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Umsobomvu Youth Fund: Empowering Youth for Employment

Learn about UYF's history, achievements, and plans for 2004-2006. Discover programmes, challenges, and financial information. Explore how UYF empowers graduates and youth, fosters entrepreneurship, and fosters skills development.

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Umsobomvu Youth Fund: Empowering Youth for Employment

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  1. Outline • About UYF • Programmes of UYF • Description, Achievement, Lessons, Challenges Context (Conditions, Policies) • Financial information • Plans 2004 - 2006

  2. Key issues • Acceleration on the Implementation of Scarce Skills, the role of colleges and Higher Education Colleges • Review of Instruments available to build the capacity of our Social Partners • Strategy to train and empower Graduates and Universities of Technology Diplomates to: • Enter the Labour Market • Acquire Skills for Employment • The role of Umsobomvu Youth Fund • Progress on the theoretical content and role of Colleges • Information on the unemployed graduates’ profile and Umsobomvu’s role • More Young people into Learnerships

  3. Feb 1998 Budget Speech - Minister of Finance announces a levy on the demutualisation proceeds establish the UYF Sep 1998 Government Gazette - Demutualisation Act Oct 1999 Monies are transferred from SARS to the Umsobomvu Youth Fund account and placed a deposit with CPD Oct 1999 National Treasury begins the process of appointing the Board of Directors Nov 1999 Articles of Association drafted Jan 2000 Board of Directors appointed Feb 2000 Board of Directors meet for the first time Mar 2000 Board begins the process of appointing the CEO History

  4. Jul 2000 Government Gazette amending the Demutualisation Act to exempt the UYF from income tax Aug 2000 Consultative Forum Jan 2001 CEO and COO are appointed Jan 2001 Strategic planning session between the Directors and Management to establish four key result areas for the UYF Mar 2001 Bankers, auditors and asset consultant are appointed Mar 2001 Work commenced on the internal structure, policies, procedures and systems to administer the UYF Mar 2001 Board of Directors approve the focus areas of the UYF Apr 2001 Recruitment process to fill 10 strategic posts begins History

  5. Focus of the Fund INVESTMENTS & PROJECTS Skills Development & Transfer Youth Entrepreneurship Contact, Information & Counselling • SME Finance • SME Finance • Cooperative Funding • Micro Finance • Business Development Support • Entrepreneurship Education • New Venture Creation Learnership • Business skills development voucher programme • Youth information service • Youth line • Youth portal • Youth advisory centres • Youth Card • On-the-job Training / Skills Development • National Youth Service • School to Work (FETCs)

  6. Commitments

  7. Targets* *At current funding commitment level 50 000 jobs by 2006

  8. Programme Number of beneficiaries 1. Youth Advisory Centres 80 554 2. Youth Line 81 480 3. Business Development Services Voucher Programme 3 356 4. Entrepreneurship Education 10 000 4. Small & Medium Enterprise Finance 60 5. Micro Finance 1 015 6. Youth Co-operatives Finance 120 7. School to Work 2 236 8. Community Youth Service 990 9. Skills Training (including Volunteer Campaign) 1 572 10. Youth Portal 505 000 Participants to date Total beneficiaries in excess of 650 000

  9. EntrepreneurshipTarget Market

  10. PROGRAMME AREAS

  11. EF PROGRAM STRUCTURE • Progress Fund: R100 million Fund – provides finance from R100k to R5,000k to SMEs which are beneficiaries of procurement contracts. • Franchise Fund: R125 million Fund – provides finance from R150k to R3,000 for purchase of new or existing franchises. • General Fund: R90 million Fund – provides finance from R50k to R5,000k to SMEs which are not covered by Franchise or Progress Fund • Micro-Finance: Provides finance of up to R50k for start up or expansion of existing business. • Co-operatives: Provides finance to groups of people in co-operative up to R500,000 per co-operative

  12. ACHIEVEMENTS • Micro: 1015 enterprises (2000 jobs) • SME: 60 SMEs (979 jobs) • Co-investment: R50 million (7:1) • Private sector involvement – Banks • High (50%) support for women in micro • Returns = 21%-22% (Portfolio) • Bank direct commitment of R160 million and indirect of R320 million) • Strong expression of interest from other Banks • Partnership in process with ECDC and Ithala • Achieved significantly more than Khula, Msele-Nedventures, NEF Ventures, Equity Africa

  13. 2004/2005 PLAN • Approve R60 m loans/investments to SMMEs • SME (70), Co-operatives (28), Micro (1,208) • Leverage private sector finance = 2:1 (R340m : R170m) • Implement partnerships with ECDC, Ithala, MEEC, NPDC; Provincial Investment Promotion Agencies and Provincial Departments • Create / preserve 3,000 jobs • Women-owned SMMEs = 60% • Design, develop, implement mainstream micro • Gross portfolio return >20%

  14. MEDIUM TERM PLAN • Fully disburse in next 4 years • Co-investment target from 7:1 to 0.5:1 • Create / sustain 17,000 jobs for mainly youth • 67% (vs 50%) of SMMEs - women-owned • Successful mainstream micro-finance model • Successful mainstream co-operatives model • Lower cost of financing for micro-businesses and co-operatives (partnership with SACCOL) • Gross portfolio return (>20%)

  15. CHALLENGES • Attracting private sector investment in SMME • Increased private sector investment vs UYF influence • Managing stakeholder expectations • Managing growth • Balance developmental & financial returns • Maintain focus (especially if seen as successful) • Balancing breadth / depth of programs • Improving outreach • Creating and strengthening partnerships • Lower operating costs of programs / projects • Lowering cost of financing to SMMEs.

