ANNUAL REPORT 2011-2012 - Parliamentary Monitoring Group

1NATIONAL YOUTH DEVELOPMENT AGENCY

ANNUAL REPORT 2011/2012

NYDAANNUAL REPORT

2011-2012

OUR YOUTH. OUR FUTURE.

REPUBLIC OF SOUTH AFRICA


2NATIONAL YOUTH DEVELOPMENT AGENCYANNUAL REPORT 2011/2012


CONTENTS

Message from the Minister ........................................................ 3

Message from the Chairperson of the Board of Directors .......... 5

Our Mission, Vision and Values ................................................. 7

Introduction to the National Youth Development Agency ........... 8

Operating Structure .................................................................. 9

Performance for Period under Review ..................................... 10

National Youth Development Agency Board of Directors ......... 16

National Youth Development Agency

Operations Executive Committee ............................................ 18

Transitional Accounting Authority’s Report .............................. 22

Chief Executive Officer’s Report .............................................. 25

Operational Review Report Against Key Performance Areas ... 29

Beneficiary Stories and Articles ............................................... 39

Statement of Corporate Governance ...................................... 63

Annual Financial Statements ................................................... 73



REPUBLIC OF SOUTH AFRICA

Minister in The Presidency:Performance Monitoring, Evaluation and AdministrationCollins Chabane


contribute to the holistic development of youth and help South Africa to tackle the challenge of youth unemployment.

I am pleased to note that the NYDA has received an unqualified report and as the Ministry we will work with the NYDA Board to address all management issues raised in the Auditor General report.

As we celebrate this achievement and many other milestones reached by the NYDA during the 2011/2012 financial year, we should not lose sight of the people who steered the organisation to these heights. This is the first NYDA Board of Directors led by Board Executive Chairperson, Mr Andile Lungisa and supported by Board Deputy Executive Chairperson, Mr Yershen Pillay, Mr Francois Slabbert, Ms Innocentia Motau, Ms Maria Tshabalala, Mr Mcebo Khumalo and Ms Pholisa Makeleni. These young people laid the foundation to ensure that this organisation can continue to improve for years to come.

On behalf of The Presidency I also wish to appreciate the sterling leadership of the Deputy Minister Obed Bapela for his support during this period. I applaud the NYDA Executives and staff for the excellent work they have done in this period.

If we work together, we can do more.

Mr Collins Ohm Chabane, MPMinister in The Presidency: Performance Monitoring, Evaluation and Administration

In the last financial year the NYDA achieved 42 out of 49 key performance indicators. This year the organisation achieved 63 out of 70 key performance indicators, another remarkable achievement by this young organisation.

As a country we still need to do more to tackle one of South Africa’s biggest challenges since the attainment of democracy in 1994. At 25% of the population, we have one of the highest official unemployment rates in the world. What is most concerning is that our young people are the most affected and this becomes evident during service delivery protests where young people are always seen leading from the front. We cannot allow this trend to continue, the whole of South Africa needs to pull together to address the unemployment challenge.

As government takes the lead, corporate South Africa also needs to play its part. I take this opportunity to thank all NYDA programme implementation partners in government, the private and civil society sectors who are making significant contributions to address this challenge. On behalf of government, I call on more and more sectors to play their part and to continue refining and implementing youth development programmes.

Part of the NYDA’s mandate involves advancing youth development through guidance and support to initiatives across sectors of society and spheres of government. The organisation has developed and shared with the public the National Youth Policy Implementation Guidelines aimed at simplifying the implementation of the National Youth Policy 2009-2014.

Together with the Draft Integrated Youth Development Strategy (IYDS), the implementation guidelines will direct how all sectors of society including organs of state, private and non-governmental organisations must implement programmes aimed at the development of youth. This includes assisting the private sector to structure its corporate social investment budgets for targeted youth development programmes. I plead with everyone to use these implementation guidelines so that all efforts



MESSAGEFROM THE MINISTER

Executive Chairperson:Andile Lungisa


It is with great pleasure that I write this note as the former Executive Chairperson of the NYDA Board of Directors. Although the Annual Report was developed after my term had ended, I was part of the accounting authority in the third year of the existence of the National Youth Development Agency (NYDA). For the year under review, we can proclaim with confidence that the NYDA, led by an eight-member Board of Directors with the Chief Executive Officer as an ex-officio board member, did sterling work in establishing a world-class institution capable and adequately prepared to respond to the challenges of young people. Through our various initiatives, we have responded well to the many challenges that continue to confront the youth of our country, mainly characterised by the triple challenge of unemployment, poverty and inequality. This does not in any way suggest that our tenure has been without its challenges. There were challenges and they are still there. They are, however, by no means insurmountable. The NYDA was officially launched by President Jacob Zuma in June 2009 and its launch coincided with the 33rd anniversary of the June 16, 1976 uprisings that took place in Soweto and other parts of the country. This was by no means an accident of history, but a deliberate act on the part of government to practically demonstrate the South African government’s commitment to the improvement of young people’s lives. We take pride as the only youth development agency of the country. We actively lobbied government for the establishment of an institution such as the NYDA, in response to the challenges that confronted the youth sector at the time, which were mainly related to the mainstreaming and coordination of youth development. In responding to that immediate challenge, we undertook a process of compiling the Integrated Youth Development Strategy (IYDS) for South Africa, aimed at providing a framework for approaching the course of youth development in the next decade. We remain very grateful to all the young people and stakeholders who actively participated in the formulation of this strategy.

We look forward to witnessing how government, the private sector and civil society are implementing the strategy towards attaining a more coordinated approach, as the country collectively seeks to improve the lives of young people. Guidelines for the simplification of the implementation of the National Youth Policy (NYP) (2009–2014) have also been developed.

We are encouraged by the government departments that have started to heed the call by the NYDA to establish youth directorates in their respective departments, strategically located in the offices of the Director Generals, Premiers and Municipal Managers, respectively. We look back with pride at the first day that we set up office in 2009. Mindful of the amount of work we had to perform, we always had the goal in mind of improving the lives of young people in everything we did. We sought to do this through covering a range of issues affecting young people. Despite a drop in the financial allocation of the NYDA in the past three years, we progressively underwent a period of growth regarding the performance of the NYDA. This is evident through the value of loans disbursed through microfinance, and group and SME lending over the past three years. Consequently, approximately 74 000 jobs were created for young people.

We shifted our focus from being a funding institution to becoming a developmental institution for young people, which resulted in decreasing our interest on loans to just 6% effective in 2012/13 financial year. In addition, more young people served on projects such as the 2010 Soccer World Cup, the World Festival of Youth and Students, and the COP 17 conference, under the auspices of the National Youth Service (NYS) programme, thereby providing services to their communities, while gaining skills to help equip them for life. We also placed more emphasis on the training of artisans in various technical fields such as bricklaying, plumbing and boiler-making; undertook a comprehensive process of developing a Status of Youth Report (SYR) for South Africa, to be submitted to Parliament every three years; and achieved two unqualified audit opinions in the past two financial years, an achievement we intend to maintain. It is important to note that we could not have done this work all on our own. We are, therefore, forever grateful to the following: • The Minister in the Presidency for Performance Monitoring, Evaluation

and Administration, Mr. Collins Chabane, for his ongoing, unrelenting support and willingness to lend an ear to the NYDA Board, since its establishment in 2009

• The former Deputy Minister in the Presidency, Ms Dina Pule, for always being available whenever called upon, particularly for her support of the work of the Pan African Youth Union, as South Africa’s growth and development is linked to that of the rest of the continent

MESSAGEEXECUTIVE CHAIRPERSON OF THE BOARD OF DIRECTORS



• The recently appointed Deputy Minister in the Presidency: Performance Monitoring, Evaluation and Administration, Mr Obed Bapela, for the commitment and energy he has displayed from the very start, and his ongoing guidance and leadership, which will further propel the NYDA to greater heights

• The late Minister in the Presidency, Dr Manto Tshabalala-Msimang, for playing an invaluable role in the reconfiguration of the youth develop-ment landscape in South Africa.

• Significantly, Dr Tshabalala-Msimang, who, during her success-ful tenure as Minister in the Presidency, oversaw the adoption of the NYDA Bill, leading to the successful establishment of the NYDA. This was subsequent to her playing a leading role in the adoption of the NYP (2009–2014), which guides government on its youth development programmes.

• Members of Parliament for their ongoing oversight of the work of the NYDA, and continued guidance and scrutiny of our plans.

• All civil society and political youth organisations for their continuous

engagement, constructive criticism and willingness to always partner with the NYDA. Specific recognition goes to the former President of the ANC Youth League, comrade Julius Malema, for always sharply highlighting the plight of young people, including the underfunding of the NYDA.

• The President of the South African Youth Council, comrade Thulani Tshefuta, for always being available to travel the length and breadth of the country with us to confront young people and their challenges head-on.

• Makashule Gana of the opposition DA for being available to attend programmes of the NYDA.

We are also very appreciative of the international community, particularly international youth formations, for understanding that we are all part of a global community and cannot, therefore, plan in isolation. The 2010 World Festival of Youth and Students, held in December 2010 in Tshwane, South Africa, bears testimony to that fact. Furthermore, we are grateful for the recognition of the African youth and the confidence the international community has demonstrated in South Africa, which led to the election of South Africa (through its representative, Andile Lungisa) to the position of President of the Pan African Youth Union, the continental youth body. The 17th African Union Heads of State and Government Summit, which took place in Malabo, Equatorial Guinea, with the theme, ‘Accelerate Youth Empowerment for Sustainable Development in Africa’, also adopted South Africa’s model of youth development. The summit established a specialised youth agency, responsible for advising the Secretary General of the African Union on youth development matters on the continent.The millions of young South Africans, who engaged with the NYDA at all its access points, attended our programmes to interact with us and participated in our various forums, made us very proud. You must continue to dream and go out to pursue your dreams, because South Africa is

indeed alive with possibilities. Please continue to vigilantly monitor the NYDA’s progress to ensure that it continues to serve your interests, irrespective of background, faith and political orientation. It is through your ongoing feedback that the NYDA can rise to greater heights.The media allowed us the platform and space to communicate the NYDA’s mandate and vision, as well as the NYDA products and services, for which we are thankful. We have not always seen eye-to-eye, but we remain confident that, through ongoing engagement, and a better understanding of each other’s role in improving the lives of young people and building a developmental state, we will, in future, clarify issues, which will, in turn, help young people understand the space they need to occupy. It has been both an honour and a privilege to serve with the outgoing Board of Directors, Mr Yershen Pillay (Deputy Chairperson), Mr François Slabber, Ms Innocentia Motau, Ms Maria Tshabalala, Mr Pholisa Makeleni and Mr Mcebo Khumalo (all non-executive members). It is through your invaluable input and contribution that the NYDA is considered a world-class institution, able to fulfil the needs of people. The Chief Executive Officer, Steven Ngubeni continues to successfully lead and inspire the staff of the NYDA to soldier on, despite challenges that continue to confront the organisation, particularly the under-resourcing by National Treasury. While this has limited the scope and reach of what we collectively sought to achieve, it has not broken the morale of the staff in their quest to be part of the vision to improve the lives of young people. Importantly, it has been a great privilege to interact with each and every member of staff of the NYDA. Your distinctive personalities and diverse energies have helped us lay the foundation for this institution. You must continue to work towards improving yourselves, particularly through education. You must never be deterred by criticism, but must continue to walk with your heads held high, because you have committed your time and potential to the cause of youth development. I trust we will continue to interact in our endeavours to serve young people. We must continue to pose a challenge to government to recommit itself to the cause of youth development. If we continue to underfund the NYDA, we will achieve nothing other than setting it up for failure and, in the process, creating unsustainable expectations from young people. Let’s continue the fight against youth poverty, unemployment and inequality.

Andile LungisaFormer Executive Chairperson: NYDA Board of Directors


Developmental — We will strive to empower young people, protect their dignity and advocate for society to recognise young people as agents and partners in their own development, as well as vital assets for national and community development.

Service-orientation and excellence — We will strive to attain internationally recognised standards of service quality, a high standard of professionalism and maintain continuous improvement in service delivery to young people.

Integrity and ethics — We shall, at all times, conduct our programmes with integrity and inculcate a culture of honesty, respect and accountability among all our employees.

Transparency and fairness — We shall always ensure transparency in everything we do, in order to build trust and confidence with young people, and all our stakeholders. We shall treat all our partners, suppliers and employees with fairness, and equity, at all times.

Prudence — We shall exercise prudence and economy in running the business of the NYDA, and in pursuance of its vision for youth development and the objectives of government.

To promote faster economic participation, job creation, sustainable livelihoods and social cohesion through designing, implementing, initiating, facilitating, integrating, coordinating, mainstreaming and monitoring youth development interventions, in partnership with all spheres of government, the private sector and civil society.

OUR MISSION

OUR VALUES

OUR VISION‘A world-class developmental agency that empowers all South Africa’s youth socially and economically for a better life.’




NYDA activities and interventions are designed to achieve the following Strategic Outcomes: Improved opportunities for sustainable livelihood for young peopleAn enhanced enabling environment that promotes youth developmentEnhanced sustainable social capital for young peopleMaking available an accountable, prudent, efficient centre for youth development.

NYDA Key Performance Areas (KPAs)

Economic participationGoal statement: To enhance the participation of young people in the economy through targeted and integrated programmes. The NYDA will support both profitable businesses, as well as social enterprises, which promote job creation, job placement, self-employment and income-generating activities.

Training and developmentGoal statement: To promote, facilitate and provide training and development opportunities to young people to enhance their socio-economic wellbeing.

INTRODUCTIONTO THE NATIONAL YOUTH DEVELOPMENT AGENCY (NYDA)

Policy, research and developmentGoal statement: To develop a body of knowledge and best practice in the youth-development sector which informs and influences policy development, planning and implementation.

Youth advisory and information servicesGoal statement: To ensure access by youth to information about various interventions aimed at improving the living conditions of young people, including information and career guidance services to young people.

National Youth Service (NYS) and social cohesionGoal statement: To promote social dialogue among the youth and create opportunities for young people to serve their communities.

GovernanceGoal statement: To ensure that NYDA operations comply with applicable legislation and regulations governing a Schedule 3A institution

National Youth FundGoal statement: To establish a mechanism to enable the NYDA to raise funds for purposes of advancing and implementing programmes aimed at improving the livelihood of the youth.

The NYDA is a South African-based agency, established primarily to tackle challenges that the nation’s youth are faced with. The NYDA was established by the NYDA Act, 2008 (Act 54 of 2008). The existence of the NYDA should be viewed within the broad context of South Africa’s development dynamics. Similar to many developing countries, South Africa has a large population of youth, between the ages 14–35, representing 41,2% of the total population. Given the youthful nature of the South African population, much of the socio-economic challenges faced by the nation, i.e. poverty, inequality, joblessness and poor health are borne by the youth. The gravity of challenges South Africa faces require multipronged efforts, which simultaneously promote the development of sustainable livelihoods, reduce poverty and inequality, and prioritise the development of policies which create an enabling environment for youth development. The NYDA plays a leading role in ensuring that all major stakeholders, i.e. Government, the private sector and civil society, prioritise youth development and contribute towards identifying and implementing lasting solutions that address youth development challenges.

Furthermore, the NYDA designs and implements programmes aimed at improving the lives of the youth and the opportunities available to them. At an individual level (microlevel), the NYDA provides direct services to youth in the form of information, career guidance services, mentorship, skills development and training, entrepreneurial development and support, loan funding, health awareness programmes and involvement in sport.At a community level (mesolevel), the NYDA encourages young people to be catalysts for change in their communities through involvement in community development activities, social cohesion activities, NYS programmes and dialogue.At a provincial and national level (macrolevel), the NYDA facilitates the participation of youth in the development of key policy inputs into shaping the socio-economic landscape of South Africa, by means of its policy development, partnerships and research programmes.



OPERATINGSTRUCTUREBelow is the operating structure of the NYDA during the year under review, as approved by the NYDA Board of Directors in June 2011.

NYDA CLUSTERS

OFFICE OF THE EXECUTIVE CHAIRMAN

OFFICE OF THE EXECUTIVE DEPUTY CHAIRMAN

OFFICE OF THE CHIEF EXECUTIVE OFFICER (CEO)

RESEARCH AND POLICY

CORPORATE SERVICES

SERVICE DELIVERY CHANNELS

PROVINCIAL OFFICES

FULL SERVICE BRANCHES

SATELLITE BRANCHES

NYS AND SKILLS DEVELOPMENT

FINANCEINFORMATION AND

COMMUNICATIONS TECHNOLOGY (ICT)

ECONOMIC DEVELOPMENT

RISK MANAGEMENT

CORPORATE PARTNERSHIPSCOMMUNICATIONS

OFFICE OF THE CHIEF OPERATIONS OFFICER (COO)


PERFORMANCEFOR THE PERIOD UNDER REVIEW

KPA: NYS and Social CohesionGoal: To promote social dialogue among the youth and create opportunities for young people to serve their communities

Objectives Key Performance Indicator 2011/2012 Target Annual Performance 2011/2012

Reason for Variance

To promote opportunities for young people to serve their communities

A number of youth serving their communities through NYDA-funded projects

10 000 youths 11 734 youths The annual target was exceeded by 1 734, due to high numbers of young people willing to enrol in NYS programmes implemented by the NYDA.

A number of youth serving their communities through National Youth Service Unit (NYSU)-registered projects

40 000 youths 43 051 youths The annual target was exceeded by 3 051, due to increased numbers of youth enrolled in NYS programmes implemented by government departments.

To create a platform for young people to participate in and benefit from democratic processes

A number of local municipalities assisted with establishing youth councils

Eight local municipalities

17 local municipalities The annual target was exceeded by nine municipalities, due to willingness of municipalities to establish youth councils.

A number of hosted dialogue sessions with young people

Four sessions Eight sessions The annual target was exceeded by 100%. During the 2011/12 financial year, a large number of topical issues on youth emerged, which warranted dialogue by young people.

A number of young women mobilised towards the 16 Days of Activism (against violence and abuse on women and children)

500 young women 505 young women The annual target was met.

A number of youth participating in Youth Month celebrations

10 000 youths 31 000 youths The annual target was exceeded by 21 000. The NYDA planned for 10 000 youth, but demand for attendance increased and the Presidency selected the 40 000-capacity Orlando Stadium.

To create and support social networks to benefit young people

A number of volunteer mentors participating in the NYDA mentorship programme

300 volunteer mentors

332 volunteer mentors The annual target was exceeded by 10,6%.

A number of opportunity providers participating in the Buy Youth Campaign

300 opportunity providers

319 opportunity providers The annual target was exceeded by 6,3%.

A number of youth supported through social and health interventions

3 000 youths 3 460 youths The annual target was exceeded by 15,3%.

Report on Performance against Predetermined ObjectivesThe annual performance information report against predetermined objectives covers the period from 1 April 2011 to 31 March 2012. It details all the KPAs, goals, objectives and targets set for the NYDA, as approved by the Office of the Presidency for the financial year 2011/2012.



KPA: Economic ParticipationGoal: To enhance the participation of young people in the economy through targeted and integrated programmes

Objectives Key Performance Indicator 2011/2012 TargetAnnual Performance 2011/2012

Reason for Variance

To provide business support to young people

A number of business support vouchers issued to youth entrepreneurs

800 vouchers 2 239 vouchers The annual target was met and exceeded by 1 439 vouchers, due to launch of Ithubalentsha Projects, which increased the number of youth entrepreneurs who accessed vouchers.

A number of youth beneficiaries supported through business consultancy vouchers and business opportunities support services

2 000 beneficiaries 2 276 beneficiaries The annual target was met and exceeded by 276 beneficiaries, due to increased numbers of beneficiaries issued with vouchers for business support activities.

A number of youth-owned companies assisted with registration with CIPC

500 new companies 502 new companies The annual target was exceeded by the registration of two companies.

A number of youth entrepreneurs assisted with accessing funding and business opportunities through the voucher and business support programmes

50 entrepreneurs 56 entrepreneurs The annual target was exceeded by six entrepreneurs.

Value of funding and opportunities accessed by voucher recipients and business opportunities support programme

R20 million R33 million The annual target was met and exceeded by 66,8%, due to the higher value of sourced opportunities than anticipated, accessed by young entrepreneurs supported by the programme.

A number of youth entrepreneurs mentored

1 500 entrepreneurs 1 578 entrepreneurs The annual target was exceeded by 5,2%. This was due to focused campaigns on mentoring young entrepreneurs.

To provide financing support to young entrepreneurs

A number of social enterprises financed by the NYDA

Two enterprises financed

Threeenterprises financed

The annual target was met and exceeded by 50%. This was due to interest raised by young people in running social enterprises.

A number of beneficiaries supported through social enterprise financing

20 beneficiaries 20 beneficiaries The annual target was met.

Value of finance provided to social enterprises

R1 million R4.8 million The annual target was met and exceeded by R3 770 163, due to an increase in the allocated funding for each social enterprise, based on the scope of the business and financial need.

A number of loans issued to youth-owned micro-enterprises (NYDA and partner microloans)

9 000 loans 9 899 loans The annual target was exceeded by 10%, due to the demand for microloans from young entrepreneurs

Value of loans issued to youth-owned micro-enterprises (NYDA and partner microloans)

R9,6 million R26 million The annual target was met and exceeded by R16 476 592. Microloans issued by the Ithubalentsha programme contributed R5 435 500 towards loans.

A number of loans issued to SMEs

12 loans 14 loans The annual target was met and exceeded by 16,6%. due to increased demand.

Value of loans issued to youth-owned small and medium enterprises

R6 million R10.8 million The annual target was met and exceeded by R4 777 937, due to funding of youth SMEs that are in the social enterprise field which the NYDA is introducing.


Goal: To enhance the participation of young people in the economy through targeted and integrated programmes


Reason for Variance

To provide employment opportunities to young people

A number of jobs facilitated through business consultancy vouchers and business opportunities support services

2 000 jobs 2 107 jobs The annual target was exceeded by 5,4%.

A number of jobs facilitated through financing of social enterprises

20 jobs 83 jobs The annual target was met and exceeded by 63 jobs, due to the increased job creation potential by the funded social enterprises.

A number of jobs facilitated through financing of SMMEs

60 jobs 68 jobs The annual target was met and exceeded by 13,3%. The SME funding created more jobs than what had been anticipated by the programme.

A number of jobs facilitated through microfinance lending

9 000 jobs 9 304 jobs The annual target was met and exceeded by 3,4%.

A number of jobs facilitated through placements in job opportunities

1 000 jobs 1 017 jobs The annual target was met and exceeded by 1,7%.

KPA: Policy, Research and DevelopmentGoal: Developing a body of knowledge and best practice in the youth development sector to inform and influence policy development, planning and implementation


Reason for Variance

To develop an IYDS and guidelines for the implementation of youth development programmes

IYDS adopted by the NYDA Board and Cabinet

IYDS adopted by Board and Cabinet

IYDS adopted by the NYDA board and submitted to Cabinet for the approval process.

The Office of the Presidency has not provided the NYDA with confirmation of approval by Cabinet.

Evaluation protocol for IYDS developed

Evaluation protocol of the IYDS

The protocol was approved during the NYDA board meeting.

The annual target was met.

Design, printing and distribution of the IYDS

3 000 copies printed and distributed

0 copies The target was not met, due to the fact that the NYDA has not yet received confirmation of approval by Cabinet.

To identify annual national youth development (NYD) priorities

List of NYD priorities submitted to the Office of the Presidency

Submitted list of youth development priorities to the Presidency

List of youth development priorities approved by the NYDA board and submitted to the Presidency.


To promote, lobby and advocate for a uniform approach by all sectors on matters relating to youth development

A number of partnerships established with government, civil society and the private sector

15 partnerships 48 partnerships The annual target was met and exceeded by 33 partnerships, due to efforts made by the NYDA to extend available resources and increase the impact on young people.

Government departments lobbied to establish youth directorates

Five departments 13 departments The annual target was met and exceeded by eight departments. The NYDA put more effort into increasing the impact on youth development by encouraging more participation in other government departments.



Goal: Developing a body of knowledge and best practice in the youth development sector to inform and influence policy development, planning and implementation


Reason for Variance

To conduct research and evaluations to inform policy and programme interventions

Submitted Status of Youth report to the Office of the Presidency

Submitted final Status of Youth report

Final report approved by board and submitted to the Presidency

The target was met.

A number of research project reports produced

Six research reports Six research reports The annual target was met.

A number of programme and project evaluation reports produced

10 evaluation reports

11 evaluation reports The annual target was exceeded by 10%.

A number of publications produced on youth development

24 knowledge management publications


The annual target was exceeded by 8,3%.

To provide inputs on policies and legislation by government and other relevant structures

A number of written submissions on policies and legislation on youth development issues to the relevant departments

Six submissions Nine submissions The annual target was met and exceeded by 50%, due to the increase in important policies and legislation developed by public institutions.

A number of portfolio committee meetings attended

10 committee meetings

11 committee meetings The annual target was met and exceeded by 10%.

KPA: Training and DevelopmentGoal: To promote, facilitate, and provide training and development opportunities to young people to enhance their socio-economic wellbeing

Objectives Key Performance Indicator 2011/2012 Target Annual Performance 2011/2012 Reason for Variance

To facilitate education opportunities, in order to improve access to quality education

A number of young people enrolled in the NYDA Matric- (Grade 12-) rewriting programme

2 000 learners 2 641 learners The annual target was met and exceeded by 32,1%, due to the higher Matric failure rate, which led to increased enrolment in this kind of programme.

To facilitate and implement technical, entrepreneurship and life-skills training programmes

A number of young people attended the entrepreneurship and business management skills programme

5 000 youths 5 293 youths The annual target was met and exceeded by 5,9%.

A number of youth attended the technical-skills training programme

500 youths 647 youths The annual target was met and exceeded by 29,4%, due to unanticipated increased interest by young people to enrol in the technical skills training programme.

A number of youth attended the job-preparedness training programme

10 000 youths 13 035 youths The target was met and exceeded by 30,4%. Increasing unemployment, due to unpreparedness of youth for placement in jobs, increased the popularity and demand for the programme services.

A number of youth attended the life-skills training programmes

2 000 youths 2 277 youths The annual target was met and exceeded by 13,9%. This was due to increased numbers of young people who registered for the NYDA life-skills training programmes

A number of young people enrolled in Youth Build South Africa projects

200 youths 511 youths The annual target was met and exceeded by 155,5% youth, due to the high enrolment of young people in the Youth Build programme, buy-in and support of partners of the programme.

A number of young people attended entrepreneurship awareness programmes

15 000 youths 17 288 youths The annual target was met and exceeded by 15,3%. This was due to the high demand for the entrepreneurship-awareness programme at NYDA branches.

A number of youth attended Buy Youth Campaign training

300 youths 358 youths The annual target was met and exceeded by 19,3%. This was due to the increased demand, as a varied and more relevant training curriculum was made available.


Goal: To promote, facilitate, and provide training and development opportunities to young people to enhance their socio-economic wellbeing

Objectives Key Performance Indicator 2011/2012 Target Annual Performance 2011/2012 Reason for Variance

To provide and facilitate capacity-building of youth development practitioners

A number of capacity-building interventions were conducted for the youth development sector

12 interventions 19 interventions The annual target was met and exceeded by 58%. This was due to additional demands by the youth development sector for training interventions by the NYDA.

A number of staff members were trained to deliver on the NYDA mandate

200 staff 379 staff The annual target was met and exceeded by 90%, due to a large number of new staff members, who joined the NYDA, and an improvement in NYDA processes that required additional training for staff.

To facilitate youth development work as a recognised profession

A number of accredited unit-standard-aligned learning programmes were registered with ETDP SETA towards the youth-work qualification

Two unit standards aligned

Two unit standards aligned The annual target was met.

A number of youth-development practitioners, who obtained unit-standard credits towards the qualification in youth work

10 practitioners 17 practitioners The annual target was met and exceeded by 70%, due to the high enrolment rate in the youth-work qualification training programme.

KPA: Youth Advisory and Information ServicesGoal: To ensure access by youth to information about various interventions aimed at improving the living conditions of young people, including information and career guidance services to young people


Reason for Variance

To provide career guidance services

A number of youth provided with individual career guidance information (one-on-one sessions)

2 600 youths 7 125 youths The annual target was met and exceeded by 173%, due to an increase in demand for this programme, especially after publication of the Matric results.

An estimated number of youth provided with group career guidance information

397 400 youths 556 918 youths The annual target was met and exceeded by 40%, due to an increase in outreach activities to schools for this programme.

To provide access to information regarding products and services of the NYDA, and referrals to other agencies

A number of people receiving information and/or referrals from NYDA service delivery points

100 000 young people 104 486 young people The annual target was met and exceeded by 4,5%.

An estimated number of youth provided with information and/or referrals through the NYDA outreach programme

400 000 young people 543 890 young people The annual target was met and exceeded by 36%, due to an increased number of NYDA service points, especially the new local youth offices established at municipalities.

A number of interactions with young people through the NYDA call centre

140 000 interactions 46 225 interactions The NYDA fell short of the target by 67%. During the 2011/12 financial year, the Telkom cable was stolen and services were affected for three to four months.

A number of NYDA beneficiary stories published

20 publications 67 publications The annual target was met and exceeded by 47 publications, due to new youth publications supported by the NYDA.

A number of NYDA portal visits 300 000 portal visits 437 452 NYDA portal visits The annual target was met and exceeded by 45,8%, due to publicity and an improvement in the amount and quality of information available on the NYDA website.

To provide administrative and operational support to service delivery

A number of new local NYDA youth-information dissemination and access points

45 access points 61 access points The annual target was met and exceeded by 35,5%, due to a relatively greater willingness by municipalities to sign agreements to establish youth offices than was anticipated.

A number of NYDA provincial offices established

Three provincial offices Three NYDA provincial offices established




Goal: To ensure access by youth to information about various interventions aimed at improving the living conditions of young people, including information and career guidance services to young people


Reason for Variance

To brand NYDA offices and project sites to improve the visibility of the NYDA

Some 95% of NYDA offices and access points branded

Some 95% of existing NYDA offices to be branded

Some 41% of existing NYDA offices are branded

The NYDA fell short of the annual target by 54%, as most municipalities that signed agreements with the NYDA to operate local youth offices did not agree on the branding of their offices in time, thereby making it impossible for the NYDA to brand most of the local youth offices in the financial year.

KPA: National Youth Fund (NYF)Goal: To establish a mechanism to enable the NYDA to raise funds for purposes of advancing and implementing programmes aimed at improving the livelihood of the youth


Reason for Variance

To plan and set up the NYF

Approved framework for financial assistance by the NYDA Board

Approved framework

The framework was approved by the Board of Directors


Approved policies and procedures for management of the fund by the NYDA Board

Policies and procedures

The procedures were approved by the Board of Directors


A number of bursaries awarded by the NYDA to youth to further their studies in tertiary institutions

10 bursaries 10 scholarships 114 bursaries

The annual target was exceeded by 104 bursaries. This was due to an increased demand from qualifying students, who applied for, or requested assistance from the NYDA for enrolment in tertiary education.

To mobilise and leverage financial assistance to small, micro and medium enterprises, and cooperatives, owned by youth

Value of funds raised from the private sector for the NYF

R30 million R46.7 million The annual target was exceeded by 55,9%. This was due to the NYDA’s drive to encourage the private sector to contribute towards youth development programmes.

Value of funds raised for the NYF through partnerships

R60 million R71.6 million The annual target was exceeded by 19,3%. This was due to the NYDA strategy for expanding partnerships with all sectors in funding youth development.

To provide financial support to projects initiated by youth

Value of funds invested in youth-initiated projects

R20 million R0.8 million The NYDA fell short of the target by 95,9%. The value of financial support requested by youth-initiated projects meeting the NYDA-sponsorship criteria for the year under review was less than the targeted value.

KPA: GovernanceGoal: To ensure that NYDA operations comply with applicable legislation and regulations governing a Schedule 3A institution

Objectives Key Performance Indicator 2011/2012 Target Cumulative Total Reason for Variance

To ensure compliance with all applicable statutes and policies

Adequate corporate governance, and financial and operational controls

Unqualified annual audit report

Unqualified annual audit report 2010/11


To implement systems and processes to increase the recoverability of defaulting loans

A decrease in the number of loans defaulting in the NYDA SME-loan book

20% decrease in defaulters


The annual target was not met. The economic downturn led to youth entrepreneurs not being able to generate adequate profits to be able to pay off their debt.

A decrease in the number of loans defaulting in the NYDA Micro-loan book


3,6% Increase in defaulters

The annual target was not met. This is due to the fact that the majority of the NYDA microloan clients have just started their businesses and require a great deal of support before they can generate adequate profits to be able to pay off their debt.


Andile Lungisa | Executive ChairpersonAndile Lungisa was appointed Executive Chairperson of the NYDA Board of Directors in 2009. Mr Lungisa is an experienced youth development worker, having been the Chairperson of the South African Youth Council in the Nelson Mandela Bay Metropolitan Municipality in the Eastern Cape. He serves on national and international bodies representing youth and is the President of the Pan African Youth Union.

Mr Lungisa became active in politics in the early nineties, through the Congress of South African Students (COSAS) and, later, the South African Students Congress (SASCO). He was elected Chairperson of the regional African National Congress Youth League (ANCYL), which included Port Elizabeth and Grahamstown. In 1998, he started an ANC Youth League branch in the western suburbs of Port Elizabeth and became a branch executive member. He also served in the Regional Executive of the ANCYL in the Nelson Mandela Bay Metropolitan Municipality. In 2001, he was elected Deputy Chairperson of the ANCYL’s Nelson Mandela Bay region and, in 2008, as National Deputy President of the ANCYL.

Mr Lungisa has worked as a detailer at M and Z Designers and is the founder of Makhanda Youth Projects, a subsidiary of the South African Music Promoters Association. He is also a playwright and poet, who has worked extensively in the creative fields in the Eastern Cape Province. In 2005, he was awarded The Herald Citizen of the Year award in the Arts and Culture category for his work in the field.

NYDABOARD OF DIRECTORSBelow are profiles of members of the NYDA Board of Directors for the year under review. The term of the board ended on 30 April 2012.

Yershen Pillay | Deputy Executive ChairpersonYershen Pillay is a Social Sciences graduate from the University of Cape Town (UCT), majoring in Politics and Economics. He has experience in the research and management of student affairs, having worked at UCT as a student development practitioner. Yershen held various leadership positions, including active involvement in establishing and developing ANC structures at UCT, serving as Secretary General of the Student Representative Council at UCT and a member of the University Senate Committee. In 2005, he was the recipient of the UCT Deputy Vice-Chancellor’s Leadership Award. He is a former National Executive Committee member of the South African Union of Students (SAUS). Yershen currently serves as the Chairperson of the Young Communist League of South Africa and in the Human Resource Development Council of South Africa.

François Slabber | Non-Executive DirectorFrançois Slabber is a graduate from UNISA with a background in Economics, Political Science and Business Management. He is a former first-team rugby and cricket player and has worked as a manager of irrigation in the farming sector. He is currently conducting research for the Freedom Front+. François is passionate about youth development and the role that the youth can play in South African society, and is currently working for Helpende Hand/Helping Hand, a subsidiary of the trade union Solidarity, focusing on social assistance to poor communities. He serves as the deputy leader of the Freedom Front+ Youth.



Innocentia Motau | Non-Executive DirectorInnocentia Motau is a qualified and experienced Chemical Engineer and was recently appointed as the Chief Executive Officer of Xpanse Investments (Pty) Ltd, with extensive exposure to project management, as well as corporate finance, servicing both the public and private sectors in infrastructure development projects. Her profes-sional highlights include the following:

• Investment Officer — Development Bank of Southern Africa• Non-Executive Board Member of the National Youth Development Agency• Non-Executive Board Member of Saatchi and Saatchi• Member of the Technical Committee of the Job Creation Trust (JCT), focusing mainly on national community

and youth business development for job creation purposes.• Executive Director - Shosholoza Operations

Innocentia’s passion for youth development is immeasurable and she thrives on participating in projects that see the young people of South Africa succeed. Entrepreneurship is her utmost passion and she views it as an impor-tant tool, necessary for alleviating poverty, as well as delivering economic emancipation among the young public of South Africa.

