COMMISSION OF INQUIRY INTO HIGHER EDUCATION AND
TRAINING:
STUDENT FUNDING
Presentation for Set 4: Day Two
15 November 2016
Presentation Overview
1
Eligibility for NSFAS funding
2
The NSFAS means test
3
Funding to universities and TVETs
4
5
6
7
Different funding programmes
A detailed look at the student centred model
Measuring impact
Questions
Eligibility for NSFAS funding
How is this defined and differentiated between
Universities and TVET colleges?
“To redress past discrimination and ensure representivity
and equal access;
TONEFRO
To respond to the human
resource development
needs of
BUILDING
M THE
A TEAM
the nation” (Preamble
to the Act)
TOP
ETHOS
SMF
Exec Coaching
“loans or bursaries granted
by the Board mayPMO
be subject to
Delegations
NCOs
Staff sessions
such conditions as it may
determine, either generally
or in
respect of a particular loan or bursary” (Section 19 – 1)
“a right to obtain a loan or bursary from the NSFAS cannot
be construed from any provision of this Act” (Section 19 – 6)
Helping students build a brighter tomorrow
Eligibility principles
Accessibility Transparency Affordability Reliability Authenticity
4
Two-pronged core eligibility criteria
Financial Need
Academic potential
• Targeting tool – means testing recognized as a
legitimate mechanism for determining who should
receive benefits from the State e.g financial aid.
• Multi-purpose – differentiate those that need the
financial support the most from those who require
it the least PLUS determine how much support is
needed.
• Affordability – In line with values, NSFAS aims
to offer affordable solutions for students to study
at public universities and TVET colleges
• What does the Act provide – “if the borrower
does not perform satisfactorily in his or her
studies, the Board may terminate the granting of
finance ….”.
• Sufficiency – for all first-time entering students,
NSFAS recognises that the academic admission
of students to a higher education programme is
sufficient as an indicator of “potential to succeed”.
• Reasonableness – Funding made available
should continue to be allocated only to those
making sufficient academic progress to complete
within 2 years of regulation time (N+2).
• Minimum requirement – NSFAS set a course
pass rate of 50% for continued funding, but many
institutions have adopted different practices.
“Aim of the NSFAS is to provide financial aid to eligible students who meet the criteria for admission to a higher education programme.”
(Section 2 – 2)
Eligible
South African citizens only, registered to
study for an accredited, funded
programme at a South African public
university or TVET college.
Not
eligible
Students who have already graduated
from a first undergraduate degree or
diploma (regardless of whether or not this
was funded by NSFAS)
Specific funders, at their discretion, may fund
students to do courses at Private Institutions
UNDERGRADUATES studying towards
their first higher education
qualification, or studying for a
postgraduate qualification required in
OTHER FUNDING:
Students who have received loans, bursaries
or scholarships from non-NSFAS sources
that cover the full cost of study
order to practice in a professional
field (e.g. PGCE, LLB); unless funder
determines otherwise
EXCLUSIONS:
Eligibility for
financial aid
CORE:
Student is able to demonstrate
potential for academic success, and
that he/she is financially needy.
General rule: no Btech’s (but list of those
that can be funded in Handbook);
No short courses or
qualifications/courses that are nondegree/diploma purposes
Helping students build a brighter tomorrow
SPECIFIED AS PART OF THE
HANDBOOK

Not all funders apply the same
eligibility criteria

Pre-selected students by some
donors may not adopt all these
criteria

Other funders that have narrower
criteria

Pages 62 – 68 (2016 edition)
Data-driven decision making at NSFAS
Full cost of study –
How do we understand this, and
how has this changed over time?*
* An
allocations
standard
operating
procedure
outlines this
process
Allocation Formula –
Constructed on the basis of
projected full cost of study * and
enrolment by race
NSFAS funding CAP – how is this
determined?
How is the split between fee tuition and
other allowances, is determined
Expected Family Contribution – a
calculation from the means test that
determines the relative need of students
in respect to family income and household
costs
TABLE A4 - FULL COST OF STUDY - 2015
The full cost of
study (FCS) and
the NSFAS cap



