Free education is a noble plan, but can SA afford it?

2012-01-16 00:00

THE vision of free education for the poor, that is up for debate at the ANC’s national policy conference in June has many wondering if the National Student Financial Aid Scheme of South Africa (NFSAS) can sustain the high expense of such a policy. Higher Education and Training Minister Blade Nzimande announced that his department will table a report on the feasibility of the policy at the same conference.

With effect from last year NSFAS has put in place a measure to encourage tertiary students to work hard at their studies in order to pass. If a student is on financial aid and passes well, up to 40% of the loan amount will be converted into a non-repayable bursary.

In addition, for students in their final year, if the student passes and is able to graduate then the loan will be fully converted into a non-repayable bursary. This means that the total cost for your tuition fees, your residence fees (if you are staying in an on-campus residence, or in approved off-campus private accommodation) will be covered by this loan, and that reasonable allowances will be considered in respect of books, meals and travel allowances.

A total of 28 174 students were granted loans for the final year programme in 2011.

The total cost of funding for the 28 174 applicants was R926 611 834.

NFSA spokesman Xolani Gobelo said the complete results of this process will be finalised by the end of this month.

“As the conversion of the loan to a bursary depends on whether the student passed all subjects and is able to graduate, the final number of those who benefitted from this programme will only be know once all universities have supplied NSFAS with final graduation figures,” he said.

Chris Hart, Investment Solutions chief economist said the policy of free tertiary education for the poor could work if students understood the consequences of having free spending power.

“We all know what living expenses mean for students so if the student uses this loan and is unable to obtain good results at the end of the year and has to repay the loan they will be left in huge debt.

“I would suggest that the academic performance of a student be monitored on a half-year trial basis. If the student is not doing well in the middle of the year they cannot be expected to make a turn around and perform better at the end of the year. Education is expensive especially with the high dropout rate in South Africa which could see this scheme becoming unstable,” he said.

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