DHET 2022/23 Annual Performance Plan & AGSA briefing; with Minister

Higher Education, Science and Innovation

20 April 2022
Chairperson: Ms N Mkhatshwa (ANC)
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Meeting Summary

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DHET  2022/23 Annual Performance Plan

The Committee met virtually with the Department of Higher Education and Training and the Auditor-General of South Africa to receive briefings on the 2022/23 annual performance plans of the Department and its entities. The Auditor-General was concerned about the usefulness of the performance targets and their measurability. This also raised concerns among the Members and implored the Department to come up with mitigating factors. Members also wanted to know if the Auditor-General had a specific deadline for the National Student Financial Aid Scheme to deal with issues still pending from the previous audit report. They asked if specific areas in the annual performance plan were not deemed useful concerning the Financial Aid Scheme and whether the Auditor-General may offer any form of assistance to train and capacitate officials in the development of the annual performance plans.

The critical issues of focus by the Department were the budget, funding, student accommodation, targets and indicators in the university, Technical and Vocational Education Training Colleges and Community Education and Training college branches, amongst others. The funding for the Department amounted to R130.1 billion, broken down from the voted funds (R109.5 billion) and Skills Levy (R20.6 billion). Universities and the National Student Financial Aid Scheme received an allocation of R92 billion; Technical and Vocational Colleges received R12.519 billion; R2.4 billion was allocated to Community Colleges; R16.5 billion for Sector Education and Training Authorities R4.1 billion from the National Skills Fund. The Department’s baseline increases over the 2022 medium-term expenditure framework amount to R7.546 billion in 2022/23, R10.551 billion in 2023/24 and R12.150 billion in 2024/25.

The Minister announced that he requested the Department to reprioritise R200 million to assist institutions affected by the KwaZulu-Natal floods. Further, in response to the challenges in the sector, The National Economic Development and Labour Council has now approved the Department’s skills strategy in support of the economic reconstruction and recovery programme. All inputs and suggestions were welcomed and the skills strategy will be fully supported by all partners in the Council this year and during the strategic plan period.

Another important factor in this financial year is the challenge of coming up with a comprehensive student funding model. The work was still underway by the Ministerial Task Team, but a report would be submitted to the Minister sooner, as he plans to submit it to the Cabinet in the second half of the year. That model will include what can be done for the ‘missing middle’ students. Another key issue is infrastructure in the sector, especially student accommodation. This is a huge priority this year and the Department was coming up with the implementation plan of programmes to start rolling out student accommodation infrastructure. Steps on articulation were being taken and called for a relationship between the Post-School Education and Training sectors' different components to allow unhindered progression. Students cannot be declined access to university education just because they studied the National Certificate (Vocational) courses in colleges of Technical and Vocational Education and Training. Therefore, the Department was now supporting six universities this year to develop articulation implementation plans for these colleges. The Minister felt that more universities should be involved as they absorbed a larger portion of the Department’s budget allocation. Universities must support colleges and skills development initiatives and train appropriately qualified lecturers. The placements of students enrolled in TVET colleges will be increased this year, from 452 000 to 580 000. The President had announced the placement of the 10 000 TVET college graduates who require in-service training for their qualifications would be a major step this year and the Department welcomed this initiative.

Members were not pleased that there was inconsistency regarding the performance targets and indicators in the Departments’ and its entities’ annual plans. Thus, they probed on the action plan and if officials would be capacitated and trained by the Auditor-General to develop these annual plans.

There were questions about the student funding, the alignment of the annual performance plans to avoid financial irregularities in the Department and its stakeholders, the accreditation issues of certain courses at Walter Sisulu University and how affected students would be assisted. Members probed infrastructure projects in TVET colleges, Community Education and Training colleges' spending, lack of compliance for SMART principles in the development of the annual performance plans, the failure to incorporate the epidemic of gender-based violence and femicide in the annual plans and whether the Student Housing Infrastructure Programme transfer to the planning branch of the Department included personnel capacity.

Meeting report

The Chairperson opened the virtual meeting and welcomed everyone present. She indicated that the Committee would be dealing with the 2022/23 annual performance of the Department of Higher Education and Training (DHET) and its entities. The meeting would conclude around 18h00 but there will be a break. Due to time constraints, she urged the entities to be succinct in their presentations. The Committee would commence with the presentation by the Auditor-General of South Africa.

