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Social advancement and change through public college education funding

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Social advancement and change through public college education funding

by Dr Connie September

Ph.D. in The Management of Technology and Innovation in Education, Da Vinci Institute.


Policies of the Technical Vocational Education and Training (TVET) sector that lend itself towards social advancement have become evident. The aim was to explore the policies, legislation and regulations of the funding realm in the public colleges towards a response with empirical evidence of improved social gains in South Africa.

The significant findings of the study revealed the magnitude of youth unemployment prevalent in the country. The results of the study render a single policy intervention ineffective, and therefore a multipronged approach offers better prospects towards a social outcome of employability possibilities for young people. Many countries have dealt with challenges to construct funding formulae. Government policies often tend to increase rather than reduce the divergence between private and social valuations (an external effect which leads to misallocation of resources).

Overall, the study concludes that policymakers and stakeholders must optimally combine priorities in order to ascertain the social value of the related areas. Consideration towards activation policies to encourage and help youth find a job is to be based on the “mutual obligations principle” as a form of improved social outcomes, whereby payment of unemployment benefits is combined with job search requirements and compulsory participation in Active Labour Market Programmes.

Key words: social gains; policy and legislation; multipronged; mutual obligations.


This paper outlines the policy and legislative prescripts of funding of the public colleges sector in South Africa and their concomitant social outcomes. More broadly, it explores evaluation techniques to gain a full view of the value that those social programmes can have on increased funding for the TVET sector. An increased interest in policies of the TVET sector towards a developmental approach of economic growth and skills development seems evident.

The point of entry into legislation on the values and principles, which act as bastions underlying the Constitution, results from the ultimate importance of the law in the inducement of a desired result in the implementation process, according to Maluleke (2000:46). In order to translate policy and legislation, the economy and social relations have to become key drivers for delivery. Success is achieved through assessment and evaluation with a developmental state having the organisational and technical ability to translate broad objectives.

A developmental agenda to give effect to increased funding in the TVET sector is firstly displayed within a relationship between expenditure and the social change within the individual student and, more broadly, collectively in societies. Thus, a social return-on-investment not only fosters trust and cooperation, but also enhances the benefits of investment in infrastructure as well as human capital. With a developmental state increasing the financial investment into the TVET sector, realising the social value, the funding is therefore not seen as a bothersome expense, but an investment in societal improvements.

A framework for a social return-on-investment has the ability to assess expenditure and become reviewable towards a new funding model that can detail the social outcomes to be achieved. In essence, expenditure must relate to an achievement of a policy outcome as policy outcomes are informed by budget allocations. The developmental role that the state has accorded to the TVET sector – as part of transforming the type of outcome of the sector – appears to have a deliberative policy intent with an inclusive social justice perspective to redefine its traditional relationship with education, as well as within the economy as encapsulated in legislation. This means that any financial increases to the TVET sector must resonate with a responsive outcome towards a social return to such an investment.


The history of Further Education and Training (FET) colleges in South Africa can be traced back to the technical colleges that supported the apprenticeship system. These were reserved for the white population only and were found in major centres and industries during the apartheid era in South Africa. This culminated in capital intensiveness in high-skill white enclaves alongside low-skilled black labour. By 1994, the college sector remained racially fragmented. It was further characterised by being linked very weakly to the labour market with students not having access to practical training. This further contributed to graduate unemployment within a broader global crisis of youth unemployment (King & Mc Grath, 2002).

The decision to place the public technical colleges in the same further education and training stream as senior schools at a provincial government level came with serious challenges for the public college sector. These included the neglect of funding as well as the college provisions in the National Accredited Technical Education Diploma (NATED) programmes. As early as 1993, The Committee of Technikon Principals agreed to reallocate funding from the historically advantaged technikons to the disadvantaged institutions (Moja & Hayward, 2000).

A considerable increase in funding for the public colleges saw the budget grow in 2010 from R3.8 billion to R5.45 billion in 2013/14, a 43% increase (DNA Economics, 2015). The South African government’s policy intention of the public funding for the TVET colleges outcome is encapsulated within the National Norms and Standards within the Continuing Education Training Act of 2006. The public colleges migrated in 2009 to the Department of Higher Education and Training (DHET), with the establishment of a single ministerial portfolio for higher education.