Maria Tshabalala | Non-Executive DirectorMaria Tshabalala’s educational investment has been varied – from casting (dramatic arts) to computer and business studies. She has been giving back to the community and enhancing her skills base by volunteering at the Protea Glen Police Station. She was employed in customer service by Johannesburg Water until June 2009. Maria is the founder of Youth with a Vision. She currently serves as a member of the Provincial Executive Committee (Gauteng) for the South African Youth Council and the National Executive Committee of the IFP Youth Brigade.

Mcebo Khumalo | Non-Executive DirectorMcebo Khumalo is currently studying for a Bachelor of Social Sciences degree at the University of KwaZulu-Natal (UKZN) Howard Campus, majoring in Political Science with Economic History and Development Studies as sub-majors. In the past, Mcebo worked as an educator and managed his own driving school business.

In addition to being a Non-Executive Director on the NYDA Board, he is also the Deputy National Chairperson of Disabled Youth South Africa (DYSA); the Provincial Chairperson of KwaZulu-Natal DYSA; and Secretary General of the Disabled Students Organisation at the University of KwaZulu-Natal.

Mcebo is a member of the National Council of Disabled People South Africa (DPSA); the Provincial Executive Council of the KwaZulu-Natal DPSA; the South African Youth Council (SAYC); the SABC Youth Advisory Panel; and the Regional Executive Council of the youth structure in the Southern Africa Federated Organisations for Disabled Persons.

Pholisa Makeleni | Non-Executive DirectorPholisa Makeleni has extensive experience in the banking sector, having worked for First National Bank for a number of years in various capacities, from sales to personal relationship management. Additional positions include Chairperson of the City of Tygerberg Youth Development Council; Chairperson of the ANC Youth League Ward 94 branch; and member of the Provincial Executive Committee/Provincial Working Committee of the ANC Youth League, Western Cape. She served as a member of the ANCYL National Executive Committee until the 24th National Congress in June 2011.


NYDAoperations executive committee

Steven Ngubeni | Chief Executive OfficerSteven Ngubeni started his professional career as a Town Planner at Terraplan Associates. He later joined In-Site Design as a Senior Planner. He has also worked as the Director for Technical Services at Emakhazeni Municipality and recently as a Municipal Manager at Victor Khanye Municipality in Mpumalanga. Ngubeni holds a degree in Town and Regional Planning from the University of Johannesburg. He has two Master’s Degrees, one in Built Environment specialising in Property Valuation and Economics from the Nelson Mandela Metropolitan University, and another in Development Studies from the University of Port Elizabeth. He has also completed a doctoral research programme with the University of Stellenbosch.

He is currently completing a Master’s Degree in Public Administration at the same university, with his research focusing on performance management and youth development. Ngubeni is also an activist, having joined the Congress of South African Students in primary school, and led the South African Youth Council in Nkangala District, Mpumalanga. He has served in both the African National Congress Youth League (ANCYL) and the ANC at various levels. He was the Deputy Secretary General of the ANCYL until the 24th National Congress in June 2011. Ngubeni serves on various boards and councils, including the Mpumalanga Town Planning and Townships Board and the Mpumalanga Heritage Council. His experience ranges from development planning, development practice, development facilitation, executive management and leadership, project management, and public administration and management. In the last three years he had extensive exposure to the area of youth development. He is the first and the sitting CEO of the NYDA.

The committee comprises of Executive Managers and General Managers in the CEO’s office

Magdalene Moonsamy l Chief Operating OfficerMagdalene Moonsamy holds an LLB degree from the University of Durban-Westville and several other certificates, among which is a certificate in Cultural Diversity that she obtained from the University of Tubigen in Germany. Magdalene is an activist for defeating all forms of oppression. She is also an advocate for a progressive African economy. She is particularly committed to fighting for the most vulnerable in society: women, young girls, youth and the poor. In addition to her role as Chief Operations Officer at the NYDA, she continues to serve in various developmental portfolios focusing on policy development and research and has interacted at both political and government levels. She has served as Deputy Director of Policy at the National Department of Social Development. Internationally Magdalene was engaged in the International Union for Socialist Youth and served in numerous international delegations. Magdalene is a National Executive Committee (NEC) member, National Working Committee (NWC) member and Spokesperson of the ANCYL. This frequent writer (both print and online) was nominated as one of Mail & Guardian’s 200 Young South African Achievers in 2012.

Khathutshelo Mike Ramukumba | Chief Financial OfficerBorn in Tshifudi village, Venda in the Limpopo Province, Khathutshelo Mike Ramukumba attended Mphandeli High School. He obtained a B. Com Financial Accounting Degree from the University of Pretoria, where he was also a radio presenter for the campus radio station, Tuks FM, and a B. Com Hons (Financial Accounting) with CTA (Certificate of Theory in Accounting) from the University of KwaZulu-Natal in 2006. In 2009 he completed the Public Practice Examination (Second Board Examination with Independent Regulatory Board for Auditors) and was admitted as a CA (SA) by the South African Institute of Chartered Accountants in 2010.

He served his articles with the Auditor-General of South Africa from 2003 to 2006. In 2006, he joined the Ellerines Holdings Group as Financial and Compliance Auditor. At the end of 2006, he joined the Rand Water Group and served

Executive Managers



in various positions, the last being that of Group Internal Audit Manager. His career highlights include being involved in two ministerial directive projects on turnaround strategy and support: one in 2009 for Botshelo Water, and the other in 2010/2011 for Bushbuckridge Water.

Khathu is passionate about youth development, and consequently, continues to serve in various leadership positions within various youth organisations focusing on issues of young people across the board. He was the Chairperson of Youth against Crime at Vhumbedzi District in Vhembe Region in Limpopo from 2002 – 2003.

Daniel van Vuuren | Executive Manager: Service Delivery ChannelA law graduate from the University of the Free State, Daniel van Vuuren started his career by serving articles of clerkship with Rossouws Attorneys. He subsequently joined the office of The Presidency, where he was one of the architects of both the legislative environment and policy framework governing youth matters. While at The Presidency, he was a national youth commissioner responsible for youth policy development, legislative review and intergovern-mental co-ordination, particularly within the Justice, Crime Prevention and Security (JCPS) cluster. Daniel has also worked in various advisory roles to foreign governments and public institutions in Europe and the Middle East. During his tenure in The Presidency, he represented the South African government in various bi-national and multi-national fora, and addressed diverse international conferences, on invitation.

Edgar Mahura | Acting Chief Information Officer: Information Communication TechnologyEdgar Mahura started his career by serving articles of clerkship at Deloitte in Pretoria, before joining Deloitte’s Computer Assurance Services division as a consultant. He then joined Daimler Chrysler South Africa (DCSA) as a project manager implementing SAP. He later set up the Programme Management Office to manage all DCSA internal projects. Edgar also established his own project management consulting business before joining Umsobomvu Youth Fund as a project manager. He is currently head of the NYDA’s Information Communication Technology Cluster. He holds a B. Com degree from Rhodes University.

Linda Yolisa Dlova | Executive Manager: CommunicationsLinda Dlova acquired her knowledge and experience in the field of corporate communications during a career spanning 14 years, of which 12 years were spent at Eskom. More recently, she gained further experience at Nedbank. Linda commenced her career at Eskom in 1997, where she was an experiential learner. She worked her way up through the ranks to Communication & Stakeholder Manager, which entailed internal and external communications, media relations and stakeholder management. In her capacity as the Executive Manager: Communications at the NYDA, Linda’s overall role is that of reputation custodian, strategically positioning the NYDA positively in the minds of its various stakeholders by building and maintaining relationships. This is driven through the initiation of dialogue through optimised communication platforms to influence interested and affected parties’ opinions and perceptions in order to solicit support for the NYDA’s strategic objectives. All communications, public relations, marketing and branding strategies form part of this portfolio. Linda holds a National Diploma in Public Relations Management from Natal Technikon as well as B-Tech and M-Tech Degrees in Public Relations Management from Cape Technikon, now part of the Cape Peninsula University of Technology (CPUT). Linda Dlova is a member of the Public Relations Institute of South Africa.

Mzwabantu Ntlangeni | Acting Executive Manager: Corporate PartnershipsMzwabantu Ntlangeni holds a B. Com degree from Rhodes University. His career in the development field spans over 15 years during which he held various positions at among others, the Transitional National Development Trust, National Development Agency and Umsobomvu Youth Fund. He has acquired extensive experience in project design, monitoring and grant financing for development initiatives. His current responsibilities at the NYDA include forging partnerships between the NYDA and key stakeholders inclusive of government and the private and civil society sectors. In addition, he is responsible for international partnerships.


Tamari Tlangelani Mavasa| Executive Manager: Economic DevelopmentTamari Tlangelani Mavasa holds a Master’s Degree in Built Environment (Property Economics and Valuations) from the Nelson Mandela Metropolitan University, a Degree in Quantity Surveying, and a National Diploma in Building Science. She is currently completing two Master’s Degrees, one in Public Administration and another in Development Finance with the University of Stellenbosch (USB). She is a Registered Quantity Surveyor (PrQS) and a member of the Association of South African Quantity Surveyors, the Project Management Institute of South Africa and the Incorporated Member of the Chartered Institute of Building.

Over the past 13 years, Tamari has acquired comprehensive experience in engineering and construction projects that enabled her to render services as a programme and project manager, quantity surveyor and a development practitioner. She has worked in the mining sector; at Eskom Electricity Generation and Distribution; national, provincial and local Government; civil society sector; and consulting firms. Her comprehensive experience allowed her to deliver professional services as a quantity surveyor, a cost engineer/estimator, an investment analyst, a programme manager (projects and contracts) and a property manager. Her accomplishments within the projects involved economic development, business and financial management. This includes skills development, mentorship and training to business enterprises. Tamari joined the NYDA in June 2011 as an Executive Manager: Economic Development. Her position at the NYDA is mandated to oversee the rural development and enterprise finance programmes and business development services.

Vincent Mulaudzi | Executive Manager: Corporate ServicesVincent Mulaudzi started his career in 1997 as a lecturer at Further Education and Training (FET) Colleges and taught for five years at both FETs and Technical High Schools. He then moved to the corporate sector where he worked for Chris Hani Baragwanath Hospital, Tembisa Hospital, Greater Sekhukhune District Municipality (Groblersdal) and Emalahleni Local Municipality as a Middle Manager in ICT and Administration. Before joining the NYDA, he worked for the Insurance Sector Education and Training Authority (INSETA) as a Corporate Services Manager. He holds a National Diploma in Public Management and Administration, National Higher Diploma in Education and a B-Tech Post School. He is currently reading towards obtaining a Master of Business Administration (MBA) Degree at the Manage-ment College of Southern Africa. Vincent remains passionate about education and the community, he currently serves as a member on a School Governing Body and a Community Policing Forum.

Nthuseng Mphahlele | Executive Manager: Skills Development and National Youth ServiceNthuseng Mphahlele holds an MSc in Development Planning from the University of the Witwatersrand. She has more than 14 years’ development sector experience having held various positions in both government and civil society organisations. Her focus includes infrastructure development, the environment, gender and poverty. She joined Umsobomvu Youth Fund in 2004 as a Programme Manager for the National Youth Service (NYS) programme. In her current position at the NYDA, Nthuseng has been mandated to oversee the implementation of the NYS and Skills Development programmes, facilitating the mainstreaming of youth development across government, and fostering partnerships with civil society and the private sector to increase development opportunities for young people.

Siviwe Mkoka | Executive Manager: Research and PolicySiviwe is responsible for the Research and Policy cluster of the NYDA, which includes policy, research, monitoring and evaluation, and knowledge management. In 2007 Siviwe joined the Gauteng Provincial Department of Health as the manager responsible for strategic policy management, research and in part strategic planning.

He worked at the University of Cape Town from 2002-2007 as a lecturer and a researcher in the Faculty of Health Sciences. Whilst completing his Master’s Degree in 2004 he published scientific research papers in local and international peer-reviewed journals. He also presented papers at conferences locally and abroad, including in Barcelona, Spain; Dar es Salaam, Tanzania; Leeds University in the United Kingdom and Lusaka, Zambia. He is a PhD student of the University of Cape Town. Siviwe has also obtained a number of other formal qualifications in strategic public policy management, project management and general management in the public and development sector from various universities across South Africa including University of Witwatersrand, University of South Africa and the University of Pretoria.



Teboho Sejane | General Manager: Corporate StrategyTeboho Sejane holds a postgraduate Degree in Industrial Sociology from Wits University. She also completed the Executive Education Programme: Nepad African Leadership Programme at Wits Business School. This postgraduate certificate programme explored the notions of leadership, management and development and their inter-relationships in the context of the challenges present on the African continent. She is part of the InterAction programme, run by the British Council, involving a network of leaders from 19 countries across the African continent and focusing on strengthening leadership skills on the continent. She has worked in the development sector for the past 14 years, including working in six SADC countries: South Africa, Lesotho, Botswana, Swaziland, Mozambique and Zimbabwe while at the Kellogg Foundation. Teboho worked for the National Development Agency (NDA) as Senior Manager: Eco-nomic Development before joining Umsobomvu Youth Fund in July 2005 as Manager: Process Cycle Management. She currently holds the position of General Manager: Corporate Strategy within the NYDA.

Sanjay Hargovan | General Manager : Risk and Internal AuditSanjay Hargovan is a member of the Institute of Risk Management South Africa (IRMSA). He completed his B. Com Accounting and a postgraduate Diploma in Management Accounting at the University of Natal and a Programme in Risk Management at the University of South Africa’s Centre for Business Management. He has nine years’ experience in the accounting profession, which has given him insight into enterprise risk management; seven years’ experience in risk management; and ten years’ experience in the public sector, specifically public entities. Prior to joining the NYDA in its present form, he established the Risk Unit at Umsobomvu Youth Fund and served with the United Pharmaceuti-cal Distributors and the National Lotteries Board.

Clayton Peters | General Manager: Strategic Programmes Clayton Peters has worked extensively in the youth and development sectors over the past 16 years. He is busy completing his Master’s Degree in Development Management. He was the founder and Chief Executive Officer of the Youth Development Network. Under his leadership, the network extended its programming to 13 countries in the Southern African Development Community (SADC) region. As the editor of South Africa’s first journal on youth development, he has written extensively about the subject. He gained invaluable global experience while working on a United Nations project on youth employment. He has worked in Africa, Asia, the Middle East and Latin America. Clayton was a director at YouthBuild International, based in Boston, USA, where he was responsible for developing new programme areas around the globe. With a team of researchers, he conducted in-depth research on global youth employment models for a World Bank-related study.

General Managers in the CEO’s office


Young people matter. Their contribution to this country has been historic. They continue to make colossal strides in politics, arts, culture, civil society, the private sector and within government. They challenge the status quo while imagining the prospects and promises of what could be. Youth development is an essential consideration for our country’s development trajectory. It has its fits, starts and crossroads, and requires integration and mainstreaming for all stakeholders to play their part. For youth development to succeed, concentrated coordination is required. The mandate of the NYDA requires the agency to coordinate youth development issues, which is critical for achieving progress for youth development.

The NYDA initiated a consultation process to develop the IYDS, which is a comprehensive implementation framework that will assist the NYDA to rally all key government and non-government stakeholders towards the successful initiation, design, coordination, evaluation and monitoring of all programmes aimed at integrating youth into the economy, and society, in general. Valuable inputs were received from government departments, civil society, the private sector, youth organisations and young people themselves. The inputs strengthened the relevance and quality of the IYDS. During the financial year under review, the NYDA Board approved the IYDS and submitted it to Cabinet for approval. We are confident that the strategy will provide coordination and concrete direction for youth development in South Africa.

The Annual List of Youth Development Priorities, as mandated by the NYDA Act, was approved by the NYDA Board and submitted to the Presidency. The list is a practical guide to stakeholders and assists them in planning for youth development. This is a tool towards the concentrated coordination of youth development.

TRANSITIONAL ACCOUNTING AUTHORITY REPORT

To ensure that the voices of youth are being heard, the NYDA readily engaged with the National Planning Commission to focus on youth development. The input reflected the youth perspective and aspirations to develop the vision and the National Development Plan, as a whole. The NYDA volunteered its infrastructure for the NPC Jam Sessions, and actively participated, to engage more youth and make their voices heard. The fundamental concern that faces this country is youth unemployment. According to the Quarterly Labour Force survey, 5,96 million people were unemployed as at December 2010, of which over 70% are youth between the ages of 15 and 35. Social commentators have described this as a ‘ticking time bomb’. The NYDA is committed to addressing this fundamental issue through advocacy, policy development and programmes.

To this end, the NYDA has created 12 579 jobs and issued R32 million in loans to young entrepreneurs. We have also assisted young entrepreneurs to access R36.8 million in funding opportunities to sustain and grow their businesses. The livelihood of young people was improved through the NYDA’s training programme in technical and business skills. Education still remains a critical focus area for our country. It is a strong determinant of young people’s skills and capacity development, which enables them to secure employment and/or start their own business enterprises in the future. To this end, we have enrolled 2 641 learners in the NYDA Matric rewriting programme. The fact that we have exceeded our target of 2 000 learners demonstrates the need for second-chance opportunities for our young people. Our YouthBuild programme has benefited 511 youth and continues to provide an innovative programme model for addressing the education, skills and employment needs of young



people. We have also contributed towards education by providing mobile science laboratories to selected schools, to increase the enrolment and performance of Physical Science learners. Our sanitary towels initiative supports female learners from disadvantaged schools with free sanitary towels. Youth service is a powerful platform for young people to strengthen their positive engagement with communities, learn valuable skills and contribute to the nation’s development. With 54 785 young people engaged in service opportunities in the year under review, we believe that more service opportunities must be created. We will continue to grow the NYS programme and will steadfastly advocate for government and civil society to initiate new service programmes, and create more service opportunities. Every young person must be given an opportunity to serve their community and country.

The NYDA has expanded its national footprint by increasing its network to 205 access points across all provinces, resulting in increased accessibility to more young people. We thank the participating municipalities and civil society partners for making their infrastructure available. The NYDA partnered with the SABC to sponsor the One Day Leader reality TV show, as part of our outreach to youth, and to inspire youth leadership capability. The Provincial Advisory Boards (PABs) continue to advise the NYDA on provincial priority programmes. The enduring work of this group of dedicated and committed young people has helped to ensure that the mandate, and presence, of the NYDA filters down to provincial level. We are happy and thankful to those provincial governments that have heeded the call in respect and recognition of the importance of prioritising youth development. The Transitional Accounting Authority has noted the significant irregular expenditure incurred during the financial year under review. This is adequately disclosed in the notes to the Annual Financial Statements. The main contributor to the irregular expenditure has been the decentralisation of the procurement of goods and services to divisions with the supply chain management unit only playing an advisory role for the period 01 April 2011 to 31 October 2011. During this period the respective divisions within the NYDA were responsible to source quotations directly from suppliers listed on the NYDA supplier database, decide on the supplier to be used to procure goods and services and also file the quotations and all other related documents received from the bidding process. These divisions did not necessarily follow the correct supply chain management prescripts during the competitive bidding process.

The other contributing factor to the irregular expenditure disclosed in the notes to the financial statements is the travel and accomodation expenses for the year, this resulted from the fact that no tender process was followed when the relationship between the NYDA and BCD Travel was concluded over 10 years ago. The NYDA board upon receipt of the Auditor-General’s report for the 2010/11 financial year instructed management to initiate a tender process to appoint a service provider to render travel and accommodation services to the organisation. In September 2011 the tender process began, unfortunately due to unforeseen challenges the process took longer than was anticipated to finalise.

The other contributor was the procurement of goods and services from service providers who had been listed on the NYDA database earlier than the 2011/12 financial year. These service providers submitted valid tax clearance certificates at the time of being listed, however over time their tax clearance certificates expired and when goods and services were procured from them by the various divisions withing the NYDA, new valid tax clearance certificates were not requested.

The NYDA Board and the Transitional Accounting Authority have already instructed management to implement corrective actions regarding all the above contributors to the significant disclosed irregular expenditure.Since November 2011, the NYDA management has centralised the critical roles for the procurement of goods and services to the supply chain management unit, and the unit has been re-capacitated to ensure compliance with all legislation.

Subsequent to financial year end the NYDA management had appointed three service providers, through an open tender process for travel and accommodation.

In addition to the centralisation of key procurement functions to the supply chain management unit, a check list that is signed by the manager of supply chain in now required to be attached to each purchase. This check list requires amongst others, for a valid tax clearance certificate.

The NYDA Board has provided governance and leadership to ensure that the agency meets its mandate and remains responsive to youth development matters. The Executive Management Committee; the Credit, Risk and Investment Committee; the Human Resource and Remuneration Committee, as well as the Audit Committee, have been very efficient in assisting the NYDA Board with performing its functions with ease. I thank all Board and Board Committee members for their tireless efforts.

I would like to extend much gratitude to President Jacob Zuma, Minister Collins Chabane and Deputy Minister Obed Bapela for their continued political guidance and support. I am grateful to all our stakeholders and partners for working with us in addressing critical youth development challenges. I hope that they continue to support the NYDA, as together we can do more.

Lastly, I would like to thank the employees of the NYDA for demonstrating commitment to their work, thereby serving young people and the youth development cause. Without your determined efforts, we would not have been able to record the success that we have achieved.

Steven NgubeniTransitional Accounting AuthorityJune 2012

Chief Executive Officer:Steven Ngubeni


I take pleasure in presenting the third annual report of the NYDA, which

is also the last annual report in which we account for the work performed

under the auspices of the first Board of the NYDA. I remain optimistic that,

owing to the youth development approach we have adopted, we are on the

mark in directing and focusing all energies in favour of the youth of South

Africa. I am well aware of the growing state of anxiety and impatience

among the youth regarding the pace at which youth development services

are being delivered. It only confirms the resounding plea that all energies

and efforts by government, the private sector and civil society should be

directed towards the development of South Africa’s future.

For its third financial year, 2011/2012, the Auditor-General has once again

awarded the NYDA with an unqualified audit opinion, with emphasis on a

few issues. The NYDA celebrates this achievement as a yardstick for good

governance, sound management and prudent financial stewardship. This

also confirms our claim that the NYDA is committed to a course of youth

development in South Africa and the world.

In early 2011, we submitted an annual performance plan for 2011/ 2012,

for approval by the Presidency and the National Treasury. This plan

was communicated to Parliament through its portfolio committee and

subsequently made public. The annual performance plan covered seven

KPAs, with clearly outlined objectives and indicators. This annual report is

based on the same approved and communicated annual performance plan.

Overall, the performance levels were exceptionally high, i.e. 63 out of 70

targets were met, most of which were exceeded. There has clearly been a

gradual improvement in the performance of the agency. For the financial

year ended 2010/2011, the NYDA was at an 86% performance achievement

rate. For the year under review, the NYDA was at a 90% performance

achievement rate. This represents an increased year-on-year performance

achievement rate of four percent and is proof of the fact that resources are

being evenly allocated throughout all our KPAs.

Under our Economic Participation KPA, our aim was to create job

opportunities and provide various business support services, including

financing. We met all 18 targets under this KPA. It must be noted that

12 579 jobs were created, compared to a target of 12 080. Funding

opportunities to the tune of R33,3 million, against a target of R20 million

CHIEF EXECUTIVE OFFICER’S REPORTwere facilitated for the benefit of young entrepreneurs. With the funding

opportunities accessed, many of these young entrepreneurs were able to

sustain their businesses and take them to the next level. Despite its limited

resources, the NYDA issued R26 million in microloans against a target of

R9,6 million. We also issued R10,8 million in loans to SMEs.

Under the NYS and Social Cohesion KPA, our aim was to promote

opportunities for youth to serve their communities and to create platforms

for youth participation and youth social networks. All targets were met for

this KPA, with 54 785 young people serving their communities while gaining

skills and experience. A total of 17 municipalities, against a target of eight,

were assisted with establishing Youth Councils as a platform for meaningful

youth engagement. With Youth Month being a seminal activity in the annual

calendar, a total of 31 000 youth, against a target of 10 000, were mobilised

to participate in Youth Month celebrations.

Our Policy, Research and Development KPA aims to develop a body of

knowledge and best practice to inform and influence policy development,

planning and implementation for youth development. For the year under

review, the NYDA produced a total of 44 research reports, evaluations and

knowledge management publications. These documents contribute to the

growing body of knowledge required for good youth development policy

and practice. Youth development is ‘everybody’s business’. To this effect,

and against a target of 15 partnerships, we established 48 partnerships

with government, civil society and the private sector.

These partnerships are critical for leveraging support for youth

development and making it everybody’s business. The mandate of the

NYDA is to coordinate and promote youth development issues. To this

effect, the NYDA finalised the IYDS, after many months of thorough

and exhaustive consultation. The NYDA Board approved the IYDS and

submitted it to Cabinet for approval. The Board also approved the Annual

National Youth Development Priorities (ANYDP) and submitted it to the

Presidency. The IYDS and the ANYDS shape and guide youth development

in the short and medium term, as well as on a year-on-year basis, thereby

coordinating and promoting youth development.

Through our Training and Development KPA, we intended to improve the




matriculation results, provide youth with life, technical and business skills,

as well as build the capacity of youth workers. We met all of our 12 targets

within this KPA. With a target of 2 000 learners enrolled in the NYDA Matric

rewriting programme, we enrolled 2 644 learners, thereby exceeding our

target by 32 percent. Skills development and training, in particular, will

continue to receive attention and focus, because too many young people

remain outside of the NYDA’s achievement rate.

Our Youth Advisory and Information Services KPA aims to ensure access

by youth to information about various interventions. We met seven out of

nine targets and exceeded the targets that were met. Against a target of

397 400 youth, we were able to provide 556 918 youth with career guidance

information. With a target of 400 000 youth, we were able to provide

543 890 youth with information and referrals through our outreach

programme. We exceeded our local youth information dissemination and

access points by 35%, with a target of 45 access points and performance

of 61 access points. These points are critical to ensuring that young people

access the information they need at the right time and place.

For the NYF KPA, we met our target of setting up the fund with the

Board approving the framework, policy and procedures. Exceeding a

target of awarding 10 bursaries, the NYDA awarded 114 bursaries and 10

scholarships to deserving students. We exceeded our target of

R30 million by raising R46,7 million in funds from the private sector to

contribute towards youth development. We also exceeded our target of

R60 million by raising R71,5 million of funds through partnerships for the

NYF. With its limited resources, the NYDA will continue to galvanise and

secure partnerships to leverage its youth development investment.

Our concern is that the magnitude of the youth challenges and youth

development backlogs render our achievement a drop in the ocean. It

is disconcerting that youth justifiably continue to complain and protest,

sometimes in very unhealthy and destructive ways, against the meagre

interventions from the NYDA and government, as a whole. Another matter

of concern is that more than 500 000 young people leave the school

system every year, with the majority not entering any further education,

employment or training programmes, thereby increasing the youth

development backlogs.

The NYDA resource allocation has not increased, despite the considerable

backlogs and demand from young people. On the contrary, it has

decreased. Despite all these concerns, however, we remain optimistic for a

better future for our young people. We believe in the limitless potential that

our youth have to break the bondages of unemployment, lack of skills and

poverty. We are ‘The limitless youth of SA’ and we are the ‘present and the

future’.

In conclusion, I wish to extend our gratitude to Minister Collins Chabane

and Deputy Minister Obed Bapela for their guidance and continued

support. I also wish to thank the outgoing Board and especially the

Executive Chairperson, Mr Andile Lungisa, and the Deputy Executive

Chairperson, Mr Yershen Pillay. Their leadership and governance ensured

that the sound foundations were properly laid for the NYDA to be a world-

class agency, pro-actively responding to the needs of young people. I

am also grateful to the staff of the NYDA for holding up, even when the

environment suggested otherwise. You have remained the pillars of

strength to the leadership of the NYDA.

I thank our stakeholders and partners, including the Parliament of South

Africa, government, municipalities, civil society and the private sector, for

their continued support.

Lastly, I thank the youth of South Africa for being our partners in

development. We remain committed to working with you in realising your

limitless potential. You are the limitless youth of South Africa.

Steven NgubeniChief Executive OfficerJune 2012




OPERATIONAL REVIEW REPORT AGAINSTKEY PERFORMANCE AREAS



The NYDA has been in existence for three years. In its modest lifespan, the institution has consolidated its operations and streamlined its business operation model, albeit in an environment of limited funding from the state. Considering that the main mandate of the NYDA is the mainstreaming and integration of youth development in all sectors of society, there is also a genuinely high expectation from the public and youth population, in general, for the NYDA to deliver sustainable programmes that are meaningful for improving the livelihood of the youth in South Africa. Like most developing countries, South Africa has a large population of young people. The large youth population cohort can create new economic growth opportunities, if developed effectively by the country. At the same time, if not properly managed and supported, it could result in social and developmental catastrophes, especially if the youth population is not well monitored and their needs are not addressed by the country’s policies and programmes. The youth demographic profile in South Africa suggests that the youth bulge has the potential of increasing the labour market pool of the country, thereby fostering economic growth through human resources made available by the youthfulness of the population. Basic living conditions for South African youths fall below the levels of other age groups of the population. The vulnerability to poverty is high for young people, while this age group is also growing more rapidly than the national population. The implications are that the country is likely to be faced with high dependency ratios in respect of young people who are not contributing positively towards the economic growth of the country. This has the potential of further increasing inequalities, due to the widening gap between rich and poor, as there are fewer young people, proportionally to age group structure, who are economically active. During the year under review, the NYDA has produced some pioneering documents profiling and providing a national framework for approaching sustainable youth development. These documents are: the draft IYDS, to be tabled before Cabinet in the course of the coming year; the Context of Youth in South Africa, published by the NYDA in December 2011, and the Status of Youth Report, which gives an account of the state of young people in South Africa. These documents are a positive milestone for the youth of the country, as they provide all sectors of the economy with a blueprint for viewing and approaching youth development issues. In pursuing their aspirations for a sustainable livelihood, the youth of South Africa are faced with a number of challenges. The Context of Youth report reviewed all aspects relating to youth development, as prescribed by the NYP, 2009–2014. The conclusions reached raise pertinent issues facing the young people of South Africa. These issues may be summarised as relating to: the increasing population of young people; the very high unemployment rate among the youth, especially those below the age of 24; the poor quality of basic education and lack of basic skills, required by the labour market, among young people, and the poor health status of youth with high-risk behaviour, as a result of the high prevalence of substance abuse; and the high incidence of young people committed to correctional services.

The NYDA is faced with a vast mandate for one individual organisation. The agency recognises that it is not a panacea for youth development and, therefore, works with stakeholders from all sectors in the implementation of youth development programmes. Consequently, the NYDA has contributed towards a number of government priorities, including: the quality of basic education; decent employment through inclusive economic development; a skilled and capable workforce to support an inclusive growth path; creating a better South Africa and a better world with vibrant, equitable and sustainable rural communalities; an efficient, effective and development-oriented public service and an empowered, fair and inclusive citizenship.

Strategic FocusDuring the year under review, the NYDA has sharpened its strategic operation areas to respond to its mandate, as prescribed by the NYDA Act, 2008 (Act 54 of 2008), and the challenges faced by the youth of South Africa. In its strategic planning session, the NYDA consolidated its KPAs, which were adopted by the NYDA Board to form the pillars of its operation for the financial year. These were:1. NYS and social cohesion — this operational area seeks to promote

youth social dialogue and create opportunities for young people to serve their communities.

2. Economic participation – this operational area initiates programmes and projects that will enhance the participation of young people in the economy, through targeted and integrated programmes.

3. Policy, research and development – this area focuses on developing a body of knowledge and best practice in the youth development sector, in order to inform and influence policy development, planning and implementation.

4. Training and development — programmes and initiatives in this area seek to promote, facilitate and provide training, and development, opportunities to young people to enhance their socio-economic wellbeing.

5. Youth advisory and information services – this operation area seeks to ensure the access by youth to information about various interventions aimed at improving the living conditions of young people, including information and career-guidance services to young people.

6. NYF – for the NYDA to achieve sustainability, there was a need to establish a mechanism to enable the agency to raise funds for purposes of advancing and implementing programmes aimed at improving the livelihood of the youth.

7. Governance – as a state-funded institution, the NYDA has to ensure that its operations comply with applicable legislation and regulations governing a schedule 3A institution.

The operational review section of the annual report covers the year under

Introduction


review, where key performance indicators (KPIs) are compared against yearly targets, on a quarterly basis, to monitor performance. In general, the NYDA has improved its performance since inception. There are indications that the operations are stabilising. This suggests that the institution is stabilising its operation and is maturing. For the year under review, 63 KPIs, out of a total of 70, were achieved. This represents a 90% achievement rate, as compared to 85,7% for 2010/11 and 22,1% for 2009/10. This may suggest that the NYDA is maturing quickly and gaining its operation momentum.

NYS and Social CohesionThe goal of the NYS and Social Cohesion KPA is to promote youth social dialogue, and create opportunities for young people to serve their communities. This KPA seeks to promote opportunities for young people to serve their communities; create a platform for young people to participate in and benefit from democratic processes; and create and support social networks to benefit young people. The NYDA has implemented a number of programmes, which assisted young people to fully participate in the projects. These included programmes on NYS, the participation of young women in the 16 Days of Activism against Women and Child Abuse, and the participation of young people in the celebrations of Youth Day. In addition, the NYDA created a number of platforms that promote youth participation in their development. These included the establishment of local youth councils within municipalities and the holding of a number of dialogue sessions with young people, where they could discuss and debate issues relating to youth in the country.

Table 1 below indicates that the NYDA has performed well against the predefined KPIs for this KPA. In all the KPIs listed in the table, the NYDA met the targets and, in some areas, it exceeded the targets. This was due to the extra effort put in by the NYDA to ensure that young people have access to these services.

Table 1: Activities Promoting Youth Participation in Democratic Processes

Key Performance Indicators 2011/2012 Target Q1 Q2 Q3 Q4 Annual 2011/2012

A number of youth serving their communities through NYDA-funded projects

10 000 youths 8 562 441 701 2 030 11 734 youths

A number of youth serving their communities through NYSU- registered projects

40 000 youths 5 658 22 757 2 243 12 393 43 051 youths

A number of local municipalities assisted to establish youth councils

Eight local municipalities

1 2 4 10 17 municipalities

A number of hosted dialogue sessions with young people

Four sessions 2 3 0 3 Eight sessions

A number of young women mobilised towards the 16 Days of Activism (against violence and abuse of women and children)

500 young women 0 327 178 0 505 young women

A number of youth participating in Youth Month Celebrations

10 000 youths 31 000 0 0 0 31 000 youths

The NYDA has created platforms to assist young entrepreneurs with establishing networks that can accelerate their business operations. These include establishing a pool of business mentors that can volunteer their time to assist young people with improving their business operations. In addition, the NYDA has been running a programme that seeks to link business opportunity providers with the products and services of young entrepreneurs. The programme resulted in a number of business opportunities being made available to young entrepreneurs across the country.

Table 2: Activities for the Creation of Youth Networks

Key Performance Indicator 2011/2012 Target Q1 Q2 Q3 Q4 Annual Performance 2011/2012

A number of volunteer mentors participating in the NYDA mentorship programme

300 volunteers mentors

52 21 11 248 332 volunteers mentors

A number of opportunity providers participating in the Buy Youth campaign

300 opportunity providers

15 26 25 253 319 opportunity providers

A number of youth supported through social and health interventions

3 000 youths 0 0 0 3 460 3 460 youths

Economic ParticipationThe main goal of the economic participation programme is to enhance the participation of young people in the economy through targeted and integrated programmes. Programmes that are implemented by the NYDA against this KPA aim to provide business support to young entrepreneurs; to provide financing opportunities for young entrepreneurs; and to provide employment opportunities for the youth.



