National Youth Development Agency

Presentation to the The Portfolio Committee on Women, Youth, Children and Person’s with Disabilities

Cape Town11 August 2010

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Presentation outline

• Letter of invitation • Reporting to Portfolio Committee (For Minister Chabane)• Co-ordination of NYDA activities with the Department of Performance Monitoring and Evaluation ( For Minister Chabane)• NYDA progress report- Current financial year• NYDA progress report- 2009/10 (unaudited figures)• NYDA approach to mainstreaming Youth Development• NYDA loan recovery plan• Vacancies within the NYDA• Forensic Audit on former NYC

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The MinisterHon OC ChabaneMinister in the Presidency: Performance Monitoring and EvaluationCc: Mr A Lungisa: Chairperson of the NYDA

27 July 2010

Dear Hon Chabane

This letter serves to confirm that the Portfolio Committee on Women, Youth, Children and Persons with Disabilities will meet with the Minister and the National Youth Development Agency to receive a briefing on the following matters:

•Clarification regarding the accountability of the National Youth Development Agency (NYDA) to Parliament, specifically the Portfolio Committee on Women, Youth, Children and Persons with Disabilities.

•Clarify how the NYDA given its mandate and function co-ordinates its activities with that of the Department of Performance Monitoring and Evaluation and the National Planning Commission with specific reference to mainstreaming youth development.

•Progress report on programmes offered by the NYDA along with the intended outcomes and outputs.

•An indication of how the NYDA intended to mainstream youth development within Government’s existing programmes given the Committee’s prior reservations on this matter.

•Progress report on the loan recovery plan, the number of intended beneficiaries that had received loans and the money recuperated to date.•Update on all vacancies and provincial offices.

•Finalisation of legal matters related to the National Youth Commission and the outcome of the Auditor General forensic reports.

The Committee would also like to receive briefing on progress report related to programmes of the National Youth Development Agency.

The meeting is scheduled to take place on Wednesday, 11 August 2010 at V475, Old Assembly, Parliament from 09:30 – 11:00 in Parliament.

For enquiries contact the Committee Secretary, Neliswa Nobatana at tel:(021) 403 3840, fax: (021) 0866607716,cell: 083 709 8472 email:nnobatana@parliament.gov.za

Thank you,____________________________Ms B ThompsonChairperson: Portfolio Committee on Women, Youth, Children and People with Disabilities

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QUESTION:

Clarification regarding the accountability of the National Youth Development Agency (NYDA) to Parliament, specifically the Portfolio Committee on Women, Youth, Children and Persons with Disabilities.

The Presidency to respond

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QUESTION:

Clarify how the NYDA given its mandate and function co-ordinates its activities with that of the Department of Performance Monitoring and Evaluation and the National Planning Commission with specific reference to mainstreaming youth development.

The Presidency to respond

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NYDA Progress report

• On the 16th of June the NYDA celebrated its first anniversary. This was marked by an event in Thulamahashe stadium, BushBuck-Ridge, Mpumalanga. 25 000 youth attended the event.•During the period under review the NYDA also launched the Ride To School campaign in Jozini ( Kwa-Zulu Natal). 100 bicycles were handed to female learners who have to walk for more than 6km daily to and fro school.•The project is in line with the rural strategy for South Africa, led by the National Department of Transport•Over 18 000 participants were trained by the NYDA in partnership with the LOC as part of Africa’s 1st FIFA World Cup•Volunteers played a part in various ways including, welcoming visitors at the airport, showing spectators to their seats or escorting the VIP’s.•Process of establishing NYDA provincial structures currently underway, interviews held in 2 provinces, Northern Cape and Limpopo province

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1. Progress report on programmes offered by the NYDA: outcomes and outputs: Current financial year

KPA Key Performance Indicator KPI Target Q1

1. ECONOMIC PARTICIPATION

Number of jobs created through NYDA Programmes 17,888 6,089

Number of new young entrepreneurs businesses created 500 15

Number of young entrepreneurs provided with Mentorship 6,000 361

Entrepreneurs issued with Business Consultancy Vouchers 700 0

Value of loans issued to young entrepreneurs 11,000,000 R0

Number of loans issued to young entrepreneurs 8,150 1,940

Value of loans disbursed to young entrepreneurs 10,000,000 R6,046m

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KPA Key Performance Indicator KPI Target Q1

2. EDUCATION AND SKILLS DEVELOPMENT

Number of young people enrolled in Entrepreneurship Education programmes 30,150 464

