Transcript Sustainable Funding: Money is Not the Main Problem

Sustainable Funding
The Money is Not the Main Problem
Nico Cloete, Charles Sheppard & Francois van Schalkwyk
2016 Inyathelo Leadership Retreat, Cape Town, 5-7 April 2016
UWC Institute of Post-School Studies
It’s not the money, it’s the pact
Fees are not the cause of the crisis, but a symptom. The University
has become part of the social contestation for resources without an
agreed upon (pact) role for the university.
(Cloete, 2016a. Free higher education: Another self-destructive South African policy)
The slides will address the following:
1.
Pressures (contestation) for access to HE.
2.
The shape of the SA post-secondary school system.
3.
Tension between the postgraduate and undergraduate systems.
4.
Fees: Escalation of costs and the trilemma of trade-offs.
5.
Politics and HE systems.
6.
Leadership and the need for a pact.
7.
Approaches to funding .
2
The pressures (contestation) for access to HE
1. Youth bulge in Sub-Saharan Africa will put huge pressure on HE
2. Globally considerable benefits to HE
3. Private returns to HE higher than returns to primary and
secondary education
4. Globally the highest private returns to HE is Sub-Saharan Africa
5. South Africa has the highest private returns to HE in the world:


South Africa: 39.5
Argentina: 12, Brazil: 17, Mauritius: 21, Mexico: 20,
Norway: 10, Portugal: 14, Turkey: 14, Spain: 11, US: 14
6. SA high returns to tertiary education and high levels of
inequality (Gini coefficient 0.70) are consistent.
(Patrinos 2015)
3
The youth bulge:
Africa is increasingly the youngest continent
4
The array of higher education benefits
Public
Private

