13 November 2017

South Africa: USAf Concerned About Proposed ICL Funding Model

Universities South Africa (USAf) has expressed concern over an income-contingent loan (ICL) funding model proposed in the recently-released Fees Commission report.

The organisation, which represents 27 universities nationally, welcomed the release of the report.

However, USAf CEO Ahmed Bawa warned that the government's implementation of the commission's recommendations was more important.

The report, which President Jacob Zuma released at noon, concluded that free higher education was not a viable option for South Africa.

It also proposed replacing the National Student Financial Aid Scheme (Nsfas) with an "income-contingent loan" (ICL) system in which students would repay their debt, based on their post-qualification salaries.

Speaking to News24 from New York, Bawa said: "Basically, the report is only recommendations made to President Jacob Zuma. The main part of importance lies with what the inter-ministerial committee decides."

"We can only make a true judgement on the future of higher education when we receive word on which of the recommendations the government plans to implement."

'Nsfas plays important role'

Bawa welcomed the report's recommendation that funding for higher education be increased to 1% of GDP.

"The reason why student fees have been increasing above inflation is because the state subsidy to universities has gone down quite substantially... We have previously called for funding to be increased to 1% [of GDP] and we are happy the Fees Commission agrees."

Bawa, however, expressed concern over the proposed ICL funding model.

"Nsfas plays an extremely important role to fund students coming from very poor backgrounds... we have to start with the principle that students coming from very poor backgrounds should not be prevented from higher education on financial reasons," he said.

The report, compiled by the Heher Commission of Inquiry, was submitted to Zuma in August.

In a statement on Friday afternoon, Zuma said an inter-ministerial committee, led by Minister in the Presidency Jeff Radebe and Minister of Finance Malusi Gigaba, would be "processing" the report before "a pronouncement" is made.

"I have decided to release the report prior to the conclusion of our work in processing it, so that the public can have an opportunity to study the report while we continue with the processing thereof," Zuma said.

Source: News24

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