14/08/2021
MINISTER TUMISO RAKGARE PARLIAMENTARY STATEMENT ON YOUTH DEVELOPMENT FUND 2021
1. Mr Speaker, I would like to thank you for this opportunity to brief this Honourable House on one of my Ministry’s flagship programmes, the Youth Development Fund (YDF) for the current Financial Year.
2. The Youth Development Fund remains the Ministry’s primary vehicle for youth startup business financing. The fund was introduced in 2009 to, among other things,
• Promote active participation of youth in socio-economic development of the country
• Encourage out-of-school, marginalized, and unemployed youth to venture into sustainable and viable income generating projects
• Promote the development of competitive, sustainable and growth oriented citizen owned youth enterprises
• Reduce rural-urban migration by making it attractive to start growth oriented enterprises in rural areas
• Create sustainable employment opportunities for young people through the development of sustainable projects
3. The programme has been having a budget allocation of P120 million per annum over the years, which is distributed at a rate of P2 million per constituency. This allocation is used for funding both youth business proposals and entrepreneurship training. Individual start-up businesses are funded to a maximum of P100 000 each, with 50% of this amount being a loan and the remaining 50% being a grant. A group of five (5) to ten (10) young people (Youth Industry) is funded to a maximum of P450 000.00 under the same conditions. The loan component is repaid over a period of five (5) years, and a penalty of 5% interest on arrears is charged on defaulters.
4. For the Financial Year 2021/22, however, the programme has been financed at a budget of P104 million due to financial constraints, and this will certainly impact on the number of applications that can be funded this year.
5. Mr Speaker, the advent of the COVID-19 pandemic has had profound implications on the implementation of the YDF programme. Due to uncertainties and restrictions imposed on the normal social and economic activities, the 2020-2021 edition of the YDF was not implemented, and the funds allocated were used to, among other things; fund 171 appeals at a total cost of P15, 341, 810.56, Land banks development at a cost of P7,500, 000 and COVID Relief for YDF businesses.
6. The Ministry then resolved to run the 2021-2022 edition of the YDF, even though the COVID-19 pandemic challenges and restrictions are still prevalent. This is in recognition of the centrality of the Fund to youth economic and entrepreneurship development. However, the issues of limited budget and the continued restrictive environment imposed by COVID-19 require modifications to the manner in which the YDF has been implemented.
7. Thus for this year, priority for funding shall be for businesses with a potential to create higher numbers of employment. This has always been the guiding principle for YDF funding, as a strategy to create employment for the youth, but has become even more important now with the budget reduced, and business environment constrained. To this end, the following sectors are prioritised;
• Manufacturing (which includes health, food processing, environment, energy and other sustainability businesses)
• Agriculture (small stock, food production and the Agricultural value chains).
• Technology, Digitisation and Innovation initiatives.
8. The above sectors are viewed as capable of performing well under the current economic and health situations. They can also be used to spur the economy to perform better, creating jobs for the youth and reducing unemployment.
9. Mr Speaker, YDF applications for this year were opened from Wednesday 14th July 2021 to Tuesday 10th August 2021. However, due to the challenges encountered by the different outstations and the applicants themselves due to COVID-19 related issues, we have taken a decision to extend the application period to Friday 20th August 2021 at 1600 hours. While the extension is not necessarily desirable, the Ministry felt that on account of the prevailing environment the extension will give young people a fair chance to compete for funding.
10. I wish to indicate that, generally, there is a very high level of interest in the YDF programme. This is demonstrated by the number of youth who usually attend YDF orientations, collect application forms, and number of applications submitted. Usually we receive around 2,000 applications per cycle, of which we are only able to fund about 1,000 projects, with some of the funds going towards training, monitoring and support.
11. Mr Speaker, this programme continues to show that given a chance young people can help this country realize some it’s priorities like Job Creation. During our monitoring visits to Youth projects across the country, time and again we meet YDF beneficiaries who are really doing well, hence our commitment to ensuring that young people are able to access start-up funding.
12. Examples of such projects include:
• Humphrey Barnard of Sebokolodi Machines (PTY) LTD based in Tshesebe in the North East District and trades in Horticulture; He was funded in 2020/21 as an existing business and has 38 employees, who are mainly youth
• Lucky and Mpho Mokgowe of Lucky Bush Camp based in Kasane, and runs a Tourism business; The Company was funded in 2015/16 and has 23 employees.
• Otukile Montiredi of Montiredi’s Bakery based in Molepolole; He was funded in 2015/16 and has employed 19 youth
• Gobakwaone Phillip of RonReag Investments which deals in waste management and toilet hire and is based in Gumare; She was funded in 2018 and has 10 employees.
• Bakang Leburu and Reuben Nshakashogwe of Zehri Holdings which deals in Agricultural Stock and Transport & logistics, with branches in Gaborone, Kanye, Goodhope, Molepolole and Letlhakane; They were funded in 2013 and have a total of 19 employees.
• Thuto Kgwalabathe of A12 Motors which deals in Mechanical and Electrical repairs and is based in Molepolole; He was funded in 2019/20 and has 6 employees.
13. Mr Speaker, these are just a few examples to demonstrate that the YDF has a huge potential to contribute to the alleviation of unemployment and poverty, especially amongst young people.
14. Despite these success stories youth businesses continue to be plagued by challenges such as high rentals for operating spaces, limited markets, shortage of operating land/operating spaces and competition from established businesses. It is for this reason that I wish to appeal to all stakeholders to ensure that these youth businesses are deliberately supported.
15. Finally, Mr Speaker, I wish to thank Honourable members who continue to show support to the young people in their constituencies, and would like to implore all other members to do the same. I would like to also sincerely implore members to keep on urging the YDF beneficiaries to make good their loans so that other young people can equally benefit from the fund.
16. I thank you Mr Speaker.