Background to Funding Intention

Prior to 1994, off-budget financing of educational development programmes was identified and has been uneven in impact and effectiveness (ANC Education Policy, 1994). Inequitable funding formulae and procedures were seen to encourage wasteful or extravagant spending in some quarters, while under-funding critical services for low-income communities and other disadvantaged groups remained a challenge. The legislative obligation – as derived from the Constitution (1996) – provides in Section 26 of the Public Finance Management Act (PFMA) 1 of 1999, that Parliament must appropriate money for each financial year for the requirements of the state.

Expenditure management has three administrative levels and intents which include:

  1. Policy determination objectives and resource needs

  2. Resource allocation to those objectives and needs

  3. Assurances that the objectives and needs are carried out efficiently, economically and effectively (Premchand, 1993:22).

The national norms and standards for funding technical and vocational education and training colleges, in accordance with section 23 of the CET Act (2006), considered the public TVET Colleges to address the cost-effective services; bring about change in skills development; prepare graduates for labour market employability; as well as contribute towards the growth of the South African economy.

Background to Policy Formulation

The South African college system has its own unique function, which was preceded by consolidating a fragmented sector; address an unchanged college curriculum; expose learners to practical experience in a work-related environment; as well as address qualitative learning and teaching. The public college policy and legislation had to be an operation tailored to the needs of the country as established (CET Act, 2006). The introduction of the Green Paper (DOE, 1998) saw the state indicating an intention to steer and oversee vocational education and training, and hence the policy change of public colleges was renamed Further Education and Training (FET) colleges.

To increase the investment and involvement of employers in training, the Green Paper (1998) called for the introduction of a levy-grant and the introduction of learnerships (a model to extend apprenticeships). These policies were enacted into the Skills Development Act (1998) and the Skills Development Levies Act (1999). A joint policy paper by the Departments of Education (DOE) and Labour (DOL) (2001) ensured the output for vocational education and training culminated in the Human Resources Strategy, which sought to provide a baseline on supply and demand issues.

Whilst inequities between historically privileged colleges as well as under-resourced colleges still existed, the South African government introduced a further economic reform, namely the Accelerated and Shared Growth Initiative in South Africa (ASGISA) in 2006. The introduction of ASGISA can be read as part of a broader shift in emphasis, which was part of the rationale that came from an acceptance that policies have not been working well enough. ASGISA emphasised the increase of skills, the upgrading of FET colleges and introduced a policy called the Joint Initiative for Priority Skills Acquisition (JIPSA) (2006). This prompted the emergence of an increased focus on colleges with more theoretical input and less artisanship; skills training for the workplace; as well as the introduction of the National Certificate Vocational (NCV), which replaced the NATED programmes.

South Africa required further revision and additional policy development. This led to The National Skills Development Strategy III (NSDS) (2010) to enhance the integrated national framework. The New Growth Path (NGP) (2011) was released in 2010 as a strategy to reduce unemployment by 10% by 2020. Arising from the White Paper on Post School Education and Training (WPPSET) (2013), a draft Joint Policy Statement on “enhancing the efficacy and efficiency of the National Technical and Vocational Education and Training (TVET) System” (2016) called for an integrated approach to realise the development of intermediary level skills required by the economy which were to be produced by the TVET system.

The National Plan for the Post-School Education and Training (NPPSET) (2019-2030) provided a roadmap for the implementation of the policy vision of the White Paper on Post School Education and Training (WPPSET) (2013). These policies came against the backdrop of an increasing hostile labour market and economic environment for the TVET sector. An uptake of learnerships and the placements in employment of graduates of the public colleges were constrained by the lack of employer demand for entrants.