Table 3: Young People Provided with Business Support Services 2011/12

Key Performance Indicator 2011/2012 Target Q1 Q2 Q3 Q4Annual Performance

2011/2012

A number of business support vouchers issued to youth entrepreneurs

800 vouchers 289 vouchers 404 vouchers 236 vouchers1 310

vouchers2 239 vouchers

A number of youth beneficiaries supported through business consultancy vouchers and business opportunities support services

2 000 beneficiaries 309 beneficiaries 493 beneficiaries 442 beneficiaries1 032

beneficiaries2 276 beneficiaries

A number of youth-owned companies assisted with registration with CIPC

500 new companies 6 new companies20 new

companies3 new companies

473 new companies

502 new companies

A number of youth entrepreneurs assisted to access funding and business opportunities through the voucher and business support programmes

50 entrepreneurs 25 entrepreneurs 14 entrepreneurs 9 entrepreneurs8

entrepreneurs56 entrepreneurs

The value of funding and opportunities accessed by voucher recipients, and the business opportunities support programme

R20 000 000 R6 805 384 R19 210 267 R2 999 417 R4 338 877 R33 353 945

A number of youth entrepreneurs mentored

1 500 entrepreneurs 538 364 119 557 1 578 entrepreneurs

The NYDA has been supporting young entrepreneurs through its business-support voucher programme, which aims to provide young entrepreneurs with business-support services that can enhance their enterprises. The business-support voucher programme has also assisted young entrepreneurs in accessing business opportunities that require specialised business skills to compete with other businesses in the market. Through these NYDA programmes, young entrepreneurs have been assisted with completing tender and other procurement documents required to successfully bid for advertised business opportunities.

A survey by the Youth Context publication shows that young entrepreneurs are not registering their businesses, thereby limiting their potential to grow, and access funding and business opportunities that would help their enterprises to develop and compete in the business sector. The NYDA has been running a programme that assists young people to register their companies through the Companies and Intellectual Property Commission (CIPC). The aim of this effort is to increase the market share of youth-owned companies competing in the open business market and meeting all the regulatory requirements to access tendering opportunities provided by the public and private sectors. This process has allowed youth-owned businesses to access financing for their businesses and comply with statutory requirements for businesses in South Africa.

Regardless of limited resources allocated to the agency, young people have not been turned away, but provided with the service, even when the target has been met. During the year under review, the NYDA’s target was to provide 800 business vouchers to young entrepreneurs. However, the agency managed to issue 2 239 business-support vouchers, which reflected an achievement of 179% above the set target. This motivates the NYDA to continue offering these services to young people, even when suffering financial constraints. The mentorship programme during the year under review, managed to link 1 578 young entrepreneurs to experienced business people, who have assisted them in improving their business operations.


Table 4: Young Entrepreneurs Provided with Financing SupportKey Performance Indicator 2011/2012 Target Q1 Q2 Q3 Q4 Annual Performance 2011/2012

A number of social enterprises financed by the NYDA

Two enterprises financed

0 1 2 0Three

enterprises financed

A number of beneficiaries supported through social enterprise financing

20 beneficiaries 0 7 13 0 20 beneficiaries

Value of finance provided to social enterprises R1 000 000 R0 R2 114 375 R2 440 876 R214 912 R4 770 163

A number of loans issued to youth-owned micro-enterprises (NYDA and partner microloans)

9 000 loans 2 307 1 619 1 666 4 307 9 899 loans

The value of loans issued to youth-owned micro-enterprises (NYDA and partner microloans)

R9 600 000 R5 803 320 R4 924 437 R4 738 741 R10 610 094R 26 076 592

A number of loans issued to SMEs 12 loans 4 1 6 3 14 loans

The value of loans issued to youth-owned small and medium enterprises

R6 000 000 R2 513 382 R2 346 763 R4 171 772 R1 746 020 R 10 777 937

One of the biggest challenge faced by young entrepreneurs, especially those entering the business environment, is access to financial support. Most of the young people entering business for the first time, have a problem with accessing loans from commercial banks, which see them as high risk with no collateral. The NYDA has provided a vehicle for young Development Funding Institutions established by the state. Social enterprises, especially co-operatives, have the potential to improve the livelihood of young people in South Africa, given the climate of high unemployment for young people in South Africa. Co-operatives are more likely to assist more young people to actively participate in business ventures, with a real possibility of providing more jobs than privately owned companies. The NYDA is deliberately exploring this approach towards creating employment and youth participation in business.

The NYDA has managed to issue 9 913 micro and SME loans during the year under review. These efforts are geared towards providing access to financing, especially microloans, which have proven to be the main drivers for economic participation by young people in South Africa. During the year under review, the NYDA managed to issue 9 899 microloans to youth entrepreneurs and 14 SME loans, which included the funding of three social entrepreneurs.

The financing of entrepreneurship has the potential of providing jobs for young unemployed youth. It is, therefore, critical for the agency to continue funding young entrepreneurs as a means of creating self-employment for them.

During the year under review, the NYDA set a target of R15,6 million for micro and SME loans to young people. Due to the need among young people to access loans as a sustainable means of job creation and active economic participation, however, the NYDA was able to issue loans valued at R36 854 529, which was more than double the target.

Table 5: Employment Opportunities to Young People through NYDA ProgrammesKey Performance Indicator 2011/2012 Target Q1 Q2 Q3 Q4 Annual Performance 2011/2012

A number of jobs facilitated through business consultancy vouchers and business opportunities support services

2 000 jobs 490 440 476 701 2 107 jobs

A number of jobs facilitated through financing of social enterprises

20 jobs 0 8 75 0 83 jobs

A number of jobs facilitated through financing of SMMEs 60 jobs 54 0 14 0 68 jobs

A number of jobs facilitated through microfinance lending 9 000 jobs 2 425 1 643 1 795 3 441 9 304 jobs

A number of jobs facilitated through placements in job opportunities

1 000 jobs 116 196 222 483 1 017 jobs

As part of reducing unemployment among the youth in South Africa, the NYDA has initiated and implemented programmes that seek to create sustainable jobs for young people. These programmes include crating self-employment jobs though financing youth enterprises, providing services that promote



job creation through business support programmes and placement of young people in the job market. During the year under review, a total of 12 579 opportunities for self-employment and job placement were achieved for young people. All the targets set for the programmes implemented by the NYDA were achieved and surpassed.

Most new jobs were created through the financing of micro-enterprises and business support, which accounted for 91,9% of all jobs created by the NYDA in the year under review. This may suggest that microfinancing and business support programmes are a viable option to address youth unemployment in the country, if implemented on a large scale.

Policy, Research and Development

The goal of the policy, research and development KPA is to create a body of knowledge and best practice in the youth development sector, to inform and influence policy development, planning and implementation. The NYDA has initiated and implemented a number of programmes that seek to ensure that youth development is informed by current information and good practice, and responds to current needs of young people in the country. The fundamental aim of this area is to ensure that policies and frameworks that drive youth development are developed, based on a body of knowledge and facts that are relevant to the developmental needs of the youth of South Africa, as well as giving South Africa a competitive edge, globally.

This operational area of the NYDA is responsible for developing the IYDS and plan, as required by Section 3 (1) (a) of the NYDA Act, 2008 (Act 54 of 2008). The NYDA has developed the strategy through a process of consultation with young people, and the public, private and civic society sectors, and presented the draft strategy to the NYDA Board for adoption. The strategy was submitted to the Presidency for consideration and for tabling in Parliament for adoption as a national framework for youth development. The NYDA developed an evaluation protocol for the IYDS to monitor its implementation, in order to measure its effectiveness in addressing the youth development challenges and programmes outlined.

Section 6 (1) of the NYDA Act also requires the agency to submit a Status of Youth report to the Presidency every three years. The year under review is the third year of operation of the agency. According to the Act, the NYDA completed the Status of Youth Report after rigorous research and consultation with sectors of the society, including the youth formations of the country. The draft of the Status of Youth report was adopted by the NYDA Board and presented to the Presidency for consideration as a final report. The President will present it to Parliament on a date to be announced by him.

Section 3 (1) (b) and (g) require the NYDA to develop guidelines for the implementation of the NYP, and subsection (g) requires the agency to establish national youth priorities for youth development. In the year under review, the NYDA developed guidelines for the implementation of the areas outlined in the NYP, 2009–2014. These guidelines provide an operational framework for the response and design of programmes, by sectors, in accordance with issues outlined in the NYP. Through a consultative process, the agency also developed and produced a list of national priorities for youth development in the country. The list gives the country clear direction on how all sectors should prioritise in the implementation of programmes that respond to the needs of the youth in South Africa.

During the year under review, the agency aspired to meet all the legislative mandates stipulated. This indicates that the agency has reached its organisational maturity, and can perform its functions effectively and efficiently. The frameworks and tools developed during the year under review will assist all sectors to integrate and mainstream youth development in their operations.

Table 6: Performance against Targets for Policy, Research and DevelopmentKey Performance Indicator 2011/2012 Target Q1 Q2 Q3 Q4 Annual Performance 2011/2012

Design, printing and distribution of the IYDS3 000 copies printed

and distributed0 0 0 0 0 copies

A number of partnerships established with government civil society and the private sector

15 partnerships 6 7 11 24 48 partnerships

Government departments lobbied to establish youth directorates

Five departments 1 2 6 4 13 Departments

A number of research project reports produced Six research reports 0 1 2 3 Six reports

A number of programme and project-evaluation reports produced

10 evaluation reports 3 1 1 6 11 evaluation reports

A number of publications produced on youth development


5 3 10 8 26 knowledge management publications

A number of written submissions on policies and legislation on youth development issues to the relevant departments

Six submissions 1 1 7 0 Nine submissions

A number of portfolio committee meetings attended 10 Committee Meetings 2 3 4 2 11 meetings


The policy, research and development target was to print and distribute 3 000 copies of the IYDS. However, due to the fact that the IYDS was not adopted by Cabinet during the year under review, this activity was not performed. During the consultation period of the IYDS, however, the NYDA printed and distributed over 5 000 copies of the draft IYDS to different sectors, including youth formations. The printing and distribution of the final IYDS will be done in the coming financial year, once the strategy has been adopted by Cabinet.

With an understanding of the complexities and magnitude of the challenges facing young people, and the importance of fundamentally mainstreaming youth development in all sectors, the NYDA ensured that partnerships were developed with various sectors of economy. During the year under review, the NYDA established 48 partnerships with the public, private and civic society sectors, to ensure that their programmes contributed towards youth development. In addition, the NYDA lobbied 13 national government departments to establish youth directorates, dedicated to ensuring that youth development is mainstreamed and integrated in those departments.

As part of its lobby and advocacy role, the NYDA made submissions to government policies and legislation, and attended and made presentations in 11 parliament portfolio meetings, to ensure that the legislature took the mainstreaming and integration of youth development seriously when overseeing the work in all government departments.

Training and DevelopmentThe goal of this KPA is to promote, facilitate, and provide training and development opportunities to young people to enhance their socio-economic well-being, with the objective of facilitating education opportunities. The aim is to improve access to quality education, and facilitate and implement technical, entrepreneurship and life skills training programmes for young people in South Africa. The programmes under this KPA include technical, business and life skills training for young people. In addition, the agency has initiated and implemented programmes that provide job-preparedness training and assist young people who have failed Matric to rewrite some of the subjects they have failed.

Table 7: A Number of Young People Provided with Education and Skills Development InterventionsKey Performance Indicator 2011/2012 Target Q1 Q2 Q3 Q4 Annual Performance 2011/2012

A number of young people enrolled in the NYDA Matric- (Grade 12-) rewriting programme

2 000 learners 0 0 0 2 641 2 641 learners

A number of young people attended the entrepreneurship and business management skills programmes

5 000 youths 1 326 1 588 657 1 722 5 293 youths

A number of youth attended the technical skills training programme

500 youths 477 0 170 0 647 youths

A number of youth attended the job-preparedness training programme

10 000 youths 2 178 2 664 2 467 5 726 13 035 youths

A number of youth attended the life skills training programme

2 000 youths 1 005 998 174 100 2 277 youths

A number of young people enrolled in Youth Build South Africa projects

200 youths 0 80 0 431 511 youths

A number of young people attended the entrepreneurship awareness programmes

15 000 youths 8 539 1 708 4 352 2 689 17 288 youths

A number of youth attended the Buy Youth Campaign training

300 youths 12 29 140 177 358 youths

During the year under review, the NYDA was able to assist 42 050 young people to either undergo technical skills training, business management skills training, job-preparedness training or life skills training, or enrol in the Matric-rewriting programme. Skills development and education are important priorities for the agency in its quest to contribute to the youth of the country. At the same time, the agency is also aware that, for entrepreneurs to be successful, they need the skills and capacity to ensure that their enterprises are sustainable, and can grow. The majority of young people assisted under this KPA were young entrepreneurs, who followed our enterprise awareness programme, the entrepreneurship and business management skills programme, and the Buy Youth Campaign training programme. These programmes accounted for 54,6% of young people who followed skills training programmes presented by the NYDA.

Throughout the NYDA’s existence, entrepreneurship and business management training have been measured outputs of the agency. This is due to the fact that there are only a few youth entrepreneurs in the country and those that venture into business are often not successful. One of the contributing factors to their failure is lack of business management skills. To respond to this challenge, the agency provided business management and entrepreneurship skills to 5 293 young entrepreneurs during the year under review.



The NYDA has consistently implemented job-preparedness workshops for young people, after realising that most young people are ill prepared to present themselves appropriately during job interviews. In the year under review, 13 035 young people attended these training workshops, aimed at assisting young people in improving their skills in job hunting, CV preparation and job interviews.

Table 8: Capacity-building Interventions for the Youth Development SectorKey Performance Indicator 2011/2012 Target Q1 Q2 Q3 Q4 Annual Performance 2011/2012

A number of capacity-building interventions conducted for the youth development sector 12 interventions 7 2 3 7 19 interventions

A number of staff members trained to deliver on the NYDA mandate 200 staff 146 88 87 58 379 staff

A number of accredited unit-standard-aligned learning programmes registered with ETDP SETA towards the youth-work qualification

Two unit standards aligned 1 0 0 1 Two unit standards aligned

A number of youth development practitioners, who obtained unit-standard credits towards the youth work qualification

10 Practitioners 0 0 0 17 17 practitioners

The NYP 2009–2014 requires the country to build capacity and a skills set of youth workers. To this end, the NYDA initiated and implemented programmes that can provide and facilitate the capacity-building of youth development practitioners, and, in addition, facilitate youth development work as a recognised profession.

During the year under review, the NYDA managed to run 19 capacity-building sessions for the youth-development sectors. These sessions ranged from basic youth development to the project management of programmes, aimed at developing young people. In addition, through its Centre for Youth Development Practice (CYDP), a training arm of the agency, the NYDA managed to register two training unit standards with the ETDP SETA, to be credited towards a youth-work qualification. In the year under review, a total of 17 youth practitioners enrolled and successfully obtained full credits towards a youth-work qualification from the NYDA CYDP.

As part of the NYDA mandate to build capacity among its staff to deliver quality and effective services, a total of 379 staff members attended training courses, internally and externally, to improve their skills and capacity to deliver youth development programmes.

Youth Advisory and Information ServicesThe main aim of the youth advisory and information services KPS is to ensure access to information about various interventions, aimed at improving the living conditions of young people, including information and career guidance services. This KPA’s objectives are to provide career guidance services; ac-cess to information regarding products and services of the NYDA; and referrals to other agencies. Access to information, i.e. knowing where they can go to access services that can improve their livelihood, is one of the limiting factors for young people.

Table 9: Young People who Received Information and Visited the NYDA Service Centres

Key Performance Indicator 2011/2012 Target Q1 Q2 Q3 Q4 Annual Performance 2011/2012

A number of youth provided with individual career-guidance information (one-on-one sessions)

2 600 youths 718 1 151 558 4 698 7 125 youths

An estimated number of youth provided with group career-guidance information

397 400 youths 111 000 87 136 31 352 327 430 556 918 youths

A number of people received information and/or referrals from NYDA service-delivery points

100 000 young people

24 783 28 382 15 725 35 596 104 486 young people

An estimated number of youth provided with information and/or referrals through the NYDA outreach programme

400 000 young people

143 956 82 897 38 619 278 418 543 890 young people

A number of interactions with young people through the NYDA call centre

140 000 interactions 12 797 13 533 7 958 11 937 46 225 interactions

A number of NYDA beneficiary stories published 20 publications 51 0 14 2 67 publications

A number of NYDA portal visits300 000 NYDA

portal visits88 230 94 063 97 662 157 497 437 452 NYDA portal visits


During the year under review, the NYDA managed to interact with huge numbers of young people. There were 7 125 young people who attended one-on-one sessions on career guidance throughout the branches, while 556 918 attended group career guidance sessions, provided by our mobile units visiting communities and schools. There were 104 486 young people who visited our branches and local youth offices, seeking information and assistance from the NYDA, while 543 890 were reached by our mobile units visiting communities across the country.

Some 46 225 young people were provided information and assistance through the NYDA call centre, while about 437 452 visited our website during the year under review. The achievement against these targets proves that the NYDA communications and information provision platforms are exceptional, and provide information to a significant population of young people. Expansion of these centres and platforms can make a significant impact on youth accessing relevant information and advice about their future.

Table 10: Established Access Points for NYDA for 2011/12Key Performance Indicator 2011/2012 Target Q1 Q2 Q3 Q4 Annual Performance 2011/2012

A number of new NYDA local youth-information dissemination and access points

45 access points1 access

points8 access

points18 access

points34 access

points 61 access points

A number of NYDA provincial offices established

Three provincial offices

1 provincial office

0 provincial offices

1 provincial office

1 provincial office

Three NYDA provincial offices established

95% of NYDA offices and access points branded

95% of existing NYDA offices

branded41% of offices 0 NYDA offices 0 NYDA offices 0 NYDA offices

41% of existing NYDA offices are branded

The NYDA has the responsibility of establishing a footprint throughout the country, in order to provide administrative and operational support to service delivery. In the year under review, 61 new access points were established for service delivery across the country. In addition, the NYDA established three provincial offices. To improve visibility and for purposes of easy identification by young people who require services from the outlets, the NYDA brands its offices. Of all the NYDA access points and offices, 41% were branded in accordance with the NYDA corporate branding requirements during the year under review.

National Youth FundThe NYDA Act, 2008 (Act 54 of 2008), Section 5 (1) (vi) requires the agency to establish competencies and capabilities in its operations, to implement a National Youth Fund (NYF). In response to this legislative mandate, the agency established a mechanism to enable the NYDA to raise funds for purposes of advancing and implementing programmes, aimed at improving the livelihood of the youth.

The mechanisms established by the NYDA to establish the fund, include the development of a framework for fundraising and management of the fund. The framework was presented to the NYDA Board and approved as an institutional framework for managing the NYF. Policies and procedures for operating the fund were also developed and approved by the NYDA board. These instruments are used by the NYDA to access and distribute funding to youth development projects and young people supported by the fund.

Table 11: Funds Raised for the NYFKey Performance Indicator 2011/2012 Target Q1 Q2 Q3 Q4 Annual Performance 2011/2012

A number of bursaries awarded to youth by the NYDA, to further their studies in tertiary institutions

10 bursaries 0 bursaries 0 bursaries 0 bursaries124 bursaries and

scholarships124 bursaries and scholarships

Value of funds raised from the private sector for the NYF

R30 000 000 R0 R579 000 R0 R46 143 300 R46 722 300

Value of funds raised through partnerships for the NYF

R60 000 000 R15 250 000 R579 000 R1 072 900 R54 693 300 R71 595 200

Value of funds invested in youth-initiated projects

R20 000 000 R0 R0 R0 R802 158 R802 158

During the year under review, the NYF was able to raise funding worth R71,5 million from its partnerships with the public and private sectors, and international organisations. Of the total funding raised for the fund, more than half, R46 722 300, came from the private sector. Some 124 bursaries and scholarships were issued to young people from the fund and R802 258 was spent on youth-initiated projects across the country.

GovernanceSection 2 of the NYDA Act defines the agency as a national public entity, as defined in Section 1 of the Public Finance Management Act. The aim of this KPA is to ensure that NYDA operations comply with applicable legislation and regulations governing a Schedule 3A institution.



Table 12: NYDA Performance against Governance Indicators

Key Performance Indicator 2011/2012 Target Q1 Q2 Q3 Q4 Cumulative Total

Adequate corporate governance, financial and operational controls

Unqualified annual audit report

Audit opinion not issued yet

Unqualified annual audit

report 2010/11

Target met in Q2

Target met in Q2Unqualified annual audit report

2010/11

Decrease in the number of loans defaulting in the NYDA SME-loan book







Decrease in number of loans defaulting in the NYDA microloan book


3,6% increase in defaulters

3,6% increase in defaulters

During the year under review, the NYDA was audited by the Auditor-General for 2010/11. The audit opinion issued to the agency was unqualified. This indicates that the agency met its target, which aimed at an unqualified audit opinion for the year 2010/11. The NYDA issues loans to young people, which are a high risk, since the clientele does not have surety and the majority are start-up businesses. The agency’s target was a 20% reduction in defaulters for microloans and SME loans. The performance information figures indicate that the reduction in defaulters on SME loans was 17%, which is 3% short of the set target, while there was a 3,6% increase in defaulters on microloans, due to the fact that most young people who come to the NYDA, request microloans to start a business. This makes them a high risk, as their business may not generate profit quickly enough to enable them to repay their loan on time. It is, therefore, expected that most of the defaulters on the NYDA loan programme will be on microloans.

ConclusionThe NYDA performance information reflects that the agency is improving its operations, and meeting its targets and mandate. As a young institution, the agency is still in its growth curve. Given time and support, both in terms of co-operation with other institutions and financial resources allocated by the state, the agency can grow and improve further in meeting the needs of the majority of young people of South Africa.

Over the past three financial years of its existence, the achievements against its targets have grown from 25% against all set targets in 2009/10, to 85% in 2010/11 and, during the year under review, the agency achieved 90%. Due to the development of frameworks, processes and procedures for managing performance information, the quality of information collected and reported by the agency has improved. Over the three years, the agency has introduced new programmes and initiatives that seek to support the development of young people, thereby working towards meeting the general mandate of the agency, as stipulated by legislation.

During the year under review, the NYDA managed to produce fundamental documents to harness youth development potential in the country. The drafting of the IYDS and plan, including the monitoring and evaluation guidelines; the development and publication of the NYP guidelines; the production and publication of the NYDA priorities of the country; the publication of the Context of Youth in South Africa; and the compilation of the Status of Youth Report for the Presidency are some of the key milestones the agency has achieved. These documents are key in driving the youth development agenda in the country. They will inform policy, operations and response towards challenges faced by the youth of South Africa.

BENEFICIARYSTORIES AND ARTICLES



NATIONAL YOUTH DEVELOPMENT AGENCYANNUAL REPORT 2011/2012

The NYDA supports Soweto’s first black-owned jewellery manufacturing businessBy Refilwe Mphane

Nqobile Nkosi is the proud owner of NQ Jewellery Design Services, the first black-owned jewellery manufacturing and retail business in Soweto. The business uses precious stones as well as silver, gold, platinum and diamonds to manufacture jewellery. At the beginning of 2012, Nqobile and UK designer Paul Spurgeon launched the Cornerstone Jewellery brand at the United Kingdom (UK) Springfair Jewellery Show. ‘Our collection will be sold in South Africa and the UK. While in the UK, I also went through a two-week internship programme, where I had the opportunity to learn about all aspects of jewellery production,’ he explained.

Nqobile’s journey in the jewellery manufacturing industry started in 2007, after he attended an 18 months’ training course in jewellery manufacturing and design. ‘I started the business with the seed capital that I made by selling cakes, biscuits and soft drinks on the streets of Soweto. However, due to limited funds and equipment, when the business was established, we mainly repaired jewellery and only manufactured jewellery on a small scale,’ he said.

With the business loan that Nqobile acquired from the NYDA, he had some working capital, and managed to purchase additional equipment and material. ‘We also received immense assistance and donations from Paul Purgeon Designs and the British jewellery trade members,’ Nqobile elaborated.

Today, the business employs four people, who also underwent training in its Soweto workshop. Over the years, the business has received numerous accolades, such as the Gauteng Business Leader of the Year Award in 2008, the Jet Community Regional and National Award in 2009, and the SAB Kick Start Award in 2012. According to Nqobile, the Cornerstone Jewellery brand is doing extremely well in the UK market. However, in order to ensure growth in the South African market, he is keen to partner with prime South African jewellery retailers. ‘The African continent has an abundance of natural resources which have for so long supplied the needs of the worldwide jewellery market. Our aim is to take advantage of these resources by training and employing South Africans from disadvantaged communities, so that we can alleviate South Africa’s high unemployment levels,’ he concluded.


Young emerging black farmers changing the lives of the Cookhouse community

By Siyabonga Magadla

NYDA Executive Chairperson Andile Lungisa launched a tomato-growing and processing project, run by two emerging young black farmers: Phetheho Motanyane and Themba Mazwai, owners of BNT Resources. The launch took place at Kruger’s Post farm, Cookhouse, in the Eastern Cape, where the project is being managed. The project began after the NYDA helped facilitate interaction between the two entrepreneurs and the Department of Rural Development and Land Reform three years ago, which led to the department purchasing the farm from its initial owner, at a cost of R17,5 million, and subsequently leasing it to the two emerging farmers for a period of 10 years.

‘The NYDA started facilitating the interaction between the two entrepreneurs, and the Department of Rural Development and Land Reform, in 2009, as part of its rural development focus, resulting in the department acquiring the farm and making it available to the owners of BNT Resources. Later, the National Empowerment Fund came on board, granting the two young farmers a loan to the value of R10 million to start farming and processing tomatoes. BNT has since employed 175 people from the Cookhouse community as part of the growing project,’ explained Lungisa.

Lungisa said that South Africa had become a net importer of food that could often be produced on the abundant arable land that was available in the country, and that current landowners did not fully utilise all the land that was available. ‘I firmly believe that investing money in farming will take South Africa to much greater heights, as there are many crops to produce on land in the country,’ said Lungisa.

BNT Resources has since gone into partnership with a professional, large-

scale farming company as its technical partner, Emvest Eastern Cape, and Cape Concentrates, an Eastern Cape-based company that focuses on the processing of tomato paste. The launch marked the first harvest of tomatoes since the beginning of planting in September 2011 on the 2 389-hectare farm, of which 331 hectares are suitable for tomato farming.

Through the project, Motanyane and Mazwai have changed the lives of the community of Cookhouse, not only through the creation of employment, but also through the allocation of 30% of their proceeds in a BNTY worker’s trust and 15% in a community trust. This trust is held by the Blue Crane Development Agency, which runs Maths and Science classes in the Cacadu District as part of its vision for growing educational opportunities in the rural Karoo towns.

‘When we started the business, we realised there was an opportunity in the market, when Cape Concentrates built their factory in Coega, but didn’t have a tomato supplier. So, our research process on tomato-growing started. Then, when we approached the NYDA in 2009, we realised that they didn’t have the capacity to fund the tomato project. However, they immediately started assisting us with funding applications and we ended up obtaining funding from the National Empowerment Fund. We couldn’t have done it without the NYDA’s assistance – they helped us foster what is now a very significant funder of our business and they are the reason we are here today,’ said Motanyane.

The NYDA encourages young people, particularly in rural areas, to start their own small enterprises, including co-operatives, in order to take advantage of business opportunities available through government, and youth-development and funding institutions, such as the NYDA, in order to contribute to the alleviation of poverty and job creation.



NATIONAL YOUTH DEVELOPMENT AGENCYANNUAL REPORT 2011/2012

Aspiring entrepreneur paving his way upBy Kamogelo Maja

Born and bred in Mdantsane, a small township in East London, Jack Mziwamadoda (32) is a young entrepreneur, who designs and makes sliding gates, burglar doors and fences. He has been running the business for 14 years.

The NYDA helped him with his business plan. ‘Starting your own business is not easy. The NYDA assisted me to draft a business plan and I’m very thankful to the organisation,’ he said.

Jack was raised by both parents and has five siblings. He went to Dilizalta Senior Secondary School and dropped out in Grade 11. He was inspired to start his own business while working for his uncle‘s welding business. ‘My uncle encouraged me to start my own business and I took his advice, because I wanted to develop myself and assist in reducing the number of unemployed people in my community,’ he added.

After years of running his own business, he met up with a friend and they decided to become partners. They named the business, Kukhanya Welding Work, which now employs two people. Asked about his achievements, he said proudly, ‘The business has grown a lot and most projects that we receive are from the community.’

In terms of the challenges that they face, Jack explained that the space they are working in is not large enough and that their van is not in a good condition, which often causes delays in finishing work. ‘However, this doesn’t discourage us. Instead, we’re determined to overcome these problems, because nothing comes easy in life and you need to work hard to become a success,’ he said.

Jack would like to expand his business, work more with aluminium and secure government projects. In conclusion, he emphasises that, because starting a business and drawing customers isn’t easy, it’s important to be patient and stay focused, to ensure survival and success.

By Refilwe Mphane

The NYDA recently launched an exciting initiative called Sistaz4Life – a campaign that will be focused on targeting key social issues facing young women today. Projects that fall under Sistaz4Life include: breast cancer awareness, 16 Days of Activism Against Women and Child Abuse, World Aids Day, International Day for People Living with Disabilities and the Sanitary Towel Distribution Project. Aimed at rural and peri-urban-based young women, the Sanitary Towel Distribution Project was launched at Mandlakazulu Senior Primary School in Lindelani, on the outskirts of KwaMashu, KwaZulu-Natal. The NYDA partnered with the Imbali Sanitary Towels Pads Project for the launch event.

According to research, lack of access to sanitary towels often results in young women from poorer backgrounds being absent from school or experiencing loss of human dignity, because of having no choice but to use old newspapers or cloths. Young women in Africa have been reported being absent from school for a period of at least four days per month. This can amount to about 24 weeks out of 144 weeks during a four-year period of high school. In some instances, these young women suffer from stress and depression, due to fear of staining their clothes.

‘The key priority for this particular project is for young women in schools to have the necessary knowledge, facilities and environment to manage menstruation hygienically, and with dignity. This project will assist in ensuring that girl learners do not miss valuable learning time,’ said Innocentia Motau, NYDA Board member.

The NYDA already has a key focus on youth development in the areas of education and life skills; economic participation and employability; leadership and engagement; and health education and awareness.

Through the Sanitary Towel Distribution Project , the NYDA and partners aim to achieve the development of young women in the areas of health, education and gender equality.

‘The Sistaz4Life Project is not just about supplying sanitary towels to young women. It is about making a significant life-changing difference. The sanitary towels do not only enable girls to attend class regularly, but the effect is greater, in the sense that this falls within the government’s goal of making access to education simpler and eventually ensuring better economic exposure for these young women,’ Motau concluded.

The NYDA helps young girls stay in school


By Gugu Mjadu

Innocentia Motau, Non-Executive Board Member representing business at the NYDA and member of the G20 Young Entrepreneurs Alliance, will once again join world leaders in the entrepreneurship arena for the G20 Young Entrepreneurs Summit, taking place in Nice, France, on 2 November. This third edition of the summit, with the apt theme, ‘A New Generation Of Entrepreneurs: Builders Of The 21st Century Economy’, will bring together world-class entrepreneurs to share their key strategies for adapting and innovating products, services and business models. It is an opportunity for entrepreneurs and emblematic business leaders from top global companies to network and exchange ideas on entrepreneurship as a key component for sustainable economic growth. Bongiwe Kali, 2009 Female Farmer of the Year, and Onesimo Ngumbela, who recently won the NYDA-sponsored Future 100 competition, aimed at unearthing and recognising promising entrepreneurs in South Africa, will join Innocentia. Representatives from the Gauteng Chamber of Commerce and a number of young entrepreneurs will also attend the session. The summit will address the following topics: the context of entrepreneurship today; the social entrepreneurship revolution; the ecosystem for healthy entrepreneurial vitality; and best practice for financing projects. Confirmed speakers include: Anand Mahindra, Vice-Chairman and Managing Director, Mahindra & Mahindra, who will lead the roundtable discussion on, ‘Why do emerging and developed economies struggle so much to integrate youth in the economy?’ and ‘Is entrepreneurship something you can teach?’ and Jean-Pierre Letartre, President, Ernst & Young, France & Luxembourg, who will address the summit on, ‘The G20 Entrepreneurship Barometer: New Criteria for Measuring Resources and Means Developed by G20 Countries to Encourage Entrepreneurial Mindset’. International President of Relais & Chateaux, Jaume Tapiès and Professor Muhammad Yunus, leading microfinance expert and Nobel Peace Prize winner, will also address the summit.

‘In a country where young people account for the largest cohort of the unemployed population, we would be ignorant not to take the G20 Young Entrepreneurs Summit (YES) seriously, or not to consider its recommendations. The summit allows for extensive country-to-country benchmarking, as well as sharing best practices on entrepreneurship,’ said Innocentia. She added that the NYDA already had programmes and services in place that supported aspiring and established entrepreneurs, such as business loans, the mentorship programme and the business consultancy-services voucher programme. ‘However, we should always take up opportunities to improve on our offerings,’ she said.

South African entrepreneurs to share knowledge at the G20 Young Entrepreneurs Summit in France

At last year’s summit, held in South Korea, the following framework was outlined of how G20 YES would engage the G20 process to include entrepreneurship in its ongoing agenda. Through these recommendations, the G20 Young Entrepreneurs Alliance believes that we can move towards a world where young entrepreneurs contribute to their countries’ economies and become pillars of their communities:

• Governments supporting alternative mechanisms and institutions that provide young entrepreneurs with capital

• Governments encouraging greater collaboration and co-operation among public, private and non-profit organisations that offer business support services

• Governments playing a role in encouraging an entrepreneurship culture by communicating self-employment as a possible career option

• Governments reducing administrative burdens for recently established youth-owned businesses and enacting tax measures that will encourage their growth

• Governments encouraging entrepreneurial education in schools, colleges and universities.

Innocentia reported that, as part of responding to some of these recommendation, the NYDA introduced the Group Methodology Lending Programme, to make it easier for micro-entrepreneurs who would not ordinarily be able to access capital, because of restrictive banking regulations. This lending programme enables young people between the ages of 18 and 35, who have a minimum of five and a maximum of eight group members, to access collateral free business loans of between R1 000 and R10 000. With this methodology, loan repayments have also generally been high, because the group members are jointly liable for loan repayments.

‘We also cannot underestimate the importance of collaboration and co-operation among public, private and non-profit organisations. This year, the NYDA signed a memorandum of understanding with Ithala to provide loans of between R50 000 and R5 million to youth-owned, aspiring and established small, micro and medium enterprises, and co-operatives in KwaZulu-Natal.’ Innocentia added that, to build the entrepreneurial culture among young people and boost the sustainability of youth-owned enterprises, the NYDA had since its inception provided entrepreneurship training to 49 341 young people.

‘Entrepreneurship is the cornerstone for building flourishing 21st century economies and young entrepreneurs should play an enormous role in this process. As the NYDA, we will continue to support them through our various programmes,’ Innocentia concluded.



By Nawhal Kara-Foster

As the world celebrated International Co-operatives Day on 2 July, the NYDA Deputy Executive Chairperson, Mr Yershen Pillay, awarded Dipeung Trading Co-operative from Atteridgeville, Tshwane, a cash prize of R20 000.This took place at an exhibition held at East London’s Jan Smuts Stadium, in celebration of International Co-operatives Day, where the NYDA held a competition for the best co-operative exhibitor present. Under the worldwide theme, ‘Youth, the Future of Co-operative Enterprise,’ the NYDA’s aim was to raise awareness of co-operatives as an alternative form of enterprise model for youth. The celebrations included an exhibition of existing co-operatives and a gala dinner on 1 July, arranged by the NYDA, in partnership with the Department of Trade and Industry, the South African National Apex Co-operative and the Eastern Cape Provincial Government.

Dipeung Trading Co-operative, a jewellery design co-operative, made an impression on the NYDA-appointed judges, based on their overall presentation and the fact that six out of seven of their members are young people under the age of 35.

The top five runners-up were awarded business consultancy-services vouchers, which allowed them to select a service, such as the development of a marketing plan, business process re-engineering or financial management, which is necessary for the sustainability of their co-operative. Founding member of Dipeung Trading Co-operative, Bolepu Mathabatha, 31, was presented with a cheque by Pillay and congratulated on stage by the Minister of Trade and Industry, Mr Rob Davies. Mathabatha was overjoyed at his unexpected success. ‘It was my birthday yesterday and I could not have asked for a better gift. I thank the NYDA for

this initiative,’ he said after being awarded the prize.