Increased tax revenues

Higher salaries and benefits

Greater productivity

Employment

Increased consumption

Higher savings levels

Decreased reliance on
government financial support

Personal/professional mobility

Reduced crime rates

Improved health/life expectancy

Increased charitable
giving/community service

Improved quality of life for offspring
Economic
Social
Source: The Institute for Higher Education Policy (1998)
Private returns to education by level and region (2014)
Source: Montenegro & Patrinos (2014). Graphic by CHET/Francois van Schalkwyk.
Higher education and development
1. Factor-driven economies (agriculture, mining) have relatively
high primary school attendance, lower secondary school and
very low tertiary participation rates.
2. Innovation economies have high schooling participation, high
quality ratings and very high tertiary education participation.
3. In the more productive, efficiency-driven stage (South Africa,
Egypt, China, Mauritius) high primary and secondary
participation but low (20-30%) tertiary participation and mixed
global competitive rankings.
4. South Africa’s tertiary participation rate is too low, largely
because it doesn’t have a post-secondary college sector, which
means too much pressure on the university system as the “only
ladder out of poverty”.
(World Economic Forum 2014/5)
7
Primary education
Gross
enrolment
ratio
Quality
Rating
Secondary Education
Gross
enrolment
ratio
Quality Rating
(+Maths &
Science)
Tertiary education
Gross
enrolment
ratio
GCI
Rate of Return
Global
Competiveness
Ranking
29
119
22
99
18
133
19
120
-
115
Stage 1: Factor-driven
Ghana
89
104
67
76 (72)
Kenya
84
84
67
36 (78)
Mozambique
87
138
26
119 (133)
Tanzania
84
124
33
98 (130)
Uganda
92
113
27
81 (111)
12
4
5
4
4
77 (95)
20
-
71
-
116
40
49
21
28
Transition from 1 to 2
Botswana
90
85
82
Stage 2: Efficiency-driven
Egypt
95
139
86
139 (131)
South Africa
90
127
111
138 (140)
China
98
55
89
56 (49)
30
20
26
Transition from 2 to 3
Chile
Costa Rica
Brazil
Malaysia
Mauritius
Turkey
92
108
89
86 (107)
75
18
35
90
39
109
28 (55)
48
20
52
87
132
99
132 (134)
26
17
75
97
15
71
6 (12)
37
22
18
98
48
96
49 (50)
41
22
46
95
100
86
92 (103)
70
15
51
94
99
74
94
83
10
8
13
26
10
11
11
2
15
3
Stage 3: Innovation-driven
Finland
99
1
108
4 (2)
Korea, Rep.
98
36
97
66 (30)
Norway
100
17
111
11 (24)
Singapore
100
3
108
3 (1)
United States
91
29
94
18 (44)
8
Higher education, employment and wages
1.
After controlling for a range of variables, education does bring
rewards, but below matric very low with very little gain in
benefits between grades 1 and 12. But it improves after matric,
and returns for degrees returns are extremely high; both in
wages but especially in employment probability.
2.
“The large differentials in earnings and access to jobs between
the highly educated and the less educated lies at the heart of
income inequality. The high wage premium to educated
workers derives from a combination of a skills shortage at the
top end of the educational spectrum, driving up wages of the
educated, and a surfeit of poorly-educated workers competing
for scarce unskilled jobs, thus dampening unskilled wages.”
(Van Den Berg 2015)
3.
Of particular importance is certificates; matric (validated by a
national exam) and tertiary certificates that signal to
employers reliable cognitive gains.
(Van den Berg, 2015)
9
Conditional probability of employment and
conditional log of wages by years of education
Source: Van den Berg (2015). Graphic by CHET/Francois van Schalkwyk.
Higher education and inequality
•
Access to tertiary education is regarded by the ‘haves’ as a
means to maintain privilege, and by the ‘have‐nots’ as a
means to get out of poverty.
•
In the 1970s in the US, 10% of students from the lowest
income quintile went to university in contrast to 40-50% from
