Although there was a large cash rise in the budget of the National Student Financial Aid Scheme (NSFAS) for 2022, the country continues to face a worsening student financial crisis. The crisis affects those who have accumulated student debt and are unable to pay it off because they cannot find employment and due to the fact that they did not receive funding from NSFAS because they fell outside the scheme’s threshold.
Every year there are violent protests outside university campuses due to this crisis which highlights that South Africa needs to find a better financial model. In an effort to address the crisis, experts have gathered together.
Several experts from across the continent have met in Cape Town for the 3rd International Conference on Financing Higher Education in Africa. The Association of African Higher Education Financing Agencies (AAHEFA) hosted the conference, which consisted of 11 country members.
The conference gathers all the countries financing higher education members together to discuss how to best facilitate resource mobilisation, increase access to higher education, and build capacity to manage student loan schemes. These strategies are aimed at solving the financial crisis.
According to Michael Wanyama, the CEO of the Higher Education Students Financing Board in Uganda, the majority of African countries were previously only owned by the government. However, with population growth, more students needed access to higher education which was when private stakeholders joined the arena.
“We found that many students could not access higher education, and that's why countries started opening up student grants and student loan schemes,” said Wanyama. According to Wanyama, due to poverty levels in Africa, not all parents were able to afford tertiary education and therefore the governments decided to create a platform where students could borrow money to study further.
Many countries are also struggling to grapple with how to manage their student funding scheme since they do not have clear legal and governance frameworks.
Countries are increasing their budget to support the students but population growth outpaces the resource envelope for many countries. By giving out loans, you are creating a revolving fund because this is repayable by the end of the period. But we need to put in a strong constitutional framework to ensure we cover as much as possible.
The downside to this is that less than 30% of students pay back their student loans which makes it more difficult for the scheme’s financial sustainability. Wanyama explained that the conference brought fund managers, researchers, and academia together to discuss how to create a platform where all parties can increase the number of people gaining access to tertiary education.
The Universities Fund (UF) in Kenya was started to steer universities out of the current financial crisis. The UF realised that universities were unable to carry out their mandate of learning, teaching and training due to the unreliable nature of funding.
Prof Kanyinga, the UF Chairman, believes that it’s time for the private sector to be proactive and form links with the government. “The private sector can decide to finance students in certain disciplines, for example, chemistry for chemical engineers in South Africa. We have to discuss the future role of the private sector and manpower development in Africa,” said Kanyinga.
We have to learn how our African counterparts are doing it and it has been a great learning curve for us. We're quite astonished at how Kenya pays all students' allowances before they go to university. They've got over 3000 TVET colleges and those students get the same services. So we've had to look at the systems Kenya is using that we can adopt.
South Africa is also interested in adopting Malaysia’s module. The module of Malaysia relies mainly on funding from the private sector.
Mamabolo stated that NSFAS was approached by the private sector which had previously funded students, before 2017 but now qualifies for free education. These companies want to plough their funding into assisting students who fall outside the NSFAS threshold, known as the 'missing middle.
