What are the implications for SDFs of DHET Circular 1 of 2020?

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    • #73305
      sylvia hammond

      Yesterday Louis Nel posted a discussion in the Concerned Providers group – you can see on this link –
      Louis alerted members to the Circular 1 of 2020 issued by the Director General of DHET Gwebs Qonde – attached.

      The circular indicates that as a result of the legal action through the labour courts, that Regulation 4 (4) has been set aside. The department then interprets that Regulation 4 (1) empowers a SETA to “decide what percentage of the levies would be paid back to the employer as a Mandatory Grant”.

      You will recall that the legal action arose because Minister Nzimande (before Minister Pandor took over) had reduced the Mandatory Grant Skills Development Levy (SDL) refund from 50% to 20%. BUSA then challenged that action in court.

      Last night I did read the latest judgment – thanks to Heidi Edwards for posting it – attached.

      I have to say that if I were the Minister & DHET I would be rather irritated by the judgment. I am not a lawyer, but I clearly understood from the previous judgment that a key issue was that the Minister had not effectively consulted. The Minister then consulted with the NSA – and re-issued the 20% Regulation. To my mind – the “fault” was addressed.
      So I don’t agree with this judgment. The Minister didn’t have to prove what had changed – he had to prove that he had consulted.

      BUSA will surely respond with legal action again. However, given how close the timing is to submission of Workplace Skills Plans (WSP)s & Annual Training Reports (ATR)s, I suggest that we are in real danger of over-reaction – and the Skills Development Facilitators (SDF)s will be at the centre.

      Many SDFs know that we persuade employers to participate, we motivate and we advocate. An adverse media announcement may well lead to a large number of employers putting 2 fingers in the air, and telling the external SDFs that their services are no longer required.

      External SDFs paid off
      Internal SDfs retrenched
      No information available for skills planning.

      The only possible counter would be to those employers who make substantial use of discretionary grant funding through PIVOTAL plans – to explain that even if they receive nil% Mandatory Grant refund, they need to submit to qualify for the discretionary funding.

      So these are direct question to DHET – & the National Skills Authority (NSA) – what are your intentions?

      Surely you are not contemplating that each SETA makes individual decisions on how much they will pay? Is that per SETA – or per employer? Imagine all the inter-seta transfer applications that will materialise.

      Is the intention to remove Mandatory Grants altogether?
      To simply work with PIVOTAL grants and discretionary funding?
      To include a form of WSP & ATR in with the PIVOTAL?

      When we are trying to encourage workplace based training – is this constructive use of our time?

      DHET can simply resolve the situation – and reduce further employer withdrawal from skills development – by issuing a guidance to SETAs on the amount of SDL Mandatory Grant refund they are to pay.

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    • #73309
      Bernie Carr

      An interesting judgement but as you say does not resolve the matter and in fact makes it worse. At least with the 20% there was certainty. The judgement rests on legal and procedural principle only and does not touch on the main issue which was the attempt by BUSA to re-instate the 50% mandatory grant. So over to BUSA again to respond. Bernie Carr

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      • #73311
        sylvia hammond

        Hi Bernie, yes I agree with you.
        I sat here last night thinking to myself – did the Labour Appeal Court really not understand the implications of what it was doing?

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    • #73314
      Carmen Meyer

      Hi Sylvia,

      In my experience, especially lately, companies are not really submitting WSP’s for the 20%, but more to be BEE compliant and not lose any points on the SD element. Many companies who never even knew about a WSP, now knows as a result of this BEE requirement.

      So I think things will just continue as usual! But the more they try to standardise things across Seta’s, the more complicated they make it. Leaving each Seta to decide for themselves, will be exactly the opposite of what the Seta’s and DHET have been trying to do – to streamline the whole process.

      Anyway, cannot wait to see what happens:)


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      • #73315
        sylvia hammond

        Hi Carmen, thank you. Yes you are correct – I didn’t mention that.

        Yes I also cannot wait for the next step. I hope everyone shares the information as it comes forward.

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    • #73316
      Lynel Farrell

      I find the attached documents and the comments extremely interesting, and will be following this discussion!! Thank you for this post!!

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    • #73329
      Nigel Shipston


      We all know how consistent processes are between SETA’s and that standardisation appears to be a foreign concept. Surely DHET aren’t going to simply wash their hands on this issue? “Cry ‘Havoc!’, and let slip the dogs of war,”.

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    • #73331
      sylvia hammond

      Hi Nigel
      Yes – that is my concern & in that case I personally believe that would be a contravention of our constitutional right to fair administrative action under PAJA.

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