According to Mathabatha, Dipeung Trading Co-operative was founded in 2009, when a group of artists, all dealing with natural materials such as leather and indigenous seeds, decided to work together and form a co-operative enterprise.

‘We have an advantage over other jewellery crafters in that we use only natural materials. For example, I have never seen any other designers make use of dried lemons and guava seeds to make jewellery and accessories,’ says Mathabatha.

He said that the NYDA cash prize of R20 000 would be used for marketing their products, in order to supply more shops and possibly export their merchandise.

Pillay addressed crowds at the Jan Smuts Stadium and said, ‘To achieve the fundamental transformation of our economy, we need the requisite vehicles. One particular vehicle is that of co-operative enterprise.’ ‘Co-operative enterprise must be seen as an alternative and attractive form of enterprise for young people. It must be seen as a means of job creation, poverty alleviation and social integration, and a means to a better life,’ says Pillay.

Pillay also referred to the Mtubatuba Poultry Co-operative project, facilitated by the NYDA, which has churned out pioneering knowledge and information about poultry co-operatives.

Since its inception, the NYDA has approved R66 7 million worth of loans to young entrepreneurs, including co-operatives, and will continue to support co-operatives through financial and non-financial support. The NYDA also recently launched the Imbewu Loan Fund, in partnership with Ithala Development Finance Corporation, which will mainly focus on co-operatives in KwaZulu-Natal.

Co-operatives, alternative enterprise model for youth



A recent visit to the Eastern Cape by Deputy President Kgalema Motlanthe gave youth of the mostly rural province an opportunity to interact directly with their representatives in the high echelons of government. Motlanthe, joined by NYDA Chief Executive Officer Steven Ngubeni and Eastern Cape PAB Chairperson Ayanda Matiti, interacted with young people in the Eastern Cape as part of constructive social dialogue, aimed at providing young people with an opportunity to raise issues affecting them. The interaction coincided with the government’s declaration of 2011 as the year of job creation and was undertaken as part of the Youth Month activities, hosted under the theme, ‘Youth Action for Economic Freedom in Our lifetime.’ During the month, young people across the country deliberated on issues of job creation, skills, and youth development and economic development initiatives. During the interaction, the NYDA updated young people on the progress government was making in implementing and mainstreaming youth development, and creating jobs. Various stakeholders in the Eastern Cape were also given an opportunity to present their plans for job creation and skills development initiatives in the province. More than 300 young people attended the dialogue, and raised poverty and unemployment as the biggest challenges they were facing, proposing that skills development programmes should be implemented urgently to help absorb young people into the labour market. They said poverty in the province had also resulted in young women resorting to prostitution. Young people also complained of a lack of access to education, particularly to higher learning institutions. They identified funding as the main challenge preventing most young people from furthering their studies, calling on government to ensure that more young people have access to financial aid. At municipal level, young people expressed a strong interest in actively participating in the Integrated Development Plans of municipalities, which pave the way for development plans at local government level. This will ensure that young people influence the type of youth-development programmes that municipalities develop and implement. Other issues that young people raised included the establishment and strengthening of co-operatives as a viable form of business enterprise.

There was also a suggestion that municipalities consider employing young people in their Special Programmes Units and that the NYDA provide more access points for young people in remote areas, a suggestion that is in line with the NYDA’s strategy to open local youth offices in all 283 municipalities. The NYDA, which currently has 144 access points across the country, will use suggestions from the interaction to work out proposals to help alleviate poverty and youth unemployment. Similar interactions will be arranged with youth in all provinces.

The interaction concluded with the signing of a Memorandum of Understanding between the Manufacturing, Engineering and Related Services SETA (MERSETA) and the Eastern Cape Province regarding job creation initiatives to benefit the youth in the province. The Deputy President committed government to taking forward the issues raised by young people and to having follow-ups through the NYDA and the Eastern Cape provincial government.

Eastern Cape youth propose youth development solutions to Deputy President

By Linda Mbongwa

Hard work, patience and dedication are often considered as some of the main ingredients for a successful business. As the saying goes, ‘What you put in, is what you get out.’ Onesimo Ngumbela is testimony to this.

In June, Ngumbela was named Top Young Entrepreneur of South Africa, when she became the overall winner of the FUTURE100 entrepreneurship competition. The competition is run by the NYDA, in partnership with the South African Youth Chamber of Commerce (SAYCC), and Sowetan and Sunday World.

This inspirational programme seeks to recognise, acknowledge and promote promising young entrepreneurs in South Africa through a process that identifies, selects and awards the top 100 young entrepreneurs in the country.

Ngumbela, who owns Travel Stop, a Gauteng-based travel agency, as well as Rock Solid Properties, a property company, based in the Western Cape, received the Chief Executive Officer Award of R100 000, making her the overall winner of the FUTURE100 competition. She was also one of the Platinum Award winners.

The public nominated thousands of young entrepreneurs such as Ngumbela to take part in the competition. The nominations went through a series of internal adjudication sessions before an independent panel of judges, identified by the NYDA and SAYCC, made the final judgment. After much deliberation, the judges announced the 100 winners during a gala dinner, held at Gallagher Convention Centre, on 24 June.

According to Thapelo Maleke, Programme Director for FUTURE100, the NYDA and SAYCC identified the need to launch a programme to encourage young entrepreneurs to engage in entrepreneurial activities, to sustain their livelihood and as a way to tackle the challenge of youth unemployment in South Africa.

‘FUTURE100 awards will be held annually. It’s a new way of celebrating Youth Month every year. With these awards, we are creating new role-models in different communities across our nine provinces. These young entrepreneurs will inspire other young people to start their own businesses and contribute positively to the growth of our economy. It serves as an entrepreneurial talent search, which challenges young entrepreneurs to run their businesses in a manner that ensures that we raise the standard and quality of service delivered by young entrepreneurs,’ said Maleke.The top 100 winners from various provinces received award certificates confirming their achievement as the FUTURE100. Categories included Platinum, Gold, Silver and Bronze, and the overall winner received the Chief Executive Officer Award.

The stories of the FUTURE100 winners and businesses will be profiled in a special supplement in the Sowetan and Sunday World. The FUTURE100 website, featuring all the winners and their businesses, was launched in August 2011 for continuous interaction with the winners.

Young woman named top young SA entrepreneur




By Refilwe Mphane

From 28 June to 2 July 2011, more than 500 young people gathered at Moses Mabhida Stadium’s Conference Centre in Durban for the 7th Annual Southern African Music Conference (SAMC). The NYDA partnered with DJs United (DJU) for this initiative, in order to empower the many young people who have talent and passion for music, by offering business skills and information on how to access funding, and business development services. In addition, to make the event more accessible, the NYDA subsidised the registration fee for the conference at R150 per delegate, so that, instead of the normal R500 charge, young people only paid R350. The registration fee covered access to conference facilities and more than 20 workshops, as well as information brochures addressing, among others, the following topics: engineering and mastering; studio equipment and technology; media, marketing and branding; legal contracts; and entrepreneurship training and mentorship sessions run by the NYDA.

The event featured acclaimed names with a wealth of knowledge to share, such as Rocco and Franck Roger (both from France), Ralf Gum (Germany), Monique Bingham (Belgium), Robert Walker (USA) and South Africa’s Culoe de Song and Black Coffee. The well-respected DJU crew of DJs, namely, Christos, Vinny, Fresh, Greg ‘The Maestro’ Maloka, Oskido and many more noteworthy music practitioners also joined them. Featured international vocalists were Monique Bingham and Robert Walker, and local superstars included Winnie Khumalo, Professor, Tumelo and Zakes Bantwini. Hip Hop enthusiasts also enjoyed a full-on hip-hop dissection by leaders in the South African hip-hop industry, such as Amu, T’bo Touch, HHP, Slikour, Teargas and Da Les.

The NYDA’s support for this initiative is in line with its mandate of embarking on initiatives that seek to advance the economic development of young people and the 2011 Youth Month theme, which was, ‘Youth Action for Economic Freedom in Our Lifetime.’ Speaking at the opening of the conference, Steven Ngubeni, NYDA Chief Executive Officer, indicated that the NYDA believed that,

The NYDA empowers youth with a passion for music



The NYDA, in partnership with the Department of Trade and Industry (DTI), is currently managing a NYS project in Witbank, where they are targeting more than 120 young people to undergo entrepreneurship-development training, to enable them to provide business-development service assistance to budding entrepreneurs. The project is intended to create a pool of qualified Community Enterprise Development Officers (CEDOs) in both rural and urban areas, who will be able to originate financial quality deals, and manage loan administration and collection, towards improving youth access to enterprise finance. As part of the project, the University of Pretoria will offer training to participants, for them to acquire accredited skills in Microfinance at NQF level 4. The participants will also undergo life-skills training, including computer literacy, to enable them to effectively process loan transactions. The project idea originated from the NYDA’s experience, which revealed slow utilisation of enterprise finance by small, micro and medium enterprises. Discussions with the DTI also confirmed these findings. One obvious obstacle identified was the misalignment between deal origination and clients looking to secure enterprise finance. This project is, therefore, intended to create capacity resident within partner agencies, to bridge this gap.The project is in line with the NYDA’s mandate of facilitating youth access to business funding, in an effort to draw more young people to participate in the country’s mainstream economy. Beyond enhancing the NYDA’s value-addition to enterprise development, the project will also boost existing entrepreneurship-awareness campaigns, aimed at promoting financial literacy and general public awareness of entrepreneurship, and increasing the number of youth and women accessing enterprise finance. At the end of the training, participants will be offered the opportunity to perform community service at district municipalities, commercial banks and provincial development finance institutions. The capacity created through the CEDOs is expected to add value to current efforts by local government to stimulate local economic development. At the end of the project, participants will also be confident in matters related to accounting, community development, life-skills, marketing and the co-operative business concept. The training will contribute to the improvement of enterprise development and act as a feeder of trained staff to the microfinancing sector. The project will also look into assisting participants, who may want to pursue self-employment, with accessing further studies in related business fields. The participants were selected on the basis of the following selection criteria: • Must be a young person between the ages of 18 and 35• Should have passed Mathematics Higher Grade and should have at

least a C-pass mark (Higher Grade) in both Mathematics and English• Should commit to 100% participation in all training programmes,

including travelling to nearby identified sites for training.

Witbank NYS project, a boost for enterprise development



By Nawhal Kara-Foster and Palesa Madumo

The United Nations has declared 2012 the International Year of Co-operatives (IYC), in order to raise public awareness of the invaluable

The NYDA launches a green co-operative in Alexandra Township

with the knowledge and skills gained at the conference, young people could indeed acquire economic freedom in their lifetime.‘We have also consciously chosen to refocus the NYDA’s funding base to rural enterprises, as well as loans for micro and small businesses, such as hair salons, music producers/DJs, shoemakers, shisa-nyamas, carwashes and mobile bakeries. In the main, these businesses would require funding of about R 50 000 each. This will help us to create more entrepreneurs, and more direct and sustainable jobs for the youth,’ says Ngubeni. The increasing numbers of young people seeking assistance in the music industry and the NYDA’s aim to penetrate this market also resulted in the NYDA tailormaking a business plan for music practitioners. During the conference, more than 200 delegates visited the NYDA offices in Durban and the DJU crew agreed to act as mentors to the first 20 piloted beneficiaries of NYDA business-support services.‘We want to develop these young people into economically active and business-savvy music producers, song writers, DJs or record label owners and make a dent in the high unemployment levels among young people,’ concludes Ngubeni.

contribution by co-operative enterprises to poverty reduction, employment generation and social integration. The IYC will also highlight the strengths of the co-operative business model as an alternative means of doing business and furthering socio-economic development.

The Lesedi Manufacturing Primary Co-operative is a 13-member waste management co-operative that has been operating since 2008 and received more than R1 million through the NYDA Economic Development Cluster for the duration of 36 months. The co-operative used the funding for the construction of offices, purchasing equipment and as working capital.

The NYDA is committed to supporting green co-operative enterprises in South Africa, particularly in small communities. The Deputy Executive Chairperson of the NYDA, Mr Yershen Pillay, launched an awareness drive to encourage unemployed and disheartened youth to start co-operatives enterprises that will not only create employment, but also have a significant focus on ‘greening’ communities. ‘Co-operatives serve to uplift local communities in sustaining job creation; retaining valuable, locally developed skills; and supporting family and social structures. The NYDA is urging young people to start critically identifying requirements within their communities and fostering partnerships that could be the beginning of successful community co-operative enterprises,’ Yershen Pillay said at the launch event.

Members of the Lesedi Manufacturing Primary Co-operative recycle cans, cardboard, paper, glass and plastic collected within the community, which has enabled them to turn a community litter and pollution problem into a viable business solution.

‘We were motivated to recycle, because anybody who has ever been to Alexandra knows that our community is very dirty. We have the support of the community, because we are women known to be doing great things in Alexandra,’ said Zoleka Ntshololo, a founding member of the Lesedi Manufacturing Primary Co-operative.

The NYDA celebrated 2012 as the International Year of Co-operatives by educating the youth on the ease of forming and registering co-operatives, and illustrating the advantages of people coming together to produce goods or services, or buying stock in bulk as a group.

Unskilled South Africans are among those set to benefit from co-operatives. The NYDA firmly believes that the International Year of Co-operatives will enable youth in many communities to benefit from employment opportunities, which will serve as possible solutions to social ills such as crime, drug and alcohol abuse. It’s anticipated that the co-operatives will allow for positive community participation, skills transfer and educational opportunities.

By Amuzweni Lerato Ngoma

South Africa ratified a number of declarations that uphold the promotion of Sexual and Reproductive Health and Rights, such as CEDAW, the International Conference on Population and Development (Cairo 1994, ICPD+10), and the Beijing Platform for Action. Furthermore, the Criminal Law (Sexual Offences and Related Matters) Amendment Act, 2007 (Act 32 of 2007) prescribes the age of consent as 16 years. Therefore, it makes it a criminal act and offence for a person to engage in sex with a minor. Where an adult person, considered to be older than 16 years, engages in a sexual act with a minor, they are seen to have committed an act of statutory rape. In this setting, therefore, the act criminalises an act of sex for people aged lower than 16 years. According to the Sexual Offences Act, therefore, adolescents may be said not to have the right to engage in sex.

However, tension exists between various legal prescripts in the country. For example, the South African Constitution provides for women’s reproductive rights. Women have the right to make choices on reproductive matters.

Do adolescents have the right to have sex?

In the implementation of the Constitution Act, 1996 (Act 108 of 1996), the Choice on Termination of Pregnancy Act, 1996 (Act 92 of 1996) allows for adolescents as young as 12 years to choose and access an abortion, without the consent of a parent or caregiver.

The prevailing social environment provides for contradictory messages and teachings on whether adolescents have the right to have sex. On the one hand, there exists the normative rule that sex is an adult activity. The prevalent discourse on sex is that it requires mental and physical maturity, primarily because of the responsibilities involved with engaging in it. This messaging is typical of what is taught to children and adolescents.At the same time, society, in general, provides for another parallel, and probably more ubiquitous, message and teaching. In this setting, through television shows, consistent messaging constructs sex as a cool thing and a triumph. In a consumerist society, sex is used to sell products, services and brands. The sales language of any new product is how ‘sexy’ it is, departing from the premise that everyone wants to engage in sex and, by deduction, that everyone will want to acquire the product or service advertised. Therefore, we see a situation in which selling sex is becoming the norm in society.

In colloquial language, which is mainly responsible for the socialisation of citizens, terms such as ‘give it up,’ ‘throw it down’ and ‘ulahlile’ are prevalent, and represent what adolescents use and respond to. Empirical evidence suggests that this process is normal, but has repercussions. The Medical Research Council (MRC) Youth Risk Behaviours survey states that heightened sexual awareness is part of adolescent development. While this is a normal process, sexual awareness is often characterised by experimentation, which has the potential of placing adolescents at risk of unprotected sexual activity, unplanned pregnancy and sexually transmitted infections, including HIV.

This situation has led to the sexual debut age of adolescents dropping to as low as 14 years nationally, where 14% of adolescents have had sex. The MRC’s Youth Risk Behaviours survey showed that 37,5% of adolescents had engaged in sex, with significantly more males (45,2%) than females (30,2%). The worrying factor here is that, among those who have ever engaged in sex, the national prevalence for having had one or more sexual partners in the past three months was 52,3%, with no significant variation by gender.

The MRC survey stated that adolescents were engaging in unsafe sexual practices, in some cases leading to pregnancy. Some 70% of adolescents having sex were not using a condom when engaging in sexual acts. This would clearly place a burden on the health system. The laws about who may and may not have sex in South Africa should be as unambiguous as the alcohol and tobacco laws.

Reproductive health and peer-education programmes focus on access and activities, such as family-planning advice, access to contraceptives and choice regarding termination of pregnancy. Perhaps the emphasis of these programmes should simply be on abstinence.




By Nawhal Kara-Foster

Through a partnership between the NYDA, Service Civique, a French institution responsible for voluntary civic service, and loveLife, South Africa’s largest national HIV-prevention initiative for young people, ten young people were selected to participate in the French Exchange Programme. The programme is aimed at youth already involved in community service. In January 2012, they travelled to Burgundy, where they did youth-related volunteer work for six months. The exchange group also underwent French language instruction, and work-ethic and diplomacy training in Cape Town.

The NYDA Deputy Executive Chairperson, Mr Yershen Pillay, said about the programme, ‘The aim of the French Exchange Programme is to encourage youth service in South Africa, for skills development and to promote an increased sense of self-efficacy among young people.’

Pillay explained that youth engagement in a community might not only be beneficial for the future of an individual, but also for community advancement. Through youth exchange, young people learn firsthand about various aspects of life in another country, and mature and develop as their concept of the world expands.

The 10 young people selected were:

Nokonwaba Dalisile, 22, from Khayelitsha, who lives with her mother, two siblings and three-year-old daughter. She hopes to bring new knowledge back to her community. ‘I want to secure a solid upbringing and brighter future for my daughter. Not that I didn’t have a good home, but I just want better things for her,’ said Dalisile.

Henrico Bezuidenhout, 23, from Prince Albert, is travelling overseas for the first time and wants to inspire other young people in his community to become involved in community service. ‘When I return from France and young people see me walking in the street, they should say that this is the guy that went overseas and brought his knowledge and skills back to his community,’ said Bezuidenhout, who spends his time hosting peer-education, teenage-pregnancy and motivation workshops at high schools in his hometown.

The NYDA’s French Exchange Programme broadens horizons

Amanda Centane, 21, from the township of Langa, is the mother of a two-year-old boy, Lunami, who she will be leaving in the care of her mother — a part-time domestic worker. ‘My father passed away in December last year and, since then, my stipend from loveLife has been assisting my mother with household expenses. Initially, my mother was not too happy about me going to France, as our family would not have this stipend anymore, but I think she now understands how much I can gain from this opportunity,’ Centane said.

Yonelani Msindo, 22, from Du Noon, is hoping to impress French NGOs with his commitment and passion for service. Msindo, whose mother is a domestic worker and single parent, grew up without a father, which he says most children in his community do. ‘My mother had to play both roles very strongly. Raising a son without a male role-model could not have been easy. She is paranoid about my safety abroad and keeps reminding me of the dangers of human trafficking, but she is also very excited,’ he said.

Paultin Abrahams, 18, from Kykoedie in Klipdale, said he was the first farmworker’s child from his community to ever travel overseas. ‘My parents are so proud of me that they have been bragging to the rest of the community about me going to France and all that I will learn there,’ said Abrahams, whose father is a farmworker and his mother a housewife.

Nonkoliso Babaza, 24, from Langa, described herself as a simple person and, given the opportunity to become a South African politician, believes she could make a difference in the lives of many young people. Babaza said she would achieve this change through her firsthand knowledge about township life and by simply listening. ‘The most exciting thing for me about being selected to participate in the French Exchange Programme is the opportunity to visit another country and to travel in an aeroplane, as it will be my first time for both,’ she said.

Posiswa Makele, 23, from Khayelitsha, is the mother of two children, a seven-year-old and a one-year-old, both of whom she will be leaving in the care of her parents. ‘My life is quite routine — nothing exciting, except that I will be going to France next year,’ said Makele. She said that the furthest she had ever been from her family was to the West Coast in the Western Cape, to towns such as Langebaan, but that she was also very keen to learn, although she was nervous.

Rugby player, Jerome Damons, 22, from Hermanus, lives with his mother, who is a farmworker, and his stepfather and older siblings. ‘My mother is the most excited about me going to France. I don’t think I will even take her to the airport, because she will just cry,’ he said. When asked what he is most looking forward to, Damons said, ‘I am definitely eager to experience French culture, learn new things, and bring knowledge and education back home. I am also passionate about rugby and would like to find a French club that I could play for during my stay in Burgundy.’

Viloshnee van Wyk, 21, has lived in Worcester her whole life and said that she had always wanted to go to France. She described the challenges of gangsterism, drug and alcohol abuse, and territorial wars that young people faced in her community. She said that she made a conscious effort not to become involved in these problems and, instead, tried to become a role-model to youth in her community. ‘I am most excited about my trip to France, to learn about their culture and religion,’ said van Wyk.

Busisiwe Nontsikelelo Duna, 22, lives with her grandmother in Brown’s Farm, Philippi. She said she joined the loveLife Groundbreakers Project to make a change and do something with her life, instead of complaining about unemployment. ‘My family couldn’t believe it was actually true that I was going to France, as not many people from our background ever have an opportunity like this. I am extremely grateful,’ she said.

Debt collection specialist takes a plunge into business

By Refilwe Mphane

Seasoned debt-collection specialist Maurice Kannemeyer established his debt-collection business in 2010. Based in Bellville, Cape Town, the business offers debt-collection solutions, process redesign and debt-collection strategies to public and private-sector companies.

Maurice has a wealth of knowledge and experience on debt collection. After studying a law degree, he worked as a debt collector and, over the years, moved up the ranks, until he became a business-solutions specialist. ‘After honing my skills in debt-collection strategies and financial management processes, I saw it as a huge opportunity to start my own business,’ he explained.

In 2011, Maurice acquired a website-development voucher and a marketing voucher from the NYDA. This enabled him to market his newly established business. Today, Maurice employs four trained staff members, who work in the call centre. ‘It was challenging when I established the business. I am, however, happy with the progress we have made so far and have more plans in the pipeline. There are many opportunities in the debt-collection space. I plan to take advantage of them, so that I can create more jobs,’ he indicated.

Maurice’s advice for young, aspiring entrepreneurs is that they should plan, take advantage of business-support services offered by organisations, such as the NYDA, and persevere when things become tough. ‘Even though a great deal has been done to support young, aspiring entrepreneurs, I feel that big business and government can do more to reduce the red tape, so that we can increase South Africa’s entrepreneurship activity,’ he concluded.




By Refilwe Mphane

Montsheng Sello is determined to grow her Khayelitsha-based hair salon. The 25-year-old discovered her love for hairdressing while in primary school. ‘My cousin owned a hair salon, so I learned a great deal from her,’ she explained.

Due to financial constraints, Montsheng could not pursue her goal to study haircare after Matric and worked instead as a cashier in various retail stores. ‘I styled people’s hair in my spare time. I would actually find people waiting for me after work,’ she indicated.

Montsheng decided to take the plunge and establish her own hair salon. She approached the NYDA for a business loan and received R10 000, which she used to buy equipment and hair products. According to Montsheng, she ventured into the industry, not only because she was passionate about making people look beautiful, but also because she wanted to meet a demand and generate repeat business by being professional, honest, transparent, effective and efficient. ‘My dad built a garage in our backyard and that’s where I work from,’ she said. Montsheng works alone, as she had to dismiss two employees, because they stole hair products. However, this has not deterred her from her plans to grow the business.

Some of her plans include studying hair design and acquiring a business mentor, so that she can improve her business management skills. ‘This will equip me with the necessary skills to expand my business into a unique and quality hair salon like those that you find in town,’ she explained.Montsheng’s plans are already in motion. With the help of the NYDA, she has developed a business plan that she will use to apply for additional funds for renovating her hair salon.

Hair salon owner sets her sights high



Air-conditioning company targets the black market

By Refilwe Mphane

Khulekeni Khanyile is the proud owner of a Pietermaritzburg-based air-conditioning company. His customers include government municipalities and homeowners.

Khulekeni identified a gap in the market by targeting particularly black homeowners. ‘There is a misconception among blacks that air-conditioners are a luxury. My aim is to make them understand that air-conditioners can be affordable,’ he explained.

Khulekeni studied air-conditioning and refrigeration at a Further Education and Training College (FET). On completion of his studies, he found a job at a Durban-based air-conditioning company, after which he moved to another air-conditioning company in Pietermaritzburg. ‘I studied refrigeration trade theory while working in Pietermaritzburg, and fixed people’s fridges and air-conditioners in my spare time. However, I was not happy with my growth at the company where I worked and decided to rather start my own business on a full-time basis,’ said Khulekeni. In the beginning, he relied mainly on work from government municipalities, but this became more challenging when the work diminished.

To boost his business, Khulekeni decided to approach the NYDA for a business loan. ‘Firstly, in early 2011, the NYDA assisted me with drafting a business plan. Then, in mid-2011, I received a R370 000 business loan, which I used to import 88 air-conditioners from China, buy a bakkie and develop marketing material,’ he explained. He was then able to accelerate his plans of growing his business by targeting black homeowners.

Khulekeni’s advice to any aspiring entrepreneur is to be passionate about what they do. ‘They should also not expect to become rich overnight, because business has its ups and downs,’ he concluded.


By Refilwe Mphane

Keneilwe Mogapi’s enduring entrepreneurial spirit has played a key role in her success. The 30-year-old transformed her negative experiences in business into valuable lessons, which come in handy when running her catering and events-management business.

A recent business opportunity that she took advantage of was to install ultraviolet sanitising ceiling discs at the South African Social Security Agency’s (SASSA) nine offices. With the R50 000 business loan that she acquired from the NYDA, Keneilwe successfully implemented the SASSA deal.

According to Keneilwe, her first experience in business was when she and four friends established a trucking business. ‘After studying somatology, I worked for a leading cosmetics company as a beauty consultant. However, in 2004, my friends and I decided that we would find work in England, so that we could use the money to buy a truck,’ she explained.

On their return from England, Keneilwe and her friends followed through with their plans and bought the truck. However, things did not go according to plan. After working on a number of projects, the truck broke down and became too expensive to maintain.

‘We decided to part ways and sell the truck, but struggled to find a buyer. We finally managed to sell and accepted the little money we could get,’ she indicated.

In 2006, Keneilwe registered her catering and events-management business. The business is doing very well. Their clientele includes various government departments, the Business Women’s Association and World Vision. ‘I employ two full-time employees and three on a part-time basis. We provide catering and event-management services for all sorts of events, but mostly for corporate workshops and training,’ said Keneilwe.She continues to use her somatology skills and passion for beauty in her current business. ‘For example, with weddings, we often provide beauty treatments such as manicures, pedicures, make-up, massages and other related services,’ she explained.

Keneilwe’s future plans include establishing a beauty parlour, which will offer a variety of health and beauty services such as reflexology, waxing, advice on nutrition and so forth. ‘Many people consider beauty and health treatments a luxury. I want to make them understand the benefits of taking care of themselves, such as greater productivity,’ she concluded.

Keneilwe’s inspiring entrepreneurial spirit



By Refilwe Mphane

Entrepreneur Thandeka Myeza is making waves in Durban through her fashion label, Malesna Design. Thandeka discovered her love for fashion design in high school. ‘I grew up in an environment where everyone wanted to be a doctor or a lawyer, but I became exposed to other careers and discovered that I was good with my hands,’ she explains.

After Matric, Thandeka studied a diploma in Fashion Design and started working from her home in Pinetown. ‘Those were some of the most difficult years of my life. I didn’t have many clients and would go for months without an income,’ she said. However, even while going through these challenging times, she was never tempted to look for a full-time job, because she believed that better days were on the horizon. A change of fortune came in 2007, when she moved to Durban. ‘People wanted to know where I bought my clothes and word-of-mouth worked wonders,’ she said. As one of the three top designers at the 2009 Eastern Cape Fashion Week, Thandeka had the opportunity to supply a fashion outlet in East London. ‘I needed additional machinery and fabric, so I approached banks for a loan, but was rejected. I then approached the NYDA and they assisted me with a R50 000 business loan,’ she explained.

Today, Thandeka supplies another fashion outlet in Durban and is the Chairperson of KwaZulu-Natal Youth Designers, a group of 10 fashion designers who have a fashion outlet in Durban, and plan to open more outlets in KwaZulu-Natal and the rest of the country. In 2010, Thandeka won the Citibank Overall Entrepreneur Award, after being nominated by the NYDA. She continues to dress ordinary women and high-profile personalities for various occasions, such as the Durban July and weddings. ‘I want to grow the Malesna brand, so that I can establish stand-alone fashion outlets throughout the country,’ she concluded.

Fashion designer’s passion and persistence pay off


By Refilwe Mphane

Nomfundo Dzingwa is the proud owner of Dzingwa Clinic Physio, the first black and female-owned physiotherapy practice in KwaZulu-Natal to specialise in gynaecological physiotherapy. In 2010, she acquired a business loan of R50 000 from the NYDA, with which she purchased medical equipment and an electric fence for her practice.

Nomfundo is highly ambitious and has various achievements under her belt. For example, she was part of a team that set up a therapeutic rehabilitation facility at a rural hospital. She has also been successful in managing various physiotherapy practices and served as a health expert on Ukhozi FM’s health show.

In addition to all these achievements, Nomfundo is devising and implementing yet more plans. She is currently in the process of expanding her physiotherapy practice to include an integrated dialysis and renal-therapy care centre. ‘The love and passion that I have for what I do keeps me going when things are tough,’ she explained.

Born, raised and schooled in the township of Umlazi, South of Durban, Nomfundo’s journey into the world of physiotherapy started with her obtaining a BSc degree from the University of Durban-Westville and, subsequently, an honours degree in Physiotherapy from the Medical University of South Africa, in 2001. She also has a diploma in Sport Physiotherapy and a certificate in Orthopaedic Manual Therapy.

Nomfundo gained valuable experience and knowledge on treating spinal and neural injuries, such as strokes, and performing chest physiotherapy while being mentored by renowned physiotherapist Melanie Skeen at Muelmed Medi-Clinic in Pretoria.

‘Some of the most valuable lessons that I’ve learned have been from setbacks and failures. Today, I employ five people and, with the introduction of the dialysis and renal-therapy care centre, I will be able to employ four more people,’ she said.

Serving on the committee of the Business Women’s Association (BWA) has enabled Nomfundo to network and learn from fellow businesswomen. ‘I also enjoy the development work that I do with the BWA. Through our mentorship programme, we expose girls from rural schools to the business world,’ she concluded.

Ambitious physiotherapist excels in business



By Lebogang Manganye

The NYDA contributed to the My Future, My Career project, organised by Nedbank and Primestars Marketing. My Future, My Career is a career-education project that took place from 26 February to 29 April 2012. The project, which aims to provide learners in Grades 9, 10, 11 and 12 with career-guidance opportunities, to enable them to make informed decisions about their future career choices, was screened in 17 cinemas across the country.

Since 2010, the project has reached over 70 000 learners from previously disadvantaged backgrounds. A further 42 000 secondary school learners will be reached through this year’s career-education broadcasts. Each broadcast will be comprised of a hosted panel-type discussion, with

The NYDA promotes career guidance through Ster-Kinekor cinemas

By Refilwe Mphane

The Department of Arts and Culture (DAC) and the NYDA have joined

forces to support young South Africans with an ambition to excel in the

arts, culture and heritage sector. On 27 January 2012, the two parities

signed a Memorandum of Understanding (MOU), which signified the start

of a partnership aiming to enhance the employability of youth in the arts,

culture and heritage sector, through the Trendsetter Initiative.

Partnership to boost support for youth in arts, culture and heritage sector

academic personalities, as well as personalities from each week’s featured industry, acting as panellists. The initiative was run on pre-booked Sundays, with about 3 000 learners viewing two pre-recorded broadcasts, profiling different industries and the opportunities available within those industries. They included guides on choosing the right career, industry-based career profiling, institutional entrance requirements, and bursary and contact information. ‘Our involvement in this programme is part of our bigger “life after school” campaign, where we encourage young people to prepare for their future while still at school and give them various options, once they have completed Matric,’ said Steven Ngubeni, Chief Executive Officer of the NYDA. Ngubeni added that, with these sessions focused on creative solutions, the NYDA would be able to help guide young people into their careers of choice. ‘The NYDA is proud to be part of an initiative that protects our future, by nurturing the present,’ concluded Ngubeni.

The Trendsetter Initiative is a 12-month apprenticeship and trade-skills

programme that has the following process cycle:

• Recruitment and selection — Young people will be recruited and

selected through community arts centres.

• Induction and basic training — Training will include orientation and

programme-specific training, such as basic training in the performing

arts (theatre, music and storytelling); visual arts and visual literacy;

and heritage and the promotion of national symbols.

• Programme implementation — Trendsetters (the trained young

people) will be in a position to assist other young people, who are

ready to improve and grow in the arts, culture and heritage sector.

Each Trendsetter will recruit and mentor 15 other young people

through platforms such as face-to-face interaction, workshops, and

community arts and cultural events.

• Advanced training (personal development) – Training will focus on

personal development and life skills for Trendsetters, which will

include training on developing a winning curriculum vitae, financial

management, project management and presentation skills.

• Exit opportunities – The NYDA and DAC will facilitate employment and

other opportunities for Trendsetters through its strategic alliances with

the public and private sectors, and international bodies.

The Trendsetter Initiative falls under the NYS programme, a government

programme that not only provides youth with meaningful and accredited

skills, but also incorporates voluntary activities, which contribute to

personal, community and national development.


By Kamogelo Maja

Brent Strydom (31), is a young entrepreneur destined for a great future. He currently employs six people and is determined to achieve even more through his business. Brent owns Bodyrite gym, based in Gonubie Mall, in East London. The NYDA has played a supporting role in his development thus far. The organisation assisted him with a business-plan voucher from the NYDA’s business consultancy-services voucher programme. The programme offers young entrepreneurs access to business-development support services, such as business-plan development, bookkeeping, marketing, tendering support, website development and many more, for just R200 per service. ‘I am very glad that there is an organisation like the NYDA which is able to assist youth to achieve their dreams,’ Brent said.

Brent has always been ambitious. At some stage, he wanted to be a pilot and a marine biologist. While studying Information Technology (IT) at Port Elizabeth Technikon, Brent was offered an IT position by Lantern Financial Services. ‘I worked at the company for a number of years, even after the company expanded to form a company called Real People. While working, I studied further, until I became a systems analyst for the same company,’ he explained. He was promoted to the position of Assistant Manager in the electronic data-interchange department and worked for the group for seven years, until he was offered a position at a motor-repair centre.

‘While at the motor-repair centre, I was promoted to Managing Director and elected Vice-Chairman of the South African Motor Body Repair Association Border Region. I was also elected onto the Retail Motor Industry Border Executive Committee,’ he added.

When Bodyrite gym was put on the market, Brent made an offer to purchase. ‘I spent my early years learning and business is where I can implement all the lessons learned,’ Brent continued. He explained that his gym had a variety of equipment and activities, including ladies’ fitness classes, specialised kickboxing training, diet and training programmes, and many more.

Asked what his challenges were, he explained that the members were not always in a position to pay their membership fees, even though they were very low. ‘This prevents upgrades on equipment and, in turn, prevents membership growth, as new equipment would attract customers,’ elaborated Brent.

The challenges faced have not stopped Brent from making a success of his gym. The gym has won medals and trophies in various bodybuilding competitions in the Eastern Cape. Through hard work and support, the gym has managed to transform ordinary training guys into recognised athletes.‘Len Meyer, an ex-kickboxing coach and international trainer, joined us in April and we also have Sean O’Connell, a recognised mixed martial arts and karate trainer, who has been training our athletes,’ he added proudly.Asked what his advice for the youth would be, he calmly stated that they should dedicate themselves completely to doing what they loved. ‘I do what I love and, believe me, there is still more achievements ahead of me — just watch this space,’ he concluded.

