Universities and the department of higher education may be heading for another showdown with student protesters, as it emerged this week that National Treasury had not budgeted for zero increases in tuition fees at universities next year.
This was part of the grim picture that emerged about the finances of South Africa’s universities at the Fees Commission, which began its hearings into the matter this week.
The commission, appointed by President Jacob Zuma following last year’s student protests, is investigating fee-free higher education.
But cash-strapped universities – some of which rely on tuition fees for more than a third of their income – should not expect a helping hand from the government.
A presentation made by Treasury to the commission on Friday showed that, although the smallest part of the budget was spent on higher education, it was already stretched thin.
Michael Sachs, the head of Treasury’s budget office, said: “Prospects for economic growth are limited and Treasury forecasts that state debt will amount to R2.3 trillion by 2018.
“It will be difficult to channel money to higher education from elsewhere.”
Sachs added that, as a result of there being no increase in tuition fees last year, Treasury had been forced to redirect R16 billion that was meant for service delivery and local government to higher education.
He confirmed that the government had not budgeted for no increases in tuition fees for 2017.
“We will adjust the budget if we have to, but it would be better if we could come to an agreement, to ensure that important government functions are not compromised,” he said.
This news follows various presentations from universities and the department of higher education, which show that the financial sustainability of universities rests increasingly on the shoulders of students, with government subsidies covering fewer expenses and donations from the private sector declining.
According to a presentation by the higher education department, fewer students are paying tuition fees following last year’s #FeesMustFall protests – even those who can afford to do so.
This comes at a time when student debt is skyrocketing and universities are increasingly reliant on tuition fees.
Gwebs Qonde, director-general of higher education and training, said that over the past two years, student debt had almost doubled, from R3.6 billion in 2012 to R5.3 billion in 2014.
This amount did not include the money owed by students to the National Student Financial Aid Scheme.
Qonde said five universities indicated that they had made a loss in 2014.
Over and above these universities’ battles to collect tuition fees, student debt is often in excess of the amount of money the institutions collect in a year.
At Unisa, University of Johannesburg and Rhodes University, tuition fees make up almost half of the total income.
At University of the Witwatersrand (Wits), University of Pretoria (UP), Stellenbosch University, University of Cape Town and North-West University, tuition fees comprise a third of total income.
In its presentation, UP that it would make a loss of R100 million in 2018 if tuition fees for next year were not increased by at least 8%.
On top of this, the department of higher education has told universities to set aside money for planned repairs to equipment and infrastructure, which is estimated to cost R25 billion.
Qonde admitted that state funding had decreased by 3.4% per student in real terms over the past 11 years, as a result of inflation and a growing student population.
“Universities spend the majority of their budget on salaries (53%), but despite that, the relationship between students and academic personnel worsened in past years,” said Qonde.
Private sector investment in tertiary education is also decreasing.
According to Wits vice-chancellor Professor Adam Habib, private sector donations declined from R51 million in 2010 to R37 million in 2015.
As a solution, universities are proposing a sliding-scale method of determining tuition based on household income.
The more money students or their parents earn, the more they will have to pay to study.
“Tuition fees should be a contribution to the cost of higher education and not a means of excluding people from it,” said Professor Cheryl de la Rey, UP’s vice-rector, in her presentation.
On Friday, police were deployed to Wits in anticipation of an announcement regarding fees later that day.
Various student organisations began mobilising on Facebook, but Higher Education and Training Minister Blade Nzimande cancelled his announcement at the last minute. – Rapport