A luta continua: students fight financial exclusion

A combination of the effects of the pandemic, irregular expenditure and budget cuts mean prospective students are being stopped from registering for the 2021 academic year.

Students at universities and technical and vocational education and training colleges have been protesting against financial exclusion because those with debt were stopped from registering for the 2021 academic year. 

Protests and violent responses from institutions of higher learning and the state occur regularly during registration. The South African Police Service killed a passerby, Mthokozisi Ntumba, in Braamfontein on 10 March while responding to protest action outside the University of the Witwatersrand (Wits). 

Severe budget cuts at universities have left students struggling with financial exclusion, which has been a problem for over a decade and which adds to the country’s inequality as impoverished hopefuls are kept out of the university system.

Ahmed Bawa, a professor and chief executive officer of Universities South Africa, says the pressure the country’s higher education system is under threatens its financial sustainability. “Further cuts imply taking away from the already-low infrastructure grants and teaching and research subsidies,” he says. “This gradually erodes the quality of teaching, research and universities’ ability to maintain their research infrastructure – all of which brings into question the long-term sustainability of the system.”

Universities South Africa said in a media statement on 17 March: “In a democracy such as ours, the fact that the higher education system is unaffordable to the vast majority of households is antithetical to the purpose and role of our universities as drivers of national development, of producing a more equal society, of strengthening and deepening our democracy and contributing to the emergence of a more inclusive, competitive economy.”

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Mandisa Nyikili, student representative council (SRC) deputy secretary-general at Wits, says in 2020 students were “defunded by the National Student Financial Aid Scheme (NSFAS), [while] others were dropped by their bursaries due to the effects of the Covid-19 pandemic, and these students are left with [debts] from last year … [they] are expected to pay before registering.”

Along with budget cuts, “the subsidy per student has been in decline for more than a decade”, Bawa says. “The full bursary solution granted by the government to qualifying NSFAS students in December 2017 was not a sustainable solution for South Africa, given our underperforming economy, now exacerbated by the Covid-19 pandemic.”

The missing middle

Earlier this year, NSFAS announced a R5.6 billion shortfall in funding. According to Bawa, the shortfall adds to the existing problem of the missing-middle students, who are from households earning above the NSFAS threshold of R350 000 a year, but who are not wealthy enough to fund themselves or to qualify for study loans from banks.

“Missing-middle students, therefore, typically struggle with tuition fees and are mostly responsible for the enormous debt owed to the university system, estimated at R14 billion to date. The Covid-19 pandemic has likely left families in financial difficulties, thus adding to the number of missing-middle students in the university system. Hence, these current students’ demands for free registration and that historical debt be scrapped,” Bawa says.

Responding to financial exclusion and police violence, the South African Union of Students (SAUS) held a meeting, in which 26 university SRCs agreed to support a national shutdown on 15 March until their demands are met.

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Among others, the SAUS demands include that students be allowed to register and that their historical debts are cleared. “The University of the Western Cape (UWC) has set a good precedent in this regard. A failure to clear debt is setting [up] universities for protest and unrest,” reads a statement by the SAUS. 

In a university communication, UWC rector and vice-chancellor Tyrone Pretorius said: “The university understands the difficulties many students are experiencing and has decided to financially clear all students to allow them to register.”

Department of Higher Education and Training Minister Blade Nzimande responded to the SAUS, saying: “We are aware that there are many students whose families struggle to keep up with fee payments, and indeed many families who have also been negatively affected by the Covid-19 pandemic. However, given the difficult fiscal situation, all government departments, including the Department of Higher Education and Training have been subject to budget reductions in 2020 and 2021.”

Nzimande, who has shown insensitivity towards students, including saying during the #FeesMustFall protests that he will start his own movement called #StudentsMustFall, recently said of the yearly protests: “I’m concerned. Every year it is like a soapie now, The Bold and the Beautiful.

For Bawa, “any funding crisis on the part of NSFAS implies a crisis to historically disadvantaged universities, for whom NSFAS-funded students constitute up to 60% of their enrolment”.

Irregular expenditure at the NSFAS 

Students have questioned the competence of NSFAS, which does not communicate well and often pays late, affecting tuition, accommodation and living expenses. In its defence, Sibongile Mncwabe, NSFAS chief corporate services officer, says: “NSFAS is working tirelessly to improve on its system efficiency to ensure that responses to students are communicated on time.”

She also says NSFAS received 813 938 applications for 2021, and to date 719 413 have been confirmed eligible, with the rest not meeting the funding criteria while others await documents. 

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In mid-March, funds students were told were unavailable suddenly materialised. Nzimande announced that “Cabinet agreed that funding should be reprioritised from the budget of the Department of Higher Education and Training to ensure that all deserving NSFAS-qualifying students … receive funding support for the 2021 academic year”.

But Bawa says reprioritising funds from the higher education budget to make up for the NSFAS shortfall is a short-term solution.

“Although this resolves the problem for the qualifying first-entering NSFAS students for 2021, it does not provide a medium- [or] long-term solution for the sector.”

Administrative problems at the NSFAS also contribute to funding woes. During a parliamentary portfolio committee meeting on higher education, science and technology on 10 February, the Auditor-General of South Africa showed irregular expenditure of R50 billion by the financial aid scheme. 

During the meeting, a presentation for the 2019/20 audit outcome of the scheme revealed that “irregular expenditure was materially understated due to the NSFAS failing to consult with the minister when setting conditions and criteria for eligible students in relation to bursary awards, and failing to gazette those conditions and criteria”.

Part of the Auditor-General’s recommendations include a reassessment and update of the NSFAS Act “to be in line with [the] fee-free education announcement”. The scheme’s operations must be aligned accordingly.

The chairperson of the committee, Philly Mapulane, says: “This report is for 2019/20 and members must agree that the past two years represent the worst NSFAS has been. Items meant to be achieved through the administration were not achieved and matters got worse. The findings that propelled NSFAS to be placed under administration were still in existence.”

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Mncwabe, from the NSFAS, says: “It is important to indicate that there was no fruitless and wasteful expenditure incurred. Secondly, the irregular expenditure was totalling R7.5 billion and not R50 billion. Thirdly, this was not because of the monies that were unaccounted for but rather [because] the previous board approved the reallocation of historic debt to fund first-time entrant students for 2016, 2017 and 2018 academic years due to very low utilisation received by universities without obtaining approval from National Treasury as they thought it was not required. [And because of] erroneous disbursements due to inadequate controls in place, and thus in non-compliance to S51 of the Public Finance Management Act.”

In a meeting held between university vice-chancellors, the minister and his team on 16 March, a consensus was reached that for this year’s registration process, individual universities would use whatever means and mechanisms they had to address the issue with each student.

“But that this would be on the basis that the minister would establish a process to seek a long-term solution, which would also ensure a solution for 2022. Vice-chancellors are anxious that the solution should be an effective, sustainable one,” Bawa says. 

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