LIMPOPO, South Africa —“Education is the most powerful weapon which you can use to change the world,” said Nelson Mandela in a 2003 speech. Human capital investment has been a major priority for the democratic government of South Africa. The country aims to ensure that the black population, which was economically disadvantaged by the apartheid system, becomes economically savvy, skillful and employable, like the rest of the country’s populace. To achieve this, the South African government has launched efforts such as the National Student Financial Aid Scheme.
The NSFAS is the South African government’s student loan and bursary scheme that provides loans and bursaries to students at all of the country’s 25 public universities and 50 further education and training colleges, or FETs. Since 1991, the NSFAS has spent over 32.8 billion rand (approximately $3.07 billion U.S.), and in 2013 alone, a total of 843,566 students were given either a loan or a bursary.
Funding such as that made available by the NSFAS is meant for students who are unable to pay for higher education. In South Africa, a significant chunk of this funding goes to youth who live in rural areas, as this section of society has some of the poorest people in the country. One such rural setting, where the NSFAS has so far set aside 89 million rand (about $8.4 million U.S.) for 2014, is the University of Limpopo.
The university hosts two graduation ceremonies each year. Between 2007 and May 2014, it had 21,125 graduates. Records show that approximately 90 percent of these graduates stay in rural areas, and over two-thirds received NFSAS funding during their studies.
Professor Nehemiah Mokgalong, the vice chancellor and principal of the University of Limpopo, explicitly informs future and existing students about the availability of government funding for those who cannot meet the expenses but qualify for enrollment. Mokgalong emphasizes the precedence of knowledge attainment over its affordability. This is a testament to the South African government’s policy on empowering youth to be more knowledgeable and more specialized in their choice of profession, as well as the production of such individuals in large numbers.
We carried out a mini-survey at the university, where 500 students were asked to share their thoughts on the NSFAS. Of those interviewed, 95 percent credited their ability to meet financial expenses to government assistance. Over 80 percent of the participants singled out the NFAS as their source of funds, and 78 percent indicated that they could not have been students had they not been funded by the government. Ninety-eight percent were youth from rural areas. This 98 percent also said they believed that the government’s priority for educating the entire population was a long-term investment whose benefits far outweigh the costs.
Sibusiso Sibuyi, a fourth-year student in education studies at the university, spoke on marketability and other positive effects that NSFAS brings to the student body. “My mother could not afford to bring me to [the university]. She could not afford to pay all my fees, and NSFAS met her halfway, and that allows me to study for a degree. Government funding helps a lot of students from disadvantaged families and rural areas.
“Soon I will be a teacher and can impart knowledge and contribute to the country’s development,” Sibuyi continues. “The scheme is making education accessible to every student who qualifies to enroll at an institution of higher learning, regardless of where you come from.”
However, African Economic Outlookpoints out that in South Africa, there is a large gap between what the universities produce and what the industry needs. The assessment article further notes that the high unemployment rate for graduates shows that the universities’ training has little relevance to the market and industry needs.
Statistics South Africa estimates that the unemployment rate of South Africa is currently at 25.2 percent for both educated and uneducated youth. In 2012, 3 million young people not in education, employment or training (or NEET) and 600,000 university graduates were unemployed. Furthermore, the quality of education in South Africa came under scrutiny in the World Economic Forum’s Global Competitiveness Report,which ranks the nation 127th out of 148 countries this year.
Even more disconcerting is that the country has been steadily dropping in this ranking since 2006, when it was 71st out of 122 countries. This implies that the investment by entities like the NSFAS have yet to make the intended systemic impact and is not yet economically profitable.
Additionally, the slow growth of the South African economy in recent years has meant non-proportional fund allocations to students in need. Likewise, an increase in the number of NSFAS beneficiaries — for example, from 7,220 in 1991 to 199,470 in 2012— has meant reduced funds for individual recipients. As a result, some students have to struggle to acquire an education. This has also affected their chances of getting employment, since students have their diplomas withheld until they settle their loans.
Nokuthula Mthethwa, a second-level student, says that in her first year the NSFAS scheme covered her tuition fees, paid for her residence and also assisted with meals, which was necessary because her parents could not afford to send her to the university. However, this year the scheme can pay her only 19,000 rand ($1,800 U.S.), which does not cover the previous benefits she had. With her outstanding balance and lack of any other support, her parents cannot afford to pay the remaining balance, and so she is considering dropping out.
Although there are problems in the government’s education system, it is important to note that significant progress has been made and that people are far better off than in the pre-1994 period. The creation of the NSFAS in 1996 is a key example. South Africa has a long way to go to make the quality of its education system competitive globally, but the country’s economy and social structures have benefited immensely from this investment. It has ensured that the black population and rural residents have increased their involvement in the country’s economy and can contribute their expertise.