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In conversation with the National Youth Development Agency

Siki Mgabadeli speaks with NYDA chair Sifiso Mtsweni about young people, employment and entrepreneurship in this special edition of the SAfm Market Update with Moneyweb.

SIKI MGABADELI:  Good evening and welcome to the SAfm Market Update with Moneyweb. My name is Siki Mgabadeli.

Today we are focusing on young people, employment and entrepreneurship, speaking to the National Youth Development Agency. As you know, a new board is now in place. The president appointed Sifiso Mtsweni, Bavilele Hlogwa, Khomotjo Maimela, Ndumiso Mokako, Itiseng Morolong, Yershen Pillay and Zandile Majozi to the board. Mtsweni is chairperson, Hlongwa is deputy. As you know, the NYDA is the government’s flagship youth development initiative. It’s annual budget last stood at R409m.

Joining us now is chairperson Sifiso Mtsweni. Sifiso, thanks so much for your time today.

SIFISO MTSWENI:  Thank you very much and good evening to your listeners.

SIKI MGABADELI:  Congratulations for being part of the board. Tell us what this means to you.

SIFISO MTSWENI:  Well, thank you very much. We were very humbled by the confidence that the president has shown us. You would know that the process towards appointing a board was quite a public one. The NYDA board is a constituency-based board. When they advertised they called for nominations from various organised formations, in particular youth formations. So we were nominated.

Our profiles were made quite public. We had a public interview in parliament and seven names were recommended by the National Assembly and the National Council of Provinces to the president. The president then appointed the chair and the deputy chair.

Based on that I think we are quite honoured and we look forward to the work ahead.

SIKI MGABADELI:  As you say, it’s a constituency-based process. There is public scrutiny and it’s had some stops and starts. What did that feel like, as someone who was a candidate?

SIFISO MTSWENI:  The first stops and starts – I was not necessarily part [of them]. But you are driven by that. There is an NYDA Act in South Africa that sort of governs the process of appointing a board and what needs to happen. But the first process last year – the portfolio committee felt that there were certain requirements that had to be put [in place] in order for a board to be appointed.

But unfortunately those requirements were against the Act itself. A number of individuals then challenged the process in court. But that’s why I believe that this year it was a very thorough and open process, because the first two processes were not quite public. This one was very public. So that’s why now I would say it’s a watertight process. That’s why nobody has challenged it and we are now in office and are moving forward.

SIKI MGABADELI:  A big part of that process initially involved the red flags that were raised around education qualifications. Does it matter whether somebody has a post-secondary school education? Shouldn’t it matter, given firstly the size of the budget and also the importance of youth development in this country?

SIFISO MTSWENI:  Well, it’s important but you need to look at it in two ways. When you talk about the state of youth development in South Africa, you are talking about a broad range of factors. There are 35 million young South Africans, the majority of whom are unemployed, the majority of whom have been academically and financially excluded from higher learning – many of whom you find in your secondary schooling system.

Constituencies of youth formation

Now, when you talk about a constituency-based board, you would know that there are various constituencies of youth formation. You’ve got the Congress of South African Students, for instance, that exists in the space of secondary education, you’ve the South African Student Congress that exists in the tertiary space, you’ve got the Young Communist League, the DA Youth and the ANC Youth League.

Now the ANC Youth League in particular is still the largest youth formation in the country, with a membership of over 700 000 young people – and it exists in every ward in the country. It’s the Youth League of a ruling party that is government. So generally the Youth League would have its own nominations base from its own leadership.

But, coming back to the issues of the budget and qualifications, the board is supposed to give a broad strategic direction to what youth development needs to be, based on the inputs that people are making themselves. So if young people say this is how we thing unemployment must be dealt with, this is how we think issues of skills and development should happen, this is what we think needs to happen in a tertiary space, the board does that.

But there is a level of the executive, the CEO, the CFO – those are highly qualified individuals. You would know that over the last two or three years, for instance, the agency has done good work in terms of clearing its image, cleaning its public perception out there. When it started there were issues of financial mismanagement, irregular expenditure and so on. But today you would know that the agency has been having clean audits. For instance between the 2015/16 and the 2016/17 financial years the agency has actually performed beyond 96% if its KPAs. So, as this board, we have decided to keep the executive as it is. It works. It does good work. Everybody, senior managers, are well qualified. So those issues are intertwined, and for us that is very important.

SIKI MGABADELI: For political formations in terms of the constituency-based nature of the NYDA, what about those young people who are politically unaffiliated? Quite frankly, they aren’t card-carrying members of any organisation, but at the end of the day they still need assistance. Who speaks for them in the NYDA?

