Youth agency is a business flop

2011-06-18 15:24

The National Youth Development Agency – which turned two on Thursday – stands accused of not ­taking youth empowerment issues seriously.

Isaac Moroeng, the chief executive of the National Youth Chamber of Commerce, accused the agency of incompetence and offering outdated programmes.

“The agency’s products and services are so old-school.

The agency is still offering business plans and vouchers while the youth are interested in information that will teach them how to penetrate new industries,” said Moroeng.

He said if the government took youth issues seriously, the agency would run ­efficiently.

But, he said, the agency was not living up to its enterprise development expectations, while other state-owned ­developmental finance institutions like the Industrial Developmental Corporation, National Empowerment Fund and Small Enterprise Development Agency are being run efficiently.

The youth agency is the only ­developmental finance institution that falls under the Presidency, while others are controlled by the departments of trade and industry, and economic development.

Last week the agency, a merger between the Umsobomvu Youth Fund and the National Youth Commission, hogged headlines ­after it was revealed that its ­Northern Cape chairperson Shadrack ­Tlhaole, who has a ­criminal record but does not have matric, draws an exorbitant R650?000 yearly ­income.

“How can someone who does not have matric be appointed to lead the agency?” asked Moroeng.

“Agency appointments are a slap in the face to young entrepreneurs, because most of the agency’s board members are linked to ­political affiliations instead of business skills,” he said.

The ANC Youth League’s ­outgoing deputy president Andile Lungisa is the parastatal’s national chairperson, while its chief ­executive, Steven Ngobeni, is the league’s outgoing deputy secretary ­general.

In December the body allegedly splurged R69 million on the World Youth Festival. It raised R40?million from the ­National Lottery, while the government contributed the remainder.

An agency spokesperson this week said the agency might not be able to respond before deadline.

“We are the organisers of the ­official youth rally and other events linked to June?16, and there may be a delay in providing you with a response,” said agency spokesperson Linda Mbongwa.

She said Ngobeni and Lungisa, the only people who had the authority to make comments to the media, were attending the ANC Youth League Congress and could not be reached.

City Press could also not reach Lungisa and Ngobeni.

On its website the agency says it offers small, medium and micro- enterprise finance; business consulting services voucher programme; and business opportunity support services.

The website shows 17 entrepreneurs who have benefited from the agency. According to the agency’s 2010 yearly report, 55% of the agency’s R279 million budget was spent on operating expenses.

The agency had during that time awarded loans to 12 businesses.

Moroeng said: “I think the agency is top-heavy, is not coming up with new products and that it should be closed down.”


Sandile Dlamini, board ­member of the Black Economic Empowerment Advisory Council’s KwaZulu-Natal chapter, echoed Moroeng’s sentiments.

“Young entrepreneurs in ­KwaZulu-Natal are unhappy about the agency because the league’s leaders are made to lead the agency while business people are not made to contribute.”

He criticised the agency for giving out business development vouchers but failing to follow up and evaluate whether the vouchers yielded positive results.

Dlamini said the fact that the agency could raise R40 million from the National Lottery proved that it was a powerful lobbying platform.

“The agency should lobby private organisations for funding,” he said, adding that the agency should also lobby municipalities and parastatals to give a certain percentage of tenders to young ­entrepreneurs.

Tshiamo Dichabe, a director of the Commercial Agriculture Youth Chamber, said the agency was limited by financial constraints.

“And the organisation needs to get rid of a culture that results in appointments of politicians ­instead of businesspeople and ­professionals who are interested in businesses,” said Dichabe.

He said the organisation should focus on streamlining its products and servicing the country’s socioeconomic challenges.

“The agency should come up with an integrated youth development strategy that will result in municipalities and parastatals leading the drive to capacitate youth entrepreneurs.”


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