What free education could cost us

President Jacob Zuma’s decision to institute free tertiary education could leave South Africans with an uncomfortable choice: better education or better healthcare.

Those starting university in 2018 will be the first to benefit from free tertiary education.

The move is expected to cost the government at least R35-billion in currently unbudgeted-for expenditure, according to projections made by youth development organisation the Thusanani Foundation in a submission to the Heher Commission into the Feasibility of Fee-Free Higher Education and Training.

Although analysts have welcomed the move to increase access to further education, they warn that South Africans will face tough trade-offs to find the money to fund it. One of these trade-offs may be the quest for better and more equitable healthcare under the National Health Insurance (NHI).

What is the National Health Insurance? 

[multimedia source=”http://bhekisisa.org/multimedia/2017-07-10-will-the-national-health-insurance-cost-you-more-money”]

Over the next three years, the country’s health budget will grow a mere 1.7% when adjusted for inflation, revealed an analysis of the medium-term budget policy statement by the Rural Health Advocacy Project (RHAP). Already, only about 35% of provincial health budgets are dedicated to service delivery because two-thirds of budgets go to pay salaries, found a 2016 report by the nongovernmental organisation.

“The bottom line is that we don’t have the money to pay for our current spending with the budget that we have. That’s why transforming the way we fund healthcare is necessary,” warns RHAP health systems and policy manager Russell Rensburg.

Under the NHI, healthcare funding would change to allow the government to pool private and public funding to become the single largest buyer of healthcare services. By doing this, Health Minister Aaron Motsoaledi says the government will be able to more equitably distribute healthcare funding among citizens and, for instance, negotiate better deals through buying larger quantities of commodities such as medicine.

But South Africa will have to almost double public healthcare spending by 2025 to bring the NHI to life, says a July white paper.

The introduction of free higher education may make it even more difficult to do this.

“There is a good chance that the NHI would be put on the back burner because of the lack of funds available,” warns Daniel McLaren, budget analyst for public litigation organisation Section27.

“No one disagrees that this [free tertiary education] is a policy priority. The question is, is this being thought through and implemented in the right way?” he asked.

The National Education Health and Allied Workers Union has welcomed Zuma’s announcement, which spokesperson Khaya Xaba described as “unexpected”, but said it hoped the move would not compromise the government’s commitment to the NHI.

National Treasury likely to safeguard medical aid tax credits
If the move to free higher education does bode poorly for the NHI, it’s the latest setback for the move to universal healthcare this year. In October, Finance Minister Malusi Gigaba hinted that R20-billion in cuts to medical aid tax benefits that were slated to fund the NHI were unlikely to materialise, after the treasury found that it would hurt low-income earners, according to the medium-term budget.

In place of the R20-billion in potential NHI funding, the treasury offered about R700-million, says RHAP’s Rensburg. In its latest budget speech, the treasury also flagged the NHI as one of several government ambitions, alongside higher education reforms, that would have to “be revisited” because of their high cost and the country’s poor economic growth.

Responding to Zuma announcement late Saturday, the treasury tweeted that it had “noted” the president’s decision and was reviewing proposals on higher education ahead of the 2018 budget.

The University of Johannesburg’s senior lecturer in economics Seán Mfundza Muller says that some of the easiest cuts to free up resources for higher education may remain unpalatable to some.

“They are going to have to make cuts to other expenditure, and there may be resistance to cutting some ‘fat’ — extra ministries, ministerial perks. [Government] may feel it’s easier going to look at social grants or health or even infrastructure spending … because you only see the effects of those cuts five years down the line.”

Subscribe to the M&G

These are unprecedented times, and the role of media to tell and record the story of South Africa as it develops is more important than ever.

The Mail & Guardian is a proud news publisher with roots stretching back 35 years, and we’ve survived right from day one thanks to the support of readers who value fiercely independent journalism that is beholden to no-one. To help us continue for another 35 future years with the same proud values, please consider taking out a subscription.

Related stories

Why Covid likely won’t change the plight of community health workers

In the absence of action from the health department, South Africa’s community health workers are once again having to fight for their rights, with a nationwide strike planned from 9 November.

Hashtag lessons from the US and South Africa about racism and antiblackness

The #Black Lives Matter, #RhodesMustFall and #FeesMustFall movements show that democracy cannot happen without decolonisation

Unnatural: Conservation is yet another legacy of colonialism

Using assumptions and faulty tools leads to racist conclusions about why so few black students are taking up biological sciences

Spain did it, so why can’t South Africa nationalise healthcare to save lives?

South Africa is working towards establishing a publicly-funded universal health service and now, amid the coronavirus pandemic, is the time to implement it

The coronavirus and Africa: Exposing our vulnerabilities and inequalities

Africa is no stranger to dealing with epidemics. A regional body has been established to co-ordinate responses, but fault lines are evident at a national level

Subscribers only

Q&A Sessions: Frank Chikane on the rainbow where colours never...

Reverend Frank Chikane has just completed six years as the chairperson of the Kagiso Trust. He speaks about corruption, his children’s views and how churches can be mobilised

ANC: ‘We’re operating under conditions of anarchy’

In its latest policy documents, the ANC is self-critical and wants ‘consequence management’, yet it’s letting its members off the hook again

More top stories

Hope grows on Durban beachfront

Ten homeless men who turned a vacant lot into an organic vegetable garden are now reaping the rewards of their toil

Shabnim Ismail bowls her way into the record books Down...

The night before Australia’s Women’s Big Bash League (WBBL) final, fiery South African fast bowler Shabnim Ismail lay awake pondering how...

Hawks make arrest in matric maths paper leak

Themba Daniel Shikwambana, who works at a printing company, was granted bail and is due to return to court in January

Andile Lungisa: Early parole for the house of truth

Disgraced Nelson Mandela Bay councillor Andile Lungisa calls for a change of leadership in the ANC immediately after being released on parole

press releases

Loading latest Press Releases…