FCS used as a projection of
the following year’s likely
academic cost for the
allocation formula and the
calculation of the NSFAS
capped amount – a
“calculated estimate of what
it will cost a student to study
at university for one year” –
expanded over time to
include wider range of costs
Once funding decision
made, FCS is used to refer
to the cost of study inclusive
of actual fee account
charges and allowances
NSFAS has data as far back
as 2005 on these estimates.
Institution
Registration
R 9 340,00
Residence
Meals
Books
FCS (A)
Actual Fee
WITWATERSRAND
R 46 802,00
R 33 660,00
R 19 008,00
CAPE TOWN
R 52 237,00
R 42 398,00
R 15 667,00
R 3 300,00
R 113 602,00
JOHANNESBURG
R 24 929,00
R 24 854,00
R 4 756,00
R 3 225,00
R 57 764,00
PRETORIA
R 37 900,00
R 33 200,00
R 28 800,00
RHODES
R 38 950,00
DURBAN
R 27 635,05
VENDA
R 28 543,22
NELSON MANDELA
LIMPOPO
R 1 650,00
R 49 300,00
R 108 810,00
R 94 900,00
R 22 320,00
R 9 600,00
R 81 170,30
R 2 720,00
R 17 590,00
R 24 410,00
R 5 000,00
R 78 263,22
R 25 710,00
R 950,00
R 23 740,00
R 17 610,00
R 3 000,00
R 71 010,00
R 24 431,00
R 5 000,00
R 14 500,00
R 21 622,00
R 4 000,00
R 69 553,00
FORT HARE
R 28 413,00
R 2 630,00
R 26 000,00
R 10 000,00
R 4 000,00
R 71 043,00
STELLENBOSCH
R 39 235,00
R 32 755,00
R 15 000,00
FREE STATE
R 21 774,48
R 950,00
R 29 045,00
R 16 000,00
R 5 000,00
R 72 769,48
WESTERN CAPE
R 22 400,00
R 1 210,00
R 17 710,00
R 20 000,00
R 6 000,00
R 67 320,00
NORTH-WEST
R 37 810,00
R 1 560,00
R 17 500,00
R 12 000,00
R 8 000,00
R 76 870,00
KWAZULU NATAL
R 31 710,91
R 23 265,00
R 17 500,00
R 5 000,00
R 77 475,91
CENTRAL
R 19 502,93
R 858,00
R 18 020,00
R 18 000,00
R 5 000,00
R 61 380,93
VAAL
R 20 238,00
R 870,00
R 20 611,00
R 22 300,00
R 4 000,00
R 68 019,00
CAPE PENINSULA
R 19 177,00
R 745,00
R 23 409,00
R 2 000,00
R 3 500,00
R 48 831,00
TSHWANE
R 18 356,88
R 1 500,00
R 13 331,48
R 20 564,00
R 4 600,00
R 58 352,35
MANGOSUTHU
R 21 612,00
R 2 000,00
R 25 360,00
R 19 008,00
R 9 500,00
R 77 480,00
WALTER SISULU
R 20 220,00
R 23 498,00
R 10 000,00
R 2 000,00
R 55 718,00
ZULULAND
R 17 648,00
R 14 851,00
R 13 200,00
R 2 000,00
R 50 536,00
UNISA
R 13 350,00
R 5 000,00
R 18 350,00
SPU
R 24 125,97
UMP (UNIV MPUMALANGA)
R 25 246,40
SMU (SEFAKO MAKGATHO UNIV.)
R 38 945,00
Transparency
R 27 957,80
R 2 837,00
R 86 990,00
R 23 500,00
R 3 973,33
R 6 716,67
R 58 315,97
R 3 000,00
R 16 500,00
R 16 500,00
R 1 809,30
R 63 055,70
R 5 000,00
R 16 052,00
R 28 000,00
R 7 000,00
R 2 518,82
Affordability
R 24 090,59
R 16 593,26
Reliability
* Tuition costs
account for
between 31%
(MUT) and
52% (WITS) of
the FCS
R 99 900,00
R 5 000,00
R 21 615,25
AVERAGE
Accessibility
Tuition
R 4 880,48
Authenticity
R 94 997,00
R 72 402,96
** Average
FCS of 12
universities
above NSFAS
cap.
In 2015, cap
was R71 800.
*** allowance
costs
recommended
by NSFAS but
determined at
university
discretion
Allocations formula – the basis of NSFAS’
funding of universities
Full cost of study
(FSC)
HEIs
Tuition
Residence
Allowances
‘Circles’ of influence
NSFAS
Allocation (and
allocation
formula) for the
previous year +
MTEF grant
Racial breakdown
of students – FTE
enrolment
- Disadvantaged
student index
(DSI)
HEMIS
DSI (weighting based on race)
DISADVANTAGED STUDENT
INDEX
Helping students build a brighter tomorrow
FCS
Apportionment
Factor (AF) applied
to the MTEF grant
X
=
DSCI
=
DISADVANTAGED
STUDENT COST INDEX
(notional value)
NSFAS’ means test
Differentiating between those who are able to pay and
those that can’t