The newly established National Planning Department of the South African government in 2009 led to the National Development Plan (2012) being produced. The plan included detailed proposals that the South African government has to achieve by 2030. The TVET colleges are the catalyst within these policies to drive the developmental needs of South Africa, a country which is advancing towards a developmental state. In spite of getting higher growth from an increased expenditure on the TVET colleges, the reduction of unemployment in South Africa has not occurred. According to Statistics South Africa, the South African economy shed 2,2 million jobs in the second quarter of 2020, while in the first quarter of 2021 the unemployment rate increased to 43.2%, as per the expanded definition of unemployment (Stats SA, 2021). Between 1994 and 2012, the average economic growth rate was 3.2% (Bhorat, Cassim & Tseng, 2016), whilst since 2012, the annual growth rate fell from 2.2% to 1.3% in 2015, which Sheppard and Cole (2016) noted was below the estimates of the National Development Plan of more than 5% per annum to 2030 (National Planning Commission, 2011).


The aim was to explore the policies and legislation, together with the regulations and related norms and standards, as they all manifest themselves in an integrated way and respond with empirical evidence of improved social gains to the requirements of a developmental state.


The research endeavoured to find the reasons behind the fact that a developmental approach to skills development into the economy, and the reduction of unemployment, had not been realised despite an increase in TVET funding and related policy changes. It also proposed solutions based on the findings and included conclusions reached from the research.

In support of the aim, the research objectives were to:

  1. Examine the rationale of the South African developmental state which devotes a considerable increase in the public college sector budget allocation.

  2. Examine the policy, norms and standards processes established to analyse the demonstration of social gains on government expenditure.

Research Question

The research question was motivated by the researcher’s real-life observation and experience in fulfilling what is termed in parliament an oversight responsibility of parliamentary committees as per the rules of parliament over DHET, the Minister and their entities.

Primary Research Question

What is the nature and scope of the public funding of the public college sector and how does it affect the social gains in higher education in South Africa?

Secondary Questions

In order to address the primary research question, the following secondary questions were posed:

  1. What is the rationale behind the South African developmental state devoting a considerable increase in the public college sector budget allocation?

  2. What are the policy, norms and standard processes established to analyse the demonstration of social gains on government expenditure?


The researcher undertook a conceptual and theoretical framework of literature review in South Africa. This was done by doing a desktop literature review of scholarly articles; examining books and reports; as well as the financial norms and standards of TVET allocation, legislation and policies of the public college sector in South Africa. The study comprised a qualitative research method employed together with a [1]grounded theory data analysis process and applying an inductive lens to the theory development reasoning.

Conceptual and Theoretical Framework

The theories of the financial frameworks and norms and standards were found to have a relationship with the dictates of the Constitution (1996). The institutions built; the philosophies adhered to; the prevailing ideas of the time; and the culture of society were all determined by the economic structure of a society according to Karl Marx, in Burke (2000). The research approach took into consideration that education is a societal issue and a socio-economic approach to funding policies might be best.

The conceptual framework was developed based on the literature of current studies and theories. The researcher identified and constructed a global view of TVET funding and policies, as well the linked concepts that together provided a comprehensive understanding of the phenomenon of policies of various countries and international bodies.

Major Findings

Theoretical and Conceptual Findings

Policy papers such as the NDP (2012) and The WPPSET (2013), as well as the Revised Norms and Standards (2021), provide the theoretical intentions of government currently. They outline policy directions to guide the DHET and the institutions for which it is responsible to contribute to building a developmental state with a vibrant democracy and a flourishing economy. In addition, the national policy framework of Department of Planning Monitoring and Evaluation (DPME); the list of skills and occupations in high demand; and the presidential district models to effect skills development provided for a practical response to the national skills development objectives and the CET Act (2006).

Policies that address unemployment are broadly divided between those that consist of the demand side and those that consist of the supply side. Education is part of the supply side policies that can address and solve occupational immobility and reduce structural unemployment. The political economy of education, which is about demand and supply, has a relationship with employment opportunities and dictates – as with other commodities or services – and the amount produced (Todaro & Smith, 2009). The effective financing of TVET education causes the demand side to have more educated students with prospects of future earnings. The magnitude of the youth employment challenge facing South Africa makes its resolution impossible by a single employment policy. A combination of interventions, or a multipronged approach, is likely to offer the greatest potential for young people to gain decent work opportunities and alleviate youth unemployment.