Number of youths provided with job preparedness training programmes 15,000 987

Number of young people provided with Career Guidance 800,000 44,359

3. NATIONAL YOUTH SERVICE Number of youth enrolled in National Youth Service 60,000 0

4. SOCIAL COHESION Number of volunteers recruited to contribute to World Cup success through volunteer efforts

15,000 18,888

5. INFORMATION PROVISION & COMMUNICATIONS

Number of youth accessing information through NYDA service delivery access points 800,000 148,422

Number of NYDA information dissemination and access points in all municipalities (Full service YAC’s and YAC Points)

134 91

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KPA Key Performance Indicator KPI (Targets) Performance results

3 public hearings conducted 1 public hearing was conducted by the Portfolio committee.

Attend 20 parliamentary portfolio meetings

The Parliamentary Unit attended 3 Portfolio Committees: Basic Education; Higher Education and the Women, Youth, Children and the Disabled.

Popularise the African Youth Charter and National Youth Policy

500,000 copies printed and distributed

An estimated 1,500 copies of the African youth charter and NYP were distributed.

Lobby private sector and public sector to implement NYS

18 Government departments 1 government department was lobbied during this period. The Policy Unit made a presentation on the NYP to the NYS coordinating committee of the Dept of Public Works.

7 private companies No private companies were lobbied.

10 municipalities No municipalities were lobbied.

5 partnerships with civil structures No partnerships were formed with partnership and civil structures.

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KPA Key Performance Indicator KPI (Targets) Performance results

Cont….

POLICY, LOBBY AND ADVOCACY

Mobilisation of young people to participate in democratic processes

Youth participating in IDP processes in 10 municipalities

No youth have been mobilised to participate in the democratic processes.

Finalise and launch the Integrated Youth Development Strategy

Workshops on IYDS held in 9 provinces

Developing the terms of reference for execution of the IYDS.

Approval of IYDS by cabinet The IYDS will be approved once the document has been compiled.

Integrate and mainstream youth development in the public sector.

5 new youth directorates No new youth directorates were formed during this period.

Youth councils established in 10 municipalities

The Lobby and Advocacy Unit mobilised 3 municipalities: Moses Kotane Municipality, West Rand District Municipality and Randfontein Municipality. Youth Councils were established in all the municipalities.

4 inter-departmental youth task team meetings held

The 5th meeting of the IDC on Youth Affairs was held at the NYDA offices on 11th May.

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KPAKey Performance

Indicator KPI (Targets) Performance results

7. RESEARCH, MONITORING AND EVALUATION

Conduct status of youth survey to inform youth development interventions, policy, regulations and strategies

1 survey report A meeting of the technical committee was convened wherein they identified the themes that must be included in the report, discussed key questions that need answers, and identified data sources, agreed on the approach and methodology for the survey. The institutions and departments involved in the survey are as follows: HSRC, Dept of Social Development, MRC, Stats SA, and Standard Bank.

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KPAKey Performance

Indicator KPI (Targets) Performance results

Cont…

RESEARCH, MONITORING AND EVALUATION

Conduct impact evaluation on the National Youth Service Programme

1 Evaluation Report Old terms of reference still exist and need to be renewed and consult different stakeholders to assess and agree on the extent, approach and timeframes.

Develop framework, indicators, tools, systems procedures and guidelines for monitoring youth development interventions within NYDA, public sector and private sector

Approved framework with guidelines and a list of indicators

A draft M&E Framework is available and being continually updated in line with changes in the Customer Relationship Management System. A list of youth development indicators have been developed and engaged Stats SA to find ways of reporting on a regular basis. The indicators must be assessed if they are available within Stats SA and if not then it will be assessed if such can be collected as part of future surveys.

Produce and publish Youth Enterprise Journal

2 issues Call for papers for publications for the 1st issue has been made, awaiting submission of papers.

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KPA Key Performance Indicator KPI (Targets) Q1

8. EFFECTIVE AND EFFICIENT RESOURCE MANAGEMENT

Measure client satisfaction through quarterly surveys 90% satisfaction survey Not conducted

Minimised Portfolio at Risk (PAR) for SME & Micro loans

SME loans <10% 37.5%

Micro finance <20%37%

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Progress report on programmes offered by the NYDA along with the intended outcomes and outputs.