Minister’s Remarks
Dr Blade Nzimande, Minister of Higher Education and Training, thanked the Committee for the opportunity to be present. He requested to be released around 13h00, as he would be travelling abroad later on the day. He expressed his condolences to the families who lost their loved ones to the recent KwaZulu-Natal (KZN) floods. Under the Department of Science and Innovation (DSI), climate change and mitigation are one of the key areas of attention in the Decadal Plan. Secondly, it may be appropriate to announce that, where some of the institutions have experienced damage to infrastructure, he asked the DG to reprioritise about R200 million to assist institutions with the damage because of the floods in KZN.

As set out in the annual performance plan (APP) and strategic plan, there is a need to continue managing the sector's pandemic because Covid-19 is still looming, and there are predictions of another wave. Therefore, this becomes a priority, as it has disrupted the teaching and learning in the sector. The second challenge is to continue to drive economic reconstruction in the country, and the Department has an important role to play in this regard. He was pleased that the National Economic Development and Labour Council (NEDLAC) has now approved the skills strategy supporting the economic reconstruction and recovery programme (ERRP). All inputs and suggestions were welcomed; the skills strategy will be fully supported by all the partners in NEDLAC this year and during the strategic plan period. As much as this is a skills strategy, it is flexible to support the broader challenge of growing and developing our economy. Thirdly, employment support is very important, and the Department’s skills development initiatives support employment opportunities. The DG will elaborate on this during the presentation.

Another important factor in this financial year is the challenge of coming up with a comprehensive student funding model. DHET has a task team busy with this work, and it has been working very hard; it will produce a report sooner rather than later, as he plans to go to the Cabinet in the second half of the year with a plan for this matter. That model will include what can be done for the ‘missing middle’ students.

Another key issue is infrastructure in the sector, especially student accommodation. This year, this is a huge priority, specifically coming up with the implementation plan of programmes to start rolling out student accommodation infrastructure. It is clear that government alone does not have enough money, but it will have to strategise and establish partnerships with the private sector. The private sector is already a key partner for student accommodation in the sector. He will be updating the Committee on this matter as time progresses.

The Minister said that they would continue with the funding of a variety of programmes and the levy money to support skills development. He is proud that this government has continued to fund the National Student Financial Aid Scheme (NSFAS) and the children of the working class and the poor, many of whom are the first ever in their families to acquire qualifications for higher learning. DHET will spend beyond R40 billion this year. However, the concern is that they will need to break this university-centric Post-School Education and Training (PSET) system within the period of the strategic plan.

He called upon the Committee to join in the battle to significantly expand the college sector in the country. During this strategic plan period, there is a need to have new proposals on how it can expand as the year progresses. The expansion has been very minimal. There has hardly been new money for Technical Vocational Education and Training Colleges (TVETs) and Community Education and Training Colleges (CETs). Statistics show that out of 100 learners who start grade one, only six go to university; among those, some do not finish within record time. Only 94 out of 100 young people in this country do not go to university because the sector is university centric. One of the biggest challenges in the country is high levels of youth unemployment. Until and unless this sector is expanded, the Department will not have an impact. It is unsustainable not to increase the budget allocation of the TVET sector. This has not been done since 2013. There is no new money from the fiscus to expand vocational education.

He was pleased that steps were being taken on articulation. This means that they must not have cul-de-sacs in the education system. There must be a relationship between the different components of the PSET sector to allow unhindered progression. There cannot be students doing National Certificate (Vocational), NC (V), in colleges but cannot be accepted in universities because they do not recognise NC (V). DHET supports six universities this year to develop TVET college articulation implementation plans. It has given the university system four tasks: learning, teaching, research, and community outreach. The Department also plans to provide the universities with a fifth mandate to support the rest of the PSET sector. Universities must support colleges and skills development initiatives and train appropriately qualified lecturers.

The placements of students enrolled in TVET colleges will be increased this year from 452 000 to 580 000. This is far from the National Development Plan (NDP) targets, but the Department aims to increase students' placement. The placement of the 10 000 TVET college graduates who require in-service training for their qualifications will be a major step this year. One cannot be a college principal unless they have a system of placing students and relationships with industry – even in the deep rural areas. In some instances, this could be done in municipalities, Post Offices, etc. The Ministry, along with the Department, will be focusing on increasing this to strengthen the TVET sector. Lastly, despite the challenges, this government continues to support the children of the working class and the poor to access post-school education.