Determines the relative need
of all the students who have
applied (EFC)*
Determines how much
funding a student requires
based on their full cost of
study (FCS)
Determines which students
are not eligible (where EFC =
FCS)
Does not apply an income
threshold (exception: TVET
bursary funding AND funding
for students with disabilities)
TVET funding = income
threshold of R122 000 below
which EFC = R0
Funding for students with
disabilities = income
threshold of R400 000 (2016)
Helping students build a brighter tomorrow
NSFAS Actof56 of
Purpose
means test1999
* For all means-test waived students, EFC = R0
Means test – Calculating EFC and award size
Total net income = gross
family income – (minus) tax as
per the income tax rates for
individuals (updated
annually)
Estimated Disposable income
= total net income – (minus) costof-living (subsistence allowance
for family, dependent on
number of household members
AND where the family lives)
Expected family contribution
(EFC) = disposable income x
0.33 (one tertiary level student)
OR 0.20 (two/more tertiary level
students)
Means test – Calculating EFC and award size
Total net income = gross family
income – (minus) tax as per the
income tax rates for individuals
(updated annually)
Disposable income = total net
income – (minus) cost-of-living
(subsistence allowance for family,
dependent on number of household
members AND where the family lives)
Full cost of study
(as per individual
student fee account,
incl. allowances, where
payable*)
*
Non-NSFAS
bursaries or
scholarships
awarded to the
student
Expected family contribution (EFC)
= disposable income x 0.33 (one
tertiary level student) OR 0.20
(two/more tertiary level students)
Expected family
contribution (EFC)
Learning materials allowance (incl. laptops, books, art equipment, Labcoats, etc.), meals where not
provided, private accommodation where applicable,
NSFAS loan
or bursary
awarded
Accessibility Transparency Affordability Reliability Authenticity
MEANS TEST REQUIREMENTS
 Proof of income of parents,
guardian (not older than 3 months)
 Certified copies of ID: own, parents
and all members of household
 Copies of registration of a sibling at
another tertiary institution
 Separate annexure required for all
first-time applicants with disabilities
In the online application process, students
who are means-test waived only need to
supply their own ID copy, as background
validations with Umalusi and SASSA
databases are done. No family income
required.
However, all paper-based
applications must include all supporting
documents.
Validations with Home Affairs are now
done – this will contribute significantly to
verifying the eligibility of individual students
to funding, and reduce wastage and fraud.
25
Overview of funding to Universities and
TVETs
Mapping the funding to universities and TVET colleges
in the last few years
2016 Academic Year - Funding Allocations
Source
Amount
DHET - Universities
R4.3bn
DHET - TVET Colleges
R2.3bn
National Skills Fund
R849m
Department of Basic Education - Funza Lushaka
R1bn
Department of Social Development (Provisional)
R276m
NSFAS Recoveries
R450m
Universities’ own funding (Estimated)
R200m
Sector Education and Training Authorities
R215m
Other Funders (Provisional)
R320m
Sub - Total
R10.34bn
Additional funding for student’s historic debt
R2.543bn
Additional funding for students to continue
R2.039bn
Source: NSFAS Strategic Plan 2016/17-2019/20
Total
R14.922bn
2016 - Mid-term budget: Funding Allocation
Additional R9,2bn made available for student funding – over the MTEF Period.
27
 DHET - Universities
 National Skills Fund
 Department of Basic
Education - Funza Lushaka
 Department of Social
Development (Provisional)
 NSFAS Recoveries
 Universities’ own funding
(Estimated)
 Sector Education and
Training Authorities (SETA)
 Other Funders (Provisional)
 Additional funding for
student’s historic debt
 Additional funding for
students to continue
R12,6bn in 2016
Accessibility Transparency Affordability Reliability Authenticity
University
Allocations 2016