Emergent Themes and Concepts of the Policy and Legislation

Policies and proposals for confronting youth unemployment should be guided by the underlying issues that explain why youth employment is so low (National Treasury, 2011). ASGISA identified urgent skilled persons (engineers, artisans, technicians, and planners) and quick and effective solutions, as well as skills for local economic development, as paramount. However, no new funding for new programmes emerged and relatively high economic growth was not experienced. In addition, a continuation of socio-economic decline became prevalent. Employers were unenthusiastic regarding government policies (Mc Grath & Akoojee, 2007).

These findings are consistent with the NDP (2020) evaluation plan towards 2030. The themes that emerged spoke of the targets that were set for the TVET sector, which are unlikely to be achieved. The broad visions of the National Development Plan (2012); the New Growth Path (2011); the Industrial Policy Action Plan 2 (2011); and the Human Resource Development Strategy for South Africa 2010-2030 (2009) collectively articulate a TVET college sector that contributes towards inclusive growth. The themes that emerged from the skills supply and demand reports highlighted rising unemployment and low literacy and numeracy skills. They also cited a continuous increase in those not in education, employment or training – referred to as the NEETS – with females bearing the brunt of these challenges.

A positive increase in the enrolment of young people in the TVET sector has not produced encouraging information on skills needs in South Africa (ibid). The misalignment and mismatch of funding allocation, and the skills demand and supply, are prohibiting factors towards economic growth in the country. Thus, alignment with trade and investment strategies, together with economic growth, education and training is required.

Each year, the sector education training authorities publishes the hard-to-fill vacancies; the skills gaps, the critical skills and sectoral priority occupations and interventions lists as part of their sector skills plan. The findings reveal that, thematically, an outdated curriculum and insufficient exposure to the workplace towards apprenticeship is prevalent within the TVET sector. Employers view the type of skills produced as not addressing the skills required in the labour market. The Revised National Norms and Standards for Funding TVET (2020) revealed the following within its funding formula for the TVET sector: guidance towards the public college sector through an expenditure framework on how funds allocated are structured towards the public college sector in fulfilling its mandate.

However, a National Treasury review (2016) shows that funding the public colleges is based on full-time equivalent enrolments. Public colleges receive a proportion of the 80% allocation and the total funds made available for public colleges are allocated according to the province in which they are located. A recurring theme that emerged showed that, due to the absence of effective monitoring and evaluation, a mismatch of policy implementation of the national skills development strategy principles and funding allocation is prevalent.

The same phenomenon is prevalent according to the documented analysis about the TVET sector in Africa. It reveals that the TVET systems are also supply driven. The National Evaluation Plan 2020-2025 is a government evaluation agenda consisting of priority evaluations identified by the DPME. One of the guiding principles is the alignment to the key priorities of government which means that evaluations should be guided by the NDP. It is essential to align the evaluation process with planning and budgeting so that plans and policy development are informed by evidence attained from that strategic alignment.

The economic documented analysis provides the findings of what constitute problems of plan implementation and plan failure. Government policies often tended to increase rather than reduce the divergence between private and social valuations (an external effect which leads to misallocation of resources).

The Philosophy of Karl Marx on Education

Marx advocated a philosophy that stated, “education should correspond to the development of society and industry: it should technologically stimulate it as well as socially anticipate scientific assumptions for the future and a much faster development of the society(Ivković, 1999).


There needs to be an ability to look at what is happening in the sphere of policy as it relates to strategy; policy output; the role of a developmental state; quality and relevance of data and delivering quality. An integrated approach between government departments, the public colleges and other stakeholders enhances a sense of societal ownership of continuous improvement in the TVET system. Policy interventions to address the youth employment challenge need to concentrate on narrowing this gap.

The policy review experience reveals the important aspects of the policy process, such as the commitment to make policies clear; a commitment to provide resources to the policy goals; and a commitment to intervene in the areas of inefficiencies and crisis. It is for this reason that the ruling African National Congress party in South Africa resolved in 2007 at its national conference to become a developmental state where the government will become intimately involved in the macro and micro-economic planning in order to grow the economy and reconstruct and develop the country. According to the Green Paper (2012:1), locating the TVET college in a developmental state is an important instrument for the developmental state (strong state intervention) to improve graduate access to socially and economically rewarding jobs; redress racial income equality; secure college-to-work transitions for NEET (Not in Education, Employment, or Training) and dropouts; as well as develop skills for the poor, vulnerable, historically disadvantaged and marginalised to sustain their livelihoods (HRDCSA, 2014).