Progress Report: 2009/2010(unaudited figures)

KPA KPI KPI Target Actual Performance

Economic Participation Jobs created 78,625 33,008

Entrepreneur-ship & Enterprise Development

Vouchers 5,500 4,220

Business Opportunities Support Services

R100m worth of opportunities sourced R 77.656m

20 BOSS transactions funded 17

Volunteers In Action Mentorship Programme

2,000 women and youth supported through mentorship (group)

1,354

12,450 enterprises accessing enterprise finance loans

12,450 10,021

R54 million funding provided for enterprises.

R26 million in loans provided through group and individual micro-finance lending.

R28.8m

R28 million in loans provided for SME’s. R24.6m

Education & Skills Development

68,610 beneficiaries increase their skill level

68,610 39,813

National Youth Service 20,000 beneficiaries involved in community service

20,000 16,093

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Conti…..

KPA KPI KPI Target Actual Performance

100,000 Call Centre interactions 89,484

500,000 young people receive information through Youth Advisory Centres

440,906

364 UYF information dissemination points

33 YAC’s providing information and counseling.121 YAC points providing information.200 YAC kiosks providing information.10 YAC mobiles providing information

134

Efficient and Effective Resource Management

Establishment and Maintenance of office network structure for product deployment

121 YAC Points consolidated and Re-Engineered 121

8 Group lending sites 4

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QUESTION: An indication of how the NYDA intended to mainstream youth development within

Government’s existing programmes given the Committee’s prior reservations on this matter.

The NYDA Act and National Youth policy are both instructive on the NYDA’s role of mainstreaming youth development. To further this intention, the NYDA has undertaken a process to lobby all government departments to ensure that youth development issues are taken into account during the planning and implementation of activities.

The NYDA has developed and submitted guidelines for the establishment of youth directorates in government departments, whose role will be to ensure that youth development activities are integrated into government department activities. The guidelines have been submitted to Minister Baloyi and Minister Chabane.

The Development of the IYDS will further support and provide more guidance to government departments and other role players in the youth development sector on priority areas and sectors for effective youth development in the country

In additions, the NYDA continues to convene the Inter-Departmental Committee (IDC) on youth development. Government departments have representatives on this structure

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QUESTION: Progress report on the loan recovery plan, number of beneficiaries that had

received loans and the money recuperated to date

For the part two years the loan book has been deteriorating and management has identified key contributors to this deterioration and duly implemented measures to address these contributors;

Key contributors amongst other factors:

Poor administration of the loan book and after-care at the branch level; Target market the NYDA is operating in (mostly start up businesses are funded); Entitlement mentality of young people that this is Government money and therefore no need to repay; Performance management of Enterprise Finance lending staff not directly linked to performance of loan book; Market deterioration where NYDA clients operating making it difficult for them to repay loans; Business failure Inadequate supervision and support at the branch levelTime lag in loan processing

The next table gives a high level analysis of the impairment provision for the last 3 to 4 years;

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LOAN IMPAIRMENT ANALYSIS FOR PAST THREE(3) YEARS

Mar-06 Mar-07 Mar-08 Mar-09 Sep-09 Mar 10

Impairment net of reversals and write offs

6,152 General Fund 1,195 8,499 19,432 37,964 76,325

1,508 Cooperatives 1,508 0 190 190 1,478

5,311 Micro Loans 680 5,220 15,613 17,728 21,087

405 Progress Fund 1,735 1,408 2,549 5,651 6,491

13,376 Total 5,118 15,127 37,785 61,534 105,382

% increase/(decrease) year on year -62% 196% 150% 63% 71%

% of impairment to the loan book 6% 9% 18% 30% 53%

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LOAN IMPAIRMENT ANALYSIS FOR PAST THREE(3) YEARS (Continued)

Mar-06 Mar-07 Mar-08 Mar-09 Sep-09 Mar 10

Impairment expenses net of reversals

2,324 General Fund -516 7,566 10,938 18,639 38,361

1,508 Cooperatives 0 0 190 0 1,288

3,814 Micro Loans -571 4,540 10,773 2,115 3,359

406 Progress Fund 1,352 -56 1,141 3,102 840

8,052 Total 265 12,050 23,042 23,856 43,848

% increase/(decrease) year on year -97% 4447% 91% 4% 84%

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LOAN REPAYMENT AND WRITE OFFS ANALYSIS FOR PAST FIVE (5) YEARS

Mar-06 Mar-07 Mar-08 Mar-09 Sep-09 Mar 10

Loans write offs

General Fund 4,059 262 4 107

-

Cooperative

- 1,508

-

-

-

Micro Loans 4,442

- 380

-

-

Progress Fund 22 271

-

-

-

Total 8,523 2,041 384 107 -

Loans repayments

4,367 Total 19,920 35,989 40,368 23,962 20,551

% increase/(decrease) year on year 356% 81% 12% -41% -14%

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Loan recovery plan: Micro Finance

