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Zuma’s fee-free higher education to bring chaos

Jacob Zuma

South African President Jacob Zuma

PRETORIA-(MaraviPost)-Tertiary institutions are bracing themselves for chaos during registration, ahead of the re-opening of universities and public colleges for the 2018 academic year.

The registration season begins this week at some institutions. Others follow suit later in the month.

In addition to the confusion swirling around President Jacob Zuma’s surprise commitment to providing free higher education for poor and working-class students, there are now fears of upheavals after the Economic Freedom Fighters’ (EFF) Student Command announced that it would lead a mass walk-in registration drive at campuses.

The EFF says this is aimed at ensuring that all deserving students benefit from Zuma’s move.
Zuma’s December 16 announcement threw the higher education sector into turmoil.

As late as this week, the presidency, Treasury and the department of higher education were unable to say where the billions of rands needed to fund the initiative would come from.

All they have been able to say is that Finance Minister Malusi Gigaba – who has already stated that the fiscus was facing a shortfall of R51bn for the coming financial year and R209bn over the next three years – will provide details in his 2018/19 budget speech in February.

Zuma’s ambitious new funding policy will cover tuition, accommodation, food and transport costs.

Mayihlome Tshwete, Gigaba’s spokesperson, confirmed yesterday that Treasury was still trying to find the money within existing resources.

He said there was no tension between Treasury and other government departments over the funding question, adding that there were no plans to obtain additional funds from the International Monetary Fund, as has been speculated.

On Saturday, SA Communist Party (SACP) general secretary Blade Nzimande – who was sacked by Zuma from his post as higher education minister in October – entered the fray and questioned where government would get the funds from.

Speaking at the commemoration of late SACP leader Joe Slovo at Avalon Cemetery in Soweto, Nzimande said the party would oppose an increase in value-added tax, as well as the docking of finances from the Unemployment Insurance Fund and the Public Investment Corporation, to fund free higher education. Such moves, he said, would be at the expense of the poor.

“Where is the money going to come from?” asked Nzimande, adding that the SACP wanted to transform higher education, not “destroy” it.

Ahmed Bawa, the chief executive officer of Universities SA, told City Press that the association was concerned about the sustainability of the free higher education model over the next two years as the numbers of beneficiaries were set to increase annually.

Zuma’s new directive
Free higher education will be phased in over a five-year period, starting with first-year students and eventually incorporating students in all years of study.

Fears that government was at sixes and sevens over the issue were further fueled on Thursday by a confusing press briefing, held in Pretoria by a high-level government team of ministers that included Higher Education Minister Hlengiwe Mkhize, State Security Minister Bongani Bongo and Communications Minister Mmamoloko Kubayi.

The ministers, who were accompanied by government officials and National Student Financial Aid Scheme (Nsfas) bosses, shed little light on the matter. Gigaba was not part of the briefing, which City Press understands Treasury was not in favour of.

The call by the EFF’s student wing for students to simply turn up at universities, instead of following the standard procedure of registering online, has sparked alarm among university heads, who have pointed out that there is already a huge space crunch.

Bawa said some universities would assist prospective students walking in either by redirecting them to the higher education department’s online system, known as the Central Application Clearing House, or by registering them if there were still available spaces.

Bongo told reporters at the Pretoria briefing that the intelligence agencies were working on a plan with student structures to deal with potential security threats.

Meanwhile, City Press has established that it will cost Nsfas between R75 000 and R150 000 on average to fund one student for a year, depending on the institution.
Zuma’s statement last month committed the state to extra spending in a variety of overlapping ways:

He promised that university subsidies, which total less than half of the state’s contribution to the tertiary education sector, would increase to 1% of gross domestic product within five years. This means the current R33bn subsidy must become at least R64bn by 2022.

Zuma also promised no-fee increases for most university students (from households earning up to R600 000 a year) this year, in a repeat of his move to de-escalate student protests over the past two years.

He had frozen fees in 2016 and made the government find “gap funding” to cover 2017 increases for 75% of the student body.

This cost R2.5bn the first time and more than R5bn the second time – and will probably cost about R8bn this year.

Most students are, in effect, supposed to still pay 2015 fees, with the state paying all the increases since then.

Unfortunately, the source of the so-called gap funding in 2016 and 2017 – the National Skills Fund – is now depleted.

According to Zuma, the Technical and Vocational Education and Training (TVET) colleges will be fully subsidised within five years – but his statement is ambiguous about the role of Nsfas and direct subsidies from Treasury.

Nsfas will also henceforth cover a far larger part of the university student body – following Zuma’s revising of the definition of poor and working-class students to “those currently enrolled at TVET colleges or university students from South African households with a combined annual income of up to R350 000” – by doubling the means test to qualify for funding.

In the past, the threshold for Nsfas funding was households with a combined income of less than R120 000 a year.

Previous Nsfas loans for existing students and those returning this year will also be converted to grants, Mkhize announced this week. Not only does this expand the number of eligible students, they will also now receive only grants, not loans.

In time, this means that the poor repayment rate to Nsfas will disappear, and the scheme will have to be entirely funded by annual transfers from Treasury.
These were already meant to reach R14bn in 2020, before Zuma’s announcement.

This is counter to the existing policy, whereby Treasury hopes to constantly increase the debt recoveries that Nsfas makes from graduates.

The scheme is owed almost R30bn by students it has funded. In its annual report this year, Nsfas boasted about how it managed to increase recoveries by 75% to almost R400m.

Under Zuma’s new directive, Nsfas will have to receive an unquantified, but certainly enormous, amount of additional transfers each year.

Nsfas chair Sizwe Nxasana told City Press this week that the “numbers are still a work in progress” as Zuma’s plan was not clear-cut.

He said Nsfas was providing inputs to the higher education department, the inter-ministerial committee and the fiscal committee.

“The government will communicate the numbers,” he said.

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