Briefing by Auditor-General of South Africa on DHET and its entities 2022/23 APP
Ms Zamahlangu Mditshwa, Senior Audit Manager, took Members through the presentation, which touched on various areas, including what good performance indicators should be, and SMART principles. The objectives of the proactive APP review was to provide an early warning regarding the usefulness of set indicators and targets. 

Some of the recommendations made by the AG to the Committee included:
- assessing the planned targets and indicators linked to the mandate of the entities
-reviewing quarterly reports and obtaining actions taken by management on targets not achieved
-requesting from the Department and its entities a progress report detailing performance against budget
-review the performance against the five-year strategic plan and determining if the future objectives will still be attainable

See attached for further details.

Discussion
The Chairperson suggested that the Committee deal with the AG's presentation before receiving a brief from the Department. The AG has raised several concerns around the usefulness of indicators and measurability and consistency. Some of these areas of concern have been changed and others were still pending with NSFAS. The Committee would appreciate a detailed report on those observations and the exact areas of concern. Does the planning presented to the Committee inspire confidence for the Committee to advocate for the increased funding in the areas of concern? This is the premise that the Department should be coming from.

Ms J Mananiso (ANC) said that, as Members, they are empowered and strengthened to do their oversight. Inconsistencies by the Department and its entities on the targets are concerning. The Committee must follow up on this to ascertain the action plan and the recommendations given by the AG. She asked the AG if it had a specific deadline for NSFAS to deal with issues that were still pending.

Dr N Khumalo (DA) said that she was concerned about the process plan and the development of the APPs by NSFAS without having implemented the findings that the AG found.

Ms C King (DA) asked which specific areas in the APP were not deemed useful on NSFAS.  

Ms N Marchesi (DA) said that the AG’s recommendations implied that the DHET’s APP did not comply with the SMART principles. What will the AG do to ensure that the Department was at par and was able to comply with the AG’s recommendation and that the personnel responsible for the targets to be met by the Department were trained and capacitated to ensure that they delivered?

The Chairperson said the office of the AG will stay in the meeting until the end of the session today. So, if Members had any questions they might need clarity on as the session progresses.

Responses
Ms Michelle Magerman, Business Unit Leader, AGSA, replied that, on the detail of the entities, the AG would compile a document of all entities with their findings and submit it in writing to the Committee. She said they have raised the communication with management and justified why they see things a certain way. They always engage with the management, and any changes made are updated.

In terms of whether the allocation exists, she said that they do not get involved in looking at whether it is sufficient or not. That is left solely to the Department, but the AGSA has noted that targets were not necessarily met but the budget had been exceeded. There would be no link between the achievement and the budget. If targets were not achieved in the prior year, they are often carried over without a budget allocation for those specific targets. The AGSA has that red flag about the targets budgeted for in the prior year, which get carried over to the current year.

Another AGSA official said that AG is discussing the review with management. Members will be provided with feedback regarding what management has done about the AG's observations as it relates to NSFAS. This will be provided to the Committee and observations will also be included in the document.

Department of Higher Education and Training 2022/23 APP
Dr Nkosinathi Sishi, Director-General, DHET, took the Committee through the presentation. The presentation of the Department covered but was not limited to: policies and strategies that informed the 2022/23 planning cycle; strategic five-year outcomes up to 2024/25; update on the sustainable funding model for the PSET system; update of the procurement of the e-recruitment system. 
Update on the filling of positions; key programme outputs for the 2022/23 financial year and budget information: 2022/23 medium-term expenditure framework (MTEF).

The five-year strategic outcomes of the Department were the expanded access to PSET opportunities, improved efficiency and success of the PSET system, improved quality of PSET provision, a responsive PSET system and excellent business operations within DHET.

The funding for the Department amounted to R130.1 billion, broken down from the voted funds (R109.5 billion) and Skills Levy (R20.6 billion). Universities and NSFAS received an allocation of R92 billion; TVET Colleges received R12.519 billion; R2.4 billion for CETs; R16.5 billion for SETAs and R4.1 billion from the National Skills Fund. In terms of the budget trends, Post-School Education and Training budget have an annual average increase of 7.0% over the 2022 MTEF. The Department’s baseline increases over the 2022 MTEF amount to R7.546 billion in 2022/23, R10.551 billion in 2023/24 and R12.150 billion in 2024/25. These baseline increases mainly addressed the shortfall in the National Student Financial Aid Scheme.

