Government boosts student aid following #FeesMustFall

The South African government has announced a R4.5 billion (US$282 million) boost to the National Student Financial Aid Scheme, or NSFAS, for short-term debt relief for students. This follows last year’s intense #FeesMustFall protests and is in line with the findings of a presidential task team on funding challenges at universities, which reported back last month.

The task team calculated that in total R6.8 billion was needed to meet promises quickly made to demonstrating students in late 2015. Meanwhile, universities are bracing themselves for more protests as the new academic year begins in the coming weeks.

On 4 January the NSFAS said it had set aside R1.4 billion to pay universities upfront in the new academic year. The money would cover registration fees of students who quality for NSFAS funding – also in line with task team recommendations.

Registration fees have long been an access obstacle for students from low-income families, as they often have to be paid before students obtain NSFAS funding. Also, registration fees have been rising as, reportedly, some universities have used them to ensure some ‘fee’ income in the face of large numbers of students failing to pay tuition fees after admission is secured.

NSFAS spokesperson Kagisho Mamabolo said: “Administrative guidelines on funding will be communicated to all institutions to ensure that rules pertaining to financial eligibility of students for NSFAS are applied consistently.” Also, NSFAS technical teams would be sent to all universities to support financial aid offices to ensure smooth registration.

Since its inception in 1999, the NSFAS has supported 1.5 million students and disbursed more than R50 billion in student bursaries and loans.

The presidential task team

Higher education experienced student unrest on an unprecedented scale during 2015. Protests started early in the year with the #RhodesMustfFall campaign at the University of Cape Town, demanding the removal of a statue of British imperialist Cecil John Rhodes.

Next came a campaign at Stellenbosch University against use of the Afrikaans language and racism, and the new movement culminated in nationwide #FeesMustFall protests against tuition fee hikes and in favour of student debt relief and free higher education for the poor.

The protests were supported across regions, race and class, and sparked headlines worldwide. Government rapidly agreed a freeze on fee hikes and more financial relief for poor students.

In October President Jacob Zuma appointed a task team to investigate short-term student funding challenges in universities, implementation of an agreement on a 0% fee increase for 2016 and shortfalls in NSFAS funding for students – and to come up with possible solutions.

The task team was also asked to advise on a plan to avoid student protests at the start of 2016. Year after year, campuses are disrupted over issues such as registration and tuition fee levels, and the exclusion of students who have not paid fees from the previous year.

Zuma announced the task team findings on 15 December 2015. He said four key factors that could lead to protests this year had been identified.

The first was upfront fee or registration payments at the start of the year. The second was the “NSFAS shortfall” – accumulated debt accrued by students who qualified for NSFAS loans but were either unfunded or underfunded due to insufficient funding between 2013 and 2015.

The third factor was the financial challenges faced by the ‘missing middle’ – mostly working-class or middle-class students who do not qualify for NSFAS funding but whose families cannot afford to pay for higher education. The fourth was growing demand for university places.

All about the money

The task team found that a total of R6.8 billion was needed to meet the funding shortfall caused partly by Zuma’s 0% fee increase decision. The NSFAS shortfall was R4.5 billion.

It recommended that R2.3 billion be spent to make up in the short term for the 0% fee increase. Both the government and universities would contribute to tackling this shortfall. Also, needy students who met the NSFAS means test would not have to pay upfront registration payments or tuition fees.

The task team also recommended that R2.5 billion be made available from the fiscus in the form of loans to provide short-term debt relief to 71,753 needy students who were not funded or were underfunded in 2013, 2014 and 2015, and owe money to universities.

A further R2 billion was needed in 2016-17 to ensure that currently unfunded continuing students received NSFAS support in 2016. “This amount will also be made available through reprioritisation from the fiscus,” said Zuma.

The task team further recommended that the NSFAS improve its administrative systems and engage with universities and students to ensure its rules are clearly understood and consistently applied regarding the academic eligibility of students for NSFAS support. Universities should improve communication with students on all NSFAS matters.

Further: “A process must be put in place immediately to develop a new financing model, which includes the private banking sector and other business interests, to incorporate options for funding the ‘missing middle’, that provides loans at favourable interest rates without having to provide surety.

“This must be developed during 2016 with the view to testing it in the 2017 academic year for full implementation in 2018,” the task team proposed.

The presidency said a commission to look into the viability of free higher education for the poor – which the ruling African National Congress party promised years ago – would be announced soon.

Vice-chancellors speak out

In a joint statement issued on 18 December, the vice-chancellors of all of South Africa’s 26 public universities said they remained committed to widening student access and transforming their institutions.

They welcomed Zuma’s acceptance of the task team recommendations, and said: “We recognise that mobilising more than R6.5 billion for this purpose within a short period in an environment of fiscal restraint is exceptional.

“We do, however, continue to call for adequate financial aid to allow all academically qualified students to enrol at universities, accommodated within our enrolment plans, without prohibition. We also amplify the call for better subsidisation of the university sector by the state, in line with the current and projected growth of the sector.”

The vice-chancellors said that a 0% increase in fees in 2016 would offer “some reprieve” to students as government would contribute towards the resulting shortfall. But the higher education system was based on a cost-sharing model in which the state subsidised students who were in turn expected to pay a contribution.

“Students will therefore still be required to pay their student fees in 2016, even if these have not increased. This is one of the key revenue streams that keep universities financially sustainable.”

For their part, universities committed themselves to mobilising new funds where possible to support financially needy students. Academic requirements would continue to determine admissions policies, allowing “deserving learners the best opportunities of success”.

The university leaders said they recognised the constitutional right of students to lawful and peaceful protest, but could not condone some of the violent and destructive methods used during recent protests. “We condemn all acts of violence, criminal acts, damage to property and behaviour that impinge on the constitutional rights of others.”

Underfunding of higher education had been recognised by the government and other stakeholders, and had been highlighted in the 2013 Report of the Ministerial Committee for the Review of the Funding of Universities chaired by Deputy President Cyril Ramaphosa.

“We welcome and will participate fully in conversations around a new funding formula for universities, which is expected to take effect in 2017,” the vice-chancellors said.

They called on all actors in society to urgently prioritise higher education funding, “to support one of the best functioning sectors on the continent, and in so doing to invest in developing the high-level intellectual capacity that is desperately needed to secure our collective futures”.

Opposition concern

Belinda Bozzoli, the Democratic Alliance party’s shadow minister of higher education, welcomed the funding relief but raised two “serious questions”. The first was whether the R7 billion would be found in the new budget.

“Secondly, will a more sustainable long-term solution to the chronic underfunding of the higher education system be forthcoming, or are we set to continue to lurch from funding crisis, to funding crisis?”

“These questions are set against a background of overt statements by student bodies that their protests will continue, even escalate, in January.”