Students owe half a billion

2014-02-02 14:00

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Aid scheme hires agent to track debtors

The National Student Financial Aid Scheme has enlisted the services of a tracing agent to try to recover the more than R570?million it is owed.

Protests swept the University of Johannesburg, the Durban University of Technology, the Mangosuthu University of Technology and the Tshwane University of Technology last week as students demanded to know why there weren’t funds available for them to register.

This year’s budget for the fund, which expects to help more than 450?000 students in 2014, was set at R9?billion, but the protests saw Higher Education and Training Minister Blaze Nzimande increase it by another R1?billion on Thursday.

The aid scheme’s chief executive, Msulwa Daca, told City Press the fund had collected about R450?million from its debtors last year, but more than R570?million was still outstanding. He conceded that it was not easy to trace some former students.

“We have now enlisted the services of a tracing agency.

“We also use the government’s personnel and salaries management system, the revenue services and credit bureaus to track people who owe us.”

Scores of other bad debts have been written off – though Daca was not able to provide a figure, nor to say exactly how many people owe the fund.

On Thursday, Nzimande said the demand for the fund was outstripping supply, so the fund – and the department – are getting tough: Students who performed poorly last year simply will not be funded again this year.

Currently, Nzimande’s office gets money from Treasury and passes it on to the aid scheme.

The fund then divides and allocates the money to different universities and colleges.

But Nzimande said this would now stop because it was responsible for many of the problems experienced by the fund, which have led to the protests over the past week.

“There are no National Student Financial Aid Scheme offices in universities. Money comes from scheme to universities and we tell them: ‘Here is the money, do what you will with it.’ Universities will still do the admissions, but money will now come directly from the fund.”

He said universities’ financial aid offices distribute the funds as they wish, which may not be in line with the wishes of the department.

The fund has also introduced a central application process for loans and bursaries, which is already being piloted, Daca said.

“Once students are employed and earning in excess of R30?000 per annum, we start deducting what is due to us. The percentage deducted is based on the annual income of the debtor, it is not the same [across the board]. Up to 40% of a student loan can be converted into a bursary depending on the academic performance.”

Daca blamed the advent of Further Education and Training colleges for the increase in demand and the fund’s struggles to keep up with this.

Still, he and Nzimande are upbeat. Nzimande has even labelled the fund as “one of the ANC’s best success stories of the last two decades”.

“Can you imagine what would have become of the 1.4?million [people who have been funded in the past 23 years] had they not received assistance from us? Their stories would have been tragic,” said Daca.

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