Committee Staff analysis of budget of Department of Higher Education & Training, Legacy Report, in presence of Minister and Deputy Minister

Meeting report

Ms Y Phosa (ANC) requested that a moment of silence for prayers and meditation be observed before the commencement of the meeting.

Fourth Parliament’s Portfolio Committee Legacy Report: Committee Section briefing
Ms Mamphago Modiba, Content Advisor to the Committee, presented the Legacy Report of the Fourth Parliament’s Portfolio Committee, and a Higher Education sector overview. Ms Modiba outlined the setting up of the Department of Higher Education and Training (DHET or the Department) and the aim of developing a single and coherent national education system. She noted the legislative framework from which the DHET derived its mandate and the Bills processed by the Fourth Parliament’s Portfolio Committee from 2010. Ms Modiba acknowledged the existing need to align legislation with the provisions of access and opportunities to education on various levels.

She reiterated the legislative function of this Committee and its responsibility to oversee the following Bills:

The Higher Education Laws Bill 24 of 2010
The Skills Development Levies Amendment Bill 25 of 2010
The Higher Education and Training Laws Amendment Bill 26 of 2010
The Further Education and Training Colleges Amendment Bill 13 of 2011 (which repealed the Adult Education Act)
The Higher Education Laws Amendment Bill 14 of 2011
The Skills Development Amendment Bill 15 of 2011

Sector Overview
Ms Modiba emphasised the extensive nature of the Committee’s oversight over a large sector, and its role also in relation to other sectors of government. The oversight was inclusive of the current 25 universities and a Health and Science University which was to be established in 2015. She noted that the institutions which required oversight included technical institutions and comprehensive universities in addition to the existing universities, and two National Institutes for Higher Education (NIHEs) in Mpumalanga and Northern Cape, and coordination in Mpumalanga. Ms Modiba noted that the disestablishment of some institutions was engaged upon in 2013, but it was uncertain when the disestablishment would come into effect.

There were currently 50 Further Education and Training (FET) colleges with 300 campuses, and 12 more were to be established in the rural area to increase the existing number of vocational institutions. Ms Modiba noted that this was in addition to Public Adult Learning Centres, 21 Sector Education and Training Authorities (SETAs) and the Institute for National Development of Learnerships, Employment Skills and Labour Assessments (INDLELA). She noted the legacy of corruption, mismanagement and maladministration with regard to the SETAs which required additional oversight. The Committee must additionally exercise oversight over the National Student Financial Aid Scheme (NSFAS), the Quality Council on Trades and Occupations (QCTO) and the South African Qualifications Authority (SAQA).

Ms Modiba acknowledged that adult education still was a concurrent function of national and provincial levels. She noted that the strategy for the centralisation of colleges at one time to evaluate the sector holistically had resulted in a successful general overview in 2013.

Department of Higher Education and Training Strategic Objectives
Ms Modiba indicated that there has been a significant increase in enrolment within the Humanities and Arts faculties and that an enrolment increase was required in the Science, Engineering and Health Sciences faculties to create the necessary skills for the economy, especially where skills shortages existed. She further indicated an increase in the enrolment of previously disadvantaged groups was desired, in addition to academically-deserving students being more able to access Higher Education by means of NSFAS funding. Ms Modiba emphasised that the Technical and Vocational programmes should be available, in response to the demands of the labour market, with improved linkages between the theoretical components and the workplace.

Ms Modiba indicated an increase in enrolments for Technical and Vocational Education and Training, universities, and female university students. There had also been an increase in the enrolment rates of African and Coloured students between 20016 and 2011. However, she noted that the enrolment of Indian and White students had decreased during this period and recommended that these statistics be investigated.

Sector Challenges
Ms Modiba indicated that there was insufficient capacity within the Higher Education system. The Department had stated that the intermediate skills provided by institutions had generated interest, but the increase in enrolment statistics was countered by the factual inability of students to enrol in universities, as there was insufficient capacity. This had contributed the high FET dropout rate, as students de-registered from these institutions once their enrolment in university was successful.

It was noted in the last Parliament that every university had indicated that it had inadequate funding. Ms Modiba explained that universities received funding from three sources - student fees, third-stream research and fundraising, and government, which contributed 40% the institution’s overall funding. She indicated that the economic climate often led to the withdrawal or decrease of funding in the third-stream. As a result, institutions compensated for the loss in funds by increasing student fees, and this led to contention between the students and university management. Ms Modiba indicated that sustainable funding was needed.

An inadequacy in the funding of research was noted as another challenge for universities. Some universities were unable to match the calibre of others, based on their funding challenges. For instance, UCT received 80% research funding from foreign donors and therefore the agendas of international entities were prioritised over those of national interest. The Department needed to make incremental efforts to meet targets through funding for research, and it was suggested that universities at risk needed to be identified.

