Anita Nkonki|Published
Buti Manamela
The Construction Education and Training Authority (CETA) is facing scrutiny over nearly R29 million paid for skills-development projects that failed to deliver their intended benefits, as its accumulated irregular, fruitless and wasteful expenditure approaches R1 billion.
Higher Education and Training Minister Buti Manamela revealed the figures during a briefing to Parliament’s Portfolio Committee on Higher Education and Training on Wednesday, where he outlined the 2025/26 performance of CETA and the Services Sector Education and Training Authority (Services SETA).
Both institutions received qualified audit opinions for the financial year, despite being under administration since August 2025 following governance and operational difficulties.
Manamela said the department expected the administrators to account for the institutions’ performance, address weaknesses identified by the Auditor-General and demonstrate whether the interventions had put them on a credible path to recovery.
R29m paid for projects that failed to deliver
The two projects highlighted in the briefing involved approximately R15.75 million paid for an artisan-development project that failed to deliver its intended benefits, and R13.26 million for a learner biometric attendance and stipend-payment system that was never fully operationalised.
Together, the payments amount to approximately R29 million in reported losses.
“The principle is simple. When public money is spent on training, we must be able to identify what was delivered,” Manamela said.
He said responsibility had to be determined where losses occurred, with recovery efforts and consequence management pursued where warranted.
The minister also raised concerns about the reported prescription of the contractual claim against the supplier involved in the artisan-development project, questioning whether the institution had responded timeously.
“The department expects a complete account of investigations, legal steps, responsibility assessments and recovery options,” he said.
“I will not pre-empt any proceedings, but the passage of time must not become an excuse for institutional inaction.”
CETA records R956m in accumulated irregular expenditure
The project payments form part of broader concerns about CETA’s financial position.
According to Manamela, the authority recorded approximately R914 million in revenue against expenditure of R1.25 billion in 2025/26, resulting in a deficit of about R336 million.
CETA also reported approximately R956 million in accumulated irregular expenditure and R44 million in accumulated fruitless and wasteful expenditure. Manamela stressed that these were historical balances rather than expenditure incurred exclusively during the latest financial year.
He warned that CETA could not sustain itself by drawing down its reserves without addressing the underlying causes of its financial imbalance.
“We cannot sustain an institution by drawing down its reserves without addressing the structural causes of the imbalance. Restraint on new commitments may be necessary, but it affects the training pipeline,” he said.
While CETA achieved 58 of its 68 annual targets, equivalent to about 85%, Manamela said its financial position raised concerns about the institution’s long-term sustainability.
He said tighter controls on new commitments might be necessary, but financial constraints could affect the training pipeline. Better planning, earlier grant decisions, reliable learner records and realistic implementation schedules were needed to balance financial stability with the authority’s developmental responsibilities.
Minister calls for stronger financial controls
Manamela said the qualified audit opinions received by both institutions could not be addressed simply by improving documentation. The weaknesses behind unreliable records, irregular procurement, unsupported commitments and delayed programme delivery had to be corrected.
“Audit findings must become management decisions. Management decisions must become corrective actions. And corrective actions must produce evidence that can withstand independent scrutiny,” he said.
Services SETA reports R562m surplus amid delays
Services SETA presented a different financial picture, with revenue of approximately R2.5 billion, expenditure of R1.9 billion and a surplus of about R562 million, partly attributed to delays in programme implementation.
Manamela cautioned that underspending could not be treated as an achievement if eligible learners remained untrained, bursaries went unpaid, or employers could not access support.
He said delayed bursary payments were of particular concern because students at universities and technical and vocational education and training colleges could be left unable to register or pay for accommodation.
The administrator was expected to provide the committee with a clear account of outstanding bursary obligations, the reasons for the delays and a timetable for resolving them.
Administration extended until January 2027
The administration of both authorities has been extended until January 31, 2027, with the remaining period intended to stabilise governance structures, strengthen financial controls, resolve audit findings and prepare the institutions for a return to ordinary governance.
However, Manamela said he was concerned that governance appointments had not progressed as quickly as required, citing difficulties in securing suitable chairperson nominations and completing organised-labour representation.
He said the interventions could not become a permanent alternative to normal governance and called for a verified assessment of governance readiness, financial sustainability, audit improvements, unresolved legal matters and outstanding commitments before the administrators left.
The minister said the ultimate measure of success would be whether the authorities could turn public funding into tangible skills, employment opportunities and sustainable livelihoods.
“It is not enough to say that the sector needs a Skills Revolution. We must demonstrate it through institutions such as CETA and Services SETA,” he said.
“Ultimately, we should judge our SETAs not by how much money they control, but by how effectively they turn that money into skills, opportunities and livelihoods.”