National Skills Fund: more than R130 million fails to reach youth-owned SMMEs

The department of higher education’s National Skills Fund (NSF) is at the centre of a mismanagement scandal, with more than R130 million for training for youth-owned small, medium and micro enterprises (SMMEs) not finding its way to beneficiaries.

Project facilitators have spoken out about being unpaid for work done in the New Venture Creation Programme, funded through the Small Enterprise Development Agency (Seda), an entity of the department of small business development (DSBD), despite the government having made funding available to service providers Chippa Training Academy (CTA) and MTL.

NSF ‘unaware’

NSF acting chief executive David Mabusela confirmed the fund had awarded the SMME training contract through Seda, with two payment tranches – constituting 20% of the total amount disbursed to the DSBD agency.

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However, he said: “As of today, it has not been brought to the attention of the NSF that the project is being mismanaged…

“The NSF takes the strongest view and act when a skills development provider assigned by the NSF compromises the beneficiaries of a programme. [This is] something we will investigate.”

CTA CEO Siviwe Mpengesi, denied his company had misappropriated public funds and warned people against “spreading rumours” to that effect.

In a memorandum to SMMEs dated 14 April and seen by The Citizen, he admitted “the prorated stipends” should have been paid on 12 April, but “the CTA cannot … release such payments without our partner also doing so”.

In another memorandum, Mpengesi said: “It is apparent that we will not be able to meet the payment date of 15 June… We are pleading with you to allow us at least until 25 June to try and make sure we have enough funds to pay all outstanding SMME’s stipends, including our facilitators fees.”

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Seda’s Ntokozo Majola said the alleged mismanagement of funds in the project, was “reported to the Seda fraud hotline”.

“The forensic unit of Seda is busy with the preliminary investigation on this matter,” she said.

The two-year venture was set to start in February, with 750 trainees earning R2 000 a month and 50 project managers. A source close to the programme said R129 million and R800 000 were paid to CTA and MTL.

“The service providers are pushing for the second tranche to be paid. Facilitators and coordinators have not been paid, with many trainees not paid their stipends.”

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The source added: “The best solution should be for the NSF to take over the project and appoint new service providers – ensuring that beneficiaries do not lose out.”

– brians@citizen.co.za