Successful gym owner determined to achieve even more




The South African Breweries Limited (SAB) partnered with the DTI, the NYDA and provincial Departments of Education to launch a comprehensive programme to tackle the scourge of underage drinking. The launch of the programme, which took place in Phoenix, Durban, on 14 February 2012, was hosted by KwaZulu-Natal’s member of the executive council (MEC) for Education, Mr Senzo Mchunu. The programme encompasses a series of interactive initiatives aimed at teens, but with strong links to parents, peers, teachers, liquor traders and the community. ‘Statistics indicate that one out of every two teenagers in the average South African home is a user of alcohol,’ said SAB Director of Corporate Affairs and Transformation, Dr Vincent Maphai. ‘Underage drinking is one of the most serious forms of alcohol abuse and has an overwhelmingly negative impact on South African society, as a whole. We view this as unacceptable, so we have partnered with government in a programme that we believe will effect real change among South Africa’s youth.’ The groundbreaking programme, called ‘You Decide’, is a multifaceted intervention, grounded in the latest thinking on the clinical and psychological facets of this complex problem. The initial phase of the programme will run in KwaZulu-Natal, North West, the Free State and Mpumalanga, reaching some 360 schools and targeting an estimated 400 000 learners this year alone. The programme will be run for a number of years, expanding its reach annually until all provinces in the country have been covered. Ms Thezi Mabuza, the Chief Director of the National Liquor Authority, said: ‘One of the objects of the National Liquor Act, 2003 (Act 59 of 2003) is to reduce the socio-economic cost of alcohol abuse. In order to do this, the Act obliges macromanufacturers and distributors of liquor to make commitments to combat alcohol abuse. It is in this spirit that we,

as the DTI, join forces with the SAB and the NYDA in this initiative to curb underage drinking. The underlying reasons for underage drinking are diverse and associated with social assertion (the need to be cooler, the desire to be older or to fit in) and despondency (no sense of future, which makes teens look for unhealthy and destructive avenues of self-gratification). Industry and government have partnered to embark on this campaign, to ensure that South African communities are educated on the dangers of alcohol abuse and misuse, and the fact that underage drinking is bad for their overall development.’

The MEC for Education in KwaZulu-Natal, Mr Senzo Mchunu, echoed Ms Mabuza’s comments by saying: ‘I am very excited about this initiative, because it fits snugly with our My Life, My Future! Campaign, launched by the department in early 2011. That campaign targets alcohol and substance abuse, as well as teenage pregnancy among learners and other forms of social ills afflicting our society, which are extending to our schools. There is overwhelming evidence of a link between alcohol abuse and teenage pregnancy, as well as the scourge of HIV among young people, particularly in KwaZulu-Natal. We certainly believe that this partnership will go a long way in combating lawlessness in our schools and help us to hone young minds to become productive citizens of this country.’

Mr Andile Lungisa, Executive Chairperson of the NYDA, commented: ‘The NYDA takes the national scourge of underage drinking very seriously. That is why we have decided to join hands with the SAB to confront – head-on – one of the biggest challenges that the country faces today: that of underage drinking.’ The SAB, the DTI, the NYDA, provincial governments and subject matter experts jointly developed the You Decide campaign, which encompasses a series of activities designed to demonstrate to teens that the choices they make now can impact positively or negatively on their future prospects. The campaign includes a series of school visits, which encompass an interactive road show on underage drinking; an inter-school competition to consolidate and drive home the messaging; curriculum-aligned lesson plans for teachers; a practical guide for parents; resources for teens, including counselling, reading material, a website and a Facebook page; a teen ambassador programme and an advanced reality game for 60 core players. The teachers’ material will assist them in making learners understand the harmful effects of underage drinking and giving teens the resistance techniques required to withstand peer pressure. Workshops will also be held with parents and communities to raise awareness of underage thinking, and identify ways to discourage it. In addition, taverns around schools will be visited to impress upon tavern owners the importance of their role in preventing underage drinking. A key innovation of the You Decide programme is an immersive game that shows (rather than tells) selected youths first-hand that the decisions they make now will impact on their future prospects. The game also features local celebrities, Israel Makoe, Khanya Mkangisa, Thembalethu Ntuli and Andile Dlamini, as well as up-and-coming singing sensation, Lilly Million. The game makes use of a number of different platforms, ranging from traditional to social media.

SAB partners with the DTI and the NYDA to tackle underage drinking

By Gugu Mjadu And Lwazi Stuurman

When the NYDA was established almost three years ago, there was a lot of excitement and anticipation among the youth of South Africa, and rightly so.

The NYDA was established with a clear mandate and hope that, unlike its predecessor organisations, namely, the NYC and UYF, the agency would be adequately capitalised to deal with the myriad of challenges facing young people. The NYDA has made many strides in meeting the expecta-tions of young people, notwithstanding the fact that the organisation is not a panacea of youth development.

The NYDA has achieved two unqualified audit opinions in both the financial

years of its existence. A total of 42 out of 49 targets were met in the last financial year, thereby creating 18 038 jobs, giving 13 985 loans to youth-owned enterprises, to the value of R35,3 million, as well as recruiting, enrolling and training 66 063 young people under the NYS programme.

The NYDA has also made strides in forging private, public and civil society partnerships, which are benefiting and will continue to benefit the youth of South Africa in different areas. A total of 49 partnerships were forged across all sectors and the international community. These partnerships will assist with synergising the country’s efforts in youth development, towards a much more meaningful impact.

‘We have always argued that, despite our achievements, particularly in meeting the set targets for the year, there are still more young people awaiting similar interventions, who we have not been able to reach — our delivery, therefore, remains but a drop in the ocean,’ said Mr Andile Lungisa, Executive Chairperson of the NYDA.

By Andile Lungisa

Since 1994, government has gradually introduced measures aimed at the development of young people, including the establishment of the National Youth Commission (NYC), in 1996, and the UYF, in 2001. These measures were never adequate, leading to the merger of the two institutions, in 2009, to form the NYDA. Eagerly anticipated by young people, the NYDA was established with the intention of having an integrated and mainstreamed approach to youth development; to intensify youth-development programmes; and to ensure that planning and all policies were geared towards making the necessary impact. Unfortunately, some of the same criticism levelled against the NYC and UYF is being placed at the NYDA’s door. Furthermore, we continue to witness gross misrepresentation of facts relating to the existence and performance of the NYDA. This happens with total disregard of, and lack of appreciation for reality, which should take into account the historical context of youth development in the country, the current status of young people and the resource capacity of the NYDA. Based on the 2010 mid-year population estimates, some 77,6% of the total population is constituted of people below the age of 35 years. About 42% of young people under the age of 30 are unemployed. A variety of reasons may be attributed to this reality, hence the need for a multipronged strategy to address the challenges. If these statistics are taken into account, it is clear that it is unrealistic to conclude that, in less than three years of existence, the NYDA has failed the youth of South Africa. Even those who are in business would tell you that, even with running an enterprise, two years are barely enough to confidently assert failure or success.

Youth development is a process, not an event: let’s all work together

As a matter of fact, when merging the NYC and UYF into the NYDA, the National Treasury conducted a due diligence report which, among others, proposed that, for the NYDA to function to its optimal potential, it had to be capacitated to the amount of R930 million. Despite this reality, the NYDA was allocated less than R400 million in its first year of existence. It is because of this reality that it becomes tragic for us when youth development is short-changed, including reducing an already insufficient budget. This should be tragic, not only for the NYDA, but also for the country at large.

If the condition of young people does not improve, it will reflect badly on our future. Despite our own limitations, we are making great progress and are able to point out evidence of young people that we have supported, informed by our mandate. Over the past two years, we have ensured the creation of more than 62 000 jobs for young people, the provision of over 24 000 business loans, the training of some 84 000 youth in various skills-development programmes, and the offering of guidance and information to more than a million youth. We have also developed an IYDS for South Africa, as a road map for all stakeholders to integrate and mainstream youth development in their everyday work. Two annual reports are available to the public, with details of how we have spent our allocated resources against the given mandate. We have provided guidelines and continue to direct government departments and state-owned enterprises on the establishment of youth directorates, towards mainstreaming youth development across government. We continue to launch sustainable legacy projects that change the lives of young people, but, considering the amount of work that lies ahead, we appreciate that it will take more than three years to have the desired impact.

Only someone with no appreciation for the realities of youth development and the plight of young people would call the progress by the NYDA ineffective and wasteful. The article that appeared in The City Press, entitled, ‘NYDA thrives on greed’ is, therefore, not only confused, but baseless and devoid of all truth.

The NYDA disheartened by reduced budget allocation



‘On this note, we would like to congratulate Minister Pravin Gordhan on his third budget speech delivery yesterday afternoon. The NYDA would like to commend the ministry on raising the education budget from R207 billion to R236 billion, as well as the huge health injection that will see our youth and broader communities benefiting from a much healthier life. Most of all, the NYDA would like to applaud the ministry on the significant job creation boost, giving Public Works an extra R4,8 billion and the community works programme receiving an extra R3, 5 billion,’ Mr Lungisa added.

The NYDA consulted widely with the youth, youth organisations, youth workers and practitioners, government departments and municipalities in the process of developing an IYDS.

Recently, the NYDA released a manuscript entitled, ‘State of the Youth Context: Young Generation’. This manuscript formed the basis of the ‘Sta-tus of Youth Report’, required by the President of the Republic of South Africa for presentation before Parliament. The manuscript is a report on the literature review and analysis of the secondary data on youth development issues — very insightful information for sound youth development interven-tions.

Later this year, the President will be announcing the Annual NYD priori-ties. These priorities will focus on rural youth, young women, unemployed and underemployed youth, youth in conflict with the law, disabled young persons and the out-of-school, unemployed and unskilled youth.

‘After the consecutive successes that the organisation has achieved over the past two years, we are extremely disheartened today to announce that the NYDA targets for the 2012/2013 financial year will be reduced, in order to accommodate a reduced budget allocation from National Treasury,’ said Lungisa.

In Parliament, Finance Minister Pravin Gordhan announced that the govern-ment ‘budget continues to support job creation, with a particular focus on unemployed youth.’ He further announced the increased budget allocation to deserving youth-development programmes, including the additional R200 million allocated to the National Rural Youth Service Corps. While this is impressive, it is disappointing that the budget allocation for the organisa-tion with the sole mandate to look after young people, has been cut for the 2012/2013 financial year.

For the financial year 2011/2012, the NYDA was allocated R386 million. Dur-ing the 2010 to 2013 MTEF announcement, National Treasury indicated that the NYDA was to be allocated R405 million for the 2012/2013 financial year.

However, the 2012 to 2015 MTEF announcement indicated that the NYDA had only been allocated R376 million for the financial year 2012/2013. This represents a R29 million reduction on the R405 million, as committed dur-ing the 2010/2011 MTEF announcement. If we were to compare the budget allocation year-on-year, then this reflects a R10 million reduction on the budget allocated to the NYDA.

Of note, the Minister mentioned that most of the money would go to social spending and that the youth of South Africa would benefit the most from the budget tabled.

‘We are disappointed that government has decided to drastically reduce the NYDA budget, especially considering the depth and extent of the ex-panded mandate which has, as its overall objective, focused on enhancing and ensuring youth participation in the economic development of South Africa,’ added Lungisa.

It is estimated that young people (aged between 14 and 35), make up 42% of South Africa’s population. It is also reported that some 25% of the eco-nomically active people in South Africa are unemployed. Of these, young people constitute about 73%. The NYDA, through its programmes and other interventions, has been engaged in efforts to reduce these high and unacceptable levels of youth unemployment. Indeed, this is a collective ef-fort by many stakeholders. However, the NYDA plays a key role in this work.

Conventional wisdom dictates that the targeted deliverables for the NYDA for the year 2012/2013, be reduced to realistically fit into the set budget constraints. Generally, the annual targets for the year in question should, therefore, be reduced by almost 7,2%, responding to the reduction of the budget allocation by 7,2% for the year. Targets that do not require direct capital expenditure will not be affected by this reduction, however.

The 2012/ 2013 financial year budget allocation will present serious chal-lenges. Despite chronic underfunding, the NYDA has consistently delivered on its mandate to promote youth development and economic participation. This is achieved through key interventions, which include: • Facilitating bursaries for young people • Providing technical skills training for young people• Supporting entrepreneurship through the provision of funding, relevant

skills training and mentorship• Facilitating business opportunities.

However, given the extent of the challenges facing youth development, more still needs to be done.

The NYDA has achieved a great deal with an insufficient budget, to serve the needs of all youth, especially those in peri-urban and rural areas.

The NYDA Act, 2008 (Act 54 of 2008) stipulates that the organisation must be accessible and within reach of all youth, including those in rural areas. This call was further emphasised by President Jacob Zuma in his 2010 State of the Nation Address, when he announced that government had directed the NYDA ‘to work faster to establish its structures, throughout the country, so that it can assist us to mainstream youth development programmes within government.’ Because of funding constraints, the organisation presently only has 144 access points, instead of points in all municipalities.

‘With an increased budget and more support from government, we would be able to extend our footprint to include the most remote parts of South Africa. The support from other sectors, including business, would ensure that the country implemented more youth-development programmes,’ said Lungisa.

The NYDA calls on all spheres of government, and private and civil society sectors, to support youth development through tangible youth-develop-ment programmes.


By Andile Lungisa

In 2009, Cabinet approved and adopted the NYP (2009–2014) as a national policy framework for youth development in South Africa. The NYP was a culmination of an extensive and comprehensive consultation process by relevant youth institutions towards ensuring integrated and sustainable youth development in the country. However, three years since its adoption, youth development continues to be implemented in an uncoordinated manner that cannot be monitored or measured, impacting negatively on the progress of youth development. Often the blame for the lack of development or limited development of young people has been levelled at the NYDA. We have understood this to be the result of the broadness of our mandate and, in line with that mandate, have continued to make inroads, including interacting with organs of state, the private sector and civil society. While not to our full satisfaction, in most instances we have been able to make progress, particularly in various organs of state. However, at times, it appears that, where there is progress, such progress is slow, which is a situation we cannot accept in South Africa, particularly in light of the current unemployment situation of young people. Currently, young people account for 73% of unemployed South Africans, who comprise 25% of the country’s population.

Even at the level of the private sector, there has not been an effective tool for measuring these efforts, even though there may be initiatives. We have also realised that, while some sectors may be aware of the NYP (2009–2014), there may be challenges in terms of understanding its importance and how it should be implemented. The NYDA Act, 2008 (Act 54 of 2008) empowers the NYDA to facilitate a process towards ensuring that youth development is mainstreamed and integrated in a uniform manner by all sectors of society. With about half (42% in 2011) of the country’s population comprised of people belonging to the age group 14–35 years, it has become urgent that a coordinated, integrated approach by all sectors of society is adopted in the country. It is for this reason that the NYDA developed the NYP implementation guidelines, aimed at simplifying the implementation of the policy. The implementation guidelines will direct how sectors of society, including organs of state, and private and non-governmental organisations, should implement programmes aimed at the development of young people, including measures to ensure compliance with sectors that are moving slowly on youth development. It is often argued that South Africa has some of the best policies, but is lacking in implementation. Where there is slow movement, it becomes important that guidelines are developed to help fast-track the processes.

The objectives of the NYP 2009–2014 implementation guidelines include the following: • Promotion of a uniform approach by all organs of state, the private

sector and non-governmental organisations, to matters relating to young people, as defined in the NYP 2009–2014.

• Provision of a guide on how interventions and programmes, as defined in the NYP 2009–2014, should be planned for, implemented, monitored and evaluated.

• Provision of standard youth-development indicators, to be used to report against the country’s performance on the prescribed NYP 2009–2014 imperative and programmes.

In this case, mainstreaming effectively means that every public, private and civil society organisation consciously and continuously puts youth development at the centre of the planning and implementation of activities that form their business.

Ministers and heads of departments at national level (directors-general), premiers and MECs at provincial level, and mayors and municipal managers at local-government level must play their part by ensuring that youth development is mainstreamed. Irrespective of business, public institutions need to develop specific youth-development strategies and plans, and allocate resources for penetrating interventions that are in line with their respective mandate. Progress on implementation should be monitored and reported through quarterly reports, which will be tabled in the Interdepartmental Committee (IDC) on Youth Affairs and made available to the NYDA. The NYDA will, in turn, consolidate these and compile a report for the President that will form part of the agency’s annual reporting process to the President.

The IDC on Youth Affairs is a structure convened and coordinated by the NYDA, and is comprised of representatives delegated by heads of departments at national level (directors-general), MECs at provincial level and municipal managers at local-government level.

Its main purpose is to assist in planning and monitoring progress made by stakeholders in implementing the NYP 2009–2014. The IDC on Youth Affairs will meet quarterly and the NYDA will include a summary of minutes of the IDC on Youth Affairs in its quarterly reports to the Presidency.

Just like the public sector, the private sector needs to plan and implement the NYP 2009–2014 imperatives. The resources allocated through social corporate investment budgets need to be channelled and coordinated to achieve the goals of the NYP 2009–2014. Through the office of the Presidency, the NYDA has proposed a structure similar to the IDC on Youth Affairs, in order to assist the private sector to plan and allocate resources to the imperative areas of the NYP 2009–2014. The structure will be coordinated by the NYDA. It will meet twice annually: a quarter before the start of the financial year for most private sector institutions, to assist them with planning, as well as at the end of the financial year, to evaluate progress with the implementation of their interventions.

Section 6 and 7 of the NYDA Act gives the organisation the power to coordinate and ensure that organs of state take into consideration the NYD priorities when planning activities of their business, and submit annual reports regarding their implementation to the NYDA in the prescribed manner.

The NYDA is confident that only through systematically coordinated efforts towards a common goal by all organs of state, and private and non-governmental organisations, we will be able to make a significant impact on the unemployment rate, as a country.

Towards a uniform approach to youth development




STATEMENTof corporateGOVERNANCE



The NYDA is classified as a public entity, listed under Part A of Schedule 3 of the Public Finance Management Act, 1999 (Act 1 of 1999) (PFMA). The NYDA came into existence pursuant to Section 21(2) of the NYDA Act, 2008 (Act 54 of 2008).

Being a public entity, the NYDA is subject to, among others, the applicable provisions of the PFMA and has adopted the Protocol on Corporate Governance for the Public Sector, as well as adopting and approving the materiality framework, as required in terms of Treasury Regulation 28.3.

Furthermore, in its structure and operations, the NYDA is guided and governed by the provisions of the NYDA Act. In recognition of the fact that corporate governance was an important element of the management and operations of the NYDA, and to ensure that the NYDA met the need for accountability, integrity and transparency, the board established governance structures, in line with the provisions of the NYDA Act. In developing these structures, the Board of Directors of the NYDA took cognisance of all NYDA operations, according to the provisions of the NYDA Act, to ensure that the NYDA continued to deliver services to the young people of South Africa. The board, board committee charters, and related policies and processes, provide a comprehensive set of governance policy directives and guidelines to promote the highest standards of corporate governance within the NYDA. The board will continue to develop and improve its corporate governance practices to ensure that they comply with the requirements for best practice. To this end, the NYDA continues to assess its compliance with good corporate governance practices. The board has duly implemented measures to address cases of non-compliance whenever they are identified.

During the year under review, the NYDA engaged in a process to align the organisational structure of the entity with the requirements of the NYDA Act and the mandate of the NYDA.

Governance principle The Code of Conduct and Fraud Prevention Plan commit the NYDA’s management, and staff, to the highest standard of ethical and professional behaviour, including a fundamental respect for the law, and require all employees to act in utmost good faith and integrity in all transactions, and with all stakeholders with whom they interact.

Systems and procedures were implemented to ensure that the Code of Conduct and Fraud Prevention Plan were being communicated and adhered to by all employees and the board. The Code of Conduct, together with the Human Resource Policy, clearly articulates how its provisions should be adhered to, and dealt with, in instances of non-compliance.

and Statutory ComplianceRegulatory Environment


Governance structuresBoard of DirectorsThe NYDA is led by, and controlled by, an effective and efficient unitary board, comprising eight members: five independent, non-executive directors; two executive directors, appointed and designated as Chairperson and Deputy Chairperson; and the Chief Executive Officer as an ex-officio board member with no voting rights. The board is appointed by the President of the Republic of South Africa on recommendation of Parliament, except for the Chief Executive Officer, who is appointed by the board. The NYDA reports to the Minister in the Presidency: Minister Collins Ohm Chabane and, therefore, its executive authority. In terms of Section 49 of the PFMA, the board is the accounting authority of the NYDA and retains full and effective control of the NYDA. Its fiduciary and general responsibilities are listed in Section 50 of the PFMA and these responsibilities have been incorporated in its charter.

The duties and responsibilities of the board were determined primarily with reference to the Protocol on Corporate Governance for the Public Sector, the PFMA and the NYDA Act. These duties and responsibilities comprise, among others:• formulating corporate strategy and setting targets• approving budgets to procure the necessary resources to execute the corporate strategy• reviewing actual performance, in relation to targets • ensuring that risks arising from the execution of the strategy are effectively managed and controlled.

The Chief Executive Officer, appointed by the board, along with his executive team (the Operations Executive Committee), manages the day-to-day affairs of the NYDA and ensures that the board’s strategies, policies and resolutions are sustainably implemented and managed. In performing its tasks under its terms of reference, the board may obtain outside or other independent professional advice, as deemed necessary. Selection and appointment of professional advisors take place in accordance with the NYDA’s standard supply chain management policies and processes. The Chief Executive Officer and his executive team provide the board with the relevant information to assess the performance of the NYDA, in terms of approved targets. They meet with the board, from time to time, to discuss its performance and review the corporate strategy, targets and budgets. The board has unrestricted access to accurate, relevant and timely information.

The executive authority evaluates the mix of skills, experience and other relevant qualities inherent in the board members, on an annual basis, to ensure that the board is capable of discharging all its responsibilities towards the NYDA. The executive authority believes that the board is well constituted, in this regard. As required by the NYDA Act, the board has established committees to assist with the efficient and effective advancement of the board’s business, and to adequately and properly discharge the directors’ responsibilities. However, the board remains accountable and responsible for the performance and affairs of the NYDA. The mandates of these committees are contained in their respective charters and have been duly approved by the board.

The NYDA board governance structureThe NYDA’s board is assisted in discharging its duties through the following committees:• Audit Committee (established in terms of Section 77 of the PFMA) • Human Resources and Remuneration Committee • Credit and Investment Committee• Executive Management Committee• Development Committee



The NYDA’s Board of Directors and Board Committee structure, as at 31 March 2012

Directors

Position held on Board Committee

AuditCredit and Investment

Human Resources and Remuneration

Executive Management

Provincial Advisory Board Development

Executive:

Mr Andile Lungisa (Chairperson) Chairperson Chairperson

Mr Yershen Pillay (Deputy Chairperson) Member Member

Mr Steven Ngubeni (Chief Executive Officer) Member Member Member Member

Non-Executive:

Mr Mcebo Khumalo1 Chairperson

Ms Pholisa Makeleni Chairperson

Ms Innocentia Motau Member Chairperson

Mr François Slabber Member

Ms Maria Tshabalala Member Member

Delegation of authorityThe ultimate responsibility for the NYDA’s operations rests with the board, which retains effective control through a well-developed governance structure of board committees specialising in certain areas of the business. The Board of Directors delegates specific authorities to these committees and to the

Chief Executive Officer. The Operations Executive Committee, which is comprised of the heads of each division of the NYDA, assists the Chief Executive Officer with discharging his duties and those of the board, when it is not in session. However, certain duties are still the exclusive responsibility of the board. Delegating authority to board committees or management does not in any way mitigate or dissipate the boards’ duties and responsibilities.

Induction programmeThe board and, primarily, the board chairperson, are responsible for ensuring that induction is offered to new directors, as well as education and training to existing directors, in order to improve and maintain the effectiveness of the entire board. Directors are informed of the NYDA’s programmes and operations, senior management and the business environment, as well as the directors’ fiduciary duties, responsibilities and expectations. The induction programme is reviewed from time to time to ensure its effectiveness when inducting new board and board committee members.

Board meetingsThe board met nine times during the year under review. A summary of the attendance of directors at board meetings during the year under review is outlined in the following table:Names of members Meetings attended Attendance record (%)

Mr Andile Lungisa (Chairperson) 7/9 78

Mr Yershen Pillay (Deputy Chairperson) 7/9 78

Mr Steven Ngubeni 8/9 89

Mr Mcebo Khumalo 7/9 78

Ms Pholisa Makeleni 7/9 78

Ms Innocentia Motau 8/9 89

Mr François Slabber 7/9 78

Ms Maria Tshabalala 8/9 89

Secretary of the boardThe board secretary, who is appointed by and reports to the board, ensures that the board functions effectively by providing detailed guidance on the nature and extent of the board, and the duties and responsibilities of individual directors. The company secretary is a central source of guidance, and advice, to the board on matters of business ethics and good governance. The board secretary also serves as secretary on the board committee. The performance of the board secretary is appraised in the same manner as that of the directors.

Directors’ interest in contractsEvery board member is required to disclose their business interest in other listed and non-listed companies, and entities, in the board secretary’s Register of Interests. Board members are prohibited from dealing in or owning shares, securities or similar interests in any company, in which the NYDA’s clients, agents or service providers are involved. Except to the extent disclosed in these financial statements, none of the directors dealt in any shares, securities or similar interests in any such company.

1 Mr Mcebo Khumalo has been appointed as the Chairperson of the Development Committee, subsequent to year-end, and will lead the establishment of the committee


Board statutory committees

Audit CommitteeThe Audit Committee, established in terms of Treasury Guidelines, as provided for in Section 77 of the PFMA, is comprise of three members, of which two are independent and one is a non-executive board member. The NYDA Chief Executive Officer attends on invitation. Its purpose is to assist the board in discharging its duties relating to the safeguarding of assets, the operation of adequate systems and control processes, and the preparation of accurate financial reporting. The committee reports to the board on a quarterly basis.

The Audit Committee is further responsible for ensuring the following:• The NYDA’s audit, financial and risk areas are adequately addressed• Appropriate policies and internal control recommendations by internal audit and the Auditor-General are implemented• The annual financial statements and annual report have been properly prepared by management and reviewed by the Auditor-General, before

recommendation to the Board of Directors for approval• Periodic evaluation of the suitability and performance of auditors• Review of policies and recommendation to the board for approval• Independent specialists are remunerated, based on the guidelines issued by the National Treasury from time to time for each meeting attended.

Details of attendance by members of the committee for the period 1 April 2011 to 31 March 2012Name of members Meetings attended Attendance record (%)

Mr Vonani Mathebula (Chairperson) 4/4 100

Mr Peter Koch 3/4 75

Ms Innocentia Matou 3/4 75

Credit and Investment CommitteeThe committee comprises three members, of which two are non-executive and one is the Chief Executive Officer. Its purpose is to ensure that commitments the NYDA seeks to make to projects are aligned with the objectives of the NYDA and further reviews of the portfolio of loans and projects funded. The Credit and Investment Committee has an approval limit of R5 million to R10 million. It further considers for approval and recommends to the board, where the NYDA would have a funding exposure of above R10 million. The committee reports to the board on a quarterly basis.

The committee is further responsible for ensuring the following:• Projects fit the detailed programme criteria established by the NYDA• The NYDA does not have undue exposure to any particular project and/or service provider organisation• Adequate controls and mitigating measures are in place for managing project risks which have been identified• Recommendation of the approval of projects to the board, in cases where any single commitment exceeds R2 million.

The full terms of reference of this committee are contained in its charter.

The committee meets on a quarterly basis and assesses projects recommended for approval. The board reviews the mandate and powers of the Investment Committee on an annual basis, in order to ensure that the rules governing the committee are still relevant and applicable.

Details of attendance by members of the committee for the period 1 April 2011 to 31 March 2012Names of members Meetings attended Attendance record (%)

Ms Innocentia Motau (Chairperson) 3/3 100

Ms Maria Tshabalala 3/3 100


Human Resources and Remuneration CommitteeThe committee is comprised of an independent specialist and four members, of which two are non-executive directors. Its purpose is to provide advice and guidance to the board on matters relating to human resources. This is considered vital to ensure that the NYDA subscribes to good and fair labour practices, and has the relevant human resources to achieve its mandate. The committee reports to the board on a quarterly basis.

The committee is further responsible for the following:• Recommending all policies for conditions of employment of staff• Determining all essential components of remuneration• Establishing remuneration credibility with all key stakeholders• Advising on effective retention strategies



• Determining the basis for measuring the performance of executive directors and senior management• Recommending annual salary increments and rewards.

The committee has access to independent surveys and consultants, in order to consider market-related remuneration and related benefits. The full terms of reference of this committee are contained in its charter, which was duly approved by the board. The board reviews the mandate and powers of the committee on an annual basis, in order to ensure that the rules governing the committee are still rel-evant and applicable.


Ms Pholisa Makeleni (Chairperson) 6/7 86

Mr Francois Slabber 7/7 100


Joy Ndlovu 4/7 57

Executive Management Committee The Executive Management Committee is comprised of the Chairperson of the board, Deputy Chairperson of the board and the Chief Executive Officer.

The committee performs the following duties:• Monthly review and approval of the NYDA programme and financial performance• Review and approval of all quarterly reports, prior to such reports being submitted to the Executive Authority• Review of progress on the implementation of the board’s projects• Review of progress on the implementation of strategic partnerships• Identification and review of strategic risks as they arise• Review of the minutes of all committees led by the Chief Executive Officer, excluding the Procurement Tender Committee• Review of progress on the implementation of the NYDA communication strategy• Prioritising the allocation of capital, and technical and human resources • Attending to any other matters, as delegated by the board.

Details of attendance by members of the committee for the period 1 April 2011 to 31 March 2012 Names of members Meetings attended Attendance record (%)

Mr Andile Lungisa (Chairperson) 2/5 40

Mr Yershen Pillay2 5/5 100


Development CommitteeThe Development Committee is comprised of three members, two non-executive directors and the Chief Executive Officer. The committee reports to the board on a quarterly basis.

The committee is responsible for the following:• Advising the board on the way forward regarding programmes referred to the board by the PAB• Guiding the board in defining the youth-development interventions and programmes, as envisaged in Section 4 of the Act• Providing guidance to the board on issues to be included in conducting youth-development research• Providing guidance to the board on issues that would ensure that youth development was included in national priorities and subsequent government

programmes• Providing guidance to the board on issues that would ensure that youth interventions were in line with the IYDS• Providing input to the board on the review of the capacity of the NYDA to implement programmes.

The board reviews the mandate and powers of the committee on an annual basis, to ensure that the rules governing the committee are still relevant and applicable.


Mr Mcebo Khumalo (Chairperson) 0/0 0

Ms Maria Shabalala 0/0 0

Mr Steven Ngubeni 0/0 02 The Board appointed Mr Pillay to serve as a member of the committee in the interim, until the Chief Executive Officer has been appointed. Consequently, he attends

the committee meeting by invitation.


Committees led by the Chief Executive Officer

The following committees, some of which are led by the Chief Executive Officer, have been delegated with the day-to-day operations and decisions of the NYDA. • Operations Executive Committee• Loans Approval and Review Committee (previously known as the Management Committee) • Bid Adjudication Committee (previously known as the Procurement and Tender Committee)• Skills Development and Employment Equity Committee • Occupational Health and Safety Committee • Operational Project Committee

Operations Executive CommitteeThe committee is responsible for strategic and operational matters, including the day-to-day management of the business of the NYDA, in terms of its delegated authority, approved by the Board of Directors. This committee facilitates the effective control of all operational activities, acting as a medium of communication and coordination between the various business units, and the board. It is also responsible for recommendations of policies and strategies to the board, and monitoring their implementation, in line with the board’s mandate. This committee meets once a month. Members of the Operations Executive Committee, as at 31 March 2012Names of members

Mr Steven Ngubeni (Chairperson) Chief Executive Officer

Mr Clayton Peters Head of Department: Skills Development Transfer (until end April 2011)

Ms Ncedi Hluyo Head of Department: Human Resources (until end May 2011)

Ms Gugu Mjadu Head of Department: Communications (until end June 2011)

Mr Bongani Magongo Head of Department: Research and Evaluation (until end May 2011)

Mr Mzwabantu Ntlangeni Acting Chief Operations Officer (until end May 2011)

Ms Margaret Tleane Head of Department: Policy Lobby and Advocacy ( until end May 2011)

Ms Magdalene Moonsamy Chief Operations Officer (from June 2011)

Mr Mzwabantu Ntlangeni Acting Executive Manager: NYDA Partnerships and International Relations

Mr Khathutshelo Ramukumba Chief Financial Officer (from 1 June 2011 )

Mr Michael Mashinini Acting Chief Financial Officer (until end May 2011)

Ms Tamari Mavasa Executive Manager: Economic Development (from 01 June 2011)

Ms Nthuseng Mphahlele Executive Manager: Skills Development Transfer (from 01 June 2011)

Ms Linda Ndlova Executive Manager: Communications (1 July 2011)

Mr Siviwe Mkoka Executive Manager: Research (1 June 2011)

Mr Vincent Mulaudzi Executive Manager: Corporate Affairs (1 June 2011)

Mr Daniel van Vuuren Executive Manager: Service Delivery Channel

Mr Edgar Mahura Acting Executive Manager: ICT

The following managers have a standing invitation to attend Executive Committee meetings:Ms Teboho Sejane Business Strategist

Mr Sanjay Hargovan General Manager: Risk and Internal Audit

Mr Clayton Peters Project Manager from May 2011

The Operations Executive Committee met eight times during the year under review.

Loans Approval and Review Committee (previously known as the Management Committee)The Loans Approval and Review Committee ensures that commitments which the NYDA seeks to make to projects are aligned with the objectives of the NYDA. It has decision-making authority, in respect of project grants with a value of less than R5 million. The Loans Approval and Review Committee is responsible for ensuring that:• projects submitted are aligned to the aims and objectives of the NYDA• projects comply with the detailed programme criteria established by the NYDA• the NYDA does not have undue exposure to any particular project and/or service provider organisation• adequate controls and mitigating measures are in place to manage risks which have been identified• projects are recommended for approval to the Investment Committee, in cases where any single commitment exceeds R5 million.



The Loans Approval and Review Committee is comprised of the Chief Executive Officer, as the Chairperson, the Chief Financial Officer and Executive Managers. The Loans Approval and Review Committee met seven times during the year under review, to evaluate grant-funded programmes, including the appraisal of entrepreneurship loans and investments.

Bid Adjudication Committee (previously known as the Procurement and Tender Committee)The objective of the Bid Adjudication Committee (BAC) is to ensure that goods and services are procured, in accordance with the procurement policy of the NYDA and the full terms of references contained in its charter, duly approved by the board.

The BAC is responsible for the following:• The development and implementation of a sound and fair procurement policy, guided by the relevant regulatory framework• The introduction of proper procedures, processes and systems to give effect to the procurement policy• The adjudication of bids.

The BAC is chaired by the Chief Executive Officer and the members are: the Chief Financial Officer; the Chief Operations Officer; Executive Managers: Economic Development and Service Delivery Channel; and the General Manager: Strategic Development (Chief Executive Officer’s Office). The Senior Manager: Procurement with the Risk Unit has a standing invitation to committee meetings and the Supply Chain Management Unit, as secretariat.

Bid specification and bid evaluation committees are established with a limited mandate to support the BAC with procurement for programme or project-specific requirements. The effectiveness and compliance of procurement and tendering management are monitored through formal reporting by the Supply Chain Manager to this committee, which includes the achievement of best quality, cost-effectiveness, and optimum delivery of products and services to the NYDA, and its programmes. Emphasis on Black Economic Empowerment and Youth-Owned SMMEs is a key objective of the NYDA’s preferential procurement strategy.

The Committee met four times during the year under review.

Skills Development and Employment Equity Committee The objective of the Skills Development and Employment Equity Committee (SDEEC) is to ensure that the NYDA complies with legislation relating to skills development and employment equity.

The SDEEC is further responsible for the following:• Monitoring implementation of the workplace skills plan and employment equity plan• Making recommendations to the NYDA management, regarding skills development and training for all employees• Ensuring that the principles which underpin skills development and employment are applied in a fair manner to all employees of the NYDA.

