By Thapelo Molefe
Higher Education and Training Minister Buti Manamela says Sector Education and Training Authorities (SETAs) must be held to stricter performance standards and brought closer to employers.
Delivering his Budget Vote in the National Assembly on Tuesday, Manamela said SETAs should no longer operate mainly as funding administrators but must demonstrate clear results in linking training to employment.
“The problem is that the link between education, skills, work and industrial development is too weak, and in some places it is broken,” he said.
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He said that SETAs will be required to sign employer compacts covering at least 30% of employers in their sectors, aimed at increasing private sector participation in training and workplace placement.
Manamela also introduced a target that 70% of SETA service level agreements must be met, with stronger enforcement where institutions fail to comply.
“The private sector cannot remain a spectator to skills development,” he said.
“The skills levy is not a tax. It is an investment. And investors expect a return.”
Skills development levies are projected at R27.7 billion in 2026/27, rising to R31.1 billion by 2028/29.
Manamela said SETAs will also be integrated into regional industrial skills compacts that bring together employers, municipalities and training institutions to align skills planning with local economic needs.
Deputy Higher Education and Training Minister Mimmy Gondwe took a more hardline position, saying the current SETA system should be replaced entirely with a model where employers directly procure training from accredited institutions.
Gondwe said the current skills development system was failing to produce employment outcomes for young people despite significant public spending.
“The current skills development regime is failing to produce the employment outcomes our economy and young people urgently require,” she said.
She said that employers are better placed than government intermediaries to determine skills needs and should take greater responsibility for training outcomes.
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Under her proposal, companies would directly source training from accredited providers, supported through tax incentives rather than the current levy-based system.
Manamela did not propose scrapping SETAs, but said government was open to wide-ranging reforms depending on performance and outcomes.
