Portfolio Committee was briefed by the Department of Higher Education and Training (DHET) on its 2014/15 annual report. Issues concerning the satisfaction of students at various campuses were deliberated, as well as the Department’s financial challenges -- particularly the fact that the compensation of employees took up a large part of the annual budget. The Department had not been able to fulfil most of its targets, and this was worrisome. The Committee questioned the extent to which the DHET was working together with the Department of Basic Education (DBE) and National Treasury to address some of the challenges that were beyond the resources of the Department itself.
The Financial and Fiscal Commission (FFC) provided an analysis of the annual reports of the DHET and the National Student Financial Aid Scheme (NSFAS). It gave a contextual background to the serious conditions facing the institutions of higher education and the financial constraints looming in the coming years, as government expenditure was not likely to meet all the demands of the public, especially with the increase of access to higher education in the country. The Committee could only seek questions of clarity from the Commission, as it was not accountable to the Committee. The committee needed their independent analysis so that they could hold the entities concerned to account for their progress.
In the briefing by the Quality Council for Trades and Occupations (QCTO) on its 2014/15 annual report, the Committee expressed its satisfaction with the achievements against the targets, and indicated that the entity had to work hard to ensure that there were no illegal businesses offering the public qualifications without verification. Members questioned how QCTO was going to ensure accurate verification of qualification providers, and what measures had been put in place to scrutinise any illegal circumstances.
In the briefing by the National Student Financial Aid Scheme on its 2014/15Annual Report, Members were excited about the hopes raised by the new chairperson of the board, Mr Sizwe Nxasana, who informed the Committee about strategic goals that had been set for the improvement of loan recovery and for facilitating better access to the funds. The Committee questioned the entity on its inability to fundraise, and the entity admitted that at this stage, it was receiving no private sector funding.
Department of Higher Education and Training on 2014/2015 annual report
Mr Theuns Tredoux, Chief Financial Officer: DHET, said that the audit committee had been satisfied with the operations within the Department. It had emphasised the system of internal control, while matters of non-compliance had been raised in the internal audit. There had also been concern on the collation and reporting of performance information.
The Department had received an unqualified audit opinion from the Auditor General (AG). In Programme 3, there had been no material findings. In Programme 4, there had been an inability to obtain information on the reliability of reported performance information, and in Programme 5, the AG had been unable to obtain sufficient evidence on the achievements, and misstatements had been found on the reported performance information. The main challenge to the Department was insufficient implementation of action plans to address internal controls, inadequate consequence management, funding and human resources capacity. The Department had a R1.16 billion budget, most of which was spent on compensation of employees and human resource development. In dealing with some of these challenges, the Department would commit to submitting regular reports to the Minister and the audit committee.
Mr E Siwela (ANC) said the non-achievement of targets was worrying, especially in Programme 1 (Administration), where none of the targets had been achieved. Only 9.3% of the directors had signed performance contracts -- who had not signed, and why? Why was it difficult for the Department to comply with supply chain procedures?
Prof B Bozzoli (DA) said the Department was at a risk of collapse if the staffing issues were not dealt with. What extra hours were being put in by staff working overtime? The dysfunction of various DHET institutions had not been well reported in the report, and there should be honest and in-depth comment. The Department must liaise with the Department of Basic Education (DBE) to ensure they did not carry the burden of that Department, especially in matters of Maths and Science. Wasteful expenditure must be justified. There had also been 20 legal claims -- who was claiming against the Department, and for what?
Mr J Mahumapelo (AGANG) asked about the strategies that would be adopted to deal with the inability to reach targets.
Ms S Mchunu (ANC) indicated that more attention should be paid to issues of education in this country. Evaluation and monitoring were crucial for determining where implementation was not taking place. How was the Department planning to achieve its targets, when resources were allocated, but with no results? The Department was failing to save money. Instead there was a lot of over-spending, and this occurrence was not justified. The Department was not using state money properly.