Ms Modiba noted poor governance in universities as a challenge and indicated that four universities had already been placed under administration for maladministration and corruption. It was emphasised that the Department and Committee must ensure that the systems set up by the administrators were maintained, through a strategy or system to evaluate universities at risk. She indicated that although institutional autonomy limited the intervention capacities of the Department and Committee the hope was expressed  that universities would cooperate with the proposed system.

Shortage of student housing was identified as another challenge facing universities. Ms Modiba indicated that there had been an increase in student absorption rates since 1994, but there was a discrepancy in that there was insufficient expansion of infrastructure to accommodate the growth. There was limited accommodation for rural students in urban areas, which resulted in unscrupulous accommodation providers who failed to provide adequate studying and living environments for the students. Ms Modiba noted that universities claimed that they received insufficient funding for maintenance and indicated that government was now providing this funding to maintain current accommodation.
 
It was further acknowledged that the high student: lecturer ratio was limiting the ability of lecturers to conduct research. She also noted that there was a low production of postgraduate students as a result of limited funding for postgraduate studies, aside from national research. In addition, the prospect for students to undertake postgraduate studies was limited as students were often expected to give financial support to their parents after obtaining their qualifications.

Ms Modiba indicated that a further problem was that the labour market was not sufficiently responsive in absorbing graduates. As a result, students did not pursue postgraduate studies as they perceived themselves to be too highly qualified whilst the prospects of work remained low.

Transformation remained an issue in universities. She noted that the formerly-white universities showed domination by whites in senior positions, whilst the same applied also to the formerly-black universities, and the need for transformation at management level was noted. Furthermore, Ms Modiba emphasised the mutual need for enrolment and graduate quotas to correspond.

It was noted that women generally had various responsibilities aside from academia, which limited their time for research and postgraduate studies. Ms Modiba indicated that Rhodes University had established a programme for women academics, by means of a retreat with supervisors available. This programme was replicated in Limpopo, and proved successful. Such programmes could be implemented elsewhere to provide support to female academics to complete their research, with the funding of the Department.

It was acknowledged that the throughput rate in universities was low, for a number of reasons, including social factors, students being ill-prepared and a lack of supportive programmes. The inability of students to balance the demands of the university system and their social needs had contributed to a high failure rate amongst first year students.  Even the National Student Financial Aid Scheme (NSFAS) contribution would  not ensure success. The funding made available did not cover the total cost of study and the proportion of financial need differed by institution. She noted that students at the University of Cape Town tended to have smaller financial needs and there, more in-house bursaries were also made available, whereas other university student cohorts may, by comparison, have greater financial needs. At present, the allocations of funding were reached on a division between a number of students and this may be insufficient. In addition, the lack of foundational and supportive programmes was identified as a cause of ill-prepared students entering the Higher Education system.

Training and Vocational Education and Training (TVET)
Ms Modiba noted that there were concerns about the articulation from FET colleges to universities. Graduates with an NCV equivalent qualification were not readily accepted, despite having equivalent qualifications. She stated that the current Committee needed to engage with this concern to ensure smooth articulation, whilst maintaining sufficient enrolment in the FET system.

Modiba noted that the access to practical work engagement remained a challenge for students at FET and TVET colleges.

The distinction between weak and strong colleges created a challenge in improving linkages with the labour market. The formerly or traditionally-white colleges remained strong, with adequate linkages to the labour market. She noted that FETs in areas where industry was based, such as Rustenburg, provided the students with exposure to the practical labour market and coaching opportunities. It was established that an abundance of programmes with work-based learning requirements were inadequately situated to create the linkages required for the qualification.

The poor governance practices and maladministration of FET colleges was established as a further challenge. Six out of eight FET colleges in the Eastern Cape were placed under administration, and this was of huge concern. The Department needed to exercise better oversight over these FET collages.

Ms Modiba further indicated that there was a shortage of qualified lecturers in TVETs, owing to an inability of colleges to pay lecturers adequately. Many lecturers did not have a teaching qualification and often only hade experience in industry, and therefore were not adequately equipped to teach. Furthermore, there was an attrition of Science and Engineering lecturers, as they are paid the equivalent of teachers’ salaries, and this was something needing to be reviewed by the Department.

Ms Modiba added that certification rates were low. She indicated that many students had qualified in their respective courses yet had not received certificates. It was noted that the backlog from 2007 had only been addressed now and some students who were still awaiting certification had become redundant in the interim period.

Furthermore, the leakage of exam papers and delay in issuing of results owing to periods of investigation by Umalusi was identified as a concern. Modiba indicated that students would receive a provisional pass, but then be notified that they had failed when the results were released, and this contributed to the high dropout rate. The decision for students to deregister was prompted by their lessened morale, costs incurred, increase in the duration of courses and their inability to adequately prepare to meet examination requirements in time. Ms Modiba emphasised the need for the Committee to address all of these concerns.