The SDEEC is chaired by staff members appointed by the executive committee and reports directly to the Chief Executive Officer. The committee is comprised of 11 members, representative of the demographics of the NYDA, in respect of gender, race, job level and disability.

The committee met two times during the year under review.

Occupational Health and Safety CommitteeThe objective of the Occupational Health and Safety Committee (OHSC) is to ensure that the NYDA complies with legislation relating to health and safety issues affecting employees. The NYDA has appropriate policies and practices in place to ensure compliance with the provisions of the Occupational Health and Safety Act, 1993 (Act 85 of 1993), and the safety of all employees and contractors on the NYDA premises.

The OHSC is responsible for the following: • Ensuring that the NYDA adopts, maintains and applies appropriate health, safety and environment policies and procedures • Ensuring that the NYDA maintains effective health, safety and environment-related internal control and risk-management systems • Ensuring that effect is given to the applicable legislation.

The OHSC is chaired by a senior staff member, appointed by and reporting directly to the Chief Executive Officer, in accordance with the provisions of the Act.

The committee met once during the year under review.

Operational Project CommitteeThis committee is chaired by the Chief Operations Officer and the members are: the Executive Manager: Economic Development; the Chief Information Officer: NYS and Skills Development, Service Delivery Channel and Partnerships; and a representative from the Risk Unit.


Loans Approval and Review CommitteeThe Loans Approval and Review Committee is chaired by the Chief Finance Officer and the members are: Executive Managers: Corporate Partnerships and Economic Development; the Senior Manager: Investment (Finance); the General Manager: Strategic Programmes (Chief Executive Officer’s Office); and a representative from the Risk Unit. Members are appointed by the Chief Executive Officer. The committee has an approval limit of R300 000 to R5 million.

Micro and Small Loans Approval CommitteeThe Micro and Small Loans Approval Committee is chaired by the Executive Manager: Economic Development. Members are appointed by the Chief Executive Officer. The members are: the Senior Manager: Enterprise Finance; the General Manager: Service Delivery Channel; the Senior Manager: Investments (Finance); and a representative from the Risk Unit, with an approval limit of R50 000 to R300 000.

Branch Loans Approval and Review CommitteeThe Branch Loans Approval and Review Committee is chaired by the Branch Manager and the members are: a coordinator from Business Development Services and a coordinator from Enterprise Finance with an approval less than R50 000.

Risk management

Board responsibility on risk management The board is responsible for the total process of risk management, which includes the system of internal control. It is responsible for ensuring that a risk assessment is undertaken at least once per annum, as well as that reports on the risk-management process are regularly received and reviewed, at appropriate intervals. Its responsibility further includes ensuring that proper processes and structures are in place to identify, evaluate, mitigate and communicate the risks the NYDA is exposed to, as well as further significant risks that affect decisions of stakeholders (including the shareholder) in their dealings with the NYDA. In order to effectively discharge these responsibilities, the board has institutionalised several structures within the NYDA, including the Audit Committee, and is in the process of establishing the Risk Management Committee, which will be a subcommittee of the Audit Committee. The Risk Management Committee is coordinated by the Risk Management Unit, in order to assist with the execution of the risk-management process.

Audit Committee responsibilityThe Audit Committee has the responsibility of assisting the board with ensuring that all material risks to which the NYDA is exposed are properly managed. In this regard, the Audit Committee will work in close co-operation with the Risk Management Committee.

Risk management responsibilityThe NYDA’s Risk Management Unit, reporting to the office of the Chief Executive Officer, monitors the entire risk profile, ensuring that major risks are identified and reported, and provides and maintains the risk-management infrastructure to assist management in fulfilling its responsibilities. The General Manager: Risk and Internal Audit assists in the execution of the risk-management process, but the primary responsibility still remains with the board. The General Manager: Risk and Internal Audit has a standing invitation to attend the Board Audit Committee.

The NYDA’s approach to risk management is to identify as many of its business risks as possible, and to formulate and implement policies to counter, manage, control, reduce, or eliminate these risks. Risk policies are developed and reviewed from time to time, to take account of new business imperatives.

The NYDA’s policy on, approach to and management of risk is documented in the NYDA Risk Management Strategy and distinguishes between the follow-ing identified areas of risk:• Business and operational risks (corporate governance, sustainability, programmes and support)• Credit and market risks• Human resources risks• Information and technological risks• Business continuity and disaster recovery• Physical, health and safety risks• Political, social and economic risks.

The NYDA views risk management as an ongoing process and, during the year under review, continued to review its enterprise-wide risks, and risk-man-agement policies and procedures, at regular intervals, in order to ensure that its management of business risk is progressive and adjusted to changing circumstances.

Internal controls The NYDA’s internal controls and systems are designed to provide cost-effective, reasonable, but not absolute, assurances regarding the integrity and reliability of the annual financial statements; the adequate safeguarding of assets against material loss or unauthorised loss; and the proper authorisation



and recording of transactions. Such controls are based on established written policies, procedures, structures and approval frameworks, monitored throughout the NYDA and applied by trained, skilled personnel with appropriate segregation of duties, through clearly defined lines of accountability and delegation of authority.

The control system includes comprehensive reporting of critical risk areas, which are identified by operational risk management and confirmed by management. Management and internal auditors closely monitor the controls and ensure that actions are taken to correct deficiencies, as they are identified.

Internal auditInternal audit is an integral part of the NYDA and is prescribed by the King II Report, the PFMA and the Protocol on Corporate Governance. Functionally, it reports to the Board Audit Committee and, administratively, to the Executive Management of the NYDA. Internal audit operates under formal terms of reference, approved by the board, and acts in accordance with the standards set by the Institute of Internal Auditors. Internal audit is aimed at providing reasonable assurance on the effectiveness of the NYDA’s corporate governance, risk-management processes and the system of internal control, and has been outsourced to an audit firm.

The internal auditors have unrestricted access to members of the Audit Committee and the Chairperson of the Board, and have a standing invitation to all Audit Committee meetings.

Internal audit is further used as a tool by management for the following:• Assisting the NYDA to achieve its mandated objectives• Recommending improvements to the NYDA’s operations• Mitigating losses, illegality and damage to reputation.

Fraud prevention and whistle-blowing Fraud or fraudulent activities, in any form, as defined in the NYDA’s fraud-prevention and whistle-blowing policy, are not tolerated and are investigated and followed up by the application of all remedies available within the full extent of the law.The NYDA maintains a fraud/whistle-blowing hotline, which is outsourced to an independent external service provider. Employees, service providers and beneficiaries of the NYDA are encouraged to report any suspected fraudulent, corrupt or unethical activities. The policy enables the protection of those that report these offences, within their rights, as afforded by legislation, such as the Protected Disclosures Act, 2000 (Act 27 of 2000).

The Risk Management Unit receives and follows up on every report received and updates the Audit Committee on the status or progress of reported incidents.

Financial Intelligence Centre Act (FICA)The NYDA believes that it is fully compliant with the Financial Intelligence Centre Act, 2001 (Act 38 of 2001) (FICA), and all employees receive compulsory training regarding the awareness and obligations of the NYDA, in respect of FICA, to support the international struggle against money-laundering activities.

Employment practicesThe board has managed the transfer of employees from the former UYF and the NYC, in line with the NYDA Act and in compliance with Section 197 of the Labour Relations Act, 1995 (Act 66 of 1995). The board has further adopted a new set of employment terms and conditions of employment, which seek to achieve equity and parity within its employment practices, as well as policies that are designed to attract, motivate and retain relevant, and quality human resources that would enable the agency to achieve its mandate.

Communication and corporate affairs The NYDA enters into dialogue with institutional stakeholders for constructive engagement in forming mutual partnerships for achieving the objectives of youth development. Due consideration is given to statutory and other directives that regulate the dissemination of information by the NYDA’s directors and officials.

Directors and officials of the NYDA are expected to take cognisance of the fact that society demands greater transparency, accessibility and accountability regarding reports and communication. Therefore, the NYDA makes every effort to ensure that information is readily available to its staff and is distributed to its stakeholders, including youth, through a broad range of communication channels, including its Internet portal (www.youthportal.org.za); the NYDA call centre (08600 YOUTH); the national network of youth advisory centres; government Thusong service centres; constituency offices; its service providers; and outreach events.The NYDA is in the process of developing a Manual of Information, as required by the Promotion of Access to Information Act, which will be available on the NYDA website.

National Credit Act The NYDA is registered as a credit provider, in terms of the National Credit Act (NCA), and has implemented relevant processes to ensure that it complies with the relevant provisions of the Act.


ANNUALFINANCIALSTATEMENTSfor the year ENDED 31 MARCH 2012




INDEX

Accounting Authority’s Responsibilities and Approval ......75

Report of the Auditor-General .........................................76

Accounting Authority’s Report ........................................79

Statement of Financial Position .......................................82

Statement of Financial Performance ...............................83

Statement of changes in Net Assets ...............................84

Cash-Flow Statement .....................................................85

Accounting Policies ........................................................86

Notes of Annual Financial Statements .............................94



responsibilities, the authority sets standards for internal control, aimed at

reducing the risk of errors in a cost-effective manner. The standards include

proper delegation of responsibilities within a clearly defined framework,

effective accounting procedures and adequate segregation of duties, to

ensure an acceptable level of risk. These controls are monitored throughout

the NYDA and all employees are required to maintain the highest ethical

standards in ensuring that the NYDA’s business is conducted in a manner

that is above reproach, in all reasonable circumstances.

The focus of risk management is on identifying, assessing, managing

and monitoring all known forms of risk across the NYDA. While operating

risk cannot be fully eliminated, the NYDA endeavours to minimise risk by

ensuring the appropriate management and application of infrastructure,

controls, systems and ethical behaviour, within predetermined procedures

and constraints.

The Accounting Authority was of the opinion that the system of internal

control provided reasonable assurance that the financial records were

reliable for the preparation of these annual financial statements. However,

any system of internal financial control can only provide reasonable, and

not absolute, assurance against material misstatement or loss.

The annual financial statements for the year ended 31 March 2012, as set

out on pages 82 to 121, which were prepared on a going-concern basis,

were approved by the Accounting Authority and signed on its behalf by:

Mr Steven Ngubeni

Acting Accounting Authority of the NYDA

31 July 2012

The National Youth Development Agency (NYDA) was established by

the National Youth Development Agency Act No. 54 of 2008 (NYDA act)

through the merger of the National Youth Commission (NYC) and the

Umsobomvu Youth Fund (UYF). The merger was pursuant to Section

21(2) of the NYDA Act, effective from 1 October 2009. This report and the

accompanying financial statements cover the period 1 April 2011 to 31

March 2012.

Currently, the NYDA does not have a Board of Directors, as the term of the

previous board expired during the current financial year. The appointment

of board members is in the process of being finalised by the Office of the

Presidency. The Chief Executive Officer has been appointed by the Office

of the Presidency to act as the Accounting Authority of the NYDA in the

interim.

The Accounting Authority is required by the Public Finance Management

Act No. 1 of 1999 (PFMA), as amended, to maintain adequate accounting

records and is responsible for the content and integrity of the financial

statements and related financial information included in this report. It is

their responsibility to ensure that the financial statements fairly present

the state of affairs of the NYDA as at the end of the financial period and

the results of its operations and cash flows for the period then ended,

in conformity with South African Standards of Generally Recognised

Accounting Practice (SA Standards of GRAP) and directives and guidelines

issued by the Accounting Standards Board (ASB) from time to time. The

external auditors are engaged to express an independent opinion on the

financial statements and were given unrestricted access to all financial

records and related data.

The annual financial statements were prepared in accordance with SA

Standards of GRAP, including any interpretations, guidelines and directives

issued by the ASB.

These annual financial statements are based on appropriate accounting

policies, which were consistently applied, and supported, by reasonable,

prudent judgments and estimates.

The Accounting Authority acknowledges that it is ultimately responsible

for the system of internal financial control, established by the NYDA,

and places considerable importance on maintaining a strong control

environment. To enable the Accounting Authority to meet these

Accounting Authority’sResponsibilities and Approval


REPORT ON THE FINANCIAL STATEMENTS

Introduction

1. I have audited the financial statements of the National Youth

Development Agency (NYDA) set out on pages 82 to 121 , which

comprise the statement of financial position as at 31 March 2012,

the statement of financial performance, statement of changes in net

assets and statement of cash flows for the year then ended, and the

notes, comprising a summary of significant accounting policies and

other explanatory information.

Accounting authority’s responsibility for the financial statements

2. The accounting authority is responsible for the preparation and fair

presentation of these financial statements in accordance with South

African Standards of Generally Recognised Accounting Practice

(SA Standards of GRAP) and the requirements of the Public Finance

Management Act of South Africa, 1999 (Act No.1 of 1999) (PFMA),

and for such internal control as the accounting authority determines

is necessary to enable the preparation of financial statements that are

free from material misstatement, whether due to fraud or error.

Auditor-General’s responsibility

3. My responsibility is to express an opinion on these financial

statements based on my audit. I conducted my audit in accordance

with the Public Audit Act of South Africa, 2004 (Act No. 25 of 2004)

(PAA), the General Notice issued in terms thereof and International

Standards on Auditing. Those standards require that I comply

with ethical requirements and plan and perform the audit to obtain

reasonable assurance about whether the financial statements are free

from material misstatement.

4. An audit involves performing procedures to obtain audit evidence

about the amounts and disclosures in the financial statements. The

procedures selected depend on the auditor’s judgement, including

the assessment of the risks of material misstatement of the financial

statements, whether due to fraud or error. In making those risk

assessments, the auditor considers internal control relevant to the

entity’s preparation and fair presentation of the financial statements

in order to design audit procedures that are appropriate in the

circumstances, but not for the purpose of expressing an opinion on

the effectiveness of the entity’s internal control. An audit also includes

evaluating the appropriateness of accounting policies used and the

reasonableness of accounting estimates made by management, as

well as evaluating the overall presentation of the financial statements.

5. I believe that the audit evidence I have obtained is sufficient and

appropriate to provide a basis for my audit opinion.

Opinion

6. In my opinion, the financial statements present fairly, in all material

respects, the financial position of the NYDA as at 31 March 2012 and

its financial performance and cash flows for the year then ended in

accordance with South African Standards of Generally Recognised

Accounting Practice and the requirements of the PFMA.

Emphasis of matters

7. I draw attention to the matters below. My opinion is not modified in

respect of these matters.

Material impairments

8. As disclosed in note 7 to the financial statements, material

impairments to the amount of R24 859 000 (2010-2011: R38 752 000)

were incurred in the current year as a result of the impairment of

loans advanced by the NYDA. At 31 March 2012, R161 323 000 (which

includes the R24 859 000) had been impaired as the recoverability of

these loans are doubtful.

Irregular expenditure

9. As disclosed in note 31 to the financial statements, NYDA incurred

irregular expenditure of R133 252 000 (69% of total expenditure

subject to supply chain management requirements) as a result of non-

compliance with supply chain management prescripts as determined

by the National Treasury. The majority of the irregular expenditure was

identified during my audit.

TO PARLIAMENT ON THE NATIONAL YOUTH DEVELOPMENT AGENCYREPORT OF THE AUDITOR-GENERAL



Report on other legal and regulatory requirements 10. In accordance with the PAA and the General Notice issued in terms

thereof, I report the following findings relevant to performance against

predetermined objectives, compliance with laws and regulations and

internal control, but not for the purpose of expressing an opinion.

Predetermined objectives

11. I performed procedures to obtain evidence about the usefulness and

reliability of the information in the report on predetermined objectives

of NYDA for the year ended 31 March 2012 as set out on pages 10 to

15 of the annual report.

12. The reported performance against predetermined objectives was

evaluated against the overall criteria of usefulness and reliability. The

usefulness of information in the annual performance report relates

to whether it is presented in accordance with the National Treasury

annual reporting principles and whether the reported performance is

consistent with the planned objectives. The usefulness of information

further relates to whether indicators and targets are measurable and

relevant as required by the National Treasury Framework for managing

programme performance information.

The reliability of the information in respect of the selected objectives is

assessed to determine whether it adequately reflects the facts.

13. There were no material findings on the report on predetermined objec-

tives concerning the usefulness and reliability of the information.

Compliance with laws and regulations

14. I performed procedures to obtain evidence that the NYDA has

complied with applicable laws and regulations regarding financial

matters, financial management and other related matters. My findings

on material non-compliance with specific matters in key applicable

laws and regulations as set out in the General Notice issued in terms

of the PAA are as follows:

Annual financial statements, performance and annual report

15. The financial statements submitted for auditing were not prepared

in all material respects in accordance with the requirements of

section 55(1)(b) and 55(2)(a) of the PFMA. Material misstatements of

non-current assets, current assets, liabilities, revenue, expenditure

and irregular expenditure identified by the auditors in the submitted

financial statements were subsequently corrected, resulting in the

financial statements receiving an unqualified audit opinion.

16. The annual report for the year under review did not include the audit

committee’s comments on the effectiveness of internal controls as

well as on their evaluation of the financial statements, as required by

Treasury Regulation 27.1.10.

Asset management

17. Proper control systems to safeguard and maintain assets were not

implemented, as required by sections 50(1)(a) and 51(1)(c) of the PFMA.

Audit committee

18. The audit committee did not review the adequacy, reliability and

accuracy of the financial information provided to management and

other users, as required by Treasury Regulation 27.1.8(d).

Budget

19. The accounting authority did not submit quarterly reports on actual

and projected revenue and expenditure to the accounting officer of the

Presidency, within the timeframes as required by Treasury Regulation

30.2.1.

Procurement and contract management

20. Goods and services with a transaction value below R500 000 were

procured without obtaining the required price quotations, as required

by Treasury Regulation 16A6.1.

21. Goods and services of a transaction value above R500 000 were

procured without inviting competitive bids, as required by Treasury

Regulations 16A6.1. Deviations were approved by the accounting

authority even though it was not impractical to invite competitive bids,

in contravention of Treasury Regulation 16A6.4.

the fundamentals of internal control are limited to the significant deficiencies that resulted in the findings on compliance with laws and regulations included in this report.

Leadership32. The leadership did not exercise adequate oversight responsibility

regarding financial reporting and compliance with laws and regulations.

Financial and performance management33. Inadequate monitoring by supervisors resulted in material

misstatements in the financial statements, and non-compliance with laws and regulations.

OTHER REPORTS

Investigations34. An investigation is being conducted by the Public Protector to probe

whether the hosting of the World Festival of Youth and Students held in December 2010 was within the NYDA’s mandate, if the allocated funds were not misappropriated and whether the relevant supply chain management prescripts was followed. The investigation remains

ongoing at the reporting date.

Pretoria

31 July 2012


22. Contracts and quotations were awarded to suppliers whose tax matters had not been declared by the South African Revenue Services to be in order as required by Treasury Regulations 16A9.1(d) and the Preferential Procurement Regulations.

23. Contracts and quotations were awarded to bidders who did not submit a declaration on whether they are employed by the state or connected to any person employed by the state, which is prescribed in order to comply with Treasury Regulation 16A8.3.

24. Contracts and quotations were awarded to bidders based on points given for criteria that differed from those stipulated in the original invitation for bidding and quotations, in contravention of Treasury Regulations 16A6.3(b) and the Preferential Procurement Regulations.

25. The preference point system was not applied in all procurement of goods and services above R30 000 as required by section 2(a) of the Preferential Procurement Policy Framework Act and Treasury Regulations 16A6.3(b).

Expenditure management26. The accounting authority did not take effective steps to prevent

irregular expenditure and fruitless and wasteful expenditure, as required by section 51(1)(b)(ii) of the PFMA.

27. Effective and appropriate disciplinary steps were not taken against officials who incurred and/or permitted irregular expenditure and fruitless and wasteful expenditure, as required by section 51(1)(e)(iii) of the PFMA.

Revenue management28. The accounting authority did not take effective and appropriate steps

to collect all money due, as required by section 51(1)(b)(i) of the PFMA and Treasury Regulations 31.1.2(a) and 31.1.2(e).

Compliance with the National Credit Act29. The NYDA, registered in terms of the National Credit Act (NCA) as a

credit provider, did not submit its annual report to the National Credit Regulator (NCR) by the deadline stipulated by the NCR, thus not complying with the requirements of section 52(5)(f) of the NCA.

30. The NYDA did not reflect its registered status and registration number on all its credit agreements and communications with consumers as required by section 52(5)(b) of the NCA.

Internal control 31. I considered internal control relevant to my audit of the financial

statements, the report on predetermined objectives and compliance with laws and regulations. The matters reported below under



The Accounting Authority of the National Youth Development Agency (NYDA) is pleased to submit its report, together with the NYDA’s annual financial statements, for the year ended 31 March 2012.

1. Establishment, mandate and operations of the NYDAThe NYDA was established by the South African Government through the NYDA Act. This Act, in particular Section 21(2), made provision for the merger between the UYF and the NYC, to form the NYDA. It is classified as a national public entity under Part A of Schedule 3 of the PFMA, as amended. The NYDA’s mandate is to advance youth development through: providing guidance and support to initiatives across sectors of society, and spheres of government; to embark on initiatives that seek to advance the economic development of young people between the ages of 14 and 35; and to develop and coordinate the implementation of the Integrated Youth Development Plan and Strategy for the Republic of South Africa.

2. The NYDA thus far and corporate governanceThe Accounting Authority established its governance structure, as stipulated by the NYDA Act. The appointment of the Chief Executive Officer and the constitution of its board committees, supported by the related charters, were of particular importance. The board is also in the process of developing a Corporate Governance Manual, informed by the Protocol on Corporate Governance for the Public Sector and the King III Report on Corporate Governance, which will provide a comprehensive set of governance and policy directives, and guidelines to promote the highest standards of corporate governance within the NYDA. In line with the NYDA mandate, as articulated in the NYDA Act, the board adopted seven key performance areas (KPAs), which it believes adequately respond to the mandate of the NYDA. In the performance report for the period under review, these KPAs are used.

3. Audit CommitteeThe Audit Committee comprised of three members (a board member and two independent members), for the year 2011/2012. The Audit Committee meets at least four times per annum, according to its approved terms of reference.

During the period under review, the committee met four times.Name of member Number of meetings attended

Mr Vonani Mathebula (resigned January 2012) Four

Ms Innocentia Motau (member of board) Three

Mr Peter Koch (resigned December 2011) Three

The two independent members of the Audit Committee resigned prior to the preparation of the statements (Mr Peter Koch resigned on 31 December 2011 and Mr Vonani Mathebula, on 31 January 2012). The term of the other member, Ms Innocentia Motau, (a non-executive board member), came to an end on 30 April 2012.

4. Review of financial results and activitiesThe review of the financial results and activities of the NYDA are contained in the reports of the Acting Accounting Authority, Chief Executive Officer and annual financial statements. The financial results and position of the NYDA for the period under review are set out on pages 82 to 121.

The salient results of youth-development funding are as follows:

Disbursements31 March 2012

R’00031 March 2011

R’000

Youth Development and Related Projects 139 156 132 291

Project-related operating expenses 79 146 67 445

Project Disbursements 218 302 199 736

Investment in Small and Medium Enterprises 5 074 2 022

Micro Finance Loans and Co-operatives 11 943 4 984

Amounts Disbursed 235 319 206 742

ReportAccounting Authority’s


5. Capitalisation and going concernThrough the Medium Term Expenditure Framework process, the NYDA was capitalised by R385 million for the year ending 31 March 2012. During the year under review, National Treasury approved the shifting of R1,289 million from the NYDA to programme 1: Administration, in terms of Sec-tion 6.3.1(c) of Treasury Regulations. Furthermore, the NYDA was recapitalised through the 2012 Medium Term Expenditure Framework (MTEF) by R1,2 billion, over the MTEF period, with R376 million for the financial year 2012/13 This was against the R1,460 billion requested by the NYDA, over the same MTEF period, with R464 million requested for the financial year 2012/13. This seriously impacted the delivery of services to young South Africans. However, since government has continuously demonstrated its commitment to the youth and the NYDA, we are positive that this challenge will be overcome.

The Acting Accounting Authority made an assessment of the NYDA’s ability to continue as a going concern, and is satisfied that the NYDA has adequate resources and measures in place to operate as a going concern in the next 12 months, after approval of the annual financial statements. At the time of making the assessment, the Acting Accounting Authority was not aware of any intention by government to either liquidate or curtail the operations of the NYDA in the next 12 months. Consequently, the NYDA has adopted its viability as a going concern as basis for the preparation of these financial statements.

6. Significant mattersImpairment of financial assetsThe Acting Accounting Authority also noted the significant amount allocated to the provision for impairment during the period under review. The key contributor to the increase is the current economic conditions, which makes it difficult for young entrepreneurs to honour their current loan repayment commitments. The Acting Accounting Authority also noted that certain clients had the resources to honour their commitments, but deliberately defaulted, and started taking legal action against such defaulters. This resulted in new repayment arrangements for paying off outstanding balances. The Acting Accounting Authority also acknowledges that there are some clients who genuinely cannot honour their commitments, due to the economic conditions, and, therefore, the authority provided additional support to some of these young entrepreneurs by granting them procurement opportunities within the NYDA.

Irregular expenditure The Acting Accounting Authority also noted that significant irregular expenditure was incurred during the financial year under review. This is adequately disclosed in the notes to the annual financial statements. The main contributor to the irregular expenditure has been the decentralisation of the procurement of goods and services to divisions with the supply chain management unit only playing an advisory role for the period 01 April 2011 to 31 October 2011. During this period the respective divisions within the NYDA were responsible to source quotations directly from suppliers listed on the NYDA supplier database, decide on the supplier to be used to procure goods and services and also file the quotations and all other related documents received from the bidding process. These divisions did not necessarily follow the correct supply chain management prescripts during the competitive bidding process.

The other contributing factor to the irregular expenditure disclosed in the notes to the financial statements is the travel and accommodation expenses for the year, this resulted from the fact that no tender process was followed when the relationship between the NYDA and BCD Travel was concluded over 10 years ago. The NYDA board upon receipt of the Auditor-General’s report for the 2010/11 financial year instructed management to initiate a tender process to appoint a service provider to render travel and accommodation services to the organisation. In September 2011 the tender process began, unfortunately due to unforeseen challenges the process took longer than was anticipated to finalise.

The other contributor was the procurement of goods and services from service providers who had been listed on the NYDA database earlier than the 2011/12 financial year. These service providers submitted valid tax clearance certificates at the time of being listed, however over time their tax clear-ance certificates expired and when goods and services were procured from them by the various divisions within the NYDA, new valid tax clearance certificates were not requested.

The Acting Accounting Authority has already instructed management to implement the following corrective actions to prevent and monitor irregular expenditure:• Issues arising from the lack of proper record keeping, as well as the decentralisation of procurement of goods and services, were addressed by the

centralisation of critical procurement roles to the supply chain management unit, in November 2011. The supply chain management unit was also re-capacitated to ensure compliance with all legislation.

• The tender process for a travel and accommodation service provider resulted in the appointment of three service providers subsequent to financial year end.

• It is now also a requirement that a checklist, signed by the manager of the supply chain, be attached to each purchase. This checklist also makes provision for a valid tax clearance certificate.



7. Board of DirectorsDuring the year under review and up to 30 April 2012, the members of the NYDA Board of Directors were as follows:Executive Directors

Mr Andile Lungisa Executive Chairperson of both the board and the Executive Management Committee

Mr Yershen Pillay Executive Deputy Chairperson of the board and member of the Executive Management Committee

Non-executive Directors

Mr Mcebo Khumalo Chairperson of the Development Committee

Ms Maria Tshabalala Member of the Credit and Investment Committee, and Development Committee

Ms Innocentia Motau Chairperson of the Credit and Investment Committee, and member of the Audit Committee

Mr François Slabber Member of the Human Resource and Remuneration Committee

Ms Pholisa Makeleni Chairperson of the Human Resource and Remuneration Committee

Ex Officio

Mr Steven Ngubeni Chief Executive Officer

The Chief Executive Officer is an ex officio member of the board without voting rights. Remuneration of the board and senior management is set out in note 26.

8. Subsequent eventsThe Acting Accounting Authority is not aware of any matter or circumstance arising since 31 March 2012 and the date of this report, not dealt with in the annual financial statements, which would significantly affect the operations or results of the NYDA.

9. BankersStandard Bank of South Africa Limited Absa Bank Limited

10. AuditorsAuditor-General of South Africa

11. Company secretary Mr Neo Eugene Chuene

The annual financial statements for the year ended 31 March 2012, as set out on pages 82 to 121, which were prepared on a going-concern basis, were approved by the Acting Accounting Authority and signed on its behalf by:

Mr Steven NgubeniActing Accounting Authority of the NYDA31 July 2012Johannesburg


ANNUAL FINANCIAL STATEMENTsFor the year ended 31 March 2012

Statement of Financial Position as at 31 march 2012

Note(s)2012

R ‘0002011

R ‘000

Assets

Current assets

Receivables 2 15 116 5 233

Cash and cash equivalents 3 99 147 40 762

Loans receivable 7 11 317 11 793

125 580 57 788

Non-current assets

Equipment 4 18 084 22 887

Intangible assets 5 10 062 13 347

Investments in associates 6 4 501 6 985

Loans receivable 7 15 902 24 301

Rental deposits 1 127 2 360

49 676 69 880

Total assets 175 256 127 668

Liabilities

Current liabilities

Finance lease obligation 8 175 20

Trade and other payables from exchange transactions 9 51 312 29 985

Employee cost accruals 10 15 507 16 566

Deferred income 11 1 778 874

68 772 47 445

Non-current liabilities

Finance lease obligation 8 184 -

Total liabilities (68 956) (47 445)

Net assets 106 300 80 223

Net assets

Reserves

Accumulated reserves 80 223 78 686

Surplus for the year 26 077 1 537

106 300 80 223




Statement of Financial Performance for the year ended 31 march 2012

Note(s)2012

R ‘0002011

R ‘000

Revenue

Revenue from exchange transactions

Interest income 13 24 205 23 008

Other income 14 3 309 11 197

Fair value adjustments 15 432 189

Bad debts recovered 8 -

Gains on disposal of assets 95 71

Revenue from non-exchange transactions

Donor-funding income 274 3 321

Grant income — Office of the Presidency 384 564 369 973

Sponsorship for World Festival of Youth and Students (WFYS) 22 16 000 63 573

428 887 471 332

Expenses

Operating expenses 16 - 20 (182 850) (158 618)

Donor-funding disbursements (274) (3 321)

Interest paid (41) (1 744)

Project disbursements 21 (218 302) (199 736)

Expenses for WFYS 22 (1 343) (106 376)

(402 810) (469 795)




Accumulated SurplusR ‘000

Total net assetsR ‘000

Balance at 31 March 2010 78 686 78 686


Balance at 31 March 2011 80 223 80 223


Total changes 26 077 26 077

Balance at 31 March 2012 106 300 106 300

Statement of Changes in Net Assets for the year ended 31 march 2012




Cash-flow Statement for the year ended 31 march 2012

Note(s)2012

R ‘0002011

R ‘000

Cash flow from operating activities

Receipts

Grants received 374 722 369 973

Interest income 8 565 9 766

Sponsorship for WFYS 16 000 63 573

Other receipts 14 3 309 11 808

Bad debts recovered 8 -

Loan-capital repayments received 21 417 29 797

424 021 484 917

Payments

Employee costs (151 666) (133 655)

Suppliers (217 889) (331 011)

Changes in working capital 23 405 (1 431)

Loans disbursed (17 017) (7 006)

(363 167) (473 103)

Net cash flows from operating activities 23 60 854 11 814

Cash flows from investing activities

Purchase of equipment 24 (3 874) (2 240)

Proceeds from disposal of equipment 178 268

Purchase of other intangible assets 5 (1 505) (2 813)

Distributions from investment in associates 2 916 9 410

Net cash flows from investing activities (2 285) 4 625

Cash flows from financing activities

Financing lease payments (184) (48)

Net increase in cash and cash equivalents 58 385 16 391

Cash and cash equivalents at the beginning of the year 40 762 24 371

Cash and cash equivalents at the end of the year 3 99 147 40 762



1. Basis of preparationThe NYDA was established by the South African Government through the National Youth Development Agency Act, No. 54 of 2008 (The NYDA Act). This Act, in particular Section 21(2), makes provision for the merger between the Umsobomvu Youth Fund (UYF) and the National Youth Commission (NYC), to form the NYDA. It is classified as a National Public Entity under Part A of Schedule 3 of the Public Finance Management Act of South Africa, No. 1 of 1999, as amended (PFMA).

The annual financial statements were prepared in accordance with the South African Standards of Generally Recognised Accounting Practice (GRAP), including any interpretations, guidelines and directives issued by the Accounting Standards Board (ASB).

These annual financial statements have been prepared on the accrual basis of accounting and are in accordance with historical cost convention, unless otherwise specified. The NYDA’s functional currency is the South African Rand and the annual financial statements are presented in South African Rand.

Assets, liabilities, revenues and expenses have not been offset, except where offsetting is required, or permitted, by a Standard of GRAP.

Standards not yet effective: Standards of GRAP approved, where an effective date was determined by the Minister of Finance, and that entities may early adopt (par 11 of Direc-tive 5), are expected to have an insignificant impact on the financial statements, since they generally reflect the interpretations and principles already applied by NYDA.• GRAP 21 – Impairment of non-cash-generating assets• GRAP 23 – Revenue from non-exchange transactions• GRAP 24 – Presentation of budget information in financial statements• GRAP 25 – Employee benefits• GRAP 26 – Impairments of cash-generating assets• GRAP 103 – Heritage assets• GRAP 105 – Transfer of functions between entities under common control

The following approved Standards of GRAP, which are not yet effective, are not likely to significantly affect the value of items recognised in the annual financial statements when they are adopted.

The following GRAP statements have been approved but are not yet effective:• GRAP 106 – Transfer of functions between entities not under common control• GRAP 107 – Mergers

Standards that have been early adopted:The following GRAP statements with effective dates applicable to future financial periods, have been early adopted: • GRAP 104 – Financial instruments

1.1 Significant estimates, assumptions and judgmentsThe key assumptions concerning the future and other key sources of estimations, and uncertainty at reporting date, which hold a significant risk of causing material adjustment to the carrying amounts of assets and liabilities within the next financial year, are discussed below:

Financial assets and liabilities Management makes assumptions when determining the fair value of investments in associates. Fair value is the amount for which an asset could be exchanged or a liability settled between knowledgeable, willing parties in an arms-length transaction. The NYDA uses the discounted free cash-flow valuation technique or net asset value as the primary basis of valuing investments in associates. The NYDA uses discount rates of 20%–40% to discount estimated future cash flows. Where reliable information necessary for the application of the discounted free cash-flow valuation technique is not available, the investments are carried at cost. In circumstances where the NYDA makes a loan to an associate and such loan is impaired, this will be regarded as an impairment indicator of the investment. The NYDA does not have any financial instruments which are actively traded in the financial markets.

Accounting Policies




1.1 Significant estimates, assumptions and judgments (continued)Determination of recoverable amount and impairment of non-financial assetsWhere impairment indicators exist, the determination of the recoverable amount of non-financial assets requires management to make assumptions to determine the recoverable amount. On each reporting date, the NYDA assesses whether there is an indication that an asset may be impaired. If any such indication exists, the NYDA estimates the asset’s recoverable amount. An asset’s recoverable amount is the higher of the asset’s fair value, less costs to sell and its value in use, and is determined for an individual asset. If the asset cannot be assessed individually, it will be assessed as part of a cash-generating unit (CGU). Where the carrying amount of an asset or CGU exceeds its recoverable amount, the asset or CGU is considered impaired and is written down to its recoverable amount. In assessing the value in use, the estimated future cash flows are discounted to their present value, using a pre-tax discount rate that reflects current market assessments of time value of money and the risks specific to the asset.

Determination of recoverable amount and impairment of financial assetsWhere impairment indicators exist, the determination of the recoverable amount of financial assets requires management to make assumptions to determine the recoverable amount. On each reporting date, the NYDA assesses whether a financial asset is impaired. Individual financial assets are reviewed for any indicators of impairment. If there is objective evidence that an impairment loss on a financial asset has been incurred, the amount of the loss is measured as the difference between the asset’s carrying amount and the present value of the estimated future cash flows discounted at the financial asset’s original effective interest rate (the effective interest rate computed at initial recognition). When an amount is outstanding in excess of 90 days, this is considered by management as objective evidence that an impairment loss has occurred. However, there may be other objective evidence, either indicating or not indicating impairment, which management considers when assessing a financial asset. EquipmentDepreciation and carrying value of equipmentResidual values are determined with reference to the net realisable value obtained at the end of the asset’s useful life. The estimation of useful lives and residual values of assets is based on management’s judgment. Any material adjustments to the estimated remaining useful life and residual value of assets will have an impact on the carrying value of those items.

1.2 Investments in associatesAn associate is an entity in which NYDA has significant influence and which is neither a subsidiary nor a joint venture. The NYDA invests in equity of the young, rapidly growing companies that have the potential to develop into significant economic contributors and expanding companies that also create jobs in the economy. The NYDA meets the definition of the venture capital organisation, as it invests in new companies, with a limited operating history. These companies are too small to raise capital in the public markets and have not reached a point where they are able to secure a bank loan or complete debt offering. The NYDA has, therefore, opted to elect the venture capital organisation exemption, and these investments in associates, upon initial recognition, are designated as at fair value through surplus or deficit, in accordance with GRAP 104. Fair value adjust-ments are recognised through surplus or deficit. The NYDA uses the discounted free cash-flow valuation technique or net asset value as the primary basis for valuing investments in associates. The NYDA uses discount rates of 20%–40% to discount estimated future cash flows. Where reliable information necessary for the application of the discounted free cash flow valuation technique is not available, the investments are carried at cost. In circumstances where the NYDA makes a loan to an associate and such a loan is impaired, this will be regarded as an impairment indicator of the investment.

1.3 Joint venturesA joint venture is a binding arrangement, whereby two or more parties are committed to undertake an activity that is subject to joint control.Joint control is the agreed sharing of control over an activity by a binding arrangement, and exists only when the strategic financial and operational decisions relating to the activity require unanimous consent of the parties sharing control (the venturers). The binding agreement establishes joint control over the joint venture. Such requirement ensures that no single venturer is in a position to unilaterally control the activity.

Jointly controlled operations Where the operation of a joint venture comprises the use of the venturer’s assets and other resources, without the establishment of a separate entity, the joint venture is referred to as a jointly controlled operation.

The entity recognises, in its separate annual financial statements and, consequently, in its annual financial statements: • The assets that it controlled and the liabilities that it incurred • The expense that it incurred and its share of the revenue that it earned from the sale or provision of the goods or services by the joint venture.



1.3 Joint ventures (continued)Jointly controlled assetsWhere the entity undertakes its activities under a joint-venture arrangement directly, the controlling entity’s share of jointly controlled assets, and any liabilities incurred jointly with other venturers, is recognised in the statement of financial position of the entity and classified according to their nature. Revenue from the sale or use of the entity’s share of the output of jointly controlled assets, and its share of joint-venture expense are recognised in surplus or deficit.

1.4 EquipmentDefinition of equipmentEquipment is a tangible item that is held for use in the production or supply of goods and services, for rental to others or for administrative purposes and is expected to be used during more than one reporting period.

Initial recognition of equipmentThe cost of an item of equipment is recognised as an asset when:• it is probable that future economic benefits or service potential associated with the item flow to the entity and• the cost of the item can be measured reliably.

Equipment is initially measured at costThe cost of an item of equipment is the purchase price and other costs attributable to bringing the assets to the location and condition necessary for it to be capable of operating in the manner intended by management. Trade discounts and rebates are deducted in arriving at the cost.

Where an asset is acquired for no consideration, or for nominal consideration, its costs shall be its fair value as at date of acquisition.

Where an item of equipment is acquired in exchange for non-monetary or monetary assets, or a combination of non-monetary and monetary as-sets, the asset acquired is initially measured at fair value (the cost). If the acquired item’s fair value is undetermined, its deemed cost is the carrying amount of the asset given up.

When significant components of an item of equipment have different useful lives or residual values, they are accounted for as separate items (major components) of equipment.

Subsequent recognition of equipmentCosts include costs incurred initially to acquire an item of equipment and costs incurred subsequently to add or replace the equipment or part there-of. If a replacement cost is recognised in the carrying amount of an item of equipment, the carrying amount of the replaced part is derecognised.

Depreciation and impairment of equipmentEquipment is depreciated over its expected useful life on a straight-line basis, at rates estimated to write each asset down to its estimated residual value over the term of its useful life. Depreciation on equipment begins when the asset is available for use. Equipment is carried at cost, less accumulated depreciation and any accumulated impairment losses.

The residual value, useful life and depreciation of an asset are reviewed at least at each reporting date and, if expectations differ from previous estimates, the change(s) is accounted for as a change in accounting estimates.

At each reporting date, all items of equipment are reviewed for any indication that they may be impaired. Impairment exists when an asset’s carrying amount is greater than its recoverable amount. The recoverable amount of an asset or CGU is the higher of its fair value less costs to sell and its value in use. If there is an indication of impairment, the asset’s recoverable amount is calculated. An impairment loss is recognised in surplus or deficit and the depreciation charge relating to the asset is adjusted for future periods.

The useful lives of items of equipment for the current and comparative period (except as indicated below):Item Useful life

Furniture 5–10 years

Motor vehicles 4–6 years

Office equipment 5–10 years

Computer hardware 3–5 years

Leasehold improvements Over the shorter of its useful life or the remaining term of the lease

The depreciation charge for each period is recognised in surplus or deficit.




1.4 Equipment (continued)De-recognition of equipmentThe carrying amount of an item of equipment is derecognised:• on disposal or• when no future economic benefits or service potential are expected from its use or disposal.The gain or loss arising from the derecognition of an item of equipment is included in surplus or deficit when the item is derecognised. The gain or loss arising from the de-recognition of an item of equipment is determined as the difference between the net disposal proceeds, if any, and the carrying amount of the item.

1.5 Intangible assetsDefinition of intangible assetsAn intangible asset is an identifiable, non-monetary asset without physical substance.

An asset is identified as an intangible asset when it:• Is separable, capable of being separated or divided from an entity and sold, transferred, licensed, rented or exchanged, either individually or

together with a related contract, asset or liability; or• arises from contractual rights (including rights arising from binding arrangements) or other legal rights (excluding rights granted by statute), regardless of whether those rights are transferable or separable from the entity or from other rights and obligations.

Initial recognition of intangible assets An intangible asset is recognised when:• it is probable that the expected future economic benefits or service potential attributable to the asset will flow to the entity; and• the cost or fair value of the asset can be reliably measured.

Intangible assets are initially measured at cost. The cost of an intangible asset acquired for no consideration or for a nominal consideration shall be its fair value as at date of acquisition.

Expenditure on research (or on the research phase of the internal project) is recognised as an expense when it is incurred.

An intangible asset arising from development (or from the development phase of an internal project) is recognised when:• It is technically feasible to complete the intangible asset so that it will be available for use or sale• There is an intention to complete the intangible asset and use or sell it• There is an ability to use or sell the intangible asset• It will generate probable future economic benefits or service potential• There are available, adequate, technical, financial and other resources to complete the development and to use or sell the intangible asset• Expenditure during development can be measured.

Subsequent measurement of intangible assetsIntangible assets are carried at cost less any accumulated amortisation and any accumulated impairment losses.

Amortisation and impairment of intangible assetsAn intangible asset is regarded as having an indefinite useful life, based on an analysis of all the relevant factors. There is no foreseeable limit to the period over which the asset is expected to generate net cash inflows or service potential. An intangible asset with a finite useful life is amortised and an intangible asset with an indefinite useful life is not.

The amortisation period and the amortisation method for an intangible asset with a finite useful life is reviewed at least at each reporting date. If the expected useful life of the asset is different from previous estimates, the amortisation period is changed accordingly. If there was a change in the expected pattern of consumption of the future economic benefits or service potential embodied in the asset, the amortisation method is changed to reflect the changed pattern. Each change is accounted for as a change in accounting estimates, in accordance with the standard GRAP on Accounting policies, and Changes in Accounting Estimates and Errors.



1.5 Intangible assets (continued)Amortisation is provided to write down the intangible assets, on a straight-line basis, to their residual values. The NYDA amortises its intangible assets at a rate of 14%–20% per annum. Developed software is amortised when the software becomes available for use. Amortisation of these assets is recognised in surplus or deficit.

At each reporting date, all items of intangible assets are reviewed for any indication that they may be impaired. Impairment exists when an asset’s carrying amount is greater than its recoverable amount. The recoverable amount of an asset or CGU should be higher than its fair value less costs to sell and its value in use. If there is an indication of impairment, the asset’s recoverable amount is calculated. An impairment loss is recognised in surplus or deficit and the amortisation charge relating to the asset is adjusted for future periods.

Derecognition of intangible assetsIntangible assets are derecognised:• on disposal; or• when no future economic benefits or service potential are expected from its use or disposal.

The gain or loss from the derecognition of an intangible asset is determined as the difference between the net disposal proceeds, if any, and the carrying amount of the asset. It is recognised in surplus or deficit when the asset is derecognised.

1.6 Revenue from exchange transactionsAn exchange transaction is one in which the entity receives assets or services, or has liabilities extinguished, and directly gives an approximate equal value to the other party in the exchange. Revenue is the gross inflow of economic benefits or service potential during the reporting period, when those inflows result in an increase in net assets, other than increases relating to contributions from owners.

MeasurementRevenue is measured at the fair value of the consideration received or receivable.

InterestInterest income is recognised in surplus or deficit for all financial instruments measured at amortised cost, using the effective interest rate method. The effective interest rate method is a method of calculating the amortised cost of a financial asset and of allocating the interest income over the average expected life of the financial instruments. The effective interest rate is the rate that exactly discounts estimated future cash receipts over the expected life of the financial instrument or, where appropriate, a shorter period, to the net carrying amount of the financial asset. When calculating the effective interest rate, the NYDA estimates cash flows, considering all contractual terms of the financial instruments, but does not consider future credit losses.

1.7 Revenue from non-exchange transactionsNon-exchange transactions are transactions that are not exchange transactions. In a non-exchange transaction, an entity either receives value from another entity, without directly giving approximate equal value in exchange, or gives value to another entity, without directly receiving approximate equal value in exchange.

Government grantsGovernment grants are recognised as revenue when:• it is probable that the economic benefits or service potential associated with the transaction will flow to the entity,• the amount of the revenue can be measured reliably, and • to the extent that there has been compliance with any restrictions associated with the grant.

The entity assesses the degree of certainty attached to the flow of future economic benefits or service potential on the basis of the available evidence. Certain grants payable by one level of government to another are subject to the availability of funds. Revenue from these grants is only recognised when it is probable that the economic benefits or service potential associated with the transaction will flow to the entity. An announcement at the beginning of a financial year that grants may be available to qualifying entities, in accordance with an agreed programme, may not be sufficient evidence of the probability of the flow. Revenue is then only recognised once evidence of the probability of the flow becomes available.




1.7 Revenue from non-exchange transactions (continued)Gifts and donationsGifts and donations are recognised as revenue when:• It is probable that the economic benefits or service potential associated with the transaction will flow to the entity;• the amount of the revenue can be measured reliably.

1.8 LeasesA lease is classified as a finance lease, if it transfers substantially all the risks and rewards incidental to ownership. A lease is classified as an operating lease, if it does not transfer substantially all the risks and rewards incidental to ownership.

Finance leases – initial recognitionAt the commencement of the lease term, the NYDA recognises finance leases as assets and liabilities in its Statement of Financial Position, at amounts equal to the fair value of the leased assets or, if lower, the present value of the minimum lease payments, each determined at the inception of the lease.

The discount rate used in calculating the present value of the minimum lease payments is the interest rate implicit in the lease, if this is practicable to determine. If not, the lessee’s incremental borrowing rate is used. Any initial direct costs of the lessee are added to the amount recognised as an asset.

Subsequent measurementMinimum lease payments are apportioned between the finance charge and the reduction of the outstanding liability. The finance charge is allocated to each period during the lease term, so as to produce a constant periodic rate of interest on the remaining balance of the liability.

Contingent rents are charged as expenses in the periods in which they are incurred.

Operating leasesLease payments under an operating lease are recognised as an expense in surplus or deficit on a straight-line basis over the lease term, unless another systematic basis is more representative of the time pattern of the user’s benefit.

1.9 Irregular, fruitless and wasteful expenditureIrregular expenditure, as defined in section 1 of the PFMA, is expenditure other than unauthorised expenditure, incurred in contravention of or that is not in accordance with a requirement of any applicable legislation, including: a. The PFMA; orb. the State Tender Board Act, 1968 (Act 86 of 1968) or any regulations made in terms of the Act

Fruitless and wasteful expenditure is expenditure that was made in vain and would have been avoided, had reasonable care been exercised.

1.10 Budget informationThe annual financial statements and the budget are not on the same basis of accounting. Therefore, a reconciliation between the Statement of Finan-cial Performance and the budget has been included in the annual financial statements. Refer to note 32.

Comparative information is not required.

1.11 Related partiesThe NYDA operates in an economic sector, currently dominated by entities directly or indirectly owned or controlled by the South African govern-ment. As a consequence of the constitutional independence of the three spheres of government in South Africa, only entities within the national sphere of government are considered to be related parties.

Key management is defined as being individuals with the authority and responsibility for planning, directing and controlling the activities of the entity. We regard all members of the Operations Executive Committee reporting directly to the Chief Executive Officer as key management personnel, as per definition of GRAP. Close family members of key management individuals, in their dealings with the entity are also classified as related parties.



1.12 Financial instrumentsInitial recognition and measurementOn initial recognition, an instrument is classified as either a financial asset or a financial liability and recorded at fair value plus, in the case of financial assets and financial liabilities not recorded at fair value through surplus or deficit, any directly attributable incremental costs of acquisition or issue.

Purchases or sales of financial assets that require delivery of assets within a timeframe established by regulation or conversion in the marketplace (regular way of purchases), are recognised on the trade date, i.e. the date that the NYDA commits to purchase or sell the asset.

Subsequent measurementSubsequent measurement of financial instruments carried on the Statement of Financial Position is on the following basis:• Investments

Investments in equity instruments are designated as at fair value through surplus and deficit. All changes in fair value are recognised directly in surplus or deficit.

• Loans receivable Loans receivable are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. Such assets are carried at amortised cost, using the effective interest rate method, less any allowance for impairment. Gains and losses are recognised through surplus and deficit when the loans receivables are derecognised or impaired, as well as interest through the amortisation process.

• Receivables Receivables are initially recognised at fair value and subsequently measured at amortised cost, using the effective interest method. Where the impact of discounting is not material, receivables are carried at the original invoice amount, less any allowance for impairment.

• Trade and other payables from exchange transactions Trade payables are initially recognised and carried at fair value and, subsequently measured at amortised cost, using the effective interest rate method. Trade payables are derecognised when the obligation under the liability has been discharged.

• Cash and cash equivalents, including cash on call Cash and cash equivalents, including cash on call comprise of demand deposits and short-term, highly liquid investments that are readily convertible into known amounts of cash. Cash and cash equivalents, including cash on call, are subsequently measured at amortised cost.

• Rental deposits Rental deposits include all monies paid by the NYDA as deposits for the rental of the buildings.

• Investment in associates Refer to note 1.2

Impairment of financial assets Assets carried at amortised costAt each reporting date, the NYDA assesses whether a financial asset is impaired. Individual financial assets are reviewed for any indicators of impair-ment. If there is objective evidence that an impairment loss on a financial asset has been incurred, the amount of the loss is measured as the differ-ence between the asset’s carrying amount and the present value of the estimated future cash flows discounted at the financial asset’s original effec-tive interest rate (the effective interest rate computed at initial recognition). When an amount is outstanding for longer than 90 days, this is considered by management as objective evidence that an impairment loss has occurred. However, there may be other objective evidence that may or may not indicate impairment. Management considers such objective evidence when assessing a financial asset. The carrying amount of the financial asset is reduced through use of an allowance account, when there is objective evidence that the asset may be impaired directly and against carrying value of an asset, when the asset is considered irrecoverable. The amount of the loss is recognised through surplus or deficit. If, in a subsequent period, the amount of the impairment loss decreases and the decrease can be related objectively to an event occurring after the impairment was recognised, the previously recognised impairment loss is reversed, to the extent that the carrying value of the asset does not exceed its amortised cost at the reversal date. Any subsequent reversal of an impairment loss is recognised in surplus or deficit.

Derecognition of financial instrumentsA financial asset is derecognised in the following circumstances: • If the rights to receive cash flows from the asset have expired• If the NYDA retains the right to receive cash flows from the asset, but has assumed an obligation to pay them in full without material delay to a

third party under a ‘pass through’ arrangement • If the NYDA has transferred its right to receive cash flows from the asset and has either transferred substantially all the risks and rewards of the

asset, or has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset.




1.12 Financial instruments (continued)Derecognition of financial instruments (continued)Where the NYDA has transferred its rights to receive cash flows from an asset and has neither transferred nor retained substantially all the risks and rewards of the asset, nor transferred control of the asset, the asset is recognised to the extent of the NYDA’s continuing involvement of the asset. Continuing involvement that takes the form of a guarantee over the transferred asset is measured at the lower of the original carrying amount of the asset and the maximum amount of consideration that the NYDA could be required to repay.

A financial liability is derecognised when the obligation under the liability is discharged or cancelled, or it expires.When an existing financial liability is replaced by another from the same lender on substantially different terms or the terms of the existing liability are substantially modified, such an exchange or modification is treated as a derecognition of the original liability and the recognition of a new liability, and the difference in the respective carrying amounts is recognised through surplus or deficit.

1.13 Employee benefitsShort-term employee benefitsThe cost of short-term employee benefits (those payable within 12 months after the service is rendered, such as paid vacation leave and sick leave, bonuses and non-monetary benefits, such as medical care), are recognised in the period in which the service is rendered.

Liabilities for short-term employee benefits which are unpaid at year-end are measured at the undiscounted amount that the entity expects to pay in exchange for that service and had accumulated at the reporting date.

Defined contribution plansA defined contribution plan is a plan under which the entity pays fixed contributions into a separate entity. The entity has no legal or constructive obligation to pay further contributions, if the fund does not hold sufficient assets to pay all employees the benefits relating to services in the current or prior periods.

The entity’s contributions to the defined contribution funds are established in terms of the rules governing those plans. Contributions are recognised in surplus or deficit in the period in which the service is rendered by the relevant employees, unless the standard requires or permits the inclusion of the contribution in the cost of an asset. Prepaid contributions are recognised as an asset to the extent that a cash refund or reduction in future payments is available.

Where contributions to a defined contribution plan do not fall due wholly within 12 months after the end of the period in which the employees render the related service, they are discounted, using a risk-free rate, determined by reference to market yields at the reporting date on government bonds or by reference to market yields on high-quality corporate bonds.

1.14 Project disbursementsDisbursements to projects are categorised and disclosed as follows:• Project disbursements are approved grant funding made to third-party service providers, who plan, implement, and manage youth development projects, as well as payments relating to youth development projects, managed internally by the NYDA, using its own capacity.• Project-related operating expenses are direct and indirect support costs related to programmes and projects.

1.15 Commitments

Where a project has been approved, but has not been accrued for, or provided for, it is disclosed as commitments in the notes to the annual financial statements.

1.16 Deferred incomeDeferred income represents revenues collected, but not earned, as at reporting date. This includes grants from foreign institutions.



2. Receivables2012

R ‘0002011

R ‘000

Staff loans 613 7

Sundry debtors 13 355 4 692

Interest receivable banks 594 205

Prepaid expenses 1 520 616

16 082 5 520

Less: Allowance for impairment (966) (287)

15 116 5 233

Sundry debtors include: • A debtor was raised to the value of R9,8 million, in respect of the shortfall on grant income from the Office of the Presidency• Amounts of R1,5 million receivable from the FNB Progress Fund• Amounts of R611 000 receivable from the Flemish Government

Receivables allowance for impairment reconciliation 2012

Allowance for impairment 2011

R’000

Impairment expense

R’000


R’000

Allowance for impairment (287) (679) (966)

(287) (679) (966)

Receivables allowance for impairment reconciliation 2011


R’000

Impairment expense

R’000


R’000

Allowance for impairment (94) (193) (287)

(94) (193) (287)

The NYDA’s receivables do not exceed a maturity period of 12 months. Therefore, the carrying amount is considered to be a reasonable approximation of the fair value. Interest on staff loans is charged at the NYDA’s overdraft rate, with a maximum term of six months.

Notes to the Annual Financial Statements

ANNUAL FINANCIAL STATEMENTs

Notes to the financial statements for the period 31 March 2012

For the year ended 31 March 2012



3. Cash and cash equivalents2012

R ‘0002011

R ‘000

Cash and cash equivalents consist of:

Cash on call – 3

Cash at bank and on hand 91 343 31 252

Unrestricted cash 91 343 31 255

Free State Development Corporation 5 556 5 451

Business Partners (Pty) Ltd 1 222 1 175

NYDA/MTN Enterprise Development – 1 541

CIPC 323 –

Massmart Holdings Limited 103 466

Belgium donor funding 600 874

Restricted cash 7 804 9 507

Cash and cash equivalents 99 147 40 762

Restricted cash represents funds earmarked for specific projects, where the NYDA is in partnership with third parties. Therefore, such funds are restricted and cannot be used for any purpose other than the purpose as stipulated in the partnership agreement.

GuaranteesAbsa Bank Limited has issued rental guarantees, on behalf of the NYDA, in favour of the Department of Public Works, for the amount of R2,1 million.

4. Equipment 2012 2011

CostR’000

Accumulated depreciation and

impairment lossesR’000

Carrying value R’000

Cost R’000

Accumulated depreciation and

impairment losses R’000

Carrying value R’000

Furniture 17 372 (11 305) 6 067 17 025 (10 274) 6 751

Motor vehicles 1 797 (1 436) 361 1 797 (1 362) 435

Office equipment 7 489 (4 665) 2 824 7 077 (4 373) 2 704

Computer hardware 18 485 (13 264) 5 221 17 069 (10 751) 6 318

Leasehold improvements

31 116 (27 505) 3 611 30 201 (23 522) 6 679

Total 76 259 (58 175) 18 084 73 169 (50 282) 22 887




4. Equipment (continued)

Reconciliation of equipment – 2012

Opening balanceR’000

Additions R’000

Disposals R’000

Depreciation R’000

Impairment loss R’000

Total R’000

Furniture 6 751 453 (5) (716) (416) 6 067

Motor vehicles 435 – – (74) – 361

Office equipment 2 704 704 (13) (457) (114) 2 824

Computer hardware 6 318 1 619 (94) (2 197) (425) 5 221

Leasehold improvements 6 679 1 620 (4) (4 684) – 3 611

22 887 4 396 (116) (8 128) (955) 18 084

Reconciliation of equipment – 2011

Opening balance R’000

Additions R’000

Disposals R’000

Depreciation R’000

Impairment loss

Total R’000

Furniture 8 984 – (36) (2 099) (98) 6 751

Motor vehicles 606 – – (171) – 435

Office equipment 3 316 124 (3) (732) (1) 2 704

Computer hardware 6 519 1 972 (158) (2 015) – 6 318

Leasehold improvements 11 823 144 - (5 288) - 6 679

31 248 2 240 (197) (10 305) (99) 22 887

Equipment fully depreciated and still in use (Cost)

2012R’000

2011R’000

Furniture 3 901 3 871

Motor vehicles 1 355 1 360

Office equipment 1 432 1 386

Computer Equipment 5 475 809

Leasehold improvements – 2 977

12 163 10 403

The carrying value of office equipment includes an amount of R335 000 (2011: R20 000) relating to a finance lease for printers and copiers. In terms of the finance lease contract, ownership does not pass to the NYDA at the end of the lease term and, therefore, the NYDA is not entitled to sell or dispose of these photocopiers or printers.






5. Intangible assets2012 2011

Cost R’000

Accumulated amortisation and impairment loss

R’000Carrying value

R’000Cost

R’000

Accumulated amortisation and impairment loss

R’000Carrying value

R’000

Software developed in-house 6 383 (5 318) 1 065 9 492 (4 147) 5 345

Computer software purchased 6 174 (4 918) 1 256 6 069 (4 408) 1 661

Software under development 7 741 – 7 741 6 341 – 6 341

Total 20 298 (10 236) 10 062 21 902 (8 555) 13 347

Reconciliation of intangible assets — 2012

Opening balanceR’000

AdditionsR’000

AmortisationR’000

TotalR’000

Software developed in-house 5 345 – (4 280) 1 065

Computer software purchased 1 661 105 (510) 1 256

Software under development 6 341 1 400 – 7 741

13 347 1 505 (4 790) 10 062

Reconciliation of intangible assets — 2011

Opening balance Additions Transfers Amortisation Impairment loss Total

Software developed in-house 3 863 2 599 – (1 075) (42) 5 345

Computer software purchased 2 179 32 – (550) – 1 661

Software under development 6 159 2 703 (2 521) – – 6 341

12 201 5 334 (2 521) (1 625) (42) 13 347

Commitments for software under development to the value of R4,6 million, relating to the customer relations management system exist.

Intangible assets fully amortised and still in use (cost)

2012R’000

2011R’000

Intangible assets 3 669 1 160





6. Investments in associates

Name of entity Nature of Enterprise Shareholding

Investment at cost 2012

R’000


R’000

Repayment received 2012

R’000


R’000

Accumulated fair value adjustments

2012R’000


2011R’000

Carrying amount 2012

R’000

Carrying amount2011

R’000

Franchise Fund Private equity investment 80% 100 000 100 000 (100 000) (100 000) 4 501 6 985 4 501 6 985

Chicken Kwasa (Pty) Ltd Fast food 26% 300 300 – – (300) (300) – –

Serokolo Health Solutions (Pty) Ltd Medical healthcare 26% – – – – – – – –

Soundrite Sound (Pty) Ltd Entertainment 10% – – – – – – – –

K5 Transport Logistics (Pty) Ltd Airline charter 10% – – – – – – – –

Decti Rating (Pty) Ltd BEE rating agency 19% – – – – – – – –

Vynide Investments (Pty) Ltd Manufacturing 10% 1 000 1 000 – – (1 000) (1 000) – –

Mafatafata Printing (Pty) Ltd Printing 19% – – – – – – – –

Sword South Africa (Pty) Ltd Manufacturing 19% – – – – – – – –

E2 BA-LE2 (Pty) Ltd Manufacturing 19% – – – – – – – –

101 300 101 300 (100 000) (100 000) 3 201 5 685 4 501 6 985

In respect of the above investments, in which the NYDA has less than 20% shareholding, the NYDA has significant influence by virtue of having representation on the Board of Directors and also having a right to participate in the policy-making process, including participation in decision-making about dividends and other distributions. All the above associates have been incorporated in the Republic of South Africa. The cost of investments and fair value adjustments less than R1000 have been shown as nil. Based on the contractual agreement with Business Partners (Pty) Ltd, the NYDA contributes 80% of the funding for Franchise Fund loans. However, the NYDA only exercises significant influence and does not participate in the management of the fund. Therefore, it is classified as an investment in associate. Summarised Franchise Fund

2012R ‘000

2011R ‘000

Opening carrying amount 6 985 15 739

Repayment received during the year (2 916) (9 410)

Fair value adjustment 432 656

Carrying value at end of year 4 501 6 985

Other investments in small and medium enterprises

Opening carrying amount – 468

Fair value adjustment – (468)

Carrying value at end of year – –

Due within more than one year 4 501 6 985

4 501 6 985

The NYDA has an ongoing investment with FNB that has a maturity of more than a year.






6. Investments in associates

Name of entity Nature of Enterprise Shareholding


R’000


R’000


R’000


R’000


2012R’000


2011R’000

Carrying amount 2012

R’000

Carrying amount2011

R’000

Franchise Fund Private equity investment 80% 100 000 100 000 (100 000) (100 000) 4 501 6 985 4 501 6 985

Chicken Kwasa (Pty) Ltd Fast food 26% 300 300 – – (300) (300) – –

Serokolo Health Solutions (Pty) Ltd Medical healthcare 26% – – – – – – – –

Soundrite Sound (Pty) Ltd Entertainment 10% – – – – – – – –

K5 Transport Logistics (Pty) Ltd Airline charter 10% – – – – – – – –

Decti Rating (Pty) Ltd BEE rating agency 19% – – – – – – – –

Vynide Investments (Pty) Ltd Manufacturing 10% 1 000 1 000 – – (1 000) (1 000) – –

Mafatafata Printing (Pty) Ltd Printing 19% – – – – – – – –

Sword South Africa (Pty) Ltd Manufacturing 19% – – – – – – – –

E2 BA-LE2 (Pty) Ltd Manufacturing 19% – – – – – – – –

101 300 101 300 (100 000) (100 000) 3 201 5 685 4 501 6 985

In respect of the above investments, in which the NYDA has less than 20% shareholding, the NYDA has significant influence by virtue of having representation on the Board of Directors and also having a right to participate in the policy-making process, including participation in decision-making about dividends and other distributions. All the above associates have been incorporated in the Republic of South Africa. The cost of investments and fair value adjustments less than R1000 have been shown as nil. Based on the contractual agreement with Business Partners (Pty) Ltd, the NYDA contributes 80% of the funding for Franchise Fund loans. However, the NYDA only exercises significant influence and does not participate in the management of the fund. Therefore, it is classified as an investment in associate. Summarised Franchise Fund

2012R ‘000

2011R ‘000

Opening carrying amount 6 985 15 739

Repayment received during the year (2 916) (9 410)

Fair value adjustment 432 656

Carrying value at end of year 4 501 6 985

Other investments in small and medium enterprises

Opening carrying amount – 468

Fair value adjustment – (468)

Carrying value at end of year – –


4 501 6 985

The NYDA has an ongoing investment with FNB that has a maturity of more than a year.





7. Loans receivable2012

R’0002011

R’000

Small and medium enterprises 244 683 239 609

Microloans direct lending and intermediaries* 92 000 84 827

Co-operatives 7 191 2 421

Gross advances 343 874 326 857

Add: Interest receivable 50 131 34 880

Less: Loans written off (3 515) (2 746)

Less: Cumulative capital repayments (201 948) (180 531)

Subtotal 188 542 178 460

Less: Allowance for impairment (161 323) (142 366)

Small and medium enterprises (119 811) (113 844)

Microloans direct lending and intermediaries (34 884) (26 931)

Co-operatives (6 628) (1 591)

Net loans receivable 27 219 36 094

Due within one year 11 317 11 793


27 219 36 094

*Micro finance direct lending attracts fixed and variable interest, which is less than the maximum rate permissible by the National Credit Act, 2005 (Act 34 of 2005).Loans receivable impairment reconciliation 2012

Allowance of impairment 2011

R’000Impairment reversal

R’000Impairment expense

R’000


R’000

Small and medium enterprises 113 844 (5 902) 11 869 119 811

Microloans direct lending and intermediaries 26 931 – 7 953 34 884

Co-operatives 1 591 – 5 037 6 628

142 366 (5 902) 24 859 161 323

Loans receivable impairment reconciliation 2011


R’000Impairment expense

R’000Loans written off

R’000


R’000

Small and medium enterprises 91 563 32 726 (10 445) 113 844

Micro loans direct lending and intermediaries 21 017 5 914 – 26 931

Co-operatives 1 478 113 – 1 591

114 058 38 753 (10 445) 142 366






In the impairment reconciliation, the spread of the loans receivable impairment is as follows:2012

R’000

Less than 30 days 1 414

Less than 60 days 812

Less than 90 days 80

More than 90 days 159 017

161 323

In assessing its loan book for any indicators of impairment, the NYDA considered the following factors over and above the amount in excess of 90 days:• Whether the borrower was trading or not• The age of the debt• Progress of attorneys in recovering the debt and their opinion on recoverability• The reliance of the borrower on a few customers and the loss of this customer base • The cash flows of the business, as shown on the bank statements and/or management accounts.

Range of interest rates %

Small and medium enterprises 7–19

Microfinance direct lending and intermediaries 14–24

Co-operatives 4–12,5

All interest rates are linked to prime.

8. Finance lease obligation2012

R’0002011

R’000

Minimum lease payments due

— Within one year 205 20

— In second to fifth year inclusive 195 –

400 20

Less: future finance charges (41) –

Present value of minimum lease payments 359 20

Present value of minimum lease payments due

— Within one year 175 20

— In second to fifth year inclusive 184 –

359 20

Non-current liabilities 184 –

Current liabilities 175 20

359 20

The NYDA leased photocopiers and printers from Konica Minolta for a period ranging from 31 to 36 months, with monthly payments of R17 000, payable in arrears with no residual value.

Ownership of these machines will not pass to the NYDA at the end of the lease term.





9. Trade and other payables from exchange transactions

2012R’000

2011R’000

Trade payables 30 770 13 904

Trade accruals 20 542 16 081

51 312 29 985

The NYDA’s trade payables generally do not exceed a maturity of two months and the fair value is considered to be a reasonable approximation of the carrying value.

10. Employee cost accrualsReconciliation of employee cost accruals — 2012

Opening Balance R’000

Additions R’000

Utilised during the year R’000

Total R’000

Leave pay 7 998 3 911 (3 899) 8 010

Staff bonuses 8 568 7 288 (8 359) 7 497

16 566 11 199 (12 258) 15 507

Reconciliation of employee cost accruals — 2011

Opening Balance R’000

Additions R’000

Utilised during the year R’000

Total R’000

Leave pay 7 147 7 876 (7 025) 7 998

Staff bonuses 16 678 8 433 (16 543) 8 568

23 825 16 309 (23 568) 16 566

Staff bonuses were paid during the third quarter of the new financial year, and the leave pay provision is expected to be utilised as and when an employee takes leave or resigns.

11. Deferred income2012

R’0002011

R’000

Flemish government — donor funding 1 248 874

Prince’s Youth Business International 333 –

Front end fees 197 –

1 778 874

Deferred income relates to a conditional grant received from the Flemish government for the funding of the NYDA’s Civil Society Support Programme.Prince’s Youth Business International provided funding for the development of an e-mentoring system.






12. Financial instrumentsThe classification of financial instruments held by the NYDA at 31 March 2012.

2012

Financial assets at amortised cost

R’000

Financial assets as at fair value through

surplus and deficit R’000

Financial liabilities at amortised cost

R’000Total

R’000

Assets

Loans receivable 15 902 – – 15 902

Short-term portion of loans receivable 11 317 – – 11 317

Rental deposits 1 127 – – 1 127

Investment in associates – 4 501 – 4 501

Receivables 15 116 – – 15 116

Cash and cash equivalents 99 147 – – 99 147

142 609 4 501 – 147 110

Liabilities

Finance lease obligation – – 359 359

Trade and other amounts payable from exchange transactions – – 51 312 51 312

– – 51 671 51 671

The classification of financial instruments held by the NYDA at 31 March 2011.

2011

Financial assets at amortised cost

R’000

Financial assets as at fair value through

surplus and deficit R’000

Financial liabilities at amortised cost

R’000Total

R’000

Assets

Loans receivable 24 301 – – 24 301

Short-term portion of loans receivable 11 793 – – 11 793

Rental deposits 2 360 – – 2 360

Investment in associates – 6 985 – 6 985

Receivables 4 617 – – 4 617

Cash and cash equivalents 40 762 – – 40 762

83 833 6 985 – 90 818

Liabilities

Finance lease obligation – – 20 20

Trade and other amounts payable from exchange transactions – – 29 985 29 985

– – 30 005 30 005

The primary risks associated with the financial instruments held by the NYDA are credit, liquidity and market risk, which include interest rate and portfolio risks.





12. Financial instruments (continued)

Credit risk One of the NYDA’s core business activities is to invest in small and medium enterprises. Consequently, the agency is exposed to credit risk, which refers to the risk that loans made to third parties will not be repaid. The objective of credit risk management is to minimise financial losses that may arise as a result of third parties failing to discharge their obligations. The credit risk at the investment stage of any potential investment is researched and assessed by means of a due diligence process, where the entrepreneur is evaluated, the viability of the enterprise is considered and various other indications are established and verified. In addition, the NYDA has implemented a credit policy which assists in managing credit risk. It comprises the following key elements: • Approval process • Cash flow based lending methodology • Attaching protective covenants to funding arrangements • Collections policies and procedures • Delinquency management • Monitoring • Mentorship

There have been no changes in the exposure or the policy used to manage credit risk.