quintiles four and five. By 2010, still only 10% of quintile one
went to university, but for quintiles four and five the
percentage had increased to 80-90%. Higher education in the
US has thus become part of the ‘iron cage of privilege’.
(Piketty, 2014)
•
Hamilton project in the US shows more education increases
income, but does not reduce inequality
•
Quality schooling is key – but poor kids go to poor quality
schools in poor neighbourhoods with poor teachers.
11
More education do not reduce inequality
•
Simulation* shows that a big increase in educational levels
would increase incomes, but not change measures of overall
inequality by much (The Hamilton Project, 2015).
* Simulation assumes 10% of working-age men without advanced education receive a college degree,
and begin earning wages typical of college students.
Source: The Hamilton Project (2015).
12
Invest in education
1. “The best way to reduce inequality and increase the overall
growth of the economy is to invest in education. To
maintain a competitive edge in a rapidly transforming
knowledge economy, countries need to invest more in
quality education. Not even minimum wage schedules can
multiply wages by factors of five or ten: to achieve that
level of progress, education and technology are the
decisive factors.” (Piketty, 2014)
2. But historically SA has not invested enough in HE, nor has
it reached its own target of 1% of GDP on R&D.
3. International research is very clear: the question is not just
MORE investment because investments can have different
outcomes in different countries as the slides on the
Trilemma of Trade-offs show.
13
Expenditure on higher education as % of GDP, 2012
4.47
Compiled by Charles Sheppard
Source: OECD (2010)
0.71
South Africa
Chile
0.95 0.93
Brazil
Argentina
India
Australia
Senegal
USA
1.44 1.39 1.38
1.24 1.20 1.15
Ghana
1.76
Malaysia
Norway
Finland
Cuba
2.18 2.04
State budget for universities and R&D as % of GDP
1.00%
0.90%
0.80%
0.70%
0.60%
0.50%
2004/05 2005/06 2006/07 2007/08 2008/09 2009/10 2010/11 2011/12 2012/13
State budget for universities as a % of GDP
State budget for R&D as % of GDP
Source: R&D data: Mouton (2015); HE data: Charles Sheppard
South Africa the best HE system in Africa
1. SA the most diverse and differentiated HE system in Africa.
2. In 2008, SA HE system ranked by Shanghai as between 27-33
along with Czech Republic, New Zealand and Ireland.
3. Times
•
•
•
•
Higher (2015) rated BRICS and Developing Countries:
SA 3 universities in the top 12 (UCT 4; Wits 6; US 12)
Brazil and Russia 1 university each in top 12
India with a billion people has 0
China has 6 (massification with 30 WC universities)
4. PhD transformation from 1996-2012:
• Proportion of black graduates increased from 13% to 58%
• African women graduates increased by 960%
• No increase in white male graduates for the same period
• In 2012, more African than white graduates (Cloete, 2015)
5. PhD and research output in the HERANA project show how much
better a university like UCT is performing. (CHET/Herana 3 data, 2016)
6. But, the reputation of SA HE is based on the postgraduate system.
Source: CHET/HERANA 3 Data. Graphic by CHET/Francois van Schalkwyk.
Source: CHET/HERANA 3 Data. Graphic by CHET/Francois van Schalkwyk.
What’s wrong with the best HE system in Africa? (1)
1. Opening morning of the NCHE (1995) Prof. Reddy (chair) said:
“The two biggest problems facing HE in SA is the shape of the
system and its racial composition”.
2. The fundamental problem is the inverted pyramid: too large a
proportion of students in universities, too small a post-secondary
college sector, too small a private PSE sector and 3 million 18-24
year-old NEETs.
3. DHET has made a major shift in TVET college enrolments; from
350 000 in 2010 to 750 000 in 2014 (but only 80 000 in privates).
4. But TVET colleges have the following weaknesses:



