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Government to introduce Skills Development Fund
November 9, 2017

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Skills development
Skills development
Skills development
Minister of Finance Felix Mutati has announced the introduction of a Skills Development Fund in 2017 to address challenges of inadequate skills among craft individuals, artisans, technicians and technologists.
Speaking during the presentation of the 2017 National Budget on 11 November 2016, Mr. Mutati said the introduction of the Skills Development Fund was part of the long term financing solution for technical and vocational education and training (TVET).
The Minister added that the Fund will be jointly managed with the private sector to ensure developed skills were relevant to the requirements of industry. “This is particularly critical at this moment when our country is embarking on a path towards meaningful industrialisation.”
Skills Development Funds existing in many countries under different names such as training levy or training funds.
Rationale for Skills Development Fund
Technical and vocational education and training (TVET) is very expensive and governments are obliged to explore different sources of funding. If funding is in short supply, it is likely to create a mismatch between the training that the students receive and the needs of industry.

Quality TVET is particularly expensive as it needs workshops of reputable standards, regular investment in new equipment, and the maintenance and repair of existing equipment. Without the necessary funding, it is impossible to sustain quality training, invest in new projects that respond to the needs of industry and to pay competitive salaries to attract suitably qualified teaching staff. Thus, the source of financing [TVET] in workshops, laboratories, equipment and other requisites for improved output from the sector emerges.

TVET is an important in public policy. It can support economic growth and poverty alleviation; facilitate the transition of young people to decent work and adulthood; improve the productivity of existing workers and allow for the reinsertion of the unemployed into work; developing green skills to help meet sustainable development goals; assist in reconstruction after conflicts and disasters; and promote social inclusion. A desire for a skills development fund has been thus championed to realise TVET benefits.

A ‘skills development fund’ is a dedicated stock or flow of financing outside normal government budgetary channels for the purpose of developing productive skills for work. Its overall purpose is to raise the productivity, competitiveness and incomes of enterprises and individuals by providing them with appropriate skills, attributes and attitudes. Many Skills Development Funds are financed by levies on enterprises, but may also be based on public contributions and donor financing.

Achievement industrialisation goals, Sustainable Development Goals, Vision 2030 and economic diversification; Zambia requires new skills [such as for waste-to-energy], reskilling and upskilling of individuals in the formal and informal sectors. Upskilling and reskilling could increase production levels and utilisation of new technologies, modes of production, marketing [ICT and social media driven], accounting and other requisites the modern industry requires to remain viably efficiency.
Accordingly, the call for sustained TVET financing to ensure training is responsive to, and relevant for, labour market and industry needs; ranks higher. Forging closer links with industry is advocated at both national and provider institutional levels, and across a wide range of activities, from policy development to implementation.
A striking theme in TVET financing reforms across Africa for the past 20 years has been a shared commitment to incorporating the industry into national TVET sectors. TVET policies provide a range of motivations, including the need to raise the quality of training to ensure that it is relevant i) to improve labour market opportunities, ii) to satisfy economic needs, iii) and to increase access to TVET through sustainable financing.


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