SIFISO MTSWENI:  I would want to believe that youth formations themselves should talk to issues of young people beyond their own membership. For instance, the organisation that I come from has championed the general interests of young people, because part of its own agenda is to address issues of young people as a whole, whether social, pollical, economic or whatever they are.

But I think it’s important that as young people we also need to be organised beyond political formations – whether in sports, whether in arts and culture, in whatever aspect. Young people need to be organised so that their voice is able to be coherent. One of the first things that we’ll be doing ourselves is to convene a Youth Indaba with organised and unorganised young people. Already we’ve been hitting the ground running. We’ve been going to schools, we’ve been going to tertiary education institutions, we’ve even been going to rural areas.

We’ve come from Mqandule at the beginning of May, just after the announcement, and we said that we aim to take the agency away from the sort of urban setup that it currently is in.

I was, for instance, speaking now about the good, clean audits and whatever, but young people in Mtatha, in Mqandule, don’t know where the agency is, or how they can access it. So part of what we are going to be doing is actually to take the agency to its primary stakeholders, which are the young people in the townships and in the outskirts of our country.

SIKI MGABADELI:  Tell us a little bit about what young people have been telling you so far. Obviously I understand you are newly minted, you are coming up with new programmes. But, as you have said, you are hitting the ground running, going around meeting young people. What are they saying?

What young people are saying

SIFISO MTSWENI:  With regard to the agency itself, they are saying it’s too far from them. For instance I’ll give an example. In the Western Cape you have only one branch of the NYDA, which is in Cape Town. Now, for someone who stays in Plettenberg Bay or in Knysna, that’s 480 kilometres away. So for young people to access the services of the NYDA, they have to travel long distances and so on. We are saying that one of the first things that really must be a priority on our part is to decentralise it from being an organisation that’s just national with a few branches. I think we have only 15 branches across the country.

SIKI MGABADELI:  You know what’s interesting about that? I’ve spoken to previous board members over the years and decentralisation has always been something that they highlight. They’ve even at one point said they wanted to set up offices in the municipalities in each of the provinces, each of the districts and each of the metros. Has that not happened?

SIFISO MTSWENI:  You would know that the institution itself is a Section 75 [entity]. One of the things that we said is urgent – we’ve already spoken to the minister, and there is a process in place to change it to a Section 76 entity. That will allow us for the establishment of provincial boards and provincial offices.

Youth units

But I think what we will do differently from what my previous colleagues have said, in that within the next two weeks we’ll convene all youth units, because you’ll know that all provincial governments have got these things called youth directorates, and certain budgets are allocated there. Municipalities, particularly metros, have got youth units and there are allocations of budgets there.

Now what the Act currently says is that the Youth Development Agency is an umbrella body for all youth development in the country, but we find that because we are just at national [level] we are unable to pick up what is happening on the ground. For instance, in Ekurhuleni the municipality there allows for a R2.6bn injection to youth development, and you find that in the Western Cape there is nothing that is being injected.

So what we are going to do is we are going to mainstream youth development across the board. Every municipality already has a youth unit; the only thing is that that youth unit is just moving left or right. We are just going to take over that coordinating role and ensure that at least we make it accessible.

But in addition to that, there are currently Thusong centres in the country. Now Thusong centres at least help because it’s a national type of programme. Home Affairs is able to take its services there, the Social Development Department is able to take its services there. So we are in discussion with the president in particular, to say NYDA at least must exist in every Thusong centre, because Thusong centres are at least in townships, at least in rural villages and when old people go and access their grants, young people can quickly run to an NYDA, whether small office or access point. That’s what we are looking at.

SIKI MGABADELI:  That sounds like a long-term programme.

SIFISO MTSWENI:  No, it’s not a long-term programme.

SIKI MGABADELI:  How long is it going to take?

Lobbying

SIFISO MTSWENI:  I can tell you now, before the end of June we would have convened all youth units to ensure that we align one programme, one youth development programme. But at the same time I’m saying that there is a lot of a lobby role – which is something that people have not come to know about the NYDA. We play a lot of an advocacy role.

One of the things, for instance, we’ve already met the minister in the presidency, and we’ve said to him that we don’t understand why, when cabinet has its lekgotla, you don’t have NYDA sitting there. How does government plan for its programme and not have young people there? So we are already saying young people must sit there.

SIKI MGABADELI:  But the president says that he’s got young people in his cabinet.