suffer from a very poor reputation
an identity problem: mixing school drop-outs with postmatrics
major inefficiencies: it costs more to produce a college
diploma than a degree at a university.
19
South Africa post-school system, 2010 vs 2012
Source: DHET HEMIS 2012. Compiled by Charles Sheppard.
Graphic by CHET/Francois van Schalkwyk.
20
What’s wrong with the best HE system in Africa? (2)
1.
Of the 1 million kids who enter Grade 1, only 100 000 will enter
university and 53 000 will graduate after 6 years. (Van den Berg, 2015)
2.
Very poor graduation rates – 30% graduate in 3 years, 56% in 5 years (if
UNISA included it drops well below 50%). National diploma even worse:
below 50%.
3.
Inefficiency – high drop out, high retention rates.
4.
2006-2013: 1.7% growth for new entrants; average annual growth for
returning undergraduates 4%. Too many students stay in the system for
too long.
5.
All or nothing system: drop out or graduate. With high premium on
tertiary certificates, perhaps associate degrees must be considered.
6.
The Honours is not funded by NRF or NSFAS, a major blockage for black
students to masters and PhD study.
7.
There are too many “poor” (academic and economic) students in the
university system.
8.
The current university undergraduate system is unsustainable.
21
Progression from Grade 1 to Bachelors Degree (current estimated figures)
Enter Grade 1
1 million
Write matric
550 000
Pass matric
400 000
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👤👤👤👤
👤👤👤
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1 in 20
Only 30%
graduate after
3 years
school entrants
obtain a first degree
Enter universities
100 000
👤👤
Graduate after 6 years
with first degree
53 000
👤
Source: S. Van der Berg (pers. comm.). Graphic by CHET/Francois van Schalkwyk.
Cumulative completion rate of the 2008
first-time entering undergraduate cohort (Unisa excluded)
Source: CHE & DHET (2015) Cohort studies.
Undergraduate pipeline
Fewer than
1 in 1000
129 976
2008
school entrants
obtain a PhD
undergraduate enrolments
38 993
B graduates after 3 years
76 686
B graduates after 6 years
1 in 50
B graduates
obtain a PhD
Postgraduate pipeline
2001
40 908
bachelor graduates
10 984
honours graduates
5 795
masters graduates
897
doctoral graduates
Completion rates
Only about 40% of honours
students are likely to
complete their degree
within 3 years.
Only about 25% of masters
degree enrolments are
likely to complete their
degree within 4 years.
Only about 25% of doctoral
students are likely to
complete their degree
within 5 years.
Source: Crest and DST (2014)
Vocational education and equality
1.
VET increases labour market returns for the poor. On the other
hand, it helps to maintain social stratification.
2.
When public investment is concentrated on an elite higher
education system, it will increase private returns – as is the
case in South Africa which has the highest Gini coefficient and
the highest private returns in the world.
3.
Conversely, when governments invest heavily in VET instead of
higher education, the private benefits will accrue more towards
the lower half of the skill distribution (Busemeyer 2015).
4.
If we want the poor out of poverty and stimulate economic
growth, FREE VET.
5.
High-equality countries (Nordics, Germany) have strong VET
systems.
25
Growth in the system
1. South Africa, like other developing countries is faced with
financial constraints and backlogs in higher education as a
result of extraordinary growth and wider participation in the
higher education sector over recent years. (WB, 2010)
2. The WB in its report “Financing Higher Education in Africa”
concludes that in most Sub-Saharan African countries,
enrolment in higher education has grown faster than
financing capabilities, reaching a critical stage where the lack
of resources has led to a severe decline in the quality of
instruction and in the capacity to reorient focus and to
innovate.
3. But South Africa’s participation rate in tertiary education at
20% is too low, but the increases have to be in the nonuniversity sector of tertiary education (Cloete, 2015).
21
Fees are not the cause but the symptom
1. Lack of credible post-secondary system, a vocational system
and youth employment puts too much pressure on HE as
“contested ladder out of poverty”.
2. University has become part of societal contestation for
resources with political party contestations entering campuses
(See Cloete. 2016a. Third Force in Student Activism).
3. Different fee systems, such as a deferred graduate tax, need
high graduation and high employment. Therefore have to
address the economy; cannot just look for more money from
“somewhere”. HE is on route to the SAA model of bailouts.
4. Pressure on the UGS is going to undermine the PGS system
(funding earmarked for full-time doctoral programmes may
already be diverted to NSFAS debt). (Cloete, 2016b)
27
Fees: Cost escalation
1.
While Govt contribution increased from R16billion (2000) to
R21billion in (2013) as percentage of the budget it decreased
from 49% to 40% (and at some universities close to 30%).
2.
Third stream income almost doubled (R9billion to R14billion),
but remained at the same proportion (27%) of budget
3.
Student fees compensated for government decrease; in 2000
it contributed 24% but 33% by 2013. Over the same period
proportion of students on NSFAS increased from 2% to 13%
4.
Rise in fee income: 9% p.a. Increase of 42% from 2010 to
2014, but considerable institutional differentiation: UCT (44%)
in comparison to Fort Hare (23%)
5.
National inflation over same period 5-6%. The 9% annual
increase is similar to the increases in medical aid and private