This model in the South African TVET system is in line with the National Development Plan (2012), the then New Growth Path (2011), the Industrial Policy Action Plan 2 (2011) and the Human Resource Development Strategy 2010-2030 (2009). To achieve this the findings revealed that, to address developmental challenges, an alternate budgeting and funding model must be revised to allow for adequate funding of building capacity.

The constitutional and legislative obligations and the role of government is to ensure sustainable economic development, growth and management of the public finances for the greater good of the country. The consistent view espoused by the National Treasury (2011:58) was that the TVET sector must assist to reduce youth unemployment and absorb young people into the formal labour market. The investment in college education should measure the sum of all economic and non-economic net benefits that accrue to society at large, and the students in particular.

Economic impact is more easily measured, but it is the social impact that completes the whole return-on-investment (ROI) as studies indicate that social implications in training are most important to understand as they provide a true value of training that is often neglected in TVET research due to difficulty in measuring it (Schueler & Loveder, 2017). The National Treasury holds that high youth unemployment is an inhibiting factor to the country’s social and economic development. Unemployment is not a new problem in South Africa, although its incidence peaked early in the current decade.

Part of the explanation for high unemployment in South Africa is that economic growth has not been high enough over the last 30 years. Employment growth between 1994 and 2014 was completely inadequate to reduce unemployment, further raising the level of urgency with which skills development should be treated (Stats SA, 2014). In recognising the economic emphasis placed on the TVET sector, there is a need to consider the social segment that lends itself to the human development factor. The documented economic analysis provides the findings of what constitute problems of plan implementation and plan failure.

Government policies often tended to increase rather than reduce the divergence between private and social valuations (external effect which leads to misallocation of resources). A case in point in the least developed countries is that the economic signals and incentives have served to exaggerate the private valuations of the returns to education at the secondary and tertiary levels to a point where the private demand for more years of schooling exceeds the social payoff (ibid). As stated, policy justification must allow for implementation and justification of financial investments in the TVET sector.

Todaro and Smith (2009) offer several reasons for plan failure that must be considered:

  1. The gap between the theoretical economic benefits of planning and its practical results in most developing countries has been quite large.

  2. Plans are often overambitious and try to accomplish too many objectives at once without consideration that some of the objectives are competing or in conflict.

  3. Insufficient and unreliable data on which the economic value of a development plan depends lacks quality and reliability of statistical data.

  4. The institutional weaknesses of planning processes of most developing countries include the separation of a planning agency from the day-to-day decision making machinery of government. Planners, administrators and political leaders fail to engage in dialogue and internal communication about goals and strategies.

  5. The lack of political will with poor plan performance and the wide gap between plan formulation and plan implementation.

The above reasons for plan failure as pointed out by Todaro and Smith is testimony of government’s lack in undertaking social valuations of the benefits of financial costs attributed towards the implementation of policies.

A contribution can also be made towards continuous assessments of the labour market needs, which in turn can address the changing nature of skills requirements. As part of continuous assessments of skills and labour market needs, communications must occur with major stakeholders of the public colleges on efficient improvements towards preparing students for employability. The financial contribution that the South African government allocates to DHET, which in turn allocates funds to the TVET sector to address an expansion of effective access to deserving students, is in line with its constitutional obligations of ensuring the right to education on an equitable basis.

However, the TVET sector cannot be judged on expenditure towards providing access to students only. The special role accorded to the TVET sector, however, must be judged on the basis of whether the sector has achieved its developmental purpose. Todaro and Smith (2009) relate the phenomenon of a gap between theoretical economic benefits of planning and its practical results, which are large. Within the TVET sector, several policies have been introduced. The success hinges on overcoming the mismatch between funding and policy as well as overcoming the gap between theory and practical results.