Mr Gwebinkundla Qonde, Director General: DHET, said the Department accounted for the money that had been allocated to it for the purpose of fulfilling its mandate. The mechanisms were related to the accounting and monitoring of the Department, and a closer look must be taken on the responsibility of the leadership of the Department. Sector Education and Training Authorities (SETAs) were under administration due to their inefficiency. The Minister had put in writing his concerns over the University of Fort Hare, hoping to deal with the matters arising as soon as possible. Regarding mathematics and science, the National Development Plan had prioritised the mainstreaming of these subjects. Moderators, examiners and markers were paid by the Department at the Technical and Vocational Education and Training (TVET) colleges.
Mr Firoz Patel, Deputy Director-General: Planning and Monitoring, DHET, said that an implementation directory had been adopted, but had been delayed by the contradicting demands of trade unions. The Department had inherited staff from the previous Department of Education and Labour, and had had to do job evaluations prior to their integration into the new DHET. The service to perform this evaluation had been outsourced, and 119 posts had been evaluated in total. The reason people had not signed their performance contracts, was because some had terminated their contracts, and some had recently joined the Department. No action had been taken, because there was no need for it. In terms of the extra hours, since 1 April 2015, 1 008 extra hours had been worked by lower level staff. Senior managers did not claim extra hours. On a monthly basis, the Department worked extra time to meet its demands. Overtime was happening at the lower levels, where there were lower skills. Urgent matters came up frequently, making operations difficult at times. The Department was constrained, and this needed to be understood. The migration issue had worked against the Labour Relations Act, resulting in the promotion of an unskilled workforce.
Mr Qonde referred to the issue of instability at institutions, saying their expansion resulted in the expansion of the programmes of the Department as well. The Minister had a ministerial task team on maths and science. The Department had looked at student support structures, and there was also a lecturer support programme, particularly for maths. The Basic Education Department had had comprehensive discussions with the DHET on ensuring maths and science were taught and learnt better.
Mr Tredoux said the budget for the compensation of employees did not mean that all posts were funded -- there were still some that were left out of the equation. The shift of money from one programme to another created a means to save money. Specific strategies were followed in this process. The Department would be asking for more money from Treasury to increase the capacity for monitoring and evaluation. The money had not yet been approved.
Mr Siwela asked why the Department was failing to comply with supply chain regulations?
Prof Bozzoli asked if there was a broad responsibility for this Department. The Department should provide a list of institutions that were at risk. A plan of action could flow from that list, in alignment with the specific legislation.
Ms Mchunu asked how contractors were chosen for infrastructure at TVET colleges. Where were community colleges located? Would there be advocacy at these community colleges?
Mr C Kekana (ANC) asked about the standards of operation at the TVET colleges across the country.
Mr Qonde responded that the Department monitored and evaluated within the constraints of its budgets, and the legislative framework was the guideline for this process. The Department took the point that the institutions should be categorized, in order to have more clarity on the challenges in accordance with each circumstance.
Mr Patel added that in terms of the supply chain, the Department had provided a service delivery task to an entity that did not satisfy the requirements of the documentation. Where the Department deviated, there had to be clear reasons for that decision. The adjudication committee within the Department would deal with the matters of concerns raised by the Committee. The standards of the Department were well in order, as there were various routes by which a student could acquire adequate skills, and even though there were areas of overlap, it was important to align theory with practice in the education sector.
Ms Mchunu asked why some qualifications were not verified – what process was being followed here?
Ms Lulama Mbobo, Deputy Director General: Administration, DHET, said the verification of qualifications was done by an independent agency. There has been no appointments recently, and the Department was waiting for the agencies report.
The Chairperson asked aboutn the strategies that had been put in place to correct some of the present challenges. Why did the Department not respond to all the queries that had been brought forward by the public? Had the infrastructure grant been fully utilized? If not, what were the constraints? How would the poor implementation of the audit outcomes be turned around? What was the timeframe for the action plans?
