Free higher education for some students will lead to R61bn funding shortfall

2017-10-25 14:21 - Liesl Peyper

Cape Town - If government were to finance the full cost of study for 40% of undergraduates in South Africa it would create a funding shortfall of over R61bn over the next three years, National Treasury said in its medium term budget policy statement (MTBPS) of 2017.

In addition, covering the full cost of study for all students of Technical and Vocational Education and Training (TVET) colleges would amount to R23.5bn over the next three years.

Finance Minister Malusi Gigaba said in his mini budget speech on Wednesday that the student movement in South Africa has “correctly” put the issue of higher education at the centre of South Africa’s transformation agenda.

“The budget already makes an already enormous contribution (towards higher education). The sector’s budget is the fastest growing element of expenditure over the medium term, rising from R77bn this year to R97bn in 2020/21.”

Waiting on Zuma

Gigaba said the Commission of Inquiry into higher education has submitted its report to President Jacob Zuma on the feasibility to provide fee-free education and provide funding for the full cost of study for poor and middle-income students. “We await the President’s determination and announcement in this regard.”

He also undertook to make “further announcements” on higher education funding in the 2018 Budget.

In the MTBPS National Treasury estimated if government were to target additional subsidies to 75% of undergraduates in the poor and middle-income category, spending on post-school education would be 4.1% of GDP by 2030/31.

Government proposes to allocate R1.1bn over three years for infrastructure projects at higher education institutions to improve student accommodation which will result in 300 000 new beds at public universities and TVET colleges by 2026. 

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