DRAFT

MEMORANDUM OF UNDERSTANDIN

BETWEEN

THE PRESIDENT OF INDIA;

THE GOVERNOR/ADMINISTRATOR

of

THE STATE /UT ……………….

AND

INDUSTRY PARTNER

NAMELY………………..

IN CONNECTION WITH THE

THE UPGRADATION OF 1396 GOVERNMENT  INDUSTRIAL TRAINING INSTITUTES(ITIs)

INTO

‘THE CENTERS OF EXCELLENCE’

THROUGH
PUBLIC PRIVATE PARTNERSHIP 

DRAFT

MEMORANDUM OF UNDERSTANDING

 THIS MEMORANDUM OF UNDERSTANDING is made on this ……… day of …………. between …………the President of India acting through Shri ……………, Director General/Joint Secretary, Ministry of Labour & Employment, Government of India (hereinafter called ‘THE FIRST PARTY’); the Governor/ Administrator of the State/UT of………………. through Shri…….…… Secretary/Principal Secretary…………..(hereinafter called ‘THE SECOND PARTY’) and the Industry Partner namely M/s ….[ a constituent member of …….(Industry Association)] through Shri/Smt………(designation).(hereinafter called ‘THE THIRD PARTY’).

 WHEREAS it has been the policy of the ‘THE FIRST PARTY’  that skills imparted by the Industrial Training Institutes ( ITIs) must keep pace with the qualitative and  technological demands of the industry & expanding universe of knowledge;

AND WHEREAS in pursuance of the aforementioned policy, it is proposed to take up a Scheme for Upgradation of 1396 Government  ITIs into ‘Centers of Excellence’ through Public Private Partnership (hereinafter called THE SCHEME) with the main objective of improving the quality of training leading to better employability of trainees.
AND WHEREAS all the three above named PARTIES commit to upgrade the Industrial Training Institute……( name and full address)(hereinafter called THE ITI) into a Centre of Excellence under this SCHEME.
THE PARTIES HEREOF AGREE AS FOLLOWS:
SECTION A : ROLE OF THE FIRST PARTY

2.      The FIRST PARTY shall establish a National Steering Committee (hereinafter called `THE NSC’) which will be an Apex body          for guiding the implementation and monitoring of ‘THE SCHEME’ . It shall  comprise of the following members:
i)       Secretary, Ministry of Labour & Employment, Government of India as the Chairperson.
ii)     Director General of Employment & Training, Ministry of Labour & Employment, Government of India as the ex-officio          member Secretary.
iii)      Financial Adviser, Ministry of Labour & Employment as member.
iv)      Three representatives nominated by  industry associations.
v)       Three Government experts nominated by the Central Government
vi)      Three representatives of  State Governments ( by rotation)
Section B : ROLE OF THE SECOND PARTY :

As conditions for participation in ‘THE SCHEME’, THE SECOND PARTY agrees to:
1. Establish a State Steering Committee (hereinafter called ‘THE SSC’).  ‘THE SSC will have:

2. Establish and maintain a State Project Implementation Unit (hereinafter called ‘THE SPIU’), with adequate staff to discharge its functions.
3.Constitute/reconstitute an  Institute Management Committee  ( hereinafter called THE IMC) in the ITI and register it as a Society under the relevant Societies Registration Act as a pre-condition for disbursal of the proposed loan.  THE IMC  shall be entrusted with the task of managing the affairs of the ITI according to the terms and conditions set out in this Memorandum of Understanding and spelled out in the Memorandum of Association and Rules and Regulations of the Society so formed.
To begin with THE IMC/ Society shall consist of the following members :

i)          A representative of THE THIRD PARTY to act as the Chairperson nominated by THE THIRD PARTY.
ii)         Four other members from the local industries nominated by THE THIRD PARTY
iii)        Five representatives nominated by THE SECOND PARTY..
iv)        The Principal  of the ITI, as  Member Secretary
THE IMC shall also act as the Governing Council of the Society. Subsequently it may associate additional members in the society as per need.
4.         Delegate to THE IMC adequate administrative and financial powers to perform, interalia, the following functions:
i)     forecast emerging skill requirements in the region and accordingly take the following actions:

ii)   start short-term training courses;
iii)  review training needs and approve training of instructors, and of administrative/office staff;
iv)  facilitate placement of ITI graduates;
v)   generate, retain and utilize the revenue; and
vi)  appoint contract faculty as per need.
vii) make recommendations to THE SECOND PARTY on the funds provided by it to THE ITI out of its Annual Budget.
viii)  make expenditure out of the interest free loan received from THE FIRST PARTY under THE SCHEME.
4.1      The aforesaid powers shall be set out in the Memorandum of Association and Rules and Regulations of THE IMC/ Society formed.
5. Encourage and provide all assistance to THE IMC to establish training-cum-production center and to start a second shift/      third shift in THE ITI wherever  required.
6.   As the owner of the ITI, continue to regulate admissions and fees.