University funding contributes to the largest percentage of funding in the vote at an average rate of 65.4% over the 2022 MTEF. The projected average funding rate for TVET Colleges in the vote is 14.3% over the 2022 MTEF. The projected average funding rate for the Skills Levy is 16.4% over the 2021 MTEF.

Dr Sishi concluded the presentation by saying that when entities make their presentations, the broader outputs that have been articulated will be reflected in their presentation. Based on analysis, there is a greater measure of compliance from the entities, which will be evident in the APPs to be presented today.

See attached for further details.

Discussion
Dr W Boshoff (FF Plus) commented on the substantial increase in NSFAS funding due to the shortfall. The windfall enabled this due to the mining income and taxes from mining activities, which contributed to the fiscus. He was concerned that if someone offers something free, the demand tends to grow without an end. “We got saved now for this windfall to fill that gap before”, he added. Do we expect the demand for funding to flatten out, and will the funding be sufficient in the future academic years? The Department might need to consider increasing the funding every three years.

Ms King said that she did not get a clear sense from the DHET presentation of the urgency to properly realign the APP to avoid financial irregularities raised in the AG’s report. The Committee would need a report on whether alignment was guided by the mandate of the Department that entities needed to fulfil. The Committee needs a broad understanding of their view on the AG’s report.

Under programmes three and four, there are always targets not met, but he now saw an increase in those targets in that programme. How feasible will it be to achieve the desired targets? Does the increased budget substantiate the number of targets that are not met?

Student funding increases every year, but she was concerned when the new funding model was discussed in the Committee. There is a need to look at how sustainable the model will be and the realistic sustainability of the funds going forward. When it comes to the ‘missing middle’, it was highlighted that a loan bursary scheme is looked at for the missing middle. This should have been the approach for all students that apply to ensure that enough students are entering the system and ultimately adding on skills needed in the country. She was pleased that NSFAS was also allocating funding for skills in the country's skills development strategy.

Yesterday, she spoke to the Vice-Chancellor of Walter Sisulu University, and she was concerned about the accreditation issue. It looks like institutional audits will be conducted on some of these institutions; what institutional audits have been conducted in the last two years and ensure that there are no accreditation issues on the courses offered? Lastly, according to the APP, there is no indicator or output for the 'missing middle' to ensure that they are prioritised for funding. Is there any specific reason why this was not done and what will be done in the long run to ensure a target is set for the 'missing middle' students?

Dr Khumalo asked the DHET about student completion and infrastructure development on its actions and plans in the coming years and at what levels through the years – this may include ICT infrastructure. Secondly, she observed that the CET spending was two percent and reckoned that this was worrisome. There seems to be a huge gap between various institutions regarding spending levels and allocation. Considering some of the challenges presented in the CET summit, the budget does not reflect the desire to grow and maximise the intentions to address unemployment and economic growth that could come because of these institutions being a success. Lastly, how is the prioritisation of funding based?

Ms Marchesi said that the Committee needs to see the output; Members need to ensure that the budget allocation is aligned with DHET’s desires. As for programmes, the Minister mentioned a shortfall in accommodation but no programme speaks to that directly. The allocation does not show that there is an intention to build infrastructure. Even though there are partnerships with the private sector, the Department must have this as a programme.

On the seven-percent increase the Department received, is it inflation-related? Were there any savings from the Covid-19 related expenses such as accommodation and others, especially during the hard lockdown when students stayed in their homes?

To the AG, will it provide the capacity building for officials responsible for developing targets and indicators? How will DHET implement the observations made by the AG? The Department has not been able to comply with the SMART principles of the APP. The Committee needs to hear what the plan is on this. The AG should provide clarity on the findings made on the audit.

She observed that 43.3% is allocated for accommodation for TVET colleges but only four colleges were mentioned; what will happen with the rest of the colleges? Earlier, the Minister said that there are students from TVET colleges who had not yet received their NSFAS funding. Why is this so?