  16. EntrepreneurshipEducation

  17. How Voucher Programme Works • Client completes voucher applicationform • Undergoes assessment and identification of required intervention • Pays contribution (10%) into BDSVP account • Selects preferred SP from SP directory • Attends the approved intervention • Endorses voucher on completion of intervention • Provides continuous feedback to AA on the provision of services including final evaluation of the intervention

  18. BusinessDevelopment Services Voucher Programme

  19. Business Development Services Voucher Programme

  20. Future Plans2004/5 Entrepreneurship Education • Review of entrepreneurship education programmes (UWC) and finalisation of EE strategy • Hosting of National Entrepreneurship Conference (EE, BDS, access to finance) • 20 000 young people to be assisted to enhance their entrepreneurial skills. BDS Voucher Programme • Roll out of programme to remaining provinces : Free State, Mpumalanga, Northern Cape & North West (RFP for SPs & AAs already issued) • Provision of business support to 6000 young entrepreneurs • Approximately 9000 direct jobs to be created/sustained through programme.

  21. Role of Umsobomvu • In 2003 Implementation Plan was developed and adopted by Cabinet • The Umsobomvu strategy was to ensure that there was a national framework which would ensure the implementation of NYS to scale • 5 000 young people will commence the project in 2004. • The responsibility for implementing this programme falls to many agencies. UYF’s responsibility is to resource the youth development components. • The National Youth Service Programme is an initiative of the Presidency and managed by a Project Partnership Team. Govt. dept. are resource agents.

  22. Role of Umsobomvu UYF will support the youth service programme in a number of ways, including: • Funding for the youth development components; • Assisting with exit opportunities; • Running capacity building for the institutions that are managing the programmes; and • Developing the training material and running the training programmes for the technical advisors and the programme and institutional assessors. • Many of these roles are likely to be particularly intense during the first phase of implementation. • In the immediate term UYF is developing the scope of the initial service projects with govt. departments.

  23. Budget for the NYSP

  24. Areas of service2004 • Department of Health 3 000 • Department of Social Development 500 • Community Development Worker Support 250 • MPCCs 250 • Conservation and environment 500 • Agriculture 500 • Infrastructure: 1 000 • Construction: 1 000 • Additional 500 The Sector plans agreed by the EPWP are guiding the location and nature of projects.

  25. School to Work

  26. Programme Description • The School to Work (STW) Programme is a strategic intervention aimed at improving the employability of youth in high growth sectors through the development of high level technical skills training and work experience • Targets unemployed matriculants & graduates

  27. Programme Model • Life & professional skills training for holistic development • Technical skills training & entrepreneurship education to assist youth to acquire sufficient preparation for the world of work • Structured work experience to develop learners’ occupational competencies & an opportunity to apply theory • Case management (counselling support, mentorship, follow-up and aftercare)

  28. Target Areas • Accounting • Agriculture • Banking and Financial Services • Engineering • Information Technology • Sport and Entertainment • New sectors under FETC RFP • Mining • Manufacturing • Agri-processing • Engineering

  29. Lessons Learnt (cont.) External integration Partnerships with Setas • Poslec Seta: Learnership for People with Disabilities • Chieta: Medical Sales Representative Learnership • Insurance Seta: Formalisation of the RAF Internship into a Learnership Benefits • Joint project design • Co-funding • Access to employers • Integration of life skills & entrepreneurship education • Integration of Enterprise Funding and BDS for self-employment exit opportunities

  30. Lessons Learnt (cont.) Segment youth for effective intervention by supporting: • Learnerships • Bridging projects • Internship projects • Skills projects (if accredited by Umalusi or HEC) Benefits • Create new projects e.g. Nerpo. This agriculture project did not exit. Now its being formalised as a learnership to be handed over to PAETA • Increase access into learnerships e.g. National School of Accounting where few black learners could access the Fasset CTA learnership

  31. To Do • Reach and scale: projects & participants. • Access to funds from the Setas & NSF to replicate projects • Increase employment placement rate from 80% - 90%

  32. 2004-2005 Plans • Formalise current projects into learnerships • Contract 18 public FET colleges (34 proposals received) • Increase provincial representation through FET colleges, parastatals & Setas. New projects in NW, NC, EC & FS • Increase participants to 3500 by March 2005 • Increase employment rate to 90% through BDS & Enterprise Finance • Increase partnerships • Conceptualise Career Development Programme with DoE

  33. The Public FET Colleges Programme • In line with our mandate, UYF has identified DoE as a strategic partner to deliver skills development interventions for unemployed youth. • UYF & DoE are currently finalising the operational plan which will guide the implementation of identified interventions, one of which is to support public FET colleges to deliver skills & learnershipprogrammes.

