14 November 2017

South Africa: Cosatu Statement On the Released Heher Commission Report Into Higher Education Funding

press release

COSATU reiterates its previous call for this report to be tabled at Nedlac for further engagements because the initiative of free education for the poor cannot be postponed indefinitely. We believe that education is not only a human right but as socio-economic matter and Nedlac has a role in providing a platform , where society could engage in a sound dialogue that can provide a sustainable solution to the impasse.

Our position is clear in that we disagree with the report that Free education is not feasible. The wasteful expenditure and endemic corruption that is currently taking place in this country is proof enough that we have the resources to fund free education for the poor.

Currently South Africa is losing roughly R147 billion from the money that is illegally taken out of the country per year. This is the money that can accommodate all South African students at a university level for free.

According to the Department of Economic Development corruption costs the SA gross domestic product (GDP) at least R27bn annually and the 2015 -2016 Auditor General's Report shows that irregular expenditure increased by nearly 40% last year.

This year's Auditor General's report showed that irregular expenditure in the public sector increased by more than half from R29,4bn in 2015/16 to more than R45,6bn in 2016/17.

In July last year, 2016, a report by the U N Conference on Trade and Development showed that South African mining companies under invoiced the taxman to the tune of R1 trillion between 2000-2014. The newly proposed Income Contingency Loan System is unworkable because it will lead to many young graduates from poor families overburdened with massive loans.

We also totally reject the proposed ring-fencing of R50 billion of Unemployment Insurance Fund [UIF] surpluses for infrastructure development for TVET colleges. This money belongs to the workers and if government wants to raise money they need to push for an increase in the skills levy. We cannot afford to continue taking from the workers every time, when the country finds itself in an economic gridlock or is trying to overcompensate for the failures of government like we saw with the attempts to appropriate PIC funds to bailout some State Owned Entities.

What we want is to see government fast tracking the implementation of the UIF Amendment Act because the much talked about surplus is as a result of government delaying to expand the access to UIF since 2013. UIF is an unemployment insurance paid for by workers and not a slush fund for corrupt, incompetent politicians to hide their failures and inefficiencies.

We need a Tax Legislation for businesses that will contribute towards free education. The federation is supportive of an idea of the restructuring of the budget in a manner that prioritises the funding of free education but that should not undermine the country's developmental agenda. Government needs to fast track tax reform as proposed by Davis Tax Commission.

We also need government to show its real commitment to cut wasteful expenditure by reducing the cabinet from 78 to 27. We also need to see a reduction in the exorbitant perks that are paid to the leaders of parastatals and politicians. Free Education is possible if we also see the better management of the country and the economy because the reckless decisions that have been taken this year in particular have resulted in billions of rands being pulled out of the country by investors.

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