SIFISO MTSWENI:  No, no. Those are transitionary. Those are graduates of the Youth League in particular. But in our definition young people are 35 years and younger. Look, we are not calling for us to be ministers. There are young ministers, but they are specifically focused ministers. You’ve got Mduduzi Manana, who is still relatively young and his buddies. He is specifically higher-education-focused. What we need is a youth voice to ask every department where is youth development here. In your priorities, what are you saying about young people?

So on that one we are saying you must at least sit at the planning level, which is the cabinet lekgotla. We are demanding a seat at Nedlac, for instance, where there is the private sector and civil society, where we can really say to the private sector in particular that we are unhappy with the manner in which they are conducting themselves in relation to unemployment in this country.

For instance, on every street corner there are now graduates holding placards, saying I’ve got  a BCom in this, I’ve got an engineering degree, and yet I don’t have a job.

The private sector

The private sector will always tell you no, they don’t have experience, we can’t absorb them. We say that excuse is old – we don’t accept that excuse any more.

SIKI MGABADELI:  But there is the youth unemployment tax incentive – that’s what’s been put in place. Should you not particularly focus on that and say, right, how do we make this work to ensure that those young people who are qualified but unable to be absorbed into employment – we are going to take charge of that youth incentive?

SIFISO MTSWENI:  Look, that youth incentive is one thing. In other words, it’s practically government saying I’m giving you money to employ young people. It’s the one side.

SIKI MGABADELI:  It’s a start, though.

SIFISO MTSWENI:  What we are saying on the other side is that ordinarily there should be an incentive for private companies to employ.

Let me give an example. The more we have a situation of youth being unemployed in the manner they are, that sort of threatens the social stability of the country in future. The private companies themselves, for them to survive, need the buying power of young people. These young people one day will have to have some economic stability to be able to sustain these companies, and this is what we want to say to them, this is how we want to appeal to their consciousness, to say: at least absorb this one. Let’s put a quota system in place for every company so that, at least when we look at you, at least 40% of your workforce must be young people.

SIKI MGABADELI:  That’s actually the argument I’m making – that you have short-, medium- and long-term plans. In the short term you already have something that’s in place right now, so let’s make sure that that works.

300 000 unemployed graduates

As we come up with a medium-term and a long-term strategy, we are not going to get all 300 000 unemployed graduates employed tomorrow, and it’s unfair to give them that hope that we are fighting to get all of you employed. It’s not going to happen in the short term. So in the short term let’s work with what we have and then build on a medium to long-term plan.

SIFISO MTSWENI:  I agree. But at the same time where I slightly disagree – young people are beginning to lose hope, actually.

SIKI MGABADELI:  Yes, I know.

SIFISO MTSWENI:  Now we can’t sit here and say let’s not give them hope. Let’s give them hope, because it’s through that hope that all of us are going to be able to really start mobilising these young people and say there is a future that they need to look forward to.

My problem is that the youth incentive scheme that you are talking about – we are obviously going to look into it and say we need to start number-crunching now, to say this budget that is already there, how many young people will it absorb? Let’s say out of the 300 000 maybe it can absorb 50 000. It means we are left with 250 000 – what do we do with those? That’s why I’m saying we need to sit with Nedlac and say, look, government has come the party. It is actually incentivising you. What are you doing? You need to also come to the party and say beyond the incentive, this is what we are going to do. That’s what I’m saying we need to have a conversation about.

SIKI MGABADELI:  Can I make a suggestion? The companies have already been claiming from that tax incentive – the first thing you need to do is find out what they are claiming for, and how many young people have been absorbed with that. Then it gives you a sense of the efficacy of that programme. It’s just a little suggestion.

SIFISO MTSWENI:  Yes.

SIKI MGABADELI:  Sifiso, let’s talk a little bit then about future plans. Let’s go back to the mandate of the NYDA. What is it that you are charged with achieving?

NYDA mandate

SIFISO MTSWENI:  Well, as I said, primarily the National Youth Development Agency, according to the Act, is an umbrella body for all youth development initiatives in the country, to mainstream youth development, develop and integrated youth development strategy. You’d know that two years ago a National Youth Policy 2015-2020 was adopted by government which, at its centre, places job-creation and youth economic participation. As I said before, what I’m passionate about from where I am sitting is that the agency is doing good work. The Solomon Mahlangu Scholarship Fund has actually put 445 young people into tertiary education – we need to expand that programme to ensure that at least the NYDA does its part on the issue of the fees for tertiary education.

