Summary of proposed changes to SETA Grant legislation and related issues 10



MATTERS 12th January 2012

Summary by Des Squire (Managing Member) AMSI and ASSOCIATES cc

SETA may use a maximum of 10.5% of levies received for administrative purposes but may also use any contributions received over and above the 10.5% from public service employers for administrative costs.

The minister may also permit use of other amounts as deemed necessary to enable a SETA to function.

From October 2012 all SETAS must transfer 0,5% of all levies received to the QCTO for quality assurance functions

With effect of March 31st all surplus funds for the financial year must be transferred to Pivotal Grants within 10 working days of the 31st August

With effect of the 31st march all surplus funds from previous financial years must be transferred within 10 working days to Pivotal Grants

National Treasury may permit usage for other reasons as deemed fit

SETAS must pay mandatory grants to any employer who employs more than 50 employees and who has submitted a WSP and ATR

Mandatory grants will be 40% of total levies paid as per the relevant sections of the SDLA. This grant is to be paid monthly

All unclaimed mandatory grants will be transferred to pivotal grants

A SETA must allocate a pivotal grant to an employer for a learning programme at a level determined by the Director General through a general circular to all SETAs to fund learners on pivotal programmes inclusive of funding of University of Technology students and FET College graduates subject to verification by the SETA to a maximum of 10% of total levies paid by the employer

In addition a SETA may allocate additional pivotal grant funds to an employer for pivotal programmes, should the employer have spent more than 3 % of their payroll on training as reported in the pivotal training report and verified by the SETA

A SETA may determine and allocate a discretionary grant in support of the National Skills Development Strategy, the National Skills Accord and other relevant national priorities detailed in the strategic plan of the SETA as approved by the Minister

A SETA may only commit, beyond each financial year, discretionary funds for learners in pivotal programmes

A discretionary grant may be paid in terms of sub regulation (1) to an employer within the jurisdiction of a SETA, including an employer who is not required to pay a skills development levy in terms of the Skills Development Levies Act

Mandatory grant and Pivotal Grant recovery by employers

An employer seeking recovery of a grant against the levy payment must meet the eligibility criteria for grant recovery as prescribed

A SETA must not pay a mandatory grant and pivotal grant to an employer who is liable to pay the skills development levy in terms of section 3 (1) of the Skills Development Levies Act, unless the employer

(a) Has registered with the Commissioner in terms of section 3 (1) of the Skills Development Levies Act

(b) Has paid the levies directly to the Commissioner in the manner and within the period determined in section 6 of the Skills Development Levies Act;

(c) Is up to date with the levy payments to the Commissioner at the time of approval and in respect of the period for which an application is made;

(d) Has submitted a Workplace Skills Plan and pivotal training report that contributes to the relevant SETA sector skills plan as contemplated in section 10 (I) of the Act within the time frames prescribed in regulation 5 (2) of these Regulations

(e) With effect from 15 April 2012, has submitted and implemented its workplace skills plan for the previous financial year to the extent that it satisfies the criteria for implementation that must be established and approved by the SETA Accounting Authority based on guidelines provided by DHET

(f) Has WSP, PTR and ATR approved by relevant organised labour structures

The Sector Education and Training Authorities (SET As) Grant Regulations regarding monies received by a SETA and related matters, published in Government Notice No. R713 in Government Gazette No. 27807 of 18 July 2005, as amended by Government Notice No. R88 and published in Government Gazette No. 29584 of 2 February 2007 are hereby repealed.

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About Des Squire

I specialise in Employment Equity and Skills Development issues. Qualified facilitator, assessor, moderator, verifier and SDF. Available for any related assignments and or freelance work. If ou have a need let's meet to discuss. Quotes for training on request.

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10 thoughts on “Summary of proposed changes to SETA Grant legislation and related issues

  • Des Squire Post author

    Hi Tracy and Sylvia

    I tend to agree that too much emphasis is being place on what went wrong in the past. Alos there is too much emphasis on what might be done over the next two years, five years 10 years etc. Like you I want to know what is being dione today – I see very little different at prestent excep for resignations etc.

    Tracy, with the onset of the QCTO which i trust will be firing on all cylinders in the next few months I trust some sparks will start flying and some SETAS will be given an abrupt wake up call. The benefits for the employer are basically the same as they have been since the inception of the SETAS – very little but potentially a great deal for the employees if the employers were supported by the SETAS and permitted to do what they want to do.   

  • Des Squire Post author

    Hi Maria,

    Any registered employer who submits a WSP and ATR is entitled to the grant in terms of The SDLA. What is being said here is that those who are not compelled in terms of the act to submit WSP and ATR need not do so. However if a registered employer who has an SDL number. pays levies, completes WSP and ATR that employer will be entitled to calim the mandatory grants.

  • Sylvia F. Hammond

    Hi Tracey, I can’t answer your question about whether more training takes place but I can see that Setas are definitely being investigated and monitored more closely following the introduction of the new Chairpersons and new Board members.  I am aware of Setas under administration, CEO disciplinary action, and people leaving Setas.  The problem is that all this attention to what has been wrong/not done appropriately in the past takes attention away from what should be done today.  I am hoping that all the additional attention to what has been wrong in the past wil move in 2012 to what we should be doing now.  


    Des, in my understanding (not great) is this going to mean that Seta’s are going to be monitored more closely to see that the grants are made available, so that more training takes place? Also in lay terms what is the benefit to the employer?

  • Des Squire Post author

    Hi Moira,

    A Pivotal programmes is any professional, vocational, technical or academic learning programmes that result in an occupational qualifications. The programme must be quality assured by the QCTO and may include a knowledge component that is normally delivered at a Further Education and Training College or a University

  • Moira De Roche

    The reduction of the amount to SETA’sis welcomed. Now all that is needed is safeguards to make sure that SETA’s allocate funds fairly, And the process should be transparent.

    Still a bit uncertain about Pivotal Rraining Programmes – sure one of you wise folks can explain in bullet form!

  • Des Squire Post author

    Hi Stephanie – No. any registered employer who submits a WSP and ATR is entitled to the grant in terms of The SDLA. This is just one of those paradoxis.  

  • Stephanie Stylianou

    Hi everyone …

    ” SETAS must pay mandatory grants to any employer who employs more than 50 employees and who has submitted a WSP and ATR” 

    Some employers with less than 50 staff and payroll over R500 000 per annum submit WSP and ATR’s – does this mean that they wont retrieve Mandatory as having less than 50 staff? 

    Can anyone shed light?

    WIll appreciate