Introduced in 2007
 Only funding for the
NCV and Report 191
programmes (both
highest NQF level = 4)
 Purpose: Attract young
learners into vocational
education and training
 Approx. 33-35% of
students in these
programmes are funded
by NSFAS
Bursary covers the
20% student own
contribution to
tuition
DHET makes
allocation to each
college on the
basis of enrolment
for Report 191 and
NCV
Programme costs
are approved by
the DHET annually
ito funding norms
Accessibility Transparency Affordability Reliability Authenticity
TVET bursary
programme



Report 191
National Curriculum
Vocational (NCV)
No longer two
allocations per TVET –
single allocation for
both programmes of
funding
TVET Colleges 2016 Allocations
R2,3bn
Accessibility Transparency Affordability Reliability Authenticity
TVET bursary
programme
University vs TVET funding
Year
# university
students
Value of funding
Year
# of TVET
college students
Value of funding
2009
135 202
R 2 818 220 032
2009
55 173
R 312 666 821
2010
148 387
R3 343 530 674
2010
61 707
R317 998 191
2011
216 874
R4 833 866 379
2011
114 968
R1 116 590 548
2012
194 504
R5 871 489 880
2012
188 182
R 1 822 497 265
2013
194 923
R6 729 069 970
2013
220 978
R 1 953 253 361
2014
186 150
R 6 969 940 822
2014
228 642
R1 991 487 809
2015
178 961
R 7 194 618 509
2015
235 988
R 2 095 129 942
What NSFAS funds?
Supporting students to access funding that will contribute
to the human resource development needs of the Country




Funding from the DHET – 40/60
loans
Funding from the DHET – 100/0
loans (final year)
Institution Loans

40/60

100% (no conversion)
Other loan funding

NGO-programmes
(40/60)

SAICA/Thuthuka

EC and KZN Premier’s
Office (40/60)

Outlier – Bursary to Loan
conversion (for students
who default on their work
back commitments)
40/60 convertible loans
Annual reconciliation of individual student academic performance.
Up to 40% of the loan amount converted to a bursary.
100/0 convertible loans
On graduation:
Full loan value of final year of study converted to grant.
100% non-convertible loans
No portion of the loan is converted to a grant.
33
Accessibility Transparency Affordability Reliability Authenticity
NSFAS loan
product ‘typology’
Discounting NSFAS loans – the “hidden grant”
INTEREST RATE
 Interest levied at 80% of the repo rate – for the life of the loan
 Updated annually as at 1 April of each year – pegged
 In-Duplum rule is applied
INTEREST HOLIDAY
 Interest not charged while still studying – provision only applies to students
who were studying on/after 1 April 2011
 12 months interest holiday following exit from university – graduation or dropout
LOAN TO BURSARY
CONVERSION
 Depending on academic performance, up to 40% converted to a loan at the
end of financial year
 Annual adjustment to the loan value
CREDIT BALANCES
 Unutilised funds on the student fee account (tuition payment to university)
and on allowances (sBux) annually credited to loan account as ‘repayment’
34