But two, for me our communication strategy, our rebranding needs to come through. We need to make sure that at every access point in the country young people access the agency. But, as I said, we want to play much of an advocacy role. We are going to try our best to be in the media space. For instance, there are issues around the killing of women that is currently happening in the country. We are quite worried about it. There is a vacuum of a youth voice to say to young people, to young men, that we need not treat women in the manner in which we are treating them.

We need to start speaking the language that young people are speaking. One thing I can for certain put here is that we will irritate society. We will be there, we’ll be in everybody’s face, we’ll be in everybody’s ear, we’ll be on every radio station. We will start saying to South Africa again that young people have arisen, the hour of the youth has struck. It’s time for us to start radically addressing issues. For instance, we need to stop paying lip service to youth unemployment. We need to start saying these are the practical solutions.

For instance, we have already said to government that, in your own public service, tell us how many young people you are employing as government. If that number is less than 40%, then you as government need to start leading by example. We are going to the JSE-listed companies, we are going to meet the private sector, we are going to say to them that issues of unemployment – how are they within their sectors. But, quite importantly, we want to propose to government for youth set-asides, whether it’s government business contracts or whatever it is.

SIKI MGABADELI:  On the preferential procurement side?

SIFISO MTSWENI:  On the preferential procurement system we want to say at least 30% there of all contracts that government puts out there they must give to young people, particularly young businesses. We’ve got a lot of young people who are running security companies, catering companies, whatever it is. We need to make those companies start to benefit out of the contracts.

SIKI MGABADELI:  How many of those types of companies has the NYDA supported in the past?

SIFISO MTSWENI:  Currently, as you know, we’ve got a two-pronged system. One, we’ve got a grant-funding programme, where we take youth-owned businesses – anything between R5 000 and R100 000, whether you need machinery, whether you need shelves for whatever you are doing, or maybe you’ve got a little plumbing company there and you need certain equipment. So we’ve been funding I think close to 1 400 people just in the last financial year.

Now, here’s the problem that maybe we didn’t talk about in this interview. It’s that the budget that is being allocated to the agency is really small. For instance, this grant-funding programme that I’m talking about just benefits over 1 000 people. But R35m of that has already been spent. If you look at the R440m that has been budgeted, for the staff component of the agency about R158m of that money already goes to salaries. Now, the money that gets left for development is too little. What we are going to be doing is we are going to be creative.

One, we’ll engage the minister of finance. But on the other side we want to establish two funds. We are establishing the Youth Entrepreneurs’ Fund, where we are going to call on the private sector, everybody, to say make a contribution to that.

Going forward: the need to be creative

SIKI MGABADELI:  I was actually going to say that you are going have to be creative at this time when we are in austerity, where there is very little money going around at the moment and young people have constantly and consistently been quite creative. There is crowd-funding, there are all sorts of options available. Do you have minds within your organisation at the moment who are able to think outside of the box of traditional funding models that we’ve had in the past?

SIFISO MTSWENI:  As I was saying, there are two funds. There’s a Youth Skills Fund, where we want to expand the programme for skills development. In other words, we’ll engage the Department of Labour, we’ll engage SETAs, and say to them here’s a fund that you must make a contribution to, so that we can start taking those technical skills and ensuring that we develop them.

But there’s the Entrepreneurship Fund, because for us economic participation is a very important  component, whether it be business development training, whether it be funding, at the bigger scale, beyond R100 000. For instance, I speak about 1 200 beneficiaries – we have 20 000 applicants for the Youth Grant Funding. So that money is too little. From where we are sitting, the Youth Fund has R1bn. The National Youth Commission has R1bn. If you bring the two institutions together and …

SIKI MGABADELI:  I worry because we can’t account for some of those billions. So here’s my last parting shot. When you are done with your term, what would you want people to remember you for?

SIFISO MTSWENI:  When we are done three years from now, on every lip of young people there must be the words “National Youth Development Agency”. It must be an agency that they know, that they identify with, and that they can point to an office of the NYDA. So for me I’ll be very strong on that one.

Two, the financial prudence and management system that we already have in place must continue: clean audits all the time. We’ll ensure that we maintain that particular system

Three, issues of youth set-asides must already be legislation.

Four, we must make sure that the issue of youth unemployment already has a practical face.

That is how we are going to deal with it going forward. I’m willing to come every three months and say this is how far we are.

SIKI MGABADELI:  Okay. We’ll keep in touch. Thanks for your time today. Sifiso Mtsweni is chairperson of the National Youth Development Agency, bringing us to the end of this special edition of the SAfm Market Update with Moneyweb.

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