A plan is only as credible as its delivery mechanism. The TVET sector policies are only credible if they can be seen to produce its developmental agenda. Consideration should be given towards what Todaro and Smith (2009) referred to as the role of the state in the development of policymaking. Instead of planning policies unwittingly and so doing contributing to a perpetuation of negative outcomes in their implementation, evaluation must address the following:

  1. The objectives of the policies should not compete or conflict with each other.

  2. Overcome vagueness in the design on specific policy achievements in its stated objectives.

  3. Close the gap between plan formulation and implementation.

  4. Recognise the socio-economic value of a development plan to ensure that data remains qualitative and reliable.

  5. A developmental state must address institutional weaknesses of separation of planning and day-to-day decision making with political will to close the gap between plan formulation, lack of commitment and plan implementation.

A policy is judged in real life if it won sufficient support, proved capable of implementation and succeeded in achieving its objectives to be responsive to society. Almost any education and training policy will come to nil in practice if it does not win the support of two essential constituencies: those who are expected to benefit from it, and those who are expected to implement it.

International Comparisons of College Policies and Funding for Social Change

Effective policymaking is a challenge that many countries in Africa are facing, suitable to country context (ILO, 2013). Many countries have dealt with challenges to construct funding formulae according to the OECD reviews of VET (Field, Musset & Álvarez-Galván, 2014). A special role has now been accorded to the TVET sector internationally as part of what UNESCO (2015) referred to as being the master key to developmental objectives of alleviating poverty; conserving the environment; and achieving sustainable development and quality of life for all.

The literature shows that debates internationally around responses and policy reform for skills development focus on matching transition of economic growth with types of skills or moving towards a higher growth trajectory characterised by an increased investment in higher-level skills as done in the East-Asian transition. The G20 countries discussed the main youth employment challenges and highlighted the role of policies to increase both quantity and quality of jobs for young people (OECD & ILO, 2011).

Across the G20 economies, policy action over the recent past has been most concentrated in the areas of boosting demand and job creation; improving transitions to work; maintaining cost-effective Active Labour Market Policies (ALMPs); strengthening vocational education and training; and expanding quality apprenticeship and internship programmes (OECD & ILO, 2014). At the G20 meetings, the labour and employment minister’s policy recommendations, that were endorsed, entailed improving active employment policies particularly for young people and vulnerable groups; establishing social protection floors; as well as strengthening the coherence of economic and social policies. The South Korean experience tended to be more sequenced and designed to support the needs of the economy.

The Korean government addressed and invested in primary then secondary education, whereafter the government shifted to higher education to address the country’s skills needs. In various countries, the labour market influences the dynamics and policies in vocational education and training, such as reducing unemployment and meeting industry skills too (Keating, Medrich, Volkoff & Perry, 2002). It is evident that different labour markets have distinctive labour market types. The developing economies have different features, such as informal labour markets and reduction in rural employment and urban drifts with China being a growing labour market.

It is important therefore to undertake a comparative policy and legislative analysis to reflect on its effectiveness of its stated social objectives, such as the country’s inability to reduce unemployment and address the skills mismatches of labour market demand and supply. The debate on supply and demand arises as it relates to low- and middle-income countries, where the argument for supply is that a government-financed TVET system is a supply-driven system, which may lead to youth being trained in irrelevant skills or under-trained with no employment prospects.

The argument for a demand-side system financed and managed mainly by employers exists. TVET financing plays a major role in leveraging the TVET direction, as well as having country-specific objectives and priorities guided by the policy objectives. Korea provided an interesting illustration from the East Asia region of how a country’s TVET financing mechanisms have changed as TVET objectives changed (Lee & Kim, 2016). TVET financing approaches do not operate in isolation of other TVET reforms and therefore governments need to create a conducive policy, regulatory and administrative climate for a financing mechanism to function.

Conclusions and Recommendations

The theoretical policy purpose of TVET Colleges in South Africa needs to shift and be broadened to include the human capital, human capability and sustainable development approaches. The budget on its own will not achieve a developmental state, but integration of all plans together with mobilising society as the NDP envisioned has those possibilities. The district development model has been introduced to activate the levers for achieving common purpose of legislative and policy mandates of different spheres of government and departments.