school education. Increasing cost of public higher education is
similar to the increases in private social services.
28
Streams of university income (ZAR bn), 2000 and 2013
100%
Third stream
Third stream
8.78
14.26
27%
27%
75%
Student fees
NSFAS 2% (0.51)
Private 22%
7.80
Student fees
24%
17.83
33%
50%
Government
25%
15.93
Government
49%
21.21
40%
0%
2000
2013
Source: DHET – Annual Financial Statements of universities & DHET – Annexure 3, 2nd National Higher Education Summit 15-17 October 2015.
NSFAS 13% (6.73)
Private 20%
Increases in student fees in South African universities
ZAR
Increases in tuition fee income per student*
% increase in tuition fee income per student (2010-2014)
70,000
44%
42%
60,000
50,000
23%
40,000
30,000
9.2%
9.5%
20,000
5.4%
10,000
2010
2011
2012
2013
All South African universities
University of Cape Town
University of Fort Hare
2014
All South African University of
universities
Cape Town
Increase p.a.
University of
Fort Hare
Total increase
* The tuition fee income per student is calculated by dividing the total reported tuition fee income with the total number of full-time equivalent students
Source: Charles Sheppard. Graphic by CHET/Francois van Schalkwyk.
Trilemma of trade-offs
1.
2.
3.
4.
5.
6.
The effect of government investment in HE depends on
distribution of private and public benefits.
All fee regimes are a Triangle of Trade-offs:
Public (government) investment – enrolment – private costs
Low public investment - mass enrolment- high private cost (US,
Australia) (high private costs ameliorated by direct loans (US)
or deferred payments (Australia).
High public investment-mass enrolment – low private (Finland,
Norway) (high employment, high tax).
High public investment - low enrolment – low private (Germany,
Belgium) (30% of Univ. Vienna students from Germany).
If private benefits (returns) are concentrated in upper half of
income distribution, high level of investment will increase
income inequality. If private benefits outweigh public benefits,
government investment increases income of well educated, but
not necessarily stimulate economic growth (exactly SA).
Ansell (2008); Busemeyer (2015)
32
Trilemma of trade-offs
Source: Busemeyer (2015). Graphic by CHET/Francois van Schalkwyk.
Politics & higher education systems: England
Before the war, HE was a rite of passage for the elite.
1.
1988 Education Act tried to end binary system and double
enrolments; Tories were split between the rich (high fees and elite
system) and emerging middle class who wanted a mass system with
low fees – paralysed the Tory party reform.
2.
Decision to massify was driven by Thatcher due to fears of British
uncompetitiveness in the coming open Euro labour market. But the
system was unaffordable, so contradictorily Labour introduced fees to
accommodate expansion.
3.
Lib Dems campaigned on revoking fees, with an increase in public
spending. With the 2010 coalition government, Tories refused to
increase public spending. Breaking their election promise was the
beginning of the end of Lib Dems.
4.
Contradiction: Thatcher and Cameron (Oxford) vs Clegg (Cambridge).
Difference was not their education (all elite), but the interests of their
different constituencies.
5.
Trade off: Medium: Government spending – mass - private (income
contingent loans – advise given by UK to NCHE on NSFAS in 1996).
Ansell (2008)
34
Politics and higher education systems: China
1.
Equality in education: “In education, there is no distinction between
classes of men” [Confucius (500 BC)] “HE increasingly stands out in
the stratification of the society.” (Yulin 2003 in Jingyi 2004)
2.
Economist Tang Min): “Higher education enrolment expansion will turn
out to be a measure that entails less state investment, stimulates
domestic consumption greatly and satisfies the urgent demand from
the masses.” (Jingyi 2004)
3.
Three principles:
1.
2.
3.
High tuition to increase investment in higher education and to spur
consumption
Large-scale loan systems to help poor students – Rural Credit
Cooperatives (10-15 year pay-back) and China Development Bank
Increased scale of scholarship (30 world class universities)
4.
Trade-off: High: Government spending (3.5% GDP) – mass – private
5.
Resulted in the fastest expansion of HE in history. From 18 000 PhD’s
in 1978 to 50 000 in 2008. (40% STEM). China is distorting the world
high-skill labour market.
35
Politics & higher education systems: Africa
1.
“The purpose of post colonial flagship universities was to train a tiny
elite on full scholarships which included tuition, board, health
insurance, transport and personal needs”. Makerere was described as
a “devaluation of higher education into a form of low-level training
with no research” (Mamdani. 2008. Scholars in the Marketplace).
2.
For government “free higher education is highly visible and populist,
and encourages the perception that the state is providing something
people want ... free higher education in Africa was built on
inequitable social structures. It reproduced these inequalities ... free
higher education in highly unequal societies mainly benefits the
already-privileged (new political and business elite) , who have the
social, cultural and economic capital required to access, participate
and succeed in education. (Langa et al., 2016)
3.
Trade-off: Low: Government spending – mass (elite) – private
4.
Dual system: Private colleges high private spending – low quality.
36
Trilemma of trade-offs: England, China , SA & Africa
Source: Busemeyer (2015). Graphic by CHET/Francois van Schalkwyk.
Leadership and a pact
1.
In SA competing models of functions/roles for HE:

