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Take a stand against the commodification of education

The Heher Commission found that government cannot fund free higher education in South Africa. But the recommendations are lacking and appear more as a sophisticated means to keep the poor within the poverty trap prison says Mphuthumi Ntabeni.

The Presidency has, after two months of studying it, finally released the Commission of Inquiry into Higher Education and Training. The Heher Commission “…was mandated to advise the President as to whether the provision of fee-free education is feasible”. It was asked to take into consideration the economic situation of the country into cognisance while making comparison with “practices and experiences in the funding of such education internationally”. Seems straight forward enough.

The Commission report moves from the premise that; “Everyone has the right to further education. The state has constitutional duty to make such education progressively available and accessible through reasonable measures”. It concludes that, “Notwithstanding that higher education is regarded as an apex priority for the purposes of the National Development Plan and in the allocation of state resources, there is insufficient financial capacity in the state to provide totally free higher education and training to all who are unable to finance their own education, let alone to all students, whether in need or not. Nor for the reasons set out in the Report is the provision of totally free education, necessarily in the best interest of the expansion of South Africa’s higher education and training sector”.

The recommendations in five points:

  • The National Students’ Financial Aid Scheme (NSFAS) existing grant and loan system is inadequate and unsustainable because of its gross inefficiencies in collection of loan debts.
  • South Africa’s economy cannot be successful without technically qualified and work -orientated graduates; so it needs to expand, improve and streamline its Technical and Vocational Education and Training (TVET) sector. TVET must be fee-free for all with stipends to cover fully costs of study where required. R50 billion must be transferred from the surplus in the Unemployment Insurance Fund and ring-fenced for the infrastructure development of the TVET colleges.
  • The Income Contingent Loan (ICL) scheme should be available for all students, (with opt-out provision). This would be partnership between the state and the private financial sector to replace NSFAS. Long unclaimed pension fund benefits should be used to provide stability for the ICL system as a kitty for state repayment guarantee where a valid demand by beneficiary is lodged with the Register.
  • A Ministerial Task Team should be created by the Minister of Higher Education to advise on funding through the use of Broad-Based Black Economic Empowerment point system.
  • An education fund should be created into which companies, individuals, international aid agencies and others can be encouraged to donate towards development of higher education, bursaries and the like.

Moral, economic and reasonable objections

But a significant aspect of the ICL recommendations involves commodifying access to education. For Catholics, the objection is a moral one based on the fact that Catholic Social Teaching is against the commodification of access to education. But it is also not difficult to make an economic argument against these recommendations.

The proposed recommendations of the ICL is nothing short of commodification of the education loan and grant system; exactly what the Fees Must Fall (#FMF) movement has been fighting against. They seek to substitute government inefficiencies with private, very competent, greed of capitalism’s barons, the bankers. In fact the tone deafness of the Commission’s recommendations to the concerns of the #FMF demands is appalling, and suspiciously look like a deliberate move to drive a wedge between government and the movement.

It does not take a genius to see that the #FMF movement would not accept these recommendations, thus basically nullifying the whole point of the commission. For, it must be recalled, the president did not establish the Commission out of his own accord, but to deal with the pressure government is  receiving from #FMF demands.

The commission does not specify who’s going to pay for the bank transactions, whether the loans will be 0% interest with no payments for the initial period. If so, I do not believe the banks will play ball since they’re for profit entities. If they are compelled by some form regulation to  do so they’ll just pass the cost to the public, meaning a negative effect on consumers of ‘normal’ debt (car/home loans). Banks don’t transact for free; they’ll want to recoup that money somewhere, even if it means charging higher rates thereafter, or to bill government upfront in fees.

The increased focus on TVET’s is a good thing, but the Commission does not give sufficient detail on the mode this will take. Perhaps this is done as  a precaution; not wanting to pin government prematurely into details that would limit the options or flexibility. Still, the Commission could have provided a comparative study without prescribing or imposing its preference. We are now left wondering why did they choose only the TVET part on the German model, where University’s are for research and Fachhochschule and apprenticeships for practical study for blue collar jobs. For, as we know, countries like Germany, Scotland and most Scandinavians have successfully implemented free higher education. In fact this is becoming a norm in northern Europe. Instead these recommendations want to replicate the problematic US model of the student debt crisis happening there now, which even the US has now come to realise that, like it’s health system, is barbarically cruel to the poor. This because it prohibits social mobility even among the educated, because they spent the first twenty years of their lives pinned down by student loans. Lack of social mobility, economically, is the real means to counteract growing inequalities, the number scourge of South Africa.

Exacerbating inequality

We live in a country characterised by incredible economic inequality—extreme poverty in the midst of inordinate affluence, which is the greatest obscenity of our times. The knowledge of how to eliminate extreme poverty exists, but the political will to do so is lacking. The tradition of Catholic social thought provides moral guidance and an ethical challenge for the development of this will through its continuity in basic principles of justice and dynamic development. In his Apostolic Exhortation  Evangelii Gaudium,  Pope Francis summarised the economic challenge  of our times  in one  brief sentence:  “Inequality is  the root  of social  ills”. Pope Francis challenges the Church, through a multidimensional focus on Catholic Social Teaching, to play a key role in fostering the political will, increasing the sense of social responsibility, stimulating creation of institutions for the common good, and motivating the will of its members first to address in their own spheres of influence the multifaceted reality of gross global economic injustice. The Roman Catholic Church has opportunity to put this in practice by engaging the Commission’s recommendations head-on, for silence in these things communicates a choice, not neutrality.

The danger with these recommendations is that the financial sector (bankers) will always find a way for themselves to skim the cream than planned beneficiaries. Economists call it “market failure” when persons or groups can control market outcomes in their favour, thus generating less than maximum social well-being. The financial dominance deepens the inability of those in extreme poverty to access the basic necessities of life. This has been exposed by developmental economists, NGOs like Oxfarm and 50 Years Is Enough, and even the IMF. They have all identified financial dominance as the primary cause for market distortions in favour of the “haves”, which leads into greater inequalities.

To place bankers at the helm of restructuring those distortions is tantamount to placing the hawks to guard the coop.

As the Catholic community we should strongly recommend that government reject the recommendations of the Commission. It is just sophisticated means to keep the poor within the poverty trap prison.

The UDM and the DA are the only political parties so far who have rejected the Commission’s recommendations. “The UDM believes that government should fund fee-free, quality education by downsizing its executive, putting an end to the ever-increasing wasteful, irregular and fruitless expenditure, closing the tap on illicit financial flows and increasing corporate income tax, among others.” It’s chief whip in the national assembly, Nqabomzi Kwankwa said the President is playing delaying tactics and using the education of our children as political pawn for their factional political battle. The DA has called for an urgent debate in parliament to scrutinise the merits of the Commission’s recommendations. Perhaps parliament will come up with better proposals from the debate to avert the crisis before February next year.

Hopefully the public will show strong aversion (as they did on the rumour of SAA being nailed with them) for public funds being placed at the mercies of our greedy financial institutions, especially seeing that the fund managers who currently do so through these institutions do so in an unhealthy secretive manner that is not open to public institution. SA.

* The opinions expressed here by Spotlight.Africa contributors and editors are their own and not official statements of the Society of Jesus in South Africa or of the Catholic Church unless explicitly stated.