Mr Kekana said the targets for vacancies not being met translated to the people who were supposed to be implementing. The money was there, so what was holding the Department back from employing? The President had stressed that all public sector vacancies must be filled. The re-prioritization of allocated funds must be well justified.
Mr Qonde said the Department had stressed that it could help to introduce foundation phase measures to intervene where the basic education system had its limits.
Mr Patel said the Minister had approved the human resource strategy for the Department, which would give the Department focus and direction on where to focus its plans. There had been the permanent appointment of various staff in the Department, some of whom were on probation, some acting and some who were interning. The queries from the public were often referred to the institutions which could assist with better information -- the Department could not answer all the questions.
Ms Mbobo gave an illustrative scenario, where vacancies could not be filled because the funds were covering other issues within the Department. The junior staff was working extremely hard to deliver on what was expected of them. A lot had been done for student support in the institutions, with additional measures to advance the Department’s efforts. Curriculum reviews happened annually, so that there was standardised knowledge sharing. For English literacy, there had been the introduction of online services to enhance the skills of students. Infrastructure funding had all been dispersed, and assessments were currently taking place.
Exam question paper leakages
The Chairperson asked the Department to report on the exam question paper leakages.
Ms Diane Parker, Acting Deputy Director General (University Education), explained the turnaround plan to prevent question paper leakages. The credibility of examinations was put at risk by leakages. All the results of subjects would be blocked if this happened. Limpopo and Gauteng had the highest incidence of leakages, but Mpumalanga and KwaZulu-Natal had also had incidents. The Quality Council had been responsible for handling the issue and for finding the best remedy at the time. Overall, there had been around 220 incidents involving 1 100 students across the country.
The turnaround plan included the auditing of security protocols within the examination environment, and the exploration of alternative security measures for the handling of question papers. Security clearance for all examination officials was compulsory. She affirmed that one leakage was one too many.
Prof Bozzoli asked how many people would be actually charged over the allegations of this nature.
Ms Mchunu asked if KwaZulu-Natal was really part of this problem, or had it been a mistake.
The Chairperson asked if the students who were under investigation were denied access to National Student Financial Aid Scheme (NSFAS) funds?
Mr Qonde responded that if the students were on the irregularity lists, they must be denied the money because they had committed an offence.
The Chairperson advised the Department to write to the students and let them know of this procedure, to avoid any uncertainty.
Financial and Fiscal Commission analysis of DHET and NSFAS 2014/15 annual reports
Mr Bongani Khumalo, Chief Executive Officer, Financial and Fiscal Commission (FFC) said the Commission’s analysis showed that the Department spends its money according to its budget, but the targets were lacking in achievement. It was important that the challenge of meeting targets was addressed immediately. There was prioritization of TVET colleges, and this was clear in expenditure. Adequate funding was necessary to meet the demands of the people. In terms of NSFAS, the demand for financial support exceeded what was available, and performance needed to improve. The centrality of education required that was it important to tighten oversight.
Mr Khumalo said that higher education was an important investment for the public and private sector. Higher education was moving towards the national development plan (NDP) goals, although the limits to this success were that access was still racially and regionally inequitable, graduate output was low, post-graduate enrolment was limited and only five universities produced 55% of postgraduate qualifications.
The DHET shared 1.4% of the Gross Domestic Product and 4.2% of the national budget. The real annual average growth of the Department was 3.2%.
The Department had prioritised university education through the inclusion of two new universities, requiring the addition of R1.2 billion for the infrastructure. Subsidies to existing universities had risen to R24 billion, due to the increases each year. Challenges at the universities remained the inability to increase participation rates, to empower previously disadvantaged people and to ensure wider distribution of completion rates across all universities.
NSFAS had received R20.4 billion to fund university loans and college bursaries. The allocation of this amount had declined slightly by 1%. The important question was whether budget growth was aligned with the anticipated increase in enrolment at universities. The scheme had less than half of the funds needed to meet the demand. Its poor loan recovery record was a serious issue of policy. National Treasury had set up a technical working group to explore the option for financing the roll-out/implementation of the White Paper on Post School Education and Training.
