Outa says Sector Education and Training Authorities need complete overhaul for job creation

Daily Maverick

11-07-2025

The role of Setas has come under the spotlight following ongoing revelations around the hiring processes by Higher Education Minister Nobuhle Nkabane for Seta boards. But digging deeper, there are broader concerns: misgovernance and sliding audit figures from entities that receive R21-billion from taxpayers.
Sector Education and Training Authorities (Setas) are plagued by misgovernance and inadequate skills, which have come under scrutiny in recent months due to the actions of Higher Education Minister Nobuhle Nkabane.
The country's 21 Setas are ideally intended to provide training opportunities for both employed and unemployed individuals in a bid to improve skills, and thus employability. These Setas are involved in many different sectors from agriculture, media, transport and health to hospitality.
The Setas have been thrust into the spotlight after Higher Education Minister Nobuhle Nkabane made appointments to their boards, which included politically aligned individuals from Nkabane's political home of the African National Congress (ANC). This has resulted in the reversal of these appointments and criminal cases being opened.
Speaking to Daily Maverick, Organisation Undoing Tax Abuse's (Outa) Rudie Heyneke, a senior project manager on this issue, said there was 'a definite need' for Setas, using an example of a Seta that trained people to fix cellphones. The problem, he identified, was that 'there needs to be a total overhaul of the Setas'.
He said this key skills development, which was paid for by both employers and employees through skills development levies, was key to combating the country's high unemployment rate.
But the Setas were not functioning, despite R21-billion coming directly from taxpayers this year. The problem, Heyneke said, was 'governance' — the appointments of unqualified people for roles that required experience.
Heyneke said that 'R20-billion [is] going to them every year and they don't give us what we need', and suggested that Setas should be scrapped if they were not functioning properly and effectively.
According to data gathered by Outa, out of the 21 Setas only nine received clean audits. Five received financially unqualified audits. Seven Setas received qualified audit opinions during the 2023/2024 financial year.
This isn't the first time Outa has tackled the Setas. The organisation has been exposing the rot at the Services Seta — where there were highly inflated contracts awarded under Andile Nongogo's tenure as its CEO between 2016 and 2019.
Nongogo resurfaced as the chief executive at the National Student Financial Aid Scheme (NSFAS) in December 2020. Outa's Wayne Duvenage would later write in Daily Maverick: 'We were not surprised to see a number of his Service Seta suppliers surface in highly irregular contracts awarded at NSFAS.'
But it is not only Outa that has raised issues with the functioning and governance of Setas.
In their sixth administration legacy report, Parliament's higher education committee highlighted several key issues when it came to the governance of Setas. These include the irregular, fruitless and wasteful expenditure incurred by some Setas.
'Inadequate qualifications, skills, and capacity of some members appointed to serve on Seta boards,' read the committee's report.
An issue raised by the committee was 'poor governance and management by certain Setas, with the Services Seta receiving qualified audit opinions for four consecutive financial years despite committee recommendations.'
Other issues raised by the committee include the 'inability of some Setas to implement adequate project management and monitoring, contributing to irregular, fruitless, and wasteful expenditures, and the double-dipping of learners from different funders or multiple Setas'.
Writing in Sunday Times, Professor William Gumede said it would be better to close down the Setas and let firms do the training if they could not be reformed.
'Alternatively, business, in collaboration with business associations — which are better placed to identify the skills demands of the economy — should take over the running of Setas,' wrote Gumede.
On 13 March 2025, Parliament's higher education committee chairperson, Tebogo Letsie, implored the department to ensure the appointment of ethical board members at Setas.
'We do not want individuals who view this as an opportunity to enrich themselves at the expense of the sector. Instead, they must see this sector as a vehicle for uplifting young people and driving meaningful change,' he said. DM