7.  Assist the IMC in any other manner to help achieve the    objectives of improving quality of training and thereby provide better     employment opportunities to the trainees.

8. Ensure that the sanctioned strength of instructors in THE ITI is always filled up and in no case the vacancies shall exceed 10      percent of the sanctioned strength.

9.  Ensure that all additional positions required by THE ITI in accordance with its  Institute Development Plan  are sanctioned and      filled up on priority.

10.       Continue to have administrative control over the staff of THE ITI and pay their salary and other emoluments.

Section C : ROLE OF THE THIRD PARTY

SECTION D : MONITORING MECHANISM
All the three stakeholders shall be responsible for monitoring the implementation of the scheme. The responsibilities of all the PARTIES are as under:
i)    With the broad objective of improving  the quality of training leading to better employability, all the three parties shall jointly       agree and finalise Key Performance Indicators (KPIs) as yearly targets for next five years, for improving the internal as well       external efficiency of THE ITI against the base line information. These parameters shall  be used to evaluate the success of       the scheme during and after the project period. The agreed KPIs shall be appended to this MoU.
ii)   THE IMC shall develop monitoring mechanism to review the performance of THE ITI under THE SCHEME and submit quarterly       reports to THE SSC. THE SSC shall also monitor the implementation of THE SCHEME on quarterly basis and furnish a       consolidated report to THE NSC for all the ITIs being upgraded in the State.
iii) In case of unsatisfactory performance in achieving KPIs, THE IMC shall submit a detailed report to THE SSC within 30 days of       receipt of a notice in this regard, interalia indicating the  reasons for failure and measures required to be taken.
iv) THE SSC shall forward this report to THE NSC with their comments. THE NSC shall fix responsibility for such failure and ensure       that necessary action is taken .
SECTION E : THE  RESPONSIBILITIES OF THE IMC
1.   The responsibilities of the THE IMC shall interalia be:
i)    to develop, under the leadership of the THIRD PARTY, THE IDP for THE ITI.  THE IDP shall define the long-term goals of the       institute, the issues and challenges facing the institute and the strategies for dealing with them.  It shall set targets for       institutional improvement, define key performance indicators, and detail the financial requirement with year wise break up to       meet the needs.
ii)   to obtain short term, medium term and long term requirement of skilled work force from the local industries and take steps to       produce graduates accordingly.
      development of course curricula,  if required ;           
iii)        to identifify training needs of  faculty and deputing them for training in associated industries/ other institutes;
iv)        to ensure implementation of various activities of the scheme in time bound manner so as to adhere to the time schedule agreed in the IDP;
v)          to monitor the progress of implementation of the scheme at the Institute level and furnish periodical   reports to the SSC.
vi)        setting up of suitable mechanism to obtain feedback from the trainees about quality of training and using the feedback for improvement in the training delivery;
vii)       to set up of  placement cells in THE ITI to guide/help the graduates in employment/self employment and  developing suitable sustainable mechanism to trace the careers of the  graduates for at least three years; and,
viii)      to furnish periodical reports with respect to the placement as mentioned in sub para (vii) above to SSC which shall compile and forward the same to the NSC. alongwith the other responsibilities.

1.1    These responsibilities shall be included in the Memorandum of Association and Rules and Regulations of THE IMC/ Society.
          
SECTION  F : RELEASE OF FUNDS AND REPAYMENT OF LOAN

SECTION  G : MISCELLANEOUS

(a)          ensure the availability of sufficient funds for consumables and materials for training.
(b)          allow industry to sponsor candidates for training in these Institutes on payment basis to generate higher revenue; and,
(c)          ensure that the  expenditure on salary and wages is limited to 80% of the total recurring expenditure so that sufficient               funds are available for the purchase of consumables and material for training.

Signed at New Delhi  on…….  this day of ………………2007.

For and on behalf of
The Governor/ Administrator
State/UT Government of ………

 (………………)
Secretary
Government of …….

 For and on behalf of                                                           For and on behalf of 
The Industry Partner                                           The President of India          
…………………..…                         

 (………………)                                                                      (…………………………)       

                                                                                    Director General/ Joint Secretary
…………………….                                                   DGE&T, Ministry of Labour &     Employment, Government of India

 Witnesses: