ATC130531: Report of the Portfolio Committee on Higher Education and Training on the Strategic and Annual Performance Plan 2013/14 of the South African Qualifications Authority (SAQA) and National Student Financial Aid Scheme (NSFAS) dated 22 May 2013

Higher Education, Science and Innovation

REPORT OF THE PORTFOLIO COMMITTEE ON HIGHER EDUCATION AND TRAINING ON THE STRATEGIC AND ANNUAL PERFORMANCE PLAN 2013/14 OF THE SOUTH AFRICAN QUALIFICATIONS AUTHORITY (SAQA) AND NATIONAL STUDENT FINANCIAL AID SCHEME (NSFAS) DATED 22 MAY 2013

REPORT OF THE PORTFOLIO COMMITTEE ON HIGHER EDUCATION AND TRAINING ON THE STRATEGIC AND ANNUAL PERFORMANCE PLAN 2013/14 OF THE SOUTH AFRICAN QUALIFICATIONS AUTHORITY (SAQA) AND NATIONAL STUDENT FINANCIAL AID SCHEME (NSFAS) DATED 22 MAY 2013

The Portfolio Committee on Higher Education and Training, having considered the Strategic and Annual Performance Plan (APP) 2013/14 of SAQA and NSFAS reports as follows:

1. Introduction

The Portfolio Committee on Higher Education and Training considered the Strategic and Annual Performance Plan 2013/14 and budget of SAQA and NSFAS on 24 April 2013. This report provides a brief summary of the presentation made by both entities to the Committee, focusing mainly on the 2013/14 Annual Performance Plan including an overview of budget allocations in various programmes. The report also provides the Committee’s observations and recommendations.

Portfolio Committee on Higher Education & Training:

Present: Ms D Chili (ANC), Ms N Gina (ANC), Mr S Makhubele (ANC), Adv I Malale (Chairperson), Prof S Mayatula (ANC), Mr C Moni (ANC), Mr S Radebe (ANC), Dr L Bosman (DA), Mr A Mpontshane (IFP) and Mr J Dikobo (AZAPO).

Apologies: Prof A Lotriet (DA) and Ms D Sibiya (ANC).

Support Staff: Mr A Kabingesi (Committee Secretary), Ms M Modiba (Content Adviser), Mr L Komle (Researcher) and Ms T Majone (Committee Assistant).

The following were present:

South African Qualifications Authority:

Mr J Samuels: Chief Executive Officer, Dr V Penxa : Deputy Chairperson, Mr M Albertyn : Chief Financial Officer, Dr J Reddy: Deputy Chief Executive Officer and Ms N Gumbe : Director.

National Student Financial Aid Scheme:

Mr Z Sogayise : Chairperson, Mr M Daca : Chief Executive Officer, Ms S Masinga : Board Member, Mr E Johannes: Acting Chief Financial Officer and Ms X Peter: Chief Information Officer.

Department of Higher Education and Training:

Mr M Manana : Deputy Minister, Mr S Makgoba: Chief Director: University Financial Planning, Mr T Coombe : Chief Director, Ms H van Rensburg : Director University Academic Planning, Mr Z Hlongwane : Director Public Entities.

2. Summary of presentations

2.1 South African Qualifications Authority (SAQA)

Dr V Penxa : Deputy Chairperson made the following opening remarks:

· SAQA board comprised of 12 members nominated from the Education and Training Development (ETD) sector and appointed by the Minister. The board comprised of 10 sub-committees which reported to every board meeting on their terms of reference.

Mr J Samuels: CEO led the presentation which highlighted the following key issues:

· SAQA received an unqualified audit for the 15 th time in 2012/13 financial year. Some of the highlights for 2012/13 included; development of the Apply Now Campaign, Mandela Day Careers Festival, revised policy on Recognition of Priory Learning (RPL), draft articulation policy, development of Fraud Combat Strategy and assistance with Central Applications Clearing House (CACH) (90 000 calls received, 85% advice offered and 15% of learners assisted through CACH got accepted in institutions of higher learning).