  34. The Public FET Colleges Programme The FET Colleges Programme began in February with the following investment from UYF: • Technical support to enable colleges to consolidate various capacity building interventions they have received. • Technical support to assist colleges to align their programmes with SETA requirements • R18 million direct investment into training programmes over the next 2 years.

  35. Contact, Information & Counselling

  36. Purpose and Nature • CIC Project Purpose • Young people make informed decisions about their skills development, employment and self-employment and are linked to sustainable livelihood opportunities (What is CIC?)

  37. Achievements since 2001 • UYF Institutional Infrastructure and Capacity Developed • CDMP operational - Content Development and Management Project (CDMP), • YouthConnect operational as of March 2004 • YL (Call Centre) has serviced 60 000 callers in last year • Internet Portal now live! • SAY! to be launched in June 2004 • Service Provider Institutional Infrastructure and Capacity Developed • 13 YACs operational • YACs have serviced 86 554 direct beneficaries and benefited 408 indirect beneficiaries

  38. Achievements since 2001 - Continued • CDMP • 46 Information Products developed in key information areas and converted for the web (CDMP Information Products) • Database of 18 000 Youth Service Providers • Database of careers and 900 bursaries • 20 + Project Management Resources developed • IP has deployed an information site, corporate site and also systems for the development, management and dissemination of content (Internet Portal Screenshot) • SAY! is conservatively expected to reach 65 000 in Year 1 young people in 2004/5

  39. CDMP Information Products back

  40. Lessons Learned • UYF Investments • UYF investments are skewed to infrastructure, labour, capacity building and operational costs • Currenty the average YACs costs are: • ± 45% on Infrastructure and Operations • ± 40 % on Labour and Capacity Building • ± 15% on Direct Programme Related (some programme costs are built into Labour costs) • Scale and Sustainability will be achieved through Partnerships (to be covered later)

  41. 2004 – 2006 Plans and Targets - Continued • CIC Targets • Access Total CIC Beneficiaries 2004 = 294 000 2005 = 1 474 080 2006 = 2 700 082 Total = 4 468 162 • Usage Total = 498 906 i.e. 11% of the Young People accessing information will use it to find a job, engage in FET, start a business or make decisions about their employment, education and careers, health and rights. The usage targets do not include potential usage from information received through the Youth Card, YAC Mobiles, Points and Kiosks, and the Youth Channel

  42. Partnerships, Sustainability and Scale • Key Principles of Sustainability • Working through Infomediaries • Deploying innovative dissemination tools – Internet Portal, Community Print Media, Radio, On-demand Print, On-demand Mulit-media Datacasting • Through Partnerships with: • GCIS – 2000 Points of Presence (POPs), databases of 5000 + government services • MPCCs – projected 50 sites nationally • USA Telecentres – projected 100 sites nationally with internet connectivity • DoL Labour Centres – approximately 150 sites nationally • Local Governments - approximately 290 local governments • LoveLife Centres – as sites for info dissemination • Strategic partnerships with Youth Formations and Bodies – SAYC, NYC, etc. • Network of Municipal Libraries • Network of Higher Education and FET Institutions Libraries/ Student Centres • Mindset Livelihoods Channel – 800 000 households, 2000 schools • Community Radio – average of 80 000 listenership per station • Use Youth Advisory Centres for learner recruitment & reference purposes

  43. CIC going forward Key to CIC Impact: • Move Information Content to where Young People are – focus less on physical infrastructure and more on creating access • Use ICT to effectively develop, manage and disseminate content • Target UYF investments to information content development and training of infomediaries • Ensure integration with partners who share common purpose

  44. Some of the Research • Conduct High Impact Youth Research and Initiate Partnerships • For 2004 – 2005, the following studies are the preliminary targeted research output: • Status of the Youth Report(1st draft completed – final draft on 30 May 2004) • Youth SMME Strategy • Youth Job Prospect Analysis • Sector Value Chain Analyses (for the sectors chosen by UYF to support SMMEs in) • Comprehensive Needs Analysis through the UYF Imbizos currently underway back

  45. Performance • UYF pioneering almost all the initiatives in South Africa • 2 years of programme experience. Growing i.t.o geographic coverage & scale • Received R855 milliion, committed R500 million to 88 projects. More than 100 000 young people have participated in UYF projects

  46. Challenges • Risk of being perceived as a panacea • Improving access especially for rural areas • Launch of the “Take it to the People” concept • Recruitment of Prov. Coordinators • Dependancy on partners • Youth development agenda not mainstreamed • Diminishing resource base (sustainability) • Capacity (internally & externally)

  47. Challenges • Capacity of Service Providers – OD, accreditation, partnerships & job development • Formalise partnerships with the public and private sector institutions = sustainability

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