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Higher education secures a further R5bn in funding

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Higher education secures a further R5bn in funding

22nd February 2017

By: Natasha Odendaal
Creamer Media Deputy Editor Online

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As the National Treasury allocates a further R5-billion to support financially-strapped students, new ways are being examined to develop a clear roadmap to mitigate the magnitude of the student funding challenge faced by young South Africans.

Finance Minister Pravin Gordhan on Wednesday said that, in addition to the R32-billion in increases in the allocations for higher education in last year’s Budget Review and the Medium Term Budget Policy Statement, the additional R5-billion would be dispersed in the 2019/20 financial year of the medium-term expenditure framework (MTEF).

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“Government has provided funds to ensure that no student whose combined family income is below R600 000 a year will face fee increases at universities and technical and vocational education and training (TVET) colleges for 2017.

“All poor students who applied and qualified for the National Student Financial Aid Scheme (NSFAS) awards, and who have been accepted by a university or a TVET college, will be supported,” he assured.

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Delivering the 2017 Budget, Gordhan highlighted that revised medium-term spending on post-school education and training will reach around R77.5-billion in the 2017/18 financial year and R80.8-billion in the 2018/19 financial year.

By 2019/20, spending will reach R89.8-billion – representing an average yearly growth rate of 9.2% over the medium term – of which 42.7% is allocated to university subsidies, 21.9% for the NSFAS and 9.7% for TVETs.

“Over the MTEF period, R21.1-billion [including the R5-billion allocation] has been added to the spending envelope for the sector. It also includes R7.3-billion to compensate universities and TVET colleges for the shortfall caused by the 0% fee increase for students from households earning less than R600 000 a year in the 2017 academic year,” the National Treasury pointed out.

A total of 615 000 university students will receive NSFAS loans and bursaries over the next three years, while around R7.7-billion in additional allocations will aid 2016 NSFAS university students to continue their studies.

According to the National Treasury, university enrolments are expected to increase from one-million in 2016/17 to 1.1-million in 2019/20, while TVET enrolments are expected to remain stable at 710 535.

Meanwhile, Gordhan highlighted several broad principles aimed at developing a “clear roadmap” for a “better higher education and training system” that would unlock access, opportunity, financing and support for students in the university and further education and training sectors.

These include resolving challenges identified in post-school education and training in a resource-dependent, phased manner; securing greater contributions from employers and industry through the funding of bursaries, internship opportunities and research programmes; and promoting a consultative, as opposed to a confrontational, approach by universities, students and education stakeholders to improve the access, quality and diversity in the higher education and training sector.

“Together, we will find a way forward that meets students’ funding needs fairly and sustainably, so that rising numbers of graduates can contribute positively to inclusive growth and transformation of the economy,” he said.

Over the medium term, government will continue to work on a sustainable method of funding higher education.

The Heher Commission of Inquiry into Higher Education and Training will complete its work by June this year, following engagement with civil society.

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