Higher Education and Training Minister Buti Manamela has called for urgent corrective action at the Construction Education and Training Authority (CETA) and the Services Sector Education and Training Authority (Services SETA) after both institutions received qualified audit opinions for the 2025/26 financial year.
Addressing Parliament’s Portfolio Committee on Higher Education and Training, Manamela said the two Sector Education and Training Authorities (SETAs) must address ongoing governance and financial control weaknesses. He stressed that public funding must translate into meaningful skills development, employment opportunities and improved livelihoods.
CETA and Services SETA were placed under administration in August 2025 following governance and operational difficulties. Both institutions are expected to remain under administration until 31 January 2027.
“Administration is an intervention. It is not an outcome. Its success lies in whether the institution emerges with stronger governance, credible financial controls, capable leadership, improved service delivery and renewed public confidence,” Manamela said.
The Minister said the qualified audit opinions showed that significant problems remained unresolved. He added that both administrators had been instructed to develop audit action plans with clear responsibilities and deadlines.
CETA Faces Financial and Governance Concerns
CETA achieved 58 of its 68 annual performance targets, representing approximately 85% of its targets. However, Manamela raised concerns about its financial position and outstanding expenditure issues.
The institution recorded revenue of approximately R914 million against expenditure of R1.25 billion, resulting in a deficit of about R336 million.
Its cash balance also fell from approximately R1 billion to R607 million, while significant discretionary grant commitments remained outstanding.
Manamela warned that CETA could not continue using its reserves without addressing the underlying causes of its financial imbalance.
He also highlighted accumulated irregular expenditure of approximately R956 million and fruitless and wasteful expenditure of R44 million, which he said pointed to serious historical failures in financial controls.
R29 Million in Reported Losses Raises Questions
The Minister identified two material irregularities involving projects intended to support artisan development and learner administration.
“Two material irregularities are particularly troubling. In an artisan-development project, approximately R15.75 million was paid without the intended benefits being delivered. For a learner biometric attendance and stipend-payment system, approximately R13.26 million was paid for a system never fully operationalised.
“Together, that is approximately R29 million in reported losses. When public money is spent on training, we must be able to identify what was delivered. Where losses occurred, we must determine responsibility and pursue recovery and consequence management,” Manamela said.
He called for a comprehensive account of investigations, legal action, assessments of responsibility and possible recovery measures.
“I will not pre-empt any proceedings, but the passage of time must not become an excuse for institutional inaction.”
Manamela also raised concerns about the reported prescription of a contractual claim against the supplier involved in the artisan development project. He said the department expected CETA to explain how the matter had been handled and what recovery options remained available.
Services SETA Urged to Resolve Delayed Bursary Payments
Services SETA recorded revenue of approximately R2.5 billion, expenditure of R1.9 billion and a surplus of about R562 million. The surplus was partly attributed to delays in implementing programmes.
Manamela cautioned that unspent funds should not be viewed as a success if eligible learners had not received training, bursaries remained unpaid or employers were unable to access support.
He expressed particular concern about delayed bursary payments affecting students at universities and Technical and Vocational Education and Training (TVET) colleges.
“Behind a delayed bursary may be a student unable to register or pay for accommodation.
"The Administrator must give this Committee a clear account of outstanding bursary obligations, reasons for the delays, and the timetable for resolution."
The Minister emphasised that sound financial management must support, rather than hinder, the delivery of skills development programmes and assistance to learners.
SETAs Must Strengthen Governance Before Administration Ends
With the administration period scheduled to end in January 2027, Manamela said the remaining months must be used to stabilise executive structures, appoint Accounting Authorities, strengthen financial controls, resolve audit findings and prepare comprehensive handover reports.
He raised concerns about delays in governance appointments, including difficulties in securing suitable nominations for chairpersons and completing organised labour representation.
Before CETA and Services SETA return to ordinary governance, the department will require a verified exit assessment covering governance readiness, financial sustainability, audit improvements, unresolved legal matters and outstanding commitments.
Manamela warned against allowing the institutions to fall into a repeated cycle of governance failures, administration, the appointment of a new Accounting Authority and further interventions.
“The real test of administration is whether the improvements survive the Administrator’s departure,” he said.
NSFAS and Skills Development Also Remain Priorities
Manamela also outlined broader priorities for the post-school education and training (PSET) sector, including stabilising the National Student Financial Aid Scheme (NSFAS) and developing a credible, sustainable student funding model.
He urged prospective students to submit their NSFAS applications for the 2027 academic year before the 31 October 2026 deadline.
The Minister also said the department and the National Skills Fund must address concerns raised by learners participating in the Denel Training Programme. These include delayed stipends, accommodation and transport challenges, access to tools, safety concerns and the completion of training.
He added that the department was considering broader reforms to the SETA system, subject to consultation, legal compliance and fiscal assessment.
Minister Calls for Clear Plans and Consequence Management
Manamela called for time-bound plans to resolve outstanding audit findings, transparent reporting on expenditure and financial sustainability, and appropriate consequence management where failures had occurred.
He also emphasised the need to improve bursary payments and workplace learning opportunities while ensuring that both SETAs transition to stable governance structures when their administration periods end.
The Minister's message was clear: CETA and Services SETA must demonstrate that public funds are being managed responsibly and that their work delivers tangible benefits for students, trainees, employers and the wider economy.