Redress (race and poverty) vs development

Undergraduate access vs knowledge economy skills
2.
In the deteriorating economic climate, HE is increasingly seen as
individual mobility, not as key to economic growth
3.
In a study on HE systems that have successfully linked HE to
development, the main feature was a PACT that link HE to the economic
development model (Pillay 2011).
4.
Politically in SA there is conflict between modernisers who push the
development agenda and traditionalists who see HE as redress
5.
In government a similar divide between DST and DHET

DST focus: development, knowledge economy, postgraduate

DHET focus: redress (institutional, individual), undergraduate
(Cloete 2016b).
6.
During the crisis many VCs acted like competing spaza shop owners:
protect your own shop, call the police and try and get the government
to sort out the problem.
7.
Currently both Govt and University leadership seem too fragmented for
a PACT.
38
The fundamental tension in the SA model of HE
1.
The tension between equity and development was posited by
Wolpe (??) and successive HE policy initiatives have failed to
resolve it. The NCHE came closest by proposing massification,
which the government rejected. What the NCHE did not even
want to discuss was differentiation, instead the focus was
redress and democratisation (Cloete and Muller ??)
2.
It is now widely accepted that to balance equity and
development a massified, but differentiated system is required
(Altbach ??).
3.
In terms of enrolment, massified means participation rates of
over 60% (even 80%) for developed innovation economies, and
between 30-50% for developing economies. Elite systems below
20-25%.
4.
A key aspect of massification is that the majority of tertiary
enrolments are not in universities, but a diverse range of public
and private college providers.
40
A diverse and differentiated HE system
1.
The so-called knowledge economy requires a great diversity of skills
programmes, and differentiation in the levels of skills and performance.
2.
Broadly this means:

high percentage of labour with post-matric qualifications for
people to work in jobs that require higher than matric-level
information processing and problem-solving:
“In the coming years, jobs requiring at least an associate degree are
projected to grow twice as fast as jobs requiring no college
experience.” (Obama, 2010)

A strata of a university system that offers solid general and
vocational-orientated education, mainly, but not exclusively, at the
undergraduate level to produce what Castells calls ‘selfprogrammable labour’, meaning skills that enable workers to adapt
to and change working conditions.

A group of universities that concentrate on high-level professional
training and new knowledge production with a high percentage of
staff with doctorates (70%), and with more than 40% of students in
postgraduate programmes (currently 7 universities produce 70% of
all PhDs; 6 universiites 1%). (Cloete et al. 2015)
41
A differentiated fee regime
1.
The funding for a post secondary tertiary system will not only
vary in amounts, but also in sources and mechanisms of
funding.
2.
The post matric ‘non-university’ sector is diverse in itself;
directly vocational private and public sector needs much greater
input from and coordination with business, and even particular
government departments (Paul Lundall, Seamus)
3.
The Govt subsidy for TVET colleges must firstly reward
certification (success) instead of rewarding failure (Charles,
Seamus).
4.
Charles what do we say in terms of funding development
courses, research outputs – just a few general comments.
42
The slogan should be “Affordable”, not “Free HE”
1.
The students and the VCs both use examples countries such as Norway
and Germany as examples of free HE: the students to argue for free HE,
the VCs to argue that we can’t afford it.
2.
Nowhere in the world is there free HE; the question is:
Who pays what and when?
3.
The question whether SA can afford free HE is simply wrong:

Free HE in a unequal developing country privileges the “have’s” (or
in economists terms, is regressive) and is morally indefensible
(Barr; Fourie). That is apart from the issue of why HE should be
free when schooling is not?

HE could be free for some groups of students and very expensive
for others, as long as it is affordable.

