Analysis by Mwansa P. Chalwe Snr
The 2020 Budget presented by Minister of Finance, Dr. Bwalya Ng’andu on September, 27, 2019 did not cover the issue of Youth unemployment comprehensively as one would have expected. There were a few theoretical and cavalier sentences in budget that the minister read like: “ With regard to skills development, support to technical, vocation and entrepreneurship development as a means for job and wealth creation will remain a priority”, which did not inspire confidence about its practicality and impact. Youth unemployment is an issue I consider as the number one social, political and economic problem facing Zambia to day but one gets the impression it is no getting enough attention.
The practical aspect of Youth empowerment that the Minister should have addressed in the budget was the reform of the moribund Youth Development Fund. In the current article, I will address factors that have contributed to its failure to achieve job creation. The next one will provide comprehensive and practical solutions on how the Fund can be redesigned to create jobs for young people.
The Republic of Zambia government created the Youth Development Fund (YDF) in 2000 in order to address the issue of Youth unemployment through encouraging young people who could not find formal salaried employment to pursue entrepreneurship and self-employment. This option to employment is one of the universally and internationally recognized solution to youth unemployment.
However, 19 years down the line, there is nothing much to show for it. This article will address the reasons why the programme has miserably failed and why it needs to be revisited and refined as it still offers hope to the issue of solving youth unemployment if innovatively implemented.
According to the study and evaluation of the programme done by the Zambia Institute for Policy analysis and Research (ZIPAR) in 2018, they concluded that the programme failed to achieve its objectives
“The evaluation found that the YDF created a total of 742 paid jobs from 2011 to 2015. Compared to the amount of resources that were invested in the YDF, the jobs did not sufficiently contribute to reduction in the high youth unemployment rate. Additionally, the welfare of the beneficiaries did not improve compared to that of the non- beneficiaries”, ZPAR study concluded.
The intentions of the policy were noble but any knowledgeable person would have predicted or foreseen that the programme was destined to fail from the word go. The reasons why the programme was not going to achieve its objectives was because of flaws in its design, implementation and monitoring and evaluation.
In the first instance, the Ministry of Youth, Sport and Child development was charged with the task of managing the fund – loan assessment and disbursement of funds – for Youth empowerment. It is curious how one could have expected a line ministry to all of sudden become a financial institution and expected to carry out the complicated task of loan assessment, disbursement and recovery. It is obvious that issues of capacity, skills set, and experience were certainly going to arise in the administration of the fund.
The Youth Development Fund Programme (YDF), was premised on the flawed assumption that money was the panacea to youth unemployment and is the only impediment to youth going into business. And as such, once funds were provided, Youth were going to set up businesses and create jobs. But if any comprehensive independent research had been done, the programme would have been designed in such way that other resources like business development services, practical youth entrepreneurship training, information dissemination, mentoring and coaching and the use of 21st century digital tools would have been incorporated in the programme. These were clearly absent.
There is also the big and persistent mistake that Government bureaucrats make by thinking that they can come up with private sector policies including those relating to job creation to the exclusion of the people with the expertise and who know how jobs are and be created – the private sector. It is crystal clear that one of the major reasons why the YDF failed is the fact that the Private sector was not involved by government in the design of the programme, its implementation and its monitoring. There was need for the Ministry of Youth, Sport and Child Development to involve the private sector by tapping into private sector expertise and possibly out sourcing some of the services as well as entering into some form of Public Private Partnerships (PPP).The line Ministry would still have been able to be in charge of the overall management of the programme.
The Youth Development Fund started in 2000 but there was no strong formal Monitoring and evaluation (M&E) framework in place to find out how the fund was performing and whether it was achieving its objectives. The first M& E was contracted in 2017 which is 17 years after its commencement. It was, therefore, impossible to track and measure the impact the fund was making so that improvements could be made.
The other major problem that contributed to the fund failing to achieve its objectives is the fact that it is highly politicized. The various administrations under the MMD and PF have abused the Fund for political purposes and the Zambia Institute for Policy analysis study alludes to this.
”The involvement of politicians in the disbursement of funds has negatively influenced the public perception of the Fund and its potential as a youth economic empowerment vehicle. This is because the Fund is highly linked to the political structures, which make youths think the funds are a political reward or benefit, and this perception could have significantly affected repayments”. ZIPAR study observed.
The idea of solving youth unemployment with entrepreneurship and self-employment initiatives is a noble one and can achieve its intended objectives but the big question is the vehicles and tools used to implement the policy. If innovatively designed, and in tandem with the knowledge and ICT economy of the 21st century, entrepreneurship and self-employment can solve the youth unemployment problem. The government should rethink the design of the Youth Development Fund.
It is imperative that the promotion of youth entrepreneurship should be approached comprehensively in order to achieve lasting impacts. A mix of financial and non-financial support as well as partnership with the private sector can influence the success and sustainability of such policies.
The Author is a former financial specialist advisor to the USAID funded Botswana Private Enterprise Development Project (BPED), an entrepreneur and founder of Prosper Knowledge Solutions. He has a passion for solving the Youth unemployment problem using his vast hands on international private sector experience. (Send comments and suggestions on this article to pmchalwe AT gmail DOT com)