· The National Learners Records Database (NLRD) 2012/13 included; 13 million learners with 12.8 million qualifications, 1236 registered qualifications, 10 143 accredited providers and 48 recognised Professional Bodies.

Mr M Albertyn : CFO presented the budget summary:

· The total budget for 2013/14 of SAQA was R116 million and insufficient to fulfill its mandate. The estimated budget shortfall was R10 million for the current financial year. The Career Advice Service (CAS) ends 31 August 2013 and there was no provision to continue with this project. The government grants average annual increase to SAQA from 2008/09 to 2012/13 was 5%. As a result, personnel costs in 2013/14 budget comprised 62, 5% of total budget. To balance 2013/14 budget, SAQA had to; cut 7 permanent staffing posts, not fill current vacancies, start charging conference fee attendance, reduce research activities and no staff incentive provision. Accumulated surplus funds in prior years were used to supplement SAQA’s income and then the funds were depleted.

· The R10 million shortfall would impact on the following: outreach programme to rural areas, filling of vacancies, National Qualifications Framework (NQF) website, advocacy campaigns, digitisation of learner records prior 1992, verification of qualification and programmes process and many other related programmes.

Dr J Reddy: Deputy CEO: presented the APP 2013/14:

· The strategic imperatives of SAQA included; leadership in the transition of the NQF Act, ensure research credibility to direct and steer policy, ensure effective governance, implementation of all requirements of the NQF, enhance relations with stakeholders, publish research reports and articulation.

Ms N Gumbe : Director presented the Career Advice Portal Self Help Tool:

· SAQA was in the process of developing a self-help portal that would provide learners, parents and teachers with information on different types of occupations and institutions that offer those occupation related programmes. It was reported that the portal would be integrated with employment services of South Africa and Department of Labour Market Information System.

2.2 National Student Financial Aid Scheme (NSFAS)

Mr Z Sogayise : Chairperson made the following opening remarks:

· The 2012/13 financial year was the record year in terms of number of students assisted in higher education and institutions by NSFAS. NSFAS assisted more than 405 070 students with loans and bursaries worth R7.7 billion. The proposed student centred model would be implemented in the current financial year and it aimed at improving disbursement of funds more efficient and effective.

Mr M Daca : CEO led the presentation which highlighted the following key issues:

· Programme 1: Administration was aimed at conducting the overall management of the entity and to provide efficient support service to internal departments. The total budget for this programme was R98.5 million.

· NSFAS aimed to improve governance system to provide a smooth transition from the old to new policy framework so that executive management and employees were accountable for delivering on the policy. Staff development would be prioritised to implement the new student centred model.

· Programme 2: Student-Centred Financial Aid aimed at achieving the vision and mission of NSFAS by creating a centralised student financial aid system and to provide funding to eligible student whilst maximising recoveries and striving to increase the pool of funds available. The total budget for this programme was R31.7 million.

· The Central Application Process (CAP) would be created through regional offices and other appropriate channels of delivery by and learners would be able to apply for funding through CAP by 30 September 2013.

· New funding sources had been identified (Government Employees Pension Fund & Public Investment Corporation) to raise new funding for targeted student programmes including the missing middle.

· New programme for funding Bachelor of Technology (B Tech) would be implemented. Loan recovery would be maximised to recover outstanding loans (R1.5 billion target for 2013/14) from all eligible debtors employed in both formal and informal sectors of the economy.

· Budget Overview: The total budget of NSFAS for the 2013/14 MTEF period was R8.2 billion as compared to R7.4 billion in 2012/13. Bulk of the allocation R8.1 billion was allocated to the Student-Centred Financial Aid to achieve NSFAS’s vision and mission. Administration was allocated R98.5 million as compared to R125 million in 2012/13.

3. Observations

The Committee having considered the Strategic and Annual Performance Plans 2013/14 of SAQA and NFSFAS, made the following observations:

a) South African Qualifications Authority (SAQA)

· The Committee was seriously concerned with underfunding of SAQA which would lead to retrenchment of critical personnel and inadequate implementation of certain key targets.

· It emerged that more 10 million learner records prior 1992 were not yet digitised by SAQA and inaccessible in the National Learners Records Database (NLRD).