National Student Financial Aid Scheme (NSFAS)
Ms Modiba indicated that there was a R2.5 billion shortfall in NSFAS funding and that the financial aid scheme required three times its current budget to fund a full term of study. It was also noted that corruption by students and financial aid officers had created concerns. Sometimes, the fraud took the form of fraudulent documents being submitted by students or inadequate verification by administrators. It was also indicated that the misappropriation of funds had been an issue in the past which had undermined the purpose of the financial aid scheme.

Ms Modiba noted that the misalignment of the academic year and financial year remained a challenge for universities as it led to conflicts between students and the university management.

The 2013 Committee Budget Review and Recommendation Report recommendations were referred to as being a guideline for the budget review by the National Treasury.

Discussion
Ms M Nkadimeng (ANC) thanked Ms Modiba for her comprehensive presentation and was pleased to hear about the significant increase in female enrolment. She said that the learners who could not get admission to the universities resorted to enrolment at FET colleges, and queried what the Department was doing in response to this. Furthermore, underprivileged students could not pay the required university deposit and queried how the DHET was responding to this circumstance.

Ms Nkadimeng observed that many colleges have been closed down and the educators remaining were growing older. Few learners are studying to teach professionally, which contributed to a lack of new educators coming on board.

Mr M Mbatha (EFF) asked if it was possible to utilise or even add to the recommendations of the previous Committee for the current financial year, to create an alignment with committee recommendations previously made. He wondered whether the Committee wanted to endorse the budget recommendations, or needed to engage with National Treasury on them.

Ms S Mchunu (ANC) asked if a full audit was conducted to determine if the infrastructure of former teacher colleges was now being used for educational purposes, and used to their full capacity.

Ms Modiba stated that some of the Members’ questions would have to be put to the DHET, for its response. She clarified, for Ms Nkadimeng that NFSAS-qualifying students did not pay registration fees. However, some universities required family contributions of R1 000 or stated that the lack of operational funds while the budget was still being approved meant that students would be required to pay such fees.

Ms Modiba confirmed that universities were providing education-training programmes and that the former centre in Mpumalanga has been re-opened for teacher training. The new universities will offer Teacher Development programmes, and some colleges would be opened if there was a need, as Foundation Phase Education programmes had already been established in some universities.

Ms Modiba responded to Mr Mbatha by saying that the budget recommendations were a guideline in relation to increments, and may be submitted to National Treasury to decide if funding will be granted. Members should enquire about the progress of implementation of the previous recommendations, from the DHET. Once the Appropriations Bill was passed, shifts could be recommended.

Ms M Phosa (ANC) asked what had informed the budget being referred to.

Ms Modiba replied that Ms Phosa’s would have to engage with the DHET on this question. Budgets were proposed by entities and the Department, and Parliament was required to make recommendations based on the proposed figures. This was in order to evaluate shortfalls and mitigate them.

Ms Phosa indicated a concern that the recommended budget figures may be inflated.

Ms Modiba responded that the reflected amounts were medium-term budget proposals which could be broken down to assess them against the actual need.

Budget Analysis presentation
Ms Phosa emphasised that the budget oversight was a necessary preparation for the budget presentation to Parliament, and noted that members might be requested to debate the recommendations on the day that the budget was presented.

Mr Lindumzi Komle, Committee Researcher, indicated that the Budget Analysis had been sent to Members prior to the meeting. This Committee must, through oversight, hold the Department accountable.

The Chairperson welcomed the Minister and Deputy Minister of Higher Education and Training arrived during the presentation to the Committee, having been observing it live for the previous half hour.

Mr Komle proceeded, introducing the terms used in the budget, and explained the distinctions between nominal and real rates of inflation and how they had affected the projections in the budget. It was indicated that the budget allocations were formulated to correspond with each of the five programmes of the Department.

Mr Komle indicated the increases and deficits in the relevant programmes in his presentation (see attached document for full detail). He highlighted that there had not been an increase in research funding amongst other sectors.

Mr Mduduzi Manana, Deputy Minister of Higher Education and Training, indicated that last year was declared as “The Year of the Artisan”.

Mr Komle noted that the budget should reflect the emphasis on this.

He indicated that the budget had increased by R2.5billion in nominal terms. He reaffirmed that student enrolments had increased and indicated that funding should increase provisionally to accommodate growth in order for the budget to perform adequately. He indicated that budget should also accommodate the universities which were being opened and that would require oversight.

Discussion
Mr Mbatha asked what the Department’s programme of action would be for the “Year of the Artisan” and stated that this programme should be followed by artisan training. He also asked what was allowable and realistic in terms of the budget, on an annual basis.

Mr Komle replied that Mr Mbatha’s question would be best directed to the Department.

The meeting was adjourned.