Maximum exposureDuring the period that the NYDA has exposure to a borrower or investee company, the agency conducts an ongoing evaluation of the business and does not provide loans to any single entity in excess of R5 million. The NYDA places its cash reserves with the South African Reserve Bank and local financial institutions, which have a minimum rating of AAA. Changes in credit exposure and the maximum credit exposure for all financial assets are detailed in the table below:

Loans receivable2012

R’0002011

R’000

Microloans direct lending and intermediaries 3 010 6 785


Co-operatives 29 –

27 219 36 094

Investment in associates 4 501 6 985

Receivables 15 116 5 233


Rental deposits 1 127 2 360

119 891 55 340

Total 147 110 91 434







Collateral and other credit enhancement on loans receivable The nature of the NYDA’s target market is black youth who have not accumulated assets which are significant, in relation to the loans advanced to them. Therefore, the value of tangible security offered is not adequate. For loans of less than R100 000, a third party stands as surety and co-principal debtor for a portion (10% to 50%) of the loan. The surety must be in salaried employment with no record of defaulting on loans. During the year under review, the NYDA did not take possession of any collateral, in respect of loans. There is no collateral held for other classes of financial assets. The NYDA does not take possession of collateral for use in its own operations.

2012

Neither past due nor impaired

R’000

Value in arrears for 01–30 days

R’000


R’000


R’000

Value in arrears for > 90 days

R’000Total

R’000

Loans receivable 22 315 223 545 257 3 878 27 218

Receivable – – – – 15 116 15 116

Investment in associates 4 501 – – – – 4 501

Cash and cash equivalents 99 147 – – – – 99 147

Rental deposits 1 127 – – – – 1 127

127 090 223 545 257 18 994 147 109

2011

Neither past due nor impaired

R’000


R’000


R’000


R’000

Value in arrears for > 90 days

R’000Total

R’000

Loans receivable 28 618 4 069 317 13 3 077 36 094

Receivable – – – – 5 233 5 233

Investment in associates 6 985 – – – – 6 985

Cash and cash equivalents 40 762 – – – – 40 762

Rental deposits 2 360 – – – – 2 360

78 725 4 069 317 13 8 310 91 434

Loans past due date but not impaired (loans renegotiated)

During the year under review no loans were renegotiated.

Liquidity riskLiquidity risk refers to the risk that the NYDA will not be able to meet its funding commitments and other financial obligations, as and when they fall due. The funding provided to small and medium enterprises are usually characterised by fixed maturities of up to five years, scheduled repayments and a limited moratorium on capital repayments and interest. One of the cornerstones of the lending practice adopted is consideration of the certainty of cash flows, and the ability of the borrower to absorb and service debt. The NYDA adopted a conservative cash-flow management policy to manage the risk of investments made in instruments which are not readily realisable, in order to keep a healthy liquidity position.

The NYDA has the following mechanisms in place to ensure that it has the funds available to meet its commitments: • A strategic plan and a three-year budget are prepared and approved by the Board of Directors, prior to the start of the financial year• At half-year, the NYDA conducts a revision of its annual budget and reassesses its liquidity needs. In addition, an application for recapitalisation is

made to its Executive Authority and National Treasury• On a quarterly basis, the strategic plan and budget are reviewed by a committee comprised of divisional heads, the Chief Financial Officer and the

Chief Executive Officer• Once a commitment has been made, the NYDA keeps record of all gross commitments and drawn-down commitments, or cancelled commitments

and undrawn commitments• A distinction is made between encumbered and unencumbered cash resources of the NYDA• Three-year projections of cash flow, undrawn commitments brought forward, new commitments, cancelled commitments and undrawn commitments

carried forward are prepared




12. Financial instruments (continued)Liquidity risk (continued)

• Disbursements on commitments are made in several tranches, based on individual project needs• Finance provided to small enterprises is usually in the form of self-liquidating financial instruments with minimal funds tied in equity investments.Expected maturity dates: financial liabilitiesThe NYDA does not have any long-term borrowings. Its short-term liabilities are mainly comprised of debts arising in the ordinary course of business and commitments to making grants for the implementation of National Youth Service and Skills Development projects. Debts arising in the ordinary course of business are normally settled over a period of not more than two months from date of invoice.

Grant commitments are usually made over a period of 12 to 18 months and finance leases over a period of 31 to 36 months. Expected maturity dates: financial assets The NYDA’s financial assets comprise mainly cash in current accounts with local financial institutions and loans due from small businesses. Except for loans due from small businesses and restricted cash, other financial assets are very liquid and not subject to any notice periods for draw down.

The NYDA’s exposure to illiquid assets is comprised of investments in unlisted entities and restricted cash flows. This accounts for less than 3% of the carrying value of financial assets.

The NYDA manages its liquidity risk by placing funds in short-term, highly liquid investments and ensuring that the maturities of financial assets match those of its financial liabilities.

The balance of the loans receivable, outstanding as at 31 March 2012, is scheduled to be repaid as follows:2012

R’0002011

R’000

Maturity period

Due within the next 12 months 11 317 11 793

Due thereafter 15 902 24 301

Total value of loans 27 219 36 094

2012

Due immediately or within one month

R’000

Due later than one month but not later than

twelve months R’000

Due later than twelve months

R’000Total

R’000

Receivables – 15 116 – 15 116

Cash and other cash equivalents 99 147 – – 99 147

Total current assets 99 147 15 116 – 114 263

Trade and other payables from exchange transactions – (51 312) – (51 312)

Finance lease obligation – (175) (184) (359)

Total liabilities – (51 487) (184) (51 671)

Net liquidity of continuing operations 99 147 (36 371) (184) 62 592







2011

Due immediately or within one month

R’000

Due later than one month but not later than

twelve months R ‘000

Due later than twelve months

R ‘000Total

R’000

Receivables – 5 233 – 5 233

Cash and other cash equivalents 40 762 – – 40 762

Total current assets 40 762 5 233 – 45 995

Trade and other payables from exchange transactions – (29 985) – (29 985)

Finance lease obligation – (20) – (20)

Total current liabilities – (30 005) – (30 005)

Net liquidity of continuing operations 40 762 (24 772) – 15 990

Market riskMarket risk is defined as the risk that the fair value of future cash flows of a financial instrument will fluctuate, because of changes in market prices, and includes currency risk, interest rate risk and other price risk (which are factors other than currency and interest rate risk that may influence the fair value of a financial asset). The entity is primarily exposed to interest rate risk. Its objective is to ensure that it minimises losses of interest income, as a result of utilising cash which attracts interest at a variable rate, to invest in other financial assets bearing interest at a fixed rate. Hence, not all its loans granted are variable rate loans.

The NYDA is not directly exposed to currency risk, as it does not often enter into foreign currency transactions.

There have been no changes in the exposure or the policy used to manage market risk.

Interest rate riskChanges in interest rates will affect the revenue stream of the NYDA, as most of the financial assets’ returns are linked to the prime rate.

Sensitivity analysisAt 31 March 2012, if interest rates had been 200 basis points higher, with all other variables held constant, interest income would have increased by approximately R2,5 million (2011: R1,5 million). Consequently, income and accumulated reserves would have increased accordingly. If interest rates had been 200 basis points lower, with all other variables held constant, interest income would have decreased by approximately R2,5 million (2011: R1,5 million). Consequently, income and accumulated reserves would have decreased accordingly. The change would have occurred because of variable rate interest that the NYDA earns from its financial assets, which include cash and loans.

The NYDA’s exposure to interest rate risk is as follows:2012

R’0002011

R’000



Co-operatives 29 –


126 366 76 856





Fair valuesFair value hierarchy of financial assets ‘at fair value through surplus or deficit’ The NYDA measures fair values, using the following fair value hierarchy that reflects the significance of the inputs used in making measurement: Level 1: Quoted market prices (unadjusted) in active markets for identical assets. Level 2: Inputs other than quoted prices included in Level 1, which are observable for the financial assets, either directly (as prices) or indirectly (derived from prices). Level 3: Inputs which are not based on observable market data.

2012R’000

2011R’000

Investment in associates

Level 1 – –

Level 2 – –

Level 3 4 501 6 985

Gains and Losses

Level 1 – –

Level 2 – –

Level 3 432 189

Investment in associates is measured, using the discounted cash-flow method and net asset-value method, which are not based on the observable market data. No transfers between fair value hierarchy levels took place during the current year. The carrying amount of financial assets and liabilities approximates their fair value.

Portfolio riskPortfolio risk arises as a result of loans and advances being concentrated in any particular industry, location or stage of development. The risk is managed through the steering committee, which sets limits of exposure to the various industries. The portfolio allocation is reviewed on a quarterly basis, at meetings of the steering committee.

The NYDA recognises that it may face the risk of overexposing itself in certain situations and considers the following in determining concentration:• Overconcentration of loans to a particular industry• Overconcentration of loans to businesses controlled by common shareholders or grants to a single service provider• Overconcentration of funding in illiquid equity investments.

Below is a schedule of advances made to small, medium and micro enterprises in different sectors:2012

%2011

%

Industry

Building and construction 4 7

Manufacturing 5 12

Printing 1 2

Retail 19 16

Services 61 47

Agriculture – 1

Transport 8 8

Hospitality and Leisure 1 7

Health 1 –

100 100







Overexposure to a small number of counterpartiesIn terms of the credit policy relating to loans, no entity, in which more than 25% of the issued shares are held by an existing shareholder of a borrowing company, is entitled to loans in aggregate exceeding R20 million and not more than R5 million for a single entity. Individual companies and shareholders, with exposure of less than R5 million, are approved by the Loans Approval and Review Committee (Enterprise Finance Management Committee, until November 2011); between R5 million and R10 million, by the Credit Risk and Investment Committee; and between R10 million and R20 million, by the Board of Directors.

Capital management The NYDA considers the annual government grant it receives as its capital and obtains its capital by making annual applications to the National Treasury. The funds which are received are held in money market instruments with local financial institutions which have a minimum AAA rating. The NYDA has a formalised budgeting and forecasting process in place, which allows for monitoring, on a monthly basis, of the cash reserves and commitments of the fund. It maintains cash on demand, to meet forecasted monthly cash outflows with the residual being maintained on call accounts. The NYDA conducts rolling forecasts to anticipate its cash requirements to meet operating expenses, capital expenditure and draw-down requests, in respect of commitments made regarding grants and loans. The NYDA tracks loan and grant approvals, commitments and undrawn commitments on a continuous basis, in order to provide a basis for anticipating capital calls.

The NYDA makes commitments from its existing capital base, notwithstanding that it has an expectation that the National Treasury will recapitalise the NYDA on an annual basis. The NYDA continuously keeps record of reserves which are encumbered and restricted, in order to avoid deficits arising from the over-commitment of funds.

2012R’000

2011R’000

13. Interest incomeCash and cash equivalents 3 693 1 806

Loans receivable 20 512 21 202

24 205 23 008

14. Other incomeSponsorship income 400 1 226

Gain on settlement of liability – 6 436

Other 633 3 535

Repayment from Masisizane 1 775 –

Skills development levy refund 231 –

Progress fund liability write-off 270 –

3 309 11 197

15. Fair value adjustmentsFair value adjustments to investments in associates 432 189

16. Auditors’ remunerationExternal audit fees 3 582 4 145

Internal audit fees 4 869 1 408

8 451 5 553




2012R’000

2011R’000

17. Depreciation and amortisationDepreciation

Computer hardware 2 197 2 015

Office equipment 457 732

Furniture 716 2 099

Leasehold improvements 4 684 5 288

Motor vehicle 74 171

Total depreciation 8 128 10 305

Less: amounts included in project disbursements

(6 299) (8 619)

Total depreciation 1 829 1 686

Amortisation

Intangible assets 4 790 1 625

Less: amounts included in project disbursements (951) (878)

Amortisation of intangible assets 3 839 747

18. Employee-related costsSalaries and allowances 142 167 125 951

Defined contribution plan 8 218 7 714

Termination benefits 222 –

Total employee cost 150 607 133 665

Less: amounts included in project disbursements (88 252) (90 410)

62 355 43 25519. Impairment of assetsLoans receivable impairment



Co-operatives 5 037 113

Total loans receivable 24 859 36 380

Equipment impairment 955 142

Receivables impairment 679 192

26 493 36 714

Reversal of impairments

Small and medium enterprises (5 902) –

(5 902) –

Write-off of assets

Loans receivable written off 769 7 867

Equipment written off 36 –

805 7 867

Damaged/lost assets as of 31 March 2012 were impaired. An impairment loss is recognised when the carrying amount of the asset is more than its recoverable amount. The recoverable amount of all equipment impaired was assessed to be zero and, therefore, the full carrying amount was impaired.






2012R’000

2011R’000

20. Operating lease expenseBuilding 12 832 13 170

Office equipment 3 407 3 586

16 239 16 756

Less: amounts included in project disbursements (12 925) (13 699)

3 314 3 057

Future minimum rentals under non-cancellable operating leases within one year

Buildings 9 602 12 959

After one year, but not more than five years

Buildings 2 890 8 312

The leases relate to buildings occupied by the NYDA and the average lease terms vary from three to five years, and the escalation rates range from 8%–10%.

Office equipment is rented on a monthly basis.

21. Project disbursementsThe respective disbursements are as follows:

Service Delivery Channel* 63 686 67 858

National Youth Service and Skills Development 22 631 32 863

Economic Development 35 771 25 850

Communications and Corporate Affairs 9 587 1 826

Information Communication Technology 623 820

Chief Operations Officer 85 –

Executive Director projects 2 657 –

Human Resource Management 889 2 779

Policy Lobby and Advocacy 3 227 69

Project disbursements 139 156 132 065

Project-related operating expenses 79 146 67 445

Total disbursements 218 302 199 510

*Service Delivery Channel includes expenditure relating to youth advisory centres and branches.





2012R’000

2011R’000

22. World Festival of Youth and Students (WFYS)Income

Sponsorship income 16 000 61 185

Registration fee – 2 388

Total income 16 000 63 573

Expenditure

Administration – 106

Security – 2 801

Media Products – 28 595

Launch 19 16 021

Advertising (1 594) 3 019

Catering – 27 716

Travel international 14 5 600

Travel local 2 905 1 382

Accommodation – 21 136

Total expenditure 1 344 106 376

Gain/(Deficit) for WFYS 14 656 (42 803)

The NYDA won the right to host the World Festival of Democratic Youth and Students Conference, which was held during December 2010. The organisation funded the conference expenses from grant income of R29 million from the Office of the Presidency and income generated from various sponsorships including, among others, the National Lotteries Board, the Office of the Presidency and various provinces.

Additional income was generated from the conference registration fees derived from delegates to the conference.

The amount of R16 million became receivable in the current financial year.

The advertisement income was an accrual raised for expenditure incurred, in relation to the GCIS, as the amount represented a present obligation in the previous financial year. The NYDA was waived of its responsibility to pay this amount and the expenditure of R1,6 million was, therefore, reversed in the current financial year.

The travel expenditure of R2,9 million relates to a payment to City of Tshwane (COT) for buses used during WFYS. The amount was disclosed as a contingent liability of R5,6 million at the end of the previous financial year, as it only represented a possible obligation of the NYDA. The NYDA and COT reached a settlement agreement, whereby the NYDA would settle 50% of this amount, which was paid in the current financial year.






2012R’000

2011R’000

23. Cash generated from operationsSurplus 26 077 1 537

Adjustments for:

Depreciation and amortisation 12 918 11 930

Gain on disposal of assets (95) (71)

Fair value adjustments (432) (189)

Write-off of assets 805 4 726

Non-cash portion of interest income (15 640) (13 242)

Donation income (274) –

Non-cash portion of grant income — Office of the Presidency (9 842) –

Impairment deficit 20 591 39 086

Decrease in employee cost accruals (1 059) (7 259)

Changes in working capital:

Decrease in inventories – 11

Increase in receivables (333) (2 544)

(Increase)/decrease in rental deposits 1 233 (1 441)

Increase/(decrease) in trade and other payables from exchange transactions

21 327 (43 355)

Increase/(decrease) in deferred income 1 178 (166)

Cash generated from surplus 56 454 (10 977)

Net movement in loan receivables:

Decrease in loan receivables 4 400 22 791

60 854 11 814

24. Non-cash transactionsAdditions to equipment to the value of R4,4 million include the purchase of photocopiers through a finance lease to the value of R523 000.

25. Changes in estimatesEquipment and intangible assetsIn the current period, the review of useful lives of equipment resulted in revised useful lives for furniture and office equipment, as disclosed below. The effect of this revision decreased the depreciation charges included in surplus or deficit for the current period by R1,6 million and increases the future period depreciation charges with R1,6 million. In the current period, the review of the useful lives of certain intangible assets resulted in a change in the estimated remaining useful life of software developed in-house, as disclosed below. The effect of this revision increased the amortisation charges included in surplus or deficit for the current period by R3,1 million and decreases future period amortisation charges with R3,1 million.

Prior Period Current Period

Increase in Amortisation

R’000

Decrease in Depreciation

R’000

Furniture 4–6 years 5–10 years – (1 203)

Office Equipment 3–7 years 5–10 years – (432)

Software developed in-house 7 years 1 year 3 109 –

3 109 (1 635)




2012R’000

2011R’000

26. Directors’ emolumentsChief Executive Officer: Mr Steven Ngubeni

Salary for managerial services to the NYDA 1 649 1 412

Allowances 228 138

Total short-term employee benefits 1 877 1 550

Defined contribution plan 155 250

2 032 1 800

Executive Director: Mr Andile Lungisa

Salary for managerial services to the NYDA 838 664

Allowances 14 66

Total short-term employee benefits 852 730


899 840

Executive Director: Mr Yershen Pillay

Salary for managerial services to the NYDA 657 535

Allowances 67 56

Total short-term employee benefits 724 591


764 713

Non-executive

Fees for service

Innocentia Motau 427 368

Maria Tshabalala 427 364

Mcebo Rich Khumalo 427 364

Pholisa Makeleni 427 364

François Jacobus Slabber 427 364

2 135 1 824

2012

Short-term employee

benefits R’000

Bonus R’000

Expense Allowance

R’000

Defined contribution

plan R’000

Total R’000

Other key management personnelExecutive Managers reporting directly to the Chief Executive Officer:Acting Chief Financial Officer (resigned 31 May 2011) 101 – 2 6 109Chief Financial Officer (appointed June 2011) 1 060 211 15 95 1 381Chief Operations Officer (appointed June 2011) 834 – 1 47 882Executive Managers:Mr AM Ntlangeni 752 67 43 47 909






2012

Short-term employee

benefits R’000

Bonus R’000

Expense Allowance

R’000


plan R’000

Total R’000

Ms T Mavasa (appointed June 2011) 756 – 17 46 819Mr SG Mkoka (appointed June 2011) 756 – 20 46 822Mr CJ Peters (acting until 30 April 2011) 59 72 4 9 144Mr DJ van Vuuren 817 69 87 54 1 027Ms N Mphahlele (appointed June 2011) 646 54 48 124 872Mr V Mulaudzi (appointed June 2011) 756 – 16 46 818Ms L Dlova (appointed July 2011) 666 – 13 50 729Mr KE Mahura 844 68 10 – 922Ms MI Molotsi (acting until 31 May 2011) 121 72 15 8 216Ms S Samuel (acting until 31 May 2011) 113 71 14 15 213Mr BS Magongo (acting until 31 May 2011) 108 60 8 7 183Ms NG Hluyo (acting until 31 May 2011) 117 74 12 19 222Ms GBA Mjadu (acting until 30 June 2011) 162 61 14 11 248

8 668 879 339 630 10 516

2011

Short-term employee

benefits R’000

Bonus R’000

Expense Allowance

R’000


plan R’000

Total R’000

Other key management personnel

Divisional Directors and senior management reporting directly to the Chief Executive Officer:Acting Chief Financial Officer (resigned December 2010) 562 191 66 38 857Acting Chief Financial Officer (appointed January 2011) 148 – 6 9 163Chief Operations Officer (resigned August 2010) 422 196 43 28 689Divisional Directors:Mr AM Ntlangeni 670 133 42 74 919Ms MI Molotsi 679 143 91 75 988Mr BS Magongo 611 121 46 60 838Mr CJ Peters 691 112 10 144 957Mr DJ Van Vuuren 666 151 87 57 961Ms S Samuel 423 – 98 63 584Ms NG Hluyo 655 147 69 144 1 015Ms GBA Mjadu 620 123 56 53 852Mr KE Mahura 794 135 23 – 952Mr FC Bruintjies 232 185 40 16 473Ms D Chuma 171 – 15 – 186Ms M Tleane 430 36 213 56 735

7 774 1 673 905 817 11 169

26. Directors’ emoluments (continued)




Notes to the financial statements for the period 31 March 2012Figures in Rand thousand

27. Related parties

Type Related Parties%

share-holding Nature of transaction

Loans and investments disbursed in 2012 Terms and conditions

Joint ventures

1. Jointly controlled asset with FNB Leverage Finance (LF)

33% The NYDA invested R36 million, with a commitment to invest R80 million

Nil (2011: Nil)

FNB will provide funding to SMEs and remit collections to the NYDA as, and when, received

2. Jointly controlled asset with Massmart Holdings Limited

50% The NYDA and Massmart contributed R1 million each to provide funding to entrepreneurs for franchises costing less than R150 000

Nil (2011: Nil)

The NYDA will provide funding to entrepreneurs and remit collections to Massmart as, and when, received

3. Jointly controlled asset with Mobile Telephone Network Ltd (MTN)

57% The NYDA and MTN contributed R2 million and R1,5 million, respectively, to provide funding to entrepreneurs for franchises costing R30 000

Nil (2011: Nil)

The NYDA will provide funding to entrepreneurs and remit collections to MTN as, and when, received

Associates 1. Franchise Fund (en commandité partnership between the NYDA and Business Partners)

80% The NYDA invested R100 million (80% stake) in the Franchise Fund, in order to assist young black entrepreneurs to start franchises

Nil (2011: Nil)

The Franchise Fund will provide funding to SMEs and remit collections to the NYDA

2. Chicken Kwasa (Pty) Ltd

26% The NYDA granted a loan to Chicken Kwasa (Pty) Ltd for an approved amount of R1,75 million

Nil (2011: Nil)

The interest rate on this loan is prime, less 2%. Participation fees are charged at a rate higher than 1,25% of actual gross monthly revenue or R9 100 per month. The loan period is from March 2005 to 2010.

3.Serokolo Health Solutions (Pty) Ltd

26% The NYDA granted a loan to Serokolo Health Solutions (Pty) Ltd for an approved amount of R1,2 million.

Nil (2011: Nil)

The interest rate on this loan is prime. The loan period is October 2005–October 2010

4.Soundrite (Pty) Ltd 10% The NYDA granted a loan to Soundrite Sound (Pty) Ltd for an approved amount of R5 million.

Nil (2011: Nil)

The interest rate on this loan is prime plus 2%. Participation fees are not charged. The loan period terminates on 30 December 2013.

5. K5 Transport Logistics (Pty) Ltd

10% The NYDA granted a loan to K5 Transport Logistics (Pty) Ltd for an approved amount of R1.2 million.

Nil (2011: Nil)

The interest rate on this loan is prime plus 3%. Participation fees are not charged. The loan period is from June 2006 to May 2011.

6. Decti Rating Agency (Pty Ltd

19% The NYDA granted a loan to Decti Rating (Pty) Ltd for an approved amount of R1,5 million

Nil (2011: Nil)

The interest rate on this loan is prime plus 2%. Participation fees are not charged. The loan period is from December 2006 to December 2011.






Loan balance before impairment

Liability balance Interest income Administration fees

Other expense with related parties

Other income with related parties

Impairment on loans with related party

R14,5 million (2011: R23.2 million)

Nil (2011: Nil)

R1,7 million (2011: R3.2 million)

Nil (2011: Nil)

Nil (2011: R3,7 million (management fees with interest and interest on loan))

Nil (2011: Nil)

R1,7 million (2011: R4,4 million)


Nil (2011: Nil)

R204 000 (2011: R250 000)

Nil (2011: Nil)

Nil (2011: Nil)

Nil (2011: Nil)

R2,4 million (2011: Nil)

R167 000 (2011: R133 000)

Nil (2011: R300 000)

R34 000 (2011: R6 000 )

Nil (2011: Nil)

Nil (2011: Nil)

Nil (2011: Nil)

R167 000 (2011: R71 000)

Nil (2011: Nil)

Nil (2011: Nil)

Nil (2011: Nil)

Nil (2011: Nil)

Nil (2011: Nil)

Nil (2011: Nil)

Nil (2011: Nil)


Nil (2011: Nil)

R114 000 (2011: R110 000)

Nil (2011: Nil

Nil (2011: Nil)

R109 000 (royalty income) (2011: Nil)


R516 000 (2011: R487 000)

Nil (2011: Nil )

R46 000 (2011: R44 000)

Nil (2011: Nil)

Nil (2011: Nil)

Nil (2011: Nil)

R516 000 (2011: R487 000)


Nil (2011: Nil)

R572 000 (2011: R566 000)

Nil (2011: Nil)

Nil (2011: Nil)

Nil (2011: Nil)



Nil (2011: Nil)

R139 000 (2011: R129 000)

Nil (2011: Nil)

Nil (2011: Nil)

Nil (2011: Nil)


R233 000 (2011: Nil)

Nil (2011: Nil)

Nil (2011: Nil)

Nil (2011: Nil)

Nil (2011: Nil)

Nil (2011: Nil)

R233 000 (2011: Nil)





27. Related parties (continued)

Type Related parties % Share-holding Nature of transaction

Loans and investments disbursed in 1012 Terms and conditions

Associates 7. Vynide Investments 10% The NYDA granted a loan to Vynide Investments for an approved amount of R3 million

Nil (2011: Nil)

The interest rate on this loan is prime plus 2%. Participation fees are not charged. The loan period is from November 2007 to December 2012.

8. Mafatafata Printing and Packaging

19% The NYDA granted a loan to Mafatafata Printing and Packaging for an approved amount of R1,4 million

Nil (2011: Nil)

The interest rate on this loan is prime. Participation fees are not charged. The loan period is from September 2007 to October 2012.

9. Sword South Africa (Pty) Ltd

19% The NYDA granted a loan to Sword South Africa (Pty) Ltd for an approved amount of R2,3 million

Nil (2011: Nil)

The interest rate on this loan is prime. Participation fees are not charged. The loan period is from February 2008 to March 2013.

10. E2 BA-LE2 (Pty) Ltd

19% The NYDA granted a loan to E2 BA-LE2 for an approved amount of R2,5 million

R120 000 (2011: R87 000)

The interest rate on the loan of R2,5 million is prime less 1%. Loan period is from April 2008 to September 2013.

All entities on national sphere of government, as well as entities that report to entities on national sphere of government.

Fellow Subsidiary/ Department

1. Government Communication Information System (GCIS)

N/A The GCIS advertises events on behalf of the NYDA

Nil (2011: Nil)

None

2. Lotteries Board N/A Sponsorship for the WFYS Nil (2011: Nil)

None

3. Other entities on the national sphere of government

N/A Expenses incurred for goods and services obtained

Nil (2011: Nil)

None

Advances to directors and key management

A Lungisa N/A Advances to be repaid Nil None

Y Pillay N/A Advances to be repaid Nil None

S Ngubeni N/A Advances to be repaid Nil None

M Mashinini N/A Advances to be repaid Nil None

There were no further transactions with the national sphere of government after the reporting date.






Loan balance before impairment Liability balance Interest income

Administration fees Other expense with related parties



R3 million (2011: R2,8 million)

Nil (2011: Nil)

R313 000 (2011: R301 000)

Nil (2011: Nil)

Nil (2011: Nil)

Nil (2011: Nil)

R3 million (2011: R2,8 million)

R2 million (2011: R2 million)

Nil (2011: Nil)

R179 000 (2011: R183 000)

Nil (2011: Nil)

Nil (2011: Nil)

R24 000 (royalty income) (2011: Nil)



Nil (2011: Nil)

R110 000 (2011: R130 000)

Nil (2011: Nil)

Nil (2011: Nil)

Nil (2011: Nil)

Nil (2011: R1,3 million)

R3,5 million (2011: R 2,9 million)

Nil (2011: Nil)

R256 000 (2011: R236 000)

Nil (2011: Nil)

Nil (2011: Nil)

Nil (2011: Nil)


Nil (2011: Nil)

Nil (2011: R233 000)

Nil (2011: Nil)

Nil (2011: Nil)


Nil (2011: Nil)

Nil (2011: Nil)

Nil (2011: Nil)

Nil (2011: Nil)

Nil (2011: Nil)

Nil (2011: Nil)

Nil (2011: Nil)


Nil (2011: Nil)

Nil (2011: Nil)

Nil (2011: Nil)

Nil (2011: Nil)

Nil (2011: Nil)

R844 000 (2011: R581 000)

Nil (2011: Nil)

Nil (2011: Nil)

Loan balance before impairment

Liability balance Interest income Administration fees

Other expense with related parties

Advances to Directors and Key Management



Nil (2011: Nil)

Nil (2011: Nil)

Nil (2011: Nil)

Nil (2011: Nil)

Nil (2011: Nil)

R374 000 (2011: Nil)

Nil (2011: Nil)

Nil (2011: Nil)

Nil (2011: Nil)

Nil (2011: Nil)

Nil (2011: Nil)

Nil (2011: Nil)

Nil (2011: Nil)

R163 000 (2011: Nil)

Nil (2011: Nil)

R163 000 (2011: Nil)

Nil (2011: Nil)

Nil (2011: Nil)

Nil (2011: Nil)

Nil (2011: Nil)

Nil (2011: Nil)

R14 000 (2011: Nil)

Nil (2011: Nil)

Nil (2011: Nil)

Nil (2011: Nil)

Nil (2011: Nil)

Nil (2011: Nil)

Nil (2011: Nil)

Nil (2011: Nil)

R23 000 (2011: Nil)

Nil (2011: Nil)

R23 000 (2011: Nil)





28. Commitments

Already contracted for, but not provided for, at 31 March 2012 R’000• Economic development 34 133• National Youth Service and skills development 19 711• Communications and public relations 22 286

76 130

These commitments arise from the contracts relating to project expenses that the NYDA entered into before the reporting date of 31 March 2012, but could not be implemented, because the NYDA received the last tranche of its grant in the last month of the financial year.

R32 million of the above committed amount had been paid, as at 31 May 2012.

29. Contingent liabilityA contingent liability is an existing condition or situation involving uncertainty as to possible loss to an organisation, which will ultimately be resolved when one or more future events occur, or fail to occur. A contingent liability is recognised by the NYDA when that uncertainty will ultimately be resolved, if one or more future events, not wholly within the agency’s control occur, or fail to occur. Resolution of the uncertainty may confirm the loss or the incurrence of a liability.

The NYDA has the following contingent liabilities which meet the definition, as provided for above. • Labour-related matters totalling R115 000

30. Fruitless and wasteful expenditure2012

R’0002011

R’000

Standard Bank late payment 7 –

Interest paid to Old Mutual, in respect of management fees – 712

SARS penalties on late payments 1 205 –

SARS interest on late payments 240 –

Interest paid to Merseta – 118

Interest paid to the Progress Fund, in respect of late payment of management fees – 512

Interest paid to the Progress Fund for loans paid on our behalf – 697

Fraudulent use of credit card – 6

Interest paid on late payment of rental 3 11

1 455 2 056

31. Irregular expenditureOpening balance 67 649 –

Add: Irregular expenditure — current year 133 252 67 649

Less: Amounts condoned – –

Less: Amounts recoverable (not condoned) – –

Less: Amounts not recoverable (not condoned) – –

Irregular expenditure for the period 200 901 67 649

Disclosed opening balance of irregular expenditure The irregular expenditure disclosed for the 2011/2012 financial year includes an opening balance of R67 649 000, which is irregular expenditure incurred and disclosed in the financial statements of the 2010/2011 audited financial statements. The reason for disclosing this opening balance is that National Treasury has yet to approve and condone this irregular expenditure.

Significant contributors to the value of irregular expenditure incurred during the current financial year. • Travel and accommodation expenses, in respect of BCD Travel (Connex)

Some R28 million of the disclosed irregular expenditure relates to travel and accommodation services procured from BCD Travel, a company that






31. Irregular expenditure

was awarded the contract to provide travel and accommodation services to the former Umsobomvu Youth Fund, in 2001, without following the tender process. This was due to the fact that, at the time, it was accepted that each travel and accommodation transaction was an independent transac-tion from the overall amount spent in a year, and that individual transaction amounts were always lower than the tender threshold. After the merger of Umsobomvu Youth Fund and the National Youth Commission to form the National Youth Development Agency, the new entity continued to utilise the services of BCD Travel. Subsequent to the expenditure for services delivered by BCD Travel being classified as irregular by the Auditor-General, the NYDA management immediately started a process of procuring the services of a service provider through a tender system. Unfortunately, the tender procurement process was only concluded after year-end, resulting in all expenditure incurred, in respect of BCD Travel, for the entire 2011/2012 financial year, being classified as irregular. Subsequent to year-end, three service providers were appointed through a tender process.

• Expired Tax Clearance Certificates

R17,6 million of the disclosed irregular expenditure resulted from goods and services procured through a quotation based process, from service pro-viders registered on the NYDA’s supplier database, prior to the beginning of the current financial year and whose tax clearance certificate had expired at the time goods and services were procured during the course of the current financial year.

• Copies of quotations The procurement of goods and services was decentralised to divisions, with the supply chain management unit only playing an advisory role, for the period 1 April 2011 to 31 October 2011. During this period, respective divisions within the NYDA sourced quotations directly from suppliers listed on the NYDA supplier database, decided on the supplier to be used to procure goods and services, and kept the quotations and all other related docu-ments received during the bidding process. These divisions did not necessarily follow the correct supply chain management prescripts during the competitive bidding process thus the expenditure was irregular.

32. Reconciliation between budget and statement of financial performance

Reconciliation of budget surplus/deficit with the surplus/deficit in the statement of financial performance:

AccountActual R’000

Budget R’000

Variance R’000

Variance %

Net surplus as per statement of financial performance 26 077 34 286 (8 209) (24)%

Grant income 384 564 385 853 (1 289) –%

Interest income 24 205 11 645 12 560 108%

WFYS sponsorship 16 000 – 16 000 100%

Donor-funding income 274 – 274 100%

Other income 3 309 – 3 309 100%

Fair value adjustments 432 – 432 100%

Profit on disposal of assets 95 – 95 100%

Bad debts recovered 8 – 8 100%

Total income 428 887 397 498 31 389 8%

Administration and overheads 20 118 14 995 (5 123) (34)%

Communication and PR expenses 33 448 15 774 (17 674) (112)%

Employee costs 64 329 73 991 9 662 13%

Information technology expenses 15 438 6 508 (8 930) (137)%

Outsourcing and external services 11 493 5 762 (5 731) (99)%

Travel and entertainment expenses 13 611 5 359 (8 252) (154)%

Seminars and training expenses 3 017 5 357 2 340 44%

Impairment 20 591 – (20 591) (100)%

Write-off 805 – (805) (100)%

Donor-funding disbursement 274 – (274) (100)%

Interest paid 41 – (41) (100)%

WFYS 1 343 – (1 343) (100)%

Project disbursements 218 302 235 466 17 164 7%

Total expenditure 402 810 363 212 (39 598) (11)%

Net surplus per approved budget 26 077 34 286 8 209 24%


NOTES



NOTES




NOTES



NOTES


NOTES



NATIONAL YOUTH DEVELOPMENT AGENCY11 Broadwalk Avenue

Halfway House Midrand

1683

PO Box 982Halfway House 1685

Fax: 086 606 6563Call center: 08600 YOUTH (96884)

e-mail: [email protected]


ANNUAL REPORT 2011-2012 - Parliamentary Monitoring Group

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