On the public perception, the number of misrepresented qualifications is about 1% of the total number coming to us. Right up front, the individual must be aware that when they submit misrepresented qualifications their name will appear on the registry of misrepresented qualifications. At the moment, we will make an affidavit at the Police Station and then the criminal process would take its course.

On the Tshwane municipality situation, the municipality did not ask SAQA to conduct a verification of that qualification. We were asked by the Media to comment on the document and whether that qualification was registered and on what NQF level. It was up to the municipality to take action on that. The qualification was not registered on the NQF but when the Act comes into effect, the entity will have more teeth in terms of taking action on such matters in terms of who brings the issue to the police. The qualification is a very old qualification that was never registered on the NQF but the municipalities were still recognising those qualifications as valid. SAQA has made it clear that the qualification is not registered but if the employer accepts the qualification as it is, then at the moment SAQA cannot take any further action. However, the new NQF Amendment Act will change these circumstances.

The Chairperson sought clarity that if the qualification is not registered on the NQF level, the employer can still employ a person with that qualification. ‘What is the legal basis on that’ ‘What is the legal position on this is it requiring that all qualifications that are offered in this country must have an NQF level’? ‘And those that are not registered fall outside the framework’?

Mr Samuels said that the municipalities have for years been employing people with that qualification, and that legal issue is the one that must be sorted out. The NQF amendments now put in place the conditions.

The DHET Official said that there are qualifications that have international and national currency but were not registered within the NQF. Non-registered institutions cannot offer a registered qualification. So the unregistered qualification is not necessarily a fake or bogus qualification; for example, the Microsoft qualification, it has international and national standards that are sought after but it is not registered on the NQF. A fake qualification is when it has been offered and it is registered on the NQF, but the institution is not registered, that is a fake qualification. Then one gets a misrepresented qualification, but the relationship is that to offer a registered qualification, the institution must be registered but registered institutions can offer a qualification that is not registered.

Mr Yabo was perplexed about the matter because the communication was not very authentic and said that the Committee recently had the University of Limpopo that came to account on bogus qualification. There was an outcry in the public about this.

The Chairperson said that there was an expectation out there that all qualifications offered are registered with the SAQA and anything outside the recognition is not a legitimate qualification. Institutions should take qualifications that are registered with the SAQA.

The DHET official said that the University of Limpopo matter was based on accreditation to offer that qualification. The University was registered but it was not accredited to offer the course.

Mr Samuels said the short course was not registered at the NQF.

With regard to the resignations, there are 14 people who terminated their contracts and one person died. If there are 14 people  left out of over a 197 people that is less than a 10% attrition rate and it is not something to worry about and if people want to leave, the entity cannot hold them back. When people leave, exit interviews are held to ensure that the retention strategy of the organisation was strengthened.

DHET said that there was a R11.2 million and in that there was a R3.2 million which related to vacancies and most of those vacancies were in IT and research. It takes a while to get those skills because the organisation competes with the private sector. People accept the offer and then later decline when they find employment in the private sector.

Also included in that amount is the general expenses, when one goes through the tender process and  appoints people to do the work and deliver the goods but it was completed only after year end and due to accounting principles you cannot recognise the expense; hence, it was reported under commitments. Only after the delivery of the goods or service was done, can the recognition be done. In this current year, some of the projects were completed and could not be reported in the current year due to time differences.

Mr Naidoo commented that the organisation was sitting at about 40% of young people employed.

On the TVETs on the value of the qualifications, the N-Diploma qualifications lead to a Diploma and the candidate would get that Diploma after completing the work experience. This is where the system becomes un-stuck because the students exit the system with the certificate and then come back for the Diploma.

Less than 10% of the students that complete N6 come back for the Diploma; hence the QCTO has realigned the qualifications to work experience. Part of the issue is the uptake of the occupational qualifications in the TVETs because of the funding model but this was raised to the department. TVET colleges are only funded for the N courses and the NCV.

SAQA was closing the gap in terms of industry understanding the needs, so when it developed a module of a qualification, the industry was invite and out of that process it gets refined and then a developing team gets extracted out of that group. One of the key things in that process is international comparability. So a qualifications is issued that is internationally recognised or comparable.

The issue of the workplace is a big issue and the QCTO has re-looked at that and its framework alongside the industry to determine the time required for students to complete the work experience to be recognised as equipped in terms of knowledge and the practical experience.

Three of the qualifications put out by the QCTO involved the Tool Maker (Fitting and Tuning) with over 1600 learners with the DTi (Department of Trade and Industry) it ticks all the boxes of the 4IR from the Reports received. It was also elevated from a qualification level.

Mr Gumbochuma said that on the R17 million, the open plan is not going to allow the current furniture that the entity has, and two buildings are being rented. R10 million will go into furniture, and the R6 million towards refurbishing the building. The current set up accommodates 95 workstations and 250 workstations are needed. The landlord of the building has been approached to buy the building and when the landlord has given a green light the Minister will be approached. The Entity has also talked to the bankers to see how much one can get for a bond if the approval is obtained from the Minister.

The approval came from Treasury on the 27th of March and there was only three days left to year end and a contract could not be completed in three days. All systems are ready now, but the organisation had to apply at the Treasury again for approval to utilise the funds. When the approval process has been concluded, it will be all systems go.

The revenue collection is actual cash and on the financial statements there was a donation of R2.3 million.

On the approval of the business case in terms of revoking the strategy for the SETAs; the moment those functions are taken up personnel will be needed. So when the guaranteed funding comes, employed will start.

The Chairperson thanked everyone present.

The meeting was adjourned.