If certain conditions are met (high graduation rate, high graduate
employment and high tax collection) then HE could be “free” while
students are studying and paid back when employed, or even
retired (deferred graduate tax – Barakat, 2015). This means
funding is more closely linked to the economic model than what is
usually assumed.
43
Differentiated affordability (poor)
1.
Quintile 1: the poor.
2.
The Government’s Swartz Committee recommended free higher
education for this group. The unanswered question is where the poverty
income line is drawn.
3.
There is considerable evidence poor student on NSFAS grants may be
passing courses, but graduation rates are very low. The implication is
that the poor are in a “revolving door” situation: admitted to HE but don’t
graduate which leaves them poor and with debt – and some are clearly
angry (Cloete 2016a).
4.
Barr (..) advised the UK government that poor students should not get
loans; to pay back loans keeps them in a disadvantaged position.
5.
Due to the absence of post-matric alternatives (college, VET,
employment) too many poor students are trying to get into HE- and this
pressure may destabilise the whole HE system.
6.
The “poor” must be better selected, and when admitted, better
supported, not only financially and academically, but also socially (see,
for example REAP).
44
Differentiated affordability (working class)
1.
Quintile 2 + 3?: the working class – R150 000 to R450 000? (Sevaas?)
2.
“Not poor enough for NSFAS but do not qualify for bank loans” (Cloete 2015). If
they qualify for one child, they cannot afford a second child in HE (SA’s own one
child policy).
3.
Worldwide, the children of the working class (artisans, teachers, nurses, police)
have a strong aspiration to, and considerably greater success at university than
the poor. Neither the economy nor the ruling party can abandon this group.
4.
With parents in employment, working class students have a better success rate,
and better labour market opportunities. This group needs loans or deferred
payments (which, in addition to UK and Australia, is under serious discussion by
a number of OECD countries) (Bakarat)
5.
Traditionally the banks are involved in this sector, but the US has abandoned the
banks (even the Republicans supported Obama on this) for direct loans (NSFAS).
(The high costs of bank loans could pay for more than a million extra students.)
Most interesting is China: Rural Credit Cooperatives (middle class invest at
higher interest rates and poor borrow for 10-15 years.) This system is supported
by the China Development Bank, which is an economic development bank (Jingyi,
2004).
45
Differentiated affordability (upper middle class)
1.
Quintile 4 +5?: the upper middle class – more than R500 000? (Sevaas?)
2.
Contrary to popular belief, in countries like Norway and Germany, it is not the
rich who pays for free HE, it is the middle class with 95% employment and
almost 100% pay taxes. The combined wealth of Motsepe, Rupert and the
Gupta’s will not fund NSFAS for more than a few years.
3.
It is this group who are born into HE (over 80% attend) and is most successful –
free HE will advantage them even more (Fourie; Barr; Simkins).
4.
In SA only 4% of population earn more than R500 000 p.a., the approximately
R100 000 required at most SA universities for fees and living costs is not really
affordable for 95% of the population (Fourie, 2015).
5.
In SA HE fees are a huge bargain for the upper middle class; only affordable for
the middle class with loans and debt, and totally unaffordable for the lower
middle class and the poor.
6.
Fourie proposes a fees sliding scale that ranges from R150 00 for the upper
middle class to R15 000 for the poor.
7.
The question to be determined is what percentage of their budgets the
government, business and civil society must contribute to HE.
46
Concluding comments
47
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CHET Publications
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http://www.universityworldnews.com/article.php?story=20151104111825416
Cloete N (2016a) Free higher education: Another self-destructive South African
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South Africa must be restructured. South African Journal of Science
(March/April). http://www.sajs.co.za/sustainable-funding-and-feesundergraduate-system-south-africa-must-be-restructured/nico-cloete
Cloete N, Mouton J & Sheppard C (2015) Doctoral Education in South Africa. Cape
Town: African Minds. http://www.africanminds.co.za/dd-product/doctoraleducation-in-south-africa/
Langa P, Wangenge-Ouma G, Jungblut J & Cloete N (2016). South Africa and the
illusion of free higher education.
http://www.universityworldnews.com/article.php?story=20160223145336908
Pillay P (2011) Linking Higher Education and Development. Cape Town: CHET.
49
Nico Cloete
Charles Sheppard
François van Schalkwyk
[email protected]
www.chet.org.za