Evaluating the municipal laws and regulations towards the WPPSET and NDP objectives must be taken into consideration towards a further positive outcome of the TVET sector within the district development model. At the point where high levels of unemployment have settled, stabilisation policies are required and can play a major role in turning the situation around. The ability to effect policy, funding and practices requires systems-thinking of how different role-players in government and other stakeholders in the TVET system interact and impact each other.

Systems-thinking in education can take the form of an agreement or legislative introduction of an agreement between government and stakeholders; a framework of cooperation on a common agenda; and a structured operational plan led by government in cooperation with stakeholders. This approach could further encourage government as the key mechanism through which funds are allocated to partner with other funders; civil society; the private sector to take a systems approach in developing a comprehensive costed; and a nationally owned public education system plan that supports the TVET policy.

The current policy outcomes are therefore expectant of producing the developmental objectives as set by the various policy decisions. The literature and documented reviews speak of a phenomenon in most developing countries where the government plays a dual role in the TVET sector. The multiple roles of government are that of a policy maker, a regulator and a training provider and, in most instances, it does so in an inefficient way due to the lack of coordination (Todaro & Smith, 2009) as well as facing financing constraints and capacity.

A policy justification must be shown in its true meaning of being implementable. Karl Marx referred to a curriculum that should not have an outcome of producing abstract knowledge. The TVET sector, according to Marx, must produce productive and creative citizens. Todaro and Smith (2009) relate the phenomenon of a gap between theoretical economic benefits of planning and its practical results, which are large.

The social value of the business community must be obtained through the attainment of skills that match the needs of the world of work. TVET financing as an indicator is largely determined by the rules and regulations whereby financial resources are collected, allocated and managed. Relevance considers the extent to which TVET is responsive to labour market needs and requirements. Ideally, the TVET outcome on the labour market should be measured by the share of TVET graduates who obtained a job after completion of training; the time span between graduation and placement; the ratio between the average wage of TVET graduates; and the average wage of those who did not follow the TVET path.

In many G20 countries, activation policies to encourage and help youth find a job are based on the “mutual obligations principle” whereby payment of unemployment benefits is combined with job search requirements and compulsory participation in Active Labour Market Programmes. In the case of internships, they can serve as stepping-stones for career development in more stable occupations, but only if they provide a good learning experience and a gateway to a good-quality job, rather than simply being used by employers for hiring cheap labour to do low-skilled work.

In the case of Brazil, for example, the multi-annual programme that the Federal Government has implemented aims to use apprenticeship as a tool to permanently attract youth into the formal labour market. In the United States, a four-year community college job-driven training fund was established, which offer competitive grants to partnerships of community colleges; public and non-profit training entities; industry groups; and employers to launch new training programmes and apprenticeships that prepare participants for in-demand jobs and careers. In contrast, in best-practice countries, it has a higher status and has been extended to providing state-of-the-art skills – increasingly at an advanced level – in ICT, logistics, creative arts and fashion, or social and personal services. Policymakers and stakeholders must optimally combine priorities related to the components of the focus areas and indicators in order to ascertain the social value of the related areas.


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[1]Grounded theory is a qualitative method that allows a researcher to study a particular phenomenon and to discover new theories based on the collection and analysis of real world data. Grounded theory data analysis offers a great contribution in areas in which little research has been done such as a social return-on-investment.

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This report has been published by the Inclusive Society Institute

The Inclusive Society Institute (ISI) is an autonomous and independent institution that functions independently from any other entity. It is founded for the purpose of supporting and further deepening multi-party democracy. The ISI’s work is motivated by its desire to achieve non-racialism, non-sexism, social justice and cohesion, economic development and equality in South Africa, through a value system that embodies the social and national democratic principles associated with a developmental state. It recognises that a well-functioning democracy requires well-functioning political formations that are suitably equipped and capacitated. It further acknowledges that South Africa is inextricably linked to the ever transforming and interdependent global world, which necessitates international and multilateral cooperation. As such, the ISI also seeks to achieve its ideals at a global level through cooperation with like-minded parties and organs of civil society who share its basic values. In South Africa, ISI’s ideological positioning is aligned with that of the current ruling party and others in broader society with similar ideals.

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