Midterm budget: More money thrown at skills training

Minister of Finance Pravin Gordhan came down hard on the failings of South Africa's education system on Thursday. "Where we have large sums of money assigned, we need to get much better outcomes than we have to date," he said at a press briefing before delivering his medium-term budget.

Although education remains the single largest area of government spending it continues to be notorious for producing young people who are ill-equipped to meet the rigours of the modern economy, which has fuelled the minister's ire.

Nevertheless, he gave the higher education and training department, which has universities, further education and training (FET) colleges and sector education and training authorities (Setas) in its care, more cash. The Setas and the national skills fund were the main beneficiaries.

Although the budget has increased support to South Africa's 23 public universities year on year, their capacity is stretched to breaking point – a major reason for Gordhan's unprecedented fiscal escalation in his 2011 budget for skills development, which targeted both the FET colleges and the Setas.

This week's medium-term budget policy statement recognised that universities were on track for their enrolment targets – from the current 910 000 this year to 960 000 by 2014-2015 – but there was no financial relief for them: subsidies to universities remain at their February budget level of R23-billion.

Capital spending
On the other hand, the drive initiated in 2011 to expand FET colleges shows no sign of abating. The government will spend an additional R94-million on the colleges in all spheres: salaries, institutional support and capital spending.

"Each of the colleges has already received funds to take in lots of students," said Joy Papier, director of the FET Institute at the University of Western Cape. "And the national student financial aid scheme has been extended to take in more students."

Greater bursary funding for ­college students is intended to take enrolments well beyond their current 300 000 and to outstrip university enrolments within two or three years. But analysts continue to doubt whether the notoriously underperforming colleges have the capacity to deal with large intakes – and this week's budget said nothing about the quality of the training young people will receive.

Papier said that the colleges face deep structural obstacles.

"The problem with FETs is not really a funding issue at the moment," she said. "You can't really throw more money at it."

The delay in shifting the governance of the colleges from provincial to national control was one example, she said.

Registered artisans
Similarly, as the bridging bodies between industry and training institutions, the Setas are not expected to meet their target for registered artisans. To date, only 7 000 artisans have been registered, although 31 000 were targeted for the 2012-2013 year. Capacity constraints at workplaces to accommodate trainee artisans is one of the problems.

Despite this, the medium-term budget increased funding to the Setas by R1.4-billion and its ally in skills development, the National Skills Fund, received an additional R358-million.

In basic education, the department underspent on infrastructure in particular, but still managed better spending in the first half of this year than in the first half of 2011-2012. This increase amounted to R1.08-billion – 16.08% of the main budget.

Teacher education bursaries continue their upward funding surge, with nearly 12000 Funza Lushaka teacher training bursaries awarded within the first six months of the year.

But the roll-out of the department's information technology systems, such as the learner unit record tracking system, is slow. Only 16 424 public schools are using the system against a target of all 25 600 schools. Although it was hoped that 11.2-million pupils would be recorded on the system by 2013, only 7.2-million have been recorded so far.

Ruksana Osman, head of the University of the Witwatersrand's school of education, said that better-focused interventions by the government were needed to address the dire learning conditions in schools in both rural and urban areas.

"Although the department of basic education has several priorities, we need to be much more targeted about infrastructure and teacher development. Student feeding schemes are also important, given the conditions under which some students attend school."

See the rest of the M&G's medium-term policy statement coverage:

Government debt to rise as tax revenues wobble
Pravin Gordhan has offered some optimism for SA's economic outlook, despite his mid-term budget signalling plans for a rise in government debt.

Midterm budget: Government failing to create jobs
The midterm budget policy statement has revealed that the government is failing at creating jobs, outside of the expanded public works programme.

Midterm budget: Money put aside to revamp mining sector
In response to developments in mining, the medium-term budget policy sets out imperatives to modernise the industry and amend labour relations.

Development cash linked to delivery
The government wants more bang for its buck when it comes to provincial and local government infrastructure roll-out.

Midterm budget: Strikes cost economy dearly
The treasury says unrest has had a negative impact on growth, adding tax revenue will be lower as wildcat strikes are estimated to have cost R10bn.

Fighting talk from Pravin Gordhan
Finance Minister Pravin Gordhan tightened his belt, chided the country's critics and delivered a no-nonsense medium-term budget policy statement.

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