Fee scheme has to run the gauntlet

New model: The proposed student funding reforms can make higher education more equitable. But this will only happen if NSFAS is subject to public scrutiny, participation and oversight. (Delwyn Verasamy, M&G)

New model: The proposed student funding reforms can make higher education more equitable. But this will only happen if NSFAS is subject to public scrutiny, participation and oversight. (Delwyn Verasamy, M&G)

The government is planning a major overhaul of its student funding system. This comes in the wake of protests at the country’s universities that saw students successfully freeze fee increases for the 2016 academic year.

Government aid has been available to poor students for a number of years through its National Student Financial Aid Scheme (NSFAS), which falls under the department of higher education and training. But the scheme’s definition of “poor” – a family income of less than R120 000 a year – has left the “missing middle” stranded.

These young people make up the bulk of the school-leaving population each year.
Their parents are teachers, nurses, police and other civil servants whose annual income (on average between R151 728 and R363 930) is above the NSFAS threshold but not high enough to pay for university fees. As Rhodes University vice-chancellor Dr Sizwe Mabizela has pointed out, this means you have to be either desperately poor or wealthy to afford higher education.

The proposed overhaul will see NSFAS’s household income threshold rise to R500 000. This should see many more people get a shot at a university education, though where the university places will come from in an overstretched system is unclear.

At the same time, government plans to centralise student funding. Universities will lose their power to allocate student funds and NSFAS will control student funding directly.

To date, universities have managed their own NSFAS funds. This has been marred by financial mismanagement and allegations of fraud and nepotism at a number of universities.

Such changes seem positive. But there is nothing to guarantee that these reforms will be effective in supporting students. These reforms will only work if student funding is opened to public scrutiny and participation.

Hurdles to equitable funding
There appear to be four main hurdles to ensuring that student funding is equitable and efficient.

Government capacity: How will the department of higher education implement a complex grant of this magnitude given its other priority functions? In 2014, universities administered R9-billion in NSFAS funding to more than 400?000 students. How will NSFAS build the structures and the competencies to go from managing zero students to managing 400?000?

And if universities are mismanaging relatively small pots of funding, what is to prevent a national office from mismanaging a much larger central fund, which is more complex and difficult to oversee? NSFAS has struggled to both disburse funds and recover debt.

Student care: When universities manage NSFAS funds, students have direct access to financial aid services and counselling related to the process. This is important because most young people entering universities are the first in their immediate families to do so. They need care and support to navigate university life and student funding.

How will NSFAS provide such “care services” from a central office and ensure that students are not further alienated by red tape?

Local knowledge: The academics and support staff at each institution have local, particular knowledge of students’ strengths and weaknesses and the difficulties of each course. They sometimes admit students who are failing on paper, understanding that in practice and with sufficient support such students will succeed. Will the central management of student funding affect universities’ admission and selection criteria? Will deserving students be excluded, or will these students be forced into courses that they do not want to or cannot do?

Institutional autonomy is central to the functioning of universities. If the government begins to dictate who should be allowed access to universities, this autonomy will be lost.

Funding trade-offs: There are two ways to fund more students: either university costs go down or the higher education budget goes up. If additional money for NSFAS comes from the existing higher education budget, then university costs will have to go down. This has huge implications for quality.

Austerity measures, in the form of voluntary retrenchments, are already being implemented in some universities. The casualisation of academic staff is in full swing, with more than 50% of academics working on a contract basis. How can these processes be squared with student demands for a complete overhaul of the curriculum, the insourcing of workers and support for black academics?

On the other hand, the national budget for higher education could increase. South Africa spends only 0.71% of its gross domestic product on higher education, compared with double or more spent by countries such as India, Australia, Ghana and Malaysia. But next year there will probably be less money in the budget. The economy is stagnant and the price of borrowing will probably increase substantially if South Africa’s credit rating is cut to junk status. Where will the money for an increase in NSFAS funds come from?

Overcoming the hurdles
These hurdles can only be overcome if citizens have the information and the right to participate in setting the budget and overseeing NSFAS. At the moment the process is limited to a small number of government and university bureaucrats.

The first step to deepening democratic participation would be for Higher Education Minister Dr Blade Nzimande to provide full information about the forensic audit into alleged malpractices in NSFAS. There is no transparency about who is carrying out the audit, what their terms of reference are, the expected penalties and remedial action, or even the deadline for findings.

The second step is for NSFAS to make public its financial records so that citizens can identify delays in distributing NSFAS funds and how debt is recovered. The treasury has opened up the municipal budget dataset to public scrutiny and participation in line with South Africa’s international commitments to open data. The department of higher education can and should become an innovator and open government data to democratic oversight.

The third step is for citizens to participate in setting the national budget. Should universities cut their costs and, if so, should it be staffing costs? Should the higher education budget be increased and, if so, where should this money come from? Why does the government spend three times as much on the security cluster as on higher education?

The proposed funding reforms can make higher education more equitable and sustainable. But this will only happen if NSFAS is subject to public scrutiny, participation and oversight. – the conversation.com

Temwa Moyo and Nimi Hoffmann are PhD candidates at Rhodes University. Professor Sioux McKenna works in the Centre for Higher Education Research, Teaching and Learning at Rhodes

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