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Skills Development Act and Skills Levy Act requirements

The implementation of the Skills Development Act and Skills Levy Act required all employers with an annual payroll of R500 000 or more to pay a skills levy equal to 1% of their annual payroll. In order to qualify for a mandatory grant equal to 50% of the skills levy paid, the employer had to appoint a Skills Development Facilitator, complete an Annual Training Report (ATR) with all training provided to staff during the reporting period and a Workplace Skills Plan – indicating the planned training for the coming reporting period. The WSP and ATR had to be submitted to the relevant Sector Education Fund (SETA) by 30 June every year.

Towards the end of 2011 the SETA’s started introducing a PIVOTAL grant. PIVOTAL grant can be defined as professional, vocational, technical and academic learning programmes that result in qualifications or part qualification on the National Qualifications Framework (NQF). The mandatory grant would be reduced to 40% and the other 10% would be allocated to PIVOTAL grants. The SETA’s however did not finalise or enforce the PIVOTAL grant during the 2011 and 2012 submission periods.

In December 2012 the Department of Higher Education and Training published the SETA grant regulations regarding monies received by a SETA and related matters.

The intent of the regulations is to:

      “Regulate the proportion of funds available for skills development that is spent on administration.


      Provide for SETA’s to contribute to the cost of the work of the Quality Council for Trade and Occupations (QCTO).


      Discourage the accumulation of surpluses and the carry-over of unspent funds at the end of the financial year.


      Improve the quantity and quality of labour market information received by SETA’s in the form of WSP, ATR and PIVOTAL training reports, to inform planning.


      Promote the NQF registered and quality assured PIVOTAL programmes that address priority scarce and critical skills needs identified in sector skills plans.


      Create a framework within which expanded use is made of public education and training providers for the provision of skills development programmes. “


    (Government Gazette, 3 December 2012)
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