Ms D Mahlatsi (ANC) noted that the AG found that 56% of the APP’s usefulness required adjustment, which indicates that there are capacity issues in the APP's development. Surely the Department would have missed the mark because had it developed it using the SMART principles, it would perhaps be sitting with a possible qualification as far as indicators that do not relate to the strategic planning. If quality assurance of the APPs is not done, there are bound to be problems with them.

Secondly, looking into the presentation by the Department, one agrees in principle about the adjustments in the APPs. On GBV, in the previous month, the Committee received a report from the Commission for Gender Equality (CGE) about how the sector reacts to the issues of GBV, and it left a bitter taste for many Members. Therefore, the Committee expected to see a general mainstreaming of GBV issues indicators in the APP in response to the CGE report. It would have been prudent to deal with this issue in that fashion.

She noted government's limited resources and the need to reprioritise certain programmes on the infrastructure budget. It would have been prudent to see funding for infrastructure development projects for institutions, especially TVET colleges.

Looking at the APP regarding university education, one is worried that funding is located more towards universities while having had a colloquium on institutional autonomy and accountability. The Department is evidently finding it difficult to balance the two because, as more funding goes to universities, more accountability must come from universities.

Since the CET summit was recent, one would have expected that the annual performance plan would incorporate any recommendations. The concern is that the Department targets an increase of 100 000 students’ enrolment in CETs. Do the CET colleges have the capacity for such a rapid increase, given the challenges expressed in the summit?

Mr T Letsie (ANC) said that there generally is a feeling that the Department’s APP is in line with what is expected. He commended the Department for putting together an APP that is widely accepted across all political parties. Firstly, this would be the first financial year where the SHIP programme has been transferred to the planning division; has the personnel responsible for the SHIP programme been transferred to the planning branch? Secondly, about R600 million has been allocated in this financial year for student accommodation for TUT, UKZN, Gert Sibande and Majuba TVET colleges. Why did the Department target only these specific institutions in this financial year? Many colleges do not own their student housing infrastructure.

The R10.8 million allocation for travelling and subsistence may not be enough because the Department’s personnel need to monitor the construction of these infrastructure projects to ensure value for money rather than relying on reports by these institutions. The money that the Department gives out must be monitored. Why is it only R10.8 million allocated for this huge investment the Department is making in the SHIP programme? The Department must ensure that the construction of these projects is completed within the timeframes and within budget. He commented that the mindsets of contractors need to be changed. Project managers of these institutions would, at times, collude with the contractors to create problems and come up with stories to get the Department to put in more money. The Department should provide the Committee with a list of all projects to be completed during the current financial year.

Lastly, on consultants, he noted that R4 million had been budgeted for this financial year, but this figure increased steadily over the MTEF. What necessitated this allocation of consultants, and what services will these consultants render?

Responses
Dr Sishi replied that some of these questions would be elevated to EXCO, and the questions will be reflected. Sometimes, it is not about answering questions but also reflecting on them and finding solutions to problems.

Mr Sam Zungu, Deputy Director-General: TVET branch, DHET, said that there were few questions directed to the TVET sector. He acknowledged the Minister's remarks on the issue of resources and the lack thereof and how the TVETs and CETs can be prioritised more.

DHET is working with AG to ensure that its targets are SMART on the alignment of strategic targets. There are continued sessions taking place with the AG to deal with the issues raised and ensure that the targets are SMART.

As DHET, they tried to prioritise the issue of GBV, but perhaps it was not captured properly in the APP. It is a matter of how it can be captured in terms of deliverables.

There was an issue with efforts made improving academic performance, targets set and there is still a challenge in terms of how NCV is performing. They will be looking at the gaps in the NCV, and they analysed the 2017 to 2019 cohort to identify gaps to fill and improve for the NCV programmes. They are also looking at how colleges will begin to improve on their interventions. It may be that resources are stretched too far but this also has unintended consequences. They are also focusing on work placements.

In recent floods in KZN, one college was affected, which is on the Kokstad campus. There was minor damage, but there is no report of the lost lives of students or other persons on campus during the flooding.

Dr Sishi added that about 4 000 students enrolled in the pre-vocational programmes help bridge the gap between basic education and TVET and the transition therein.

