Varsities scramble amid income famine

An Eastern Cape university has halted employment of new staff in a bid to save money and manage mounting debts.

The move comes after the government agreed not to increase fees this year at universities, and to develop a strategy to deal with challenges that would arise from the dramatic decrease in revenue from moves such as the scrapping of historic debt and waiving of registration fees.

Nelson Mandela Metropolitan University (NMMU) communications deputy director Debbie Derry said the university had introduced a number of cost-saving initiatives, including freezing support services posts. An audit was under way to determine whether posts such as media liaison were necessary.

Derry said academic staff were not affected by the moratorium.

She said a number of teams had been established to explore alternative revenue streams.

“The operations of the university will not be immediately affected, but certainly the present government subsidy model, austerity measures and fund-raising initiatives will not be sustainable,” she said.

Money owed to the university included:

R7.065-million owed by 764 students in 2013;

R13.072-million owed by 1205 students in 2014; and

R52.146-million owed by 5809 students last year.

Derry said the National Student Financial Aid Scheme (NSFAS) had allocated more than R146-million for 2814 beneficiaries. There were 1672 successful applicants who were unfunded due to insufficient funds.

Derry said NMMU had assisted 3735 students with 2015 debt relief and this year’s down payment. This amounted to R13.2-million.

“Application for this relief is ongoing until the last date of late registration as part of our efforts to ensure that no academically deserving but financially strapped students are denied the opportunity to study further,” she said.

Rhodes University spokeswoman Catherine Deiner said the university was owed R19-million by 898 students in 2013 and 2014 while 2600 students owed R43.8-million from last year.

She said the university had provided, and continued to provide, funding worth approximately R38-million a year over and above the NSFAS annual allocation of R18-million.

Deiner said the allocation would allow financially needy students to study at Rhodes.

There are approximately 1000 students on NSFAS at Rhodes.

“Rhodes University is dependent upon two main sources of income to fund its operations – a state subsidy and student fees.

“Third-stream income constitutes an insignificant proportion of the university’s income.

“The funding of the higher education system is based on a cost-sharing model in which the state provides a subsidy for each student, and each student in turn is expected to pay fees for their tertiary education.”

Responses had not been received from Walter Sisulu University and the University of Fort Hare at the time of writing on their plans to mitigate the impact of no fee increases this year.