Minister defends HE fee policy against World Bank report

South African Higher Education and Training Minister Naledi Pandor had an opportunity to defend the government’s fee-free policy for poor students against recent suggestions by the World Bank that, while attractive, the policy will strain the fiscus and is “ultimately unsustainable”.

Speaking during a panel discussion hosted recently by the University of Pretoria (UP) in partnership with the World Bank at the university’s new Future Africa campus, Pandor said the government has an obligation to ensure the new plan is sustainable and that it “will not reverse its decision of providing support to the poor”.

The event was facilitated by UP Vice-Chancellor and Principal Professor Tawana Kupe. In addition to Pandor, members of the panel included Professor Chika Sehoole (dean of UP's faculty of education), David Kabwa (UP Student Representative Council president), Ari Katz (CEO, Boston City Campus), and former Gauteng Education MEC and educationist Professor Mary Metcalfe.

Reduced admission capacity and quality?

A World Bank report published in January titled South Africa Economic Update: Tertiary education enrollments must rise asserts that the government’s decision to offer free tertiary education to poor, academically eligible students, to meet the national goal of doubling post-school education and training enrolment by 2030, will put a strain on the fiscus.

This could result in fewer public resources to increase admission capacity in the tertiary education sector, as well as improve the quality of education.

In late 2017, then-president Jacob Zuma announced the government would provide free tertiary education to the poor, following the #FeesMustFall protests that affected the country in 2016. However, questions have been raised about how sustainable the provision of free education will be.

The World Bank report looked at how to expand student enrolments in post-school education and training in a bid to upskill South Africa’s youth and thereby reduce unemployment, poverty and inequality. It reviews the impact of the new National Student Financial Aid Scheme (NSFAS) introduced in 2019, which provides grants instead of loans to pay for education and costs such as accommodation, transportation and books.

According to Sébastien Dessus, World Bank South Africa programme leader and the author of the report, under the previous NSFAS rules, the risk of failing was entirely borne by students and the uptake of NSFAS loans was low.

Attractive but costly

“The new NFSAS scheme is attractive, as it covers all costs and risks,” Dessus said. But it will be costly for the fiscus, and ultimately unsustainable – thereby reducing space for improving quality in universities and expanding their admissions capacity.

The report says for the country to grow faster and in a sustainable way, it has to address its skills gap, which perpetuates inequality. This requires enrolling more students in post-school education and training, as well as raising graduation rates and improving the relevance of skills taught to labour market needs.

However, trade-offs are required. South Africa could increase enrolments more rapidly and reduce inequality faster by rebalancing budgetary resources and policy reform attention towards interventions that improve the quality of education, while simultaneously expanding post-school education and training admissions capacity.

The report recommends comprehensively improving South Africa’s post-school education and training system by strengthening the quality of education in technical and vocational education and training (TVET) colleges, community colleges, distance-education institutions and historically disadvantaged universities.

TVET colleges are currently viewed as the poor cousins of the university sector, offering courses in fields such as agriculture, arts and culture, business, hospitality, commerce and management.

The report suggests the following solutions:

  • • Diversifying the post-school education and training sector from a mostly government-funded, university-centric model;

  • • Encouraging private sector participation;

  • • Strengthening quality assurance mechanisms;

  • • Improving resource mobilisation; and

  • • Ensuring greater equity in supporting students.

The report says implementing such options would be fiscally possible by targeting financial support to the poorest students, while extending income-contingent loans to more affluent students.

As the quality of TVET and community college education improves, the report notes that “the high private rate of return to PSET [post-school education and training] would make such a proposal equitable, sustainable, rewarding and safe for new student cohorts to enrol in universities, TVET and community colleges”.

In response, Pandor said while she agreed that the government needs to promote low- and middle-level skills emanating from the TVET sector, the country also needed engineers, scientists and researchers.

Affordable expansion

She said since 1994, two more universities (Sol Plaatje University in the Northern Cape and the University of Mpumalanga) had been built to cope with enrolment growth. “We need to look at how to expand campus provision but not build more universities,” she said.

She said the education system needs regulation of fees, especially by universities. “Some [universities] agreed to [a recommended fee increase] … while some increased their fees beyond what we agreed to. This shows contempt for the current economic situation.”

She said the leaders of higher education needed to address these issues.

Pandor conceded that the TVET sector is under-developed and under-funded. But she fought back against criticism of TVET colleges, saying, “TVET colleges are not all totally useless.”


She said the TVET sector needs quality improvement, infrastructure and better trained lecturers who can generate the skills required in the workplace and the economy. “As we make changes again to the TVET sector, we need to move to specialisation.” A large number of private colleges offer courses in business management and public relations, and “the country needs to go for skills where there are gaps”.

For Pandor, in partnerships between government and private education institutions, government should determine what courses should be offered, based on the country’s scarce skills needs.

Furthermore, distance education is failing South Africa in the use of technology, and more open access is needed, she said.

Vice-Chancellor Kupe said: “The debate on the funding and financing of the post-secondary school architecture is vitally important for producing the human capital necessary to address unemployment, poverty and inequality in South Africa.”