Funding from the DHET –
for Students with Disabilities
Funding from the NSF – for
Scarce Skills as per an
agreed list
Funding from the NSF – for
postgraduate study
Funding from the DBE – for
initial teacher education
(Funza Lushaka)
Funding from the DSD – for
social work
Funding from the SETAs –
for each of their identified
scarce skills
Specialised funding from the
NSF – NIHSS etc
Government Gazette 2014
Top 100 Occupations in Demand. 2-yr review lifecycle.
Definition: those occupations in which there are currently a scarcity of qualified or
experienced people, currently or anticipated in the future (absolute or relative scarcity)
Scarce Skills (as per NSF)*
BCM: Accounting, Financial Management, Actuarial Studies, Auditing,
Bus Man, Economics, Financial Accounting;
SET: Physics, Comp Sc, Chemistry, Geology, Info Systems,
Mathematical Sciences, Agric, Stats, Biotech, Engineering;
Postgraduate Studies
Only Honours programmes, no BTechs (exceptions).
Masters where funding available or special programmes.
* SETAs have also developed SSPs (sector skills plans) that identifies scarce skills in
their sector, and pivotal skills (top-10)
35
Accessibility Transparency Affordability Reliability Authenticity
NSFAS bursary
products for
scarce skills
Background to
the Historic
Debt Funding
• #FeesMustFall campaign  Presidential Task
Team (PTT) to determine nature and extent of the
funding challenges
• PTT requested that universities submit lists of
NSFAS-eligible students with outstanding debt
from 2013 to 2015 to the DHET
• As indicated by DHET, 71 753 students were
included on this list, and from this, the DHET made
available R2,543bn for the students indicated on
these lists
• These students who are still in the system in 2016
will be assisted with a further additional allocation
of R2,039bn
Historic Debt
Unfunded
Unfunded is a NSFASeligible student not
funded as there were
no NSFAS funds
remaining (EFC too
high)
Underfunded
Historic debt is costs which have
been charged to the student fee
account for tuition and residence
for the academic years 2013,
2014 and 2015, and which have
not been paid to date.
This debt has resulted in the
student being financially
excluded from the university or
not being able to access results
or a graduation certificate
excludes EFC which have not been paid to
date; AND those whose recommended award
was greater than the capped loan amount
determined by NSFAS for that year.
those who had a loan
award that was topsliced,
OR those who added
courses or costs after
their NSFAS contract
had been signed, and
no funds available
Student centred model – who, what, why?
Meeting the mandate to provide systems through which
qualifying students can apply for and receive loans
Applications Options
Online
Application Results
to Students
Fax/Email
Posted
Processing
Loans &
Bursary
Operations
Universities
&
TVET’s
Information
exchange between
NSFAS & Institutions
Solution is designed to work with less manual intervention; however society dynamics
requires us to look at different options to deliver the same service to students
Student registers
and has signed
LAFSOP
Students receive Money for
allowances in a form of a voucher
Student checks
voucher number by
dialling *134*176# and
will see R50 is
available for books
Student provides voucher
number to merchant
Allowances pocket for students
sBux
Merchant enters
number into POS
(till)
Voucher is checked
(is number valid?
sufficient funds?)
and merchant account is credited
Merchant receives confirmation of the
successful transaction and the student
receives a new voucher for the change.
Helping students build a brighter tomorrow
Student-centred allowance payment system - sBux
124 385 student
accounts since
February 2014
4 991 427 transactions
to date
(Q2 802 913)
sBux
spend
2016
R 816 829 203 disbursed
to date
(Q2 85 132 076)
R 778 95 116 spent to
date in 4 categories
(Q2 99 539 049)
3 413
merchant
outlets in total
Measuring impact
Using different mechanisms to track the success of the
Scheme in student funding and producing graduates
Performance
information Universities