Ms Thembisa Futshane, DDG: CET, DHET, responded to the call to increase student numbers for this current academic year. She said that the Department would need to increase all resources, including infrastructure resources, to realise this increase. The Department is looking at the quick wins that it can make. Another quick win that will be utilised is using unutilised spaces in TVET colleges. The TVET colleges can share their spaces with CET colleges. She works on this with the DDG on TVET colleges to link the CET and TVET college principals. It is not only the requirement of infrastructure that is needed but also personnel capacity and funding. The funding provided for CETs now was not enough. If they do not realise the NDP target of enrolling one million students by 2030, the Department will do its best with its limited resources to work towards achieving the target.

She appreciated the compliments from Members. While some items were pre-empted, some were not at all. It was winning that the Department has managed to realise. One of the summit resolutions was the commitment made by partners to ensure that DHET realises the massification of provision of skills programmes in CET colleges. The Department had SETAs coming on board to partner with CET colleges. There was a commitment by the National Skills Fund of R200 million for all nine provinces in CET colleges for skills development programmes.

As for the CET colleges being affected during the recent floods, there are 96 centres of CET colleges operating from primary and public schools throughout the country. The 600 schools that the floods have damaged have affected the colleges. DHET has been working in collaboration with the regional office of the Basic Education to identify the schools affected by the floods and make alternative arrangements. The team working on this does not have a report yet because the badly affected schools have been officially closed. The regional office for Basic Education was still working on a comprehensive report on assessing damage and considering alternatives. By working with the regional office, DHET emphasises that this was an opportunity to expedite the process of utilising the TVET colleges that have not been affected to arrange for the affected CET colleges and students.

On GBV, the CFO and her team have managed to secure funding to go to Higher Health continuously to run GBV programmes in CET colleges. They have started with the initial seed funding that has been received – this means that they can now scale up on the programmes and be more consistent and cover more CET colleges. They will also expand coverage to satellite centres.

Ms Nolwazi Gasa, DDG: Planning, Policy and Strategy, DHET, replied that, since coordination has moved to the planning committee, colleagues who sit in other branches have moved to the planning branch to provide infrastructure coordination support. The team is small, but with the Minister's and DG's guidance, the team will be guided to attend to some of the critical questions that Members have raised throughout the discussion. The intention is to build what DHET has constantly referred to as an Infrastructure Development Support Unit, which a level 15 programme manager will lead with technical expertise.

All infrastructure budgets and human resources have also moved to the planning branch. The main plan is to ensure coordination, and the intention is to ensure that all the coordination mechanisms that existed before are put together. Currently, they are building internal capacity that will focus on the work that these separate coordinating mechanisms were working on. The brief that the mechanism will be focusing on is providing support to the infrastructure development support unit and it will work with the three branches that require infrastructure coordination support to do the following:
If the university education branch approaches the CET branch regarding the infrastructure efficiency grant applications, the in-house team will work with us to provide them with planning support, amongst others.

Ms Pretty Makukule, Chief Financial Officer, DHET, said that, based on the current projections, these projections suggest that the demand over the MTEF will not flatten but will grow by an average of 5%. The anticipated shortfall over the MTEF has been catered for to allow a smooth transition of the new funding policy.

On the prioritisation of funding, the DHET has the NDP targets, and it is also driven by the National Skills Development plan and the MTSF targets. However, with fiscal constraints, the reality is that some of the targets are no longer affordable. Hence, it is difficult to increase funding for other sectors. The Minister, earlier, indicated the importance of crowding in private sector investment. It is also important to note that the current budget system is pre-allocated, so the implication is that the old programmes that were initiated a while back continued to enjoy funding, which affected the space or capacity to fund new programmes. It is one of the reasons why the Treasury was introducing a zero-based budget and spending reviews to address some of the budget inefficiencies. The lack of new money means that the Department must make some trade-offs, which will have implications – as some programmes have existed for quite some time. The TVET and CET sectors are heavily affected because they were transferred from the provinces with their budget.

On the seven-percent average increase over the MTEF: this percentage is not inflation-linked; it is on nominal terms. However, analysing the average in real terms over the MTEF shows that it is actually 5.4%.

On savings realised from the Covid-19 response grant: there were savings realised, and the Department has quantified them. Some were redirected to fund the NSFAS shortfall and at the university level, where there were budgetary constraints.

On the budget decline: she said they need to start the analysis in 2021/22 because DHET realised a decline in nominal growth in the budget. However, due to additional funding, there was a huge jump where we moved from R116 billion to R130 billion, hence DHET sitting on 12.6%. So, it is not an actual decline.