The Chairperson indicated that the Commission does not account to the Committee, but questions of clarity could be asked.
Prof Bozzoli said that the Commission had no comparative data that had been used in the report. The Committee had never been informed of the technical working group, and deserved a presentation on the findings of that technical group. It was important for the Committee to be informed about what was going on.
Mr Khumalo it was difficult for the Treasury to give up money somewhere in order to meet the shortcomings of the Department. There was slow growth in the economy currently, and this Department had an even lower growth rate in relation to other sectors of the economy. It was important that all stakeholders were brought together to communicate all the relevant issues.
National Student Financial Aid Scheme (NSFAS) on its 2014/15 Annual Report
Mr Sizwe Nxasana, Chairperson, NSFAS, said that the focus of the new board was to have a well-resourced and functioning institution that was results-driven. With a budget of R6.1 billion, recoveries amounting to about R240 million was unacceptable. Staff morale of the institution had been low. Since the formation of the new board, the NSFAS strategy would be reviewed and resources would be determined. There would be vigorous interrogation going forward on all facets of the functioning of the institution. Since NSFAS had engaged with students, there had been a decrease in student unrest on the campuses. NSFAS would involve all other stakeholders to gain positive results.
Mr Msulwa Daca, Chief Executive Officer, NSFAS, outlined the mission and objectives of the institution. 1.5 million students had been assisted by the institution, and around R9 billion had been disbursed across the country in the 2014 financial year. R19 billion had been disbursed for higher education in the last 20 years. Improving financial aid to students remained a top priority. Loan funding had increased in the institution, and the new student-centered model would have its first report this year. Of the strategic objectives, only 21.4% had been achieved, with 43% not achieved. The institution was working hard on a more efficient loan recovery model.
Mr Lerato Nage, Chief Financial Officer, NSFAS, said R8.8 billion had been received from National Treasury, resulting in a R1.1 billion deficit. The constraint leading to the lack of loan recovery was that 48% of the students did not graduate. Only 52% were eligible to graduate and thus be able to repay their loans. The money received by NSFAS was from the national department, but a fair amount was from donors.
Mr Daca said that a student-centered model would improve service delivery to students. About 54% of students at Nelson Mandela Metropolitan University, the University of South Africa (UNISA), Walter Sisulu, the University of Cape Town (UCT), the University of the Western Cape (UWC) and the University of Limpopo (UL) relied on NSFAS for their academic success.
Ms M Nkadimeng (ANC) asked about the challenges with loan recovery. How feasible was the plan of action ahead? When would NSFAS aim for a clean audit?
Ms Mchunu asked if the services of NSFAS were linked to the Department of Home Affairs in order to check the reliability of the information provided by students. How about the projection of the student centre -- what progress was there? Also, a dismal failure was that the entity still could not fundraise sufficiently.
Mr Siwela said the entity had been failing to perform its duty. What were the consequences for under-performance at the institution?
Prof Bozzoli said the entity was defensive and always over-praised its achievements. Could the liability of R1.1 billion be explained to the Committee? How many more people was NSFAS willing to support in the near future, seeing that the demand was growing? How had this been communicated to the universities in order to ensure sustainability?
Mr Nxasana responded that the issue of fundraising and recovering funds had to do with what NSFAS was not doing correctly, and not having adequate capacity for facilitation. What systems had been put in place to change this situation? It had to be admitted that NSFAS had not done enough to ensure recoveries. Sorting out the systems and processes would definitely make it possible to recover the loans. The 59% drop out of students at university was a serious issue that needed to be immediately addressed. The ability to engage with the public sector had to be sorted out as soon as possible.
Mr Daca said improving the structure of the loan recovery model was crucial. Part of the performance plan was to ensure that all students that applied must be secured for funding. Students must apply once, and not year to year. NSFAS was committed to funding students who passed from year to year. Where NSFAS had a good relationship with universities, the mutual objectives were reached more easily.