* Courses passed rate is not a reflection of whether a student is on track to graduate
within regulation time neither is it indicative of the credit value of each course
enrolled for. Historically collected for bursary conversion purposes.
Academic pass
rate.
From 1996 to 2015,
average courses
passed rate was
76,6%*.
Student
retention.
Based on DHET
data, only 8
universities have less
than a 15% drop-out
rate at the end of first
year**. National
average 25,2%
Drop-out.
76,6%
53%
While it is estimated that
30-40% of students
drop-out in the first year
of study, data shows
53% never graduate
Completion.
25,2%
55%
** These include UCT, UP, UKZN, NWU, Rhodes, UL, SUN and WITS
55% of students (SU study)
received qualifications within
9 years, most in N+1, with
only 38% drop-out (2000
cohort)
# of students who enter higher
education
Throughput is a
factor of :
# of students who progress through
higher education
# of students who complete their
qualification
… in regulation time (N)
• CHE and DHET studies (ALL students) – 20% complete within N; 34,4% within N+1; 42,8% in N+2
• CHE: By race – more white students complete within N (42%) than Indian (26%), than coloured (23%)
than African (19%)
• DHET: White females most likely to complete within N (61,4%) and graduation rate for African females
slightly higher than for African males
• DHET: When looking at completion within 5 years, ONLY 11 universities had more than 50% of the 2005
intake completed by 2009 (appearing highest first, then in decreasing value): Rhodes, UCT, SUN, UKZN,
NWU, UP, WITS, UL, CUT, UJ and CPUT. Three universities had a completion rate of less than 40% after
5 years: TUT, WSU and VUT.
More specific-NSFAS data will be available March 2017 once the DHET has finished it’s cohort study.
Helping students build a brighter tomorrow
Key Findings - Throughput
2017 Academic Year
Preparation for the 2017 academic year, progress to date
and the plans in place
University results
Flight Plan
Returning Students
15/12/2016
1/09/2016
TVET results
1st Entrants Applications Open
1/8/2016
NSFAS Solution Build
Jan
Mar
22/12/2016
Umalusi
Results
6/1/2017
May
Jul
Sep
Nov
2017
2017
Today
Sector Engagements
VC/ CFO engagements
Registrars
FAO/ SRC
Registrars
Working
Group
Disability Group
Engagement
•
•
•
•
•
Registrars 7/10/2016
Working
Group
Including Pilot
Institutions
1st Solution release went live 1st August as planned
2nd Release took place in October 2016
Sector engagements started and completed successfully. The team continues to work with University Registrars and
working groups to ensure program success
SRC and other student political formation engagement completed. Further engagements are in place to address
concerns raised
New SRC leadership (incoming for 2017 academic year) will be engaged once in place
Key activity
milestones
Reporting to stakeholders
Monitoring drawdown on funds
Planning for the 2018 implementation
April 2017
to March
2018
Target
migration to
the “SCM”
January to
November
2017
January
January
to
March
Generation of LAFSOPs, to
March
signing and appeals 2017
2017
Cycle 1
Assessment of applications
received – both online and
paper-based
January and
February
2017
1 September to
31 December
2016
1 August to
30
November
Application open window
Create MyNSFAS account
Disbursement of funds –
Tuition to university (quarterly)
Allowances to students via
sBux (monthly)
Ranking and provisional funding
Registration – actual costs
Countdown
to application
closing date
48
Application Status Update
Manual Application
process –
 NYDA centres across
the 9 Provinces
 Co-operation with the
Methodist Church
 Co-operation with the
SASSA Agencies
 Vodacom Application
Centres (81)
Accessibility
Transparency
Affordability
Reliability
Authenticity
2017 and beyond …..
………Organisational re-alignment is critical for the successful roll out of the student
centred model
………a systematic approach is important to drive operations excellence and effective
execution capability across the value chain
Helping students build a brighter tomorrow
Becoming more
situated within the
post-school sector
QUESTIONS