On the R10.8 million for SNT under the planning branch question will be sufficient or not: the DHET does acknowledge the concerns on whether the money will be enough or not, but it was based on previous spending trends. With the new responsibilities and relaxed regulations, they recognise that there may be a need for more funding. EXCO manages its operational budget closely every month, and this area will also be monitored and managed.

The R4 million consultation was incurred on an Open Learning Programme.

The number of beds that will be built from the R900 million SHIP funding has been attained: 9 500 beds. TUT will receive 3 500; Gert Sibande, 1 500; UKZN, 3 000 and Majuba 1 500. There is no indication from Treasury yet on the special adjustment budget to assist in the KZN floods, and they will continue to engage. Once that decision has been made, the Department will be informed. The Department does lobby for additional funding from even some of the Departments that it is clustered with.

There are many unfunded mandates and a report can be provided to the Committee in writing. These unfunded mandates are also funded through the Department’s savings. This is not sustainable, but it is the reality that the Department finds itself in.

Mr Reineth Mgiba, Chief Director: Planning, DHET, responded that the entry point on the budget ensures that PhDs are increased. He confirmed that, as part of the reprioritisation process in the Department (considering the current targets concerning the production of PhDs), the current target for this is that the number of PhDs to be targeted will increase exponentially in 2024/25, as covered in the strategic plan.

Secondly, the accreditation of institutions, with specific reference to WSU, is work that the CHE handles at institutional levels across the system. The Department will work with the CHE to ensure that the accreditation is consistent with what is targeted in programme offerings.

Dr Sishi said that institutions like Gert Sibande are responsible for implementing agents as identified by the branch. They are responsible for infrastructure across the branch. They will present infrastructure plans covering the entire sector, and the footprint for infrastructure programmes is across all institutions.

On the KZN floods, the Minister may respond to how the Department intends to respond to these floods. The Minister was in KZN with the team of the Department to monitor progress regarding the work he is doing as part of his mandate to mobilise resources across all government departments with the private sector. This was to ensure that the district development model of the President was implemented with success in each district. On that occasion, the Minister announced that R398 million was allocated to projects in the Zululand districts. However, one would realise that the Department has a footprint throughout the country and in all districts; one would expect that work is not limited only to those areas. Therefore, institutions and PSET structures in KZN were undermined by the floods – the Minister will announce the interventions.

AG’s Response
Ms Mditshwa replied to say that the AG had an engagement with the Minister on the work done with the APPs, and he requested that the office of the AG may host a capacity-building session with the officials. The Department will organise it, but the AG will come in when the Department is ready.

On findings raised on slide 12, these are findings identified at the APPs of the Department and the entities, but the AG will provide detail of what was identified per entity.

Minister’s Responses
Dr Nzimande thanked the Chairperson and the Committee for how they handled the APP presentations. Through his cell phone, the Minister displayed pictures of the floods in KZN. This showed the satellite capacity of the South African National Space Agency (SANSA). It took this picture exactly at the same spot before and after the flooding. SANSA has now been pulled in on the work to deal with the devastation of the floods. In this case, the Department does have the capacity to assist government from an aerial point of view to see the extent of the damage from a bird’s eye view. This picture showcased the government's capability to understand better when faced with disasters of this nature. However, it does not deal with the full extent of utilisation of consultants because of capacity within government. Where government has the capacity, it is utilised, but where it is lacking, it has to consult. Now, if DHET has a huge infrastructure project, does it go full-blown to build internal capacity, or is the challenge for the whole government to go back to public works to say the capacity must be rebuilt?

On the ministerial task team on student funding, the modelling will provide a more scientific analysis. If the Department is to plan for the next five to ten years, this will indicate what the demand will look like. The work by the ministerial task team also speaks to what is to be done about the ‘missing middle students. Therefore, it does not show on the APP because there is no fiscus based strategy for funding the ‘missing middle’. Going forward, DHET might not have the resources, but it might look at possibilities to support that group of students. The Department is looking at the missing middle to see what is to be done. This would not be on the current APP; it will be dealt with on the student funding model.

