Introduction: Unlocking the Mystery Behind SETA Funding
In South Africa’s ever-evolving education and training landscape, one question continues to surface among business owners, learners, and job seekers alike: “Is a SETA a government grant?”
The answer isn’t a simple yes or no. While SETA funding does originate from a government-managed system, it’s not a grant in the traditional sense—like social relief or bursaries. Instead, it’s part of a strategic national framework to equip South Africans with critical skills and improve employment rates.
Let’s take a deep dive into how SETA funding works, who qualifies for it, what types of funding are available, and how you can benefit—whether you’re a company, a training provider, or an aspiring learner.
What Is a SETA?
SETA stands for Sector Education and Training Authority. These are bodies established by the South African government under the Skills Development Act to promote skills development in specific economic sectors, such as construction, agriculture, banking, health, and more.
There are 21 SETAs, each responsible for:
- Accrediting training providers
- Funding skills development initiatives
- Ensuring workplace learning meets quality standards
- Managing learnerships, internships, and bursaries
SETA funding is not a general government handout, but rather a targeted reinvestment system that uses money collected from companies to upskill workers and unemployed youth.
The Skills Development Levy: The Source of SETA Funding
Here’s where the funding comes from:
South African employers who have an annual payroll of more than R500,000 are legally required to pay 1% of their total payroll to the Skills Development Levy (SDL). This is governed by the Skills Development Levies Act and is collected by SARS (South African Revenue Service).
That 1% is then distributed by the National Skills Fund and allocated to various SETAs to be used for:
- Training initiatives
- Learnerships
- Bursaries
- Upskilling of employed and unemployed individuals
So technically, SETA funding is a form of public reinvestment—employers fund the system through levies, and SETAs manage how that money is used to promote national growth and skills development.
SETA Funding: Two Main Types of Grants
Now let’s explore the two main types of SETA funding instruments: mandatory grants and discretionary grants.
1. Mandatory Grants – A Reward for Investing in Training
These grants are offered to companies that pay the Skills Development Levy and submit the correct documentation, such as:
- A Workplace Skills Plan (WSP)
- An Annual Training Report (ATR)
If these are submitted by the SETA’s deadline (usually around 30 April each year), the company is eligible to claim back up to 20% of the SDL they paid that year.
📌 Think of this as a reward system: If you train your staff and comply with reporting requirements, you get a portion of your levy back.
What can you use mandatory grants for?
- Internal staff training
- Accredited short courses
- Learnerships for current employees
2. Discretionary Grants – SETA’s Investment in Broader Skills Development
Discretionary grants are where SETAs provide funding for programs that benefit both companies and the broader community, especially unemployed youth. This type of funding is not guaranteed and is awarded based on proposals, business needs, or SETA priorities.
Who can apply?
- Employers
- Training providers
- NGOs or community organizations
- Public institutions
What can it fund?
- Learnerships (employed and unemployed)
- Internships
- Skills programmes
- Artisan development
- Adult education and training
- Bursaries
💡 These grants are more flexible and are used to promote transformation, youth empowerment, and strategic skills in scarce and critical fields.
Is This the Same as a Government Grant?
Not quite. A government grant (like an NSFAS bursary or SASSA payment) is usually a direct payment to an individual or organization, often without the expectation of return or performance reporting.
SETA funding, on the other hand:
- Requires compliance, reporting, and auditing
- Is performance-based (you must train people and show proof)
- Is funded not by taxpayers alone, but by private sector employers through SDL
So while SETA is administered under government authority, the model is public-private, making it a strategic investment mechanism rather than a welfare grant.
Benefits of SETA Funding for Employers
Companies that comply and engage with their SETA reap many benefits:
- Reclaim up to 20% of SDL via mandatory grants
- Access to additional discretionary funding for skills initiatives
- Improved BBBEE scorecard points (especially under Skills Development)
- Development of a more skilled, motivated, and productive workforce
- Contribution to youth employment and national development
Employers that ignore SETA processes are simply losing out on funds they’ve already paid.
Benefits of SETA Funding for Individuals
Whether you’re unemployed or an employee, SETA programmes can open doors.
If you’re unemployed:
- Apply for learnerships funded by discretionary grants
- Get paid a monthly stipend during training (R2,000–R4,500 typical)
- Gain a national qualification and workplace experience
If you’re already working:
- Ask your employer to enrol you in SETA-funded programmes
- Access career advancement and skills development
- Get certified while staying in your job
Who Manages and Oversees SETA Funding?
Although SETAs operate semi-independently, they are regulated by:
- The Department of Higher Education and Training (DHET)
- National Skills Authority (NSA)
- Quality Council for Trades and Occupations (QCTO)
These bodies ensure that:
- Funds are used efficiently and transparently
- Training meets national standards
- Skills initiatives align with South Africa’s economic goals
All SETAs are required to publish annual reports, including how funds were spent, what programmes were run, and what results were achieved.
Common Misconceptions About SETA Funding
❌ “SETA pays individuals cash for nothing.”
✅ SETA does not issue free money. All funding is tied to skills programmes, training, and accountability.
❌ “Only big companies benefit.”
✅ While larger companies may have more capacity to apply, small businesses and NGOs are also eligible—especially if they work with training providers or offer youth programmes.
❌ “You must know someone to get funded.”
✅ SETA funding is competitive, but transparent. Most SETAs issue calls for proposals or have online application portals.
How to Access SETA Funding
For Employers:
- Register for Skills Development Levy (SDL) with SARS
- Submit WSP and ATR to your SETA annually
- Apply for discretionary grants when windows open
- Partner with accredited training providers
For Individuals:
- Visit the SETA websites (e.g. www.serviceseta.org.za, www.merseta.org.za)
- Look for learnership or internship opportunities
- Register your details on relevant portals
- Apply through training providers, job centres, or online job boards
Real-World Example
Company: A construction firm in Gauteng with 50 employees pays R80,000 annually in Skills Development Levy.
- By submitting their WSP and ATR, they receive R16,000 in mandatory grants
- They apply for a discretionary grant to host 20 unemployed learners for a bricklaying learnership
- The SETA approves the proposal and pays for learner stipends, training costs, and mentorship
The result? The company upskills its staff, contributes to employment, and strengthens its BBBEE score.
Conclusion: SETA Funding Is More Than a Grant—It’s a Strategic Investment
To answer the original question: No, SETA is not a traditional government grant.
It is a structured, performance-based funding mechanism that helps employers, learners, and South Africa at large grow through targeted skills development.
Whether you’re a business looking to train your workforce or a young person seeking a qualification, understanding how SETA funding works can change your future. It’s not about handouts—it’s about building a nation of skilled, employable individuals, one learnership at a time.
Explore your SETA. Invest in your future. Grow South Africa’s skills economy.