Mr Nage mentioned that the supply chain process must be followed accordingly. Government structures must ensure that the targets of the entity were achieved. NSFAS had to work smartly with universities to make sure that any shortcomings were communicated. The accuracy of affidavits that were submitted must be scrutinised. NSFAS could now obtain information from SARS to be able to identify those who were debtors to NSFAS, and thus hold them accountable to repay their loans.
Mr Kekana asked if NSFAS had an idea of how much they received from private donors, excluding other government departments.
Prof Bozzolo asked for the names of the universities and colleges which were being forensically tested, and why this was happening.
Ms Mchunu asked if University of KwaZulu-Natal (UKZN) was receiving more money but for fewer students, while Limpopo had the same amount of money but was funding more students.
Mr Nxasana said that Nedbank had been contributing, but had pulled out. NSFAS had no contributions from the private sector as it stood at the moment.
Mr Daca said that the fee structures were what was making the difference. The UKZN was more expensive compared to the University of Limpopo. SARS was the biggest source of information for the entity, as their tax database was useful to track debtors. He could not recall all the universities involved in the forensic investigation. However, they had been chosen on the basis of the unrest and protests over allegations of fraud and corruption.
Quality Council for Trades and Occupations on its 2014/15 annual report
Mr Thomas Lata, Chief Director, Occupational Qualifications Management, said that the issues that would be discussed in this presentation included general organisational information, performance information, occupational qualifications management, occupational quality assurance and financial results. The vision of the entity was to qualify a skilled and capable workforce, ensuring competent people in priority trades and occupations.
He presented a summary of the strategic outcomes:
Programme 1 – occupational qualifications. The target was to reach 60%, but this had not been achieved.
Programme 2 – quality assurance occupational, accreditation of skills development and assessment centres. The target was 100%, and this was achieved and compliance guaranteed.
The strategies for improvement included training more learners to become qualifications development facilitators, and the centralisation of application receipts. The four recent occupational qualifications going forward were tax technicians and financial markets officer, library assistant and health promotion officer (community health worker).
Mr Vijayen Naidoo, Chief Director, Occupational Quality Assurance, said this unit applied to the newly developed occupational qualifications and previously registered qualifications. As mentioned already, all the new occupational qualifications had been achieved. In terms of certification, there had been 17 295 trade certificates issued. There had been no certificates issued against the new occupational qualifications. A monitoring and evaluation team had been set up to deal with challenges in implementation. Learners would be assessed and certificated for qualifications that had been identified and met the necessary requirements.
Ms Ndivhu Madilonga-Khondowe, Chief Director: Corporate Services, said a clean audit had been achieved for 2014/2015 financial year. In the annual financial statements, there had been no material findings, and no significant deficiencies identified. The institution relied on the availability of training opportunities, with skills development that was recognised and beneficial to the economy.
Ms Nkadimeng congratulated the entity on achieving its targets. They must sustain this clean audit and continue to work towards achieving its targets.
Prof Bozzoli asked how many education providers the entity had registered. Were people taken through the process accordingly? How could the Committee know if the providers were reliable and of good quality?
Prof Peliwe Lolwana, Chief Executive Officer, said that the entity had begun the process of issuing certificates only recently. People should lodge their queries or complaints directly with the entity. The entity would intervene in consultation with the already registered training agents, to look critically at their quality and service delivery to the public.
The Chairpers on adjourned the meeting.
- Report on Leakages of Question Papers at TVET Colleges & Turnaround Plan to Prevent Question Paper Leakages
- Financial and Fiscal Commission on analysis of DHET and NSFAS annual report 2014/2015
- Quality Council for Trades and Occupations on its annual report 2014/2015
- Quality Council for Trades and Occupations 2014/2015 Annual Report
- Department of Higher Education and Training on their annual report 2014/2015
- Department of Higher Education and Training 2014/2015 Annual Report
- National Student Financial Aid Scheme 2014/2015 Annual Report
- National Student Financial Aid Scheme on its 2014/2015 Annual Report