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Seta Mandatory & Discretionary grant regulations declared invalid 21st Aug. 2015

On 3 December 2012, the SETA Grant Regulations were gazetted (Government Gazette no. 35940). These come into effect on 1 April 2013. There were many major substantial changes in the new regulations and these may have serious implications for skills development in our country.

Some of the main changes were:

  1. That the mandatory grant to employers is reduced from 50% to 20%.
  2. Any unclaimed mandatory grants must be transferred by the 15 August each financial year into the discretionary fund.
  3. Discretionary grants will mainly be paid for programmes offered by public FET colleges and universities.

As a result‚ these funds could be spent on national skills initiatives that were not related to workplace training.

Labour Court has set aside certain aspects of the 2012 Seta Grant Regulations‚ declaring them invalid!

The Labour Court’s judgment on Friday 21st of August 2015 declared both regulations to be invalid‚ and it set them aside with effect from March 31 2016.

The court found that Mr Nzimande had failed to consult the National Skills Authority as required by law.

The court also ruled that the minister had acted irrationally by reducing the mandatory grant to employers as set out in the Skills Development Act. The minister had exceeded his powers by prescribing that surplus Seta funds be moved to the National Skills Fund.

The minister was ordered to pay all costs of the application, and Seta’s now have a period of about six months to prepare for the return to the previous skills-funding regime effective in March 2016.

Busa said on Monday it viewed the judgment as a significant decision that reinforced the rule of law and that reasserted the importance of workplace skills training programmes in SA.