The skewness of funding for universities is a big challenge. In Germany, only 30% of school leavers go to university; the other 70% become apprenticed. There is no other country that is 90% university-oriented; South Africa stands at 84%. This is a result of a system that was inherited. “We understand the demand for university education amongst blacks. We have not reached the acceptable stage of what we call participation rates for black women, but the other problem of young people who cannot access universities seems to be a bigger problem”, he remarked.

One of the changes that have been made since the current leadership came into the office was the huge inclusiveness of TVET college students on NSFAS. The mix is not the same as universities because of the nature of the colleges and other historical matters. The issue of the need for more institutional funding for student accommodation is accepted. One of the things he asked the DHET to look into seriously and hopefully starting this year is a concept of student villages, where it is possible. “We should ideally aim to build student villages, starting with a pilot or two this year”, he added.

He suggested revisiting Mangaung to host an Imbizo that follows up the engagement with the President when he was there about two weeks ago. Some serious questions and issues were raised with the President there, and he would like to engage on those further and partner with the Members to make it happen.

When targets are ticked off from the box, it should not be ticking off exercise, but they should be measured by impact.

PhD funding is needed in South Africa the most because more PhDs in the university system enhance the teaching and learning and research capacities in institutions. The more PhDs you have, the better you are placed to pursue science, technology, and innovation. On this score, the Department is restructuring through the National Research Foundation (NRF) because it is the NRF that funds PhDs and the National Institute of Humanities and Social Sciences in humanities. They have done very well and have produced more than 200 PhD graduates since 2013. The Department must consider the socio-economic status of a PhD student; it is moving towards full funding. The challenge is that full funding means that DHET can fund fewer numbers. If more numbers are required, the Department can part-fund, which would lead to people never finishing their PhDs. Secondly, the state has thousands of scholarships from other countries, and Cabinet assigned DHET with the Department of International Relations Cooperation (DIRCO) to manage such scholarships. The DG has recently informed him that he is strengthening the management of international scholarships inside the Department to prioritise better.

The Chairperson thanked the delegation for the responses and engagements. Some areas needed specific detail and documents to be presented to the Committee. One wonders what would happen if the Committee did not approve the budget because it was insufficient. The Committee remains concerned about the challenges in the sector.

The Committee welcomes the seven-percent increase in funding allocation to the Department and increases in student funding and infrastructure for student accommodation. The Committee commits itself to playing its oversight role.

The Committee also welcomed the allocation of R200 million responding to the floods in KZN and implored colleagues to work together as departments as governments respond to this disaster. The Committee notes that some of the data required may be difficult to receive about CETs affected by KZN floods. “We will trust that colleagues will be innovative, nonetheless, in the CET sector”, she added.

She implored the Minister to ensure that institutions, particularly universities, do not become discriminatory in the teaching and learning those affected by the floods. It would be important for the sector to be cognisant of that.

The Committee noted the decrease in the nominal growth of the budget in the MTEF period. It also notes with great concern the funding matters around the TVET sector, which has not been growing over the years and the impact this had on the headcount and the NDP.

The Committee also notes the reprioritisation of funds from goods and services to fund the South African Qualifications Authority (SAQA) digitisation and Higher Health for CET GBV related programmes. The reprioritisation of funds in the Department is not sustainable.

The Planning, Policy, and Strategy branch's capacity need to be strengthened to ensure support for the delivery of infrastructure projects. A year or two ago, the Department had shared with the Committee about doing work incapacitating institutions to use their infrastructure grants effectively and efficiently. Beyond having a programme, a unit should focus solely on this.

The infrastructure development projects must be fulfilled, and the Committee will continue through oversight to monitor this. She implored the Members to continue conducting their oversight but provide a report to the Committee when doing so so that there is data mining and more information on it to follow up on.

The Department and its entities with the AG should train development focusing on the development of APP targets. The Committee looks forward to seeing the fruits of this work.

The Committee recommended that the AG submit a detailed report on the findings of the proactive audit for the 2022/23 APPs. Lastly, the Department should ensure that NSFAS submits to Parliament a revised APP that incorporates the recommendations of the AG. The Committee will perhaps wait for NSFAS to firstly present whether this resolution may be included or not.

She recounted that conversations about a replica of Imbali Precinct in Limpopo had started at the beginning of the term. One is uncertain where this conversation is currently. The Department and the Committee's oversight must ensure that infrastructure development projects are fulfilled.

The Chairperson thanked all the present stakeholders for the first session.

The meeting was adjourned.

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