Measures have been put in place to improve loan recovery processes, i.e. Credit policy - improved efficiency with a number of bottlenecks addressed through the policy. The collection process is outlined below

The engagement of an attorney to handle all loans above R30, 000. (the message sent out is that young people must be responsible for their actions)

The engagement of debt collectors who are paid a commission based on collections

New tools have been introduced that emphasise closer monitoring

1 Day Overdue Client contacted telephonically

3 Days Overdue Site Visit is conducted

7 Days Overdue Reminder Letter signed by Branch Manager

14 Days Overdue Letter of Demand

30 Days Overdue Final Letter of Demand

45 Days Overdue Handed to Debt Collectors

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Conti…..

There are currently 2146 active clients of which 1,760 are delinquent.

Number of debtors handed over to debt collectors and attorney

No. of Clients Delinquency days

74 current

38 – 31 – 60 days

43 – 61 – 90 days

45 – 91 – 120 days

1,560 >120 days

99 Attorney (all active loans)

194 Ulwazi Debt collectors (All written off)

130 Creditworx (all written off)

81 Collect-a-debt (14 active, 67 written off)

107 Bo-Mosotho Recovery Brokers (17 active, 90 written off)

611 Loans were handed over, 130 active loans.

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Additional measures to be implemented

Appropriate staffing structure – adequate staff is required for aftercare, loan officer support and supervision

Linking clients within the same value chain

Linking the microfinance clients to potential opportunities through the internal BOSS program

On the job training to be provided to field staff

An improved loan analysis process with a quick turnaround time

Arrangement with the relevant government departments for the cession of payments for contract loans (NB in the past contract loans were the worst performing where youth who had obtained loans absconded after pay-out)

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Loan Recovery Plan: SME

The following measures have been put in place to address the issue of delinquent loans:

1 - 3 Days in Arrears Client contacted telephonically

15 Days in Arrears Telephonic contact, arrange meeting or personal visit

31 Days in Arrears First Letter of Demand

35 Days in Arrears If client has missed second payment, client contacted again

45 – 60 Days in Arrears Second Letter of Demand (registered mail)

60 - 80 Days in Arrears Telephonic contact, arrange meeting or personal visit

80 – 90 Days in Arrears Final Letter of Demand or Section 129 Letter

105 days Hand over for legal collection to appointed attorney’s

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Total handed over to attorneys 39

In legal Process 11

Judgements 16

Settlement Agreements 10

Liquidation

NYDA credit control 18

Settlement agreements with NYDA 5

Moratoriums 15

Cont……

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Recovery measures to be Implemented on the SME BookLegal action through attorneys with a reputable experience in collections

The implementation of interventions through other products available at the NYDA including BOSS, mentorship and vouchers

Reschedule the some loans to cater for smaller installments in line with the capacity of the business

Close monitoring through frequent visit

Close monitoring of the collection agents

Clients whose businesses have failed completely will have their loans written off

Linking the clients to opportunities within the NYDA

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Vacancies

Due to the restructuring of the organisation, NYDA has put on hold any recruitment of full time employees until the process is completed.

To date, only the executive structure has been finalised and approved; and this will result in the appointment of 27 employees either internally or externally. These positions are what can technically be referred to as vacancies at this juncture

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QUESTION: Finalisation of legal matters related to the National Youth Commission and the outcome of

the Auditor General forensic reports.

The National Youth Commission Act, No 19 of 1996 was repealed on the 5th March 2010 and subsequently the National Youth Commission (NYC) ceased to exist. As required by the NYDA Act, particularly Section 21(2) the NYC assets, rights, obligations and liabilities have been transferred to the NYDA effective 1 October 2009.

The statutory audit was conducted on NYC as of the 31st March 2010 and the audited accounts will be included in the annual report of the NYDA. To date the opinion will likely be a qualification due to the fact that the comparatives were disclaimed in the prior year.

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QUESTION: Outcome of auditor general forensic report

There has been no forensic audit performed on the former NYC by the Auditor General of South Africa

Given the concerns raised by the committee, the NYDA has commenced a process of conducting the forensic audit on the former NYC.

This process will be completed by 30th September and will be reported to committee during our next appearance

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THANK YOU!!!!