· It was noted with concern that while the country is in dire need of career guidance, the Career Advise Service (CAS) (Ministerial flagship programme) would come to an end by 30 August 2014. It was further noted with concern that expertise and infrastructure created for CAS will be lost with the disestablishment of the service.

· SAQA was commended for having clean audit for the 15 th time consecutively.

· It emerged that SAQA would charge conference attendance fees to delegates for future conferences and the Committee was not pleased with new arrangement.

b) National Student Financial Aid Scheme (NSFAS)

· It emerged that NSFAS advertised a tender where information was requested on distribution of laptops to students. The tender was to establish whether laptops would reduce the costs of buying textbooks. The view of the Committee was that special focus should be put on effective and efficient administration of funds to students.

· It was noted with concern that though NSFAS reduced the costs of consultants from R14 million to R10 million, the costs of outside services increased from R10 million to R14 million for 2013/14.

· Student hunger in higher education and training institutions remained a serious concern for the Committee and it requested NSFAS to prioritise this matter.

· It emerged that NSFAS would conduct research on top slicing with the view of assisting universities to effectively distribute bursaries to students.

· Late allocation of the Funza Lushaka bursary to students was highlighted as a major concern which contributed to high drop out rate in this programme.

· The Committee was pleased with the proposed date of 30 September 2013 for implementation of the Central Application Process whereby students from rural areas would be able to apply for NSFAS from their surroundings.

· It emerged that the Government Employees Pension Fund (GEPF) would be approached by NSFAS to assist the “missing middle” (students whose parents earn above the current threshold of R122 000 but cannot afford to pay for their fees) with study loans.

· The Committee was concerned with inadequate funding from SETAs and provincial government departments in assisting students with bursaries.

· It was noted with concern that Funza Lushaka students majoring in Afrikaans in the Northern Cape were being discriminated as compared to their counterparts studying African languages.

· It emerged that NSFAS had a shortfall of R2.5 billion to adequately assist needy students in the 2013/14 MTEF period and targeted to recover R1.5 billion in outstanding loans from eligible debtors employed in the formal and informal sectors of the economy.

4. Recommendations:

The Portfolio Committee on Higher Education and Training Committee recommended that the Minister should:

· Funding: Apply for additional funding to Treasury to allocate the R10 million required by SAQA to implement its priority projects and prevent the envisaged job losses.

· Career Advice Services: Make Career Advice Service (CAS) project a permanent service funded through National Treasury voted funds.

· Recognition of Prior Learning (RPL): Prioritise effective implementation of RPL to improve the lives of skilled workers.

· Capacity: Assist NSFAS to develop and strengthen its internal capacity to limit the extensive utilisation of consultants which would cost the entity R10 million in the 2013/14 financial year.

· Non-alignment of academic year and financial year: C onsider applying to National Treasury to release a portion of the allocation for NSFAS bursary at the beginning of academic year to enable institutions to transfer allocation for student’s accommodation, meals, transport and books.

· Funza Lushaka : Prioritise improvement in administration of the NSFAS bursary to Funza Lushaka beneficiaries to reduce the drop-out rate which was caused by late allocation of funds to this programme and, the bursary should not discriminate against students majoring in Afrikaans.

· Ensure that NSFAS beneficiaries do not re-apply for the bursary annually while they were progressing well with their academic studies.

· Appeal to Sector Education and Training Authorities ( SETAs ) to assist financial needy students with bursaries.

5. Conclusion

The Committee commended good governance structures in place at SAQA which was resembled by clean audit for the 15 th time consecutively. Of great concern to the Committee was inadequate allocation of funds to SAQA and it promised to pledge support for more funding to be allocated so that key projects may not be affected. Besides shortage of funding, SAQA was a well managed entity with strong leadership and governance.

The Committee supported NSFAS in its proposed student centred model in which money would be allocated directly to the students to reduce the administration involved in distribution of loans and bursaries. The envisaged model would allow learners / students in rural areas to apply for NSFAS in their respective surroundings and be informed whether they qualify or not before being admitted to any higher education institutions.

Report to be considered.

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