Presentation for Set 4: Day Two 15 November 2016 Presentation - - PowerPoint PPT Presentation

SLIDE 1

Presentation for Set 4: Day Two

15 November 2016

COMMISSION OF INQUIRY INTO HIGHER EDUCATION AND TRAINING: STUDENT FUNDING

SLIDE 2

Presentation Overview

Eligibility for NSFAS funding

1

The NSFAS means test

2 3

Funding to universities and TVETs

4

Different funding programmes

5

A detailed look at the student centred model

6

Measuring impact

7

Questions

SLIDE 3

Eligibility for NSFAS funding

How is this defined and differentiated between Universities and TVET colleges?

SLIDE 4

Exec Coaching Delegations Staff sessions

TONEFRO M THE TOP BUILDING A TEAM ETHOS

SMF PMO NCOs

Eligibility principles

“To redress past discrimination and ensure representivity and equal access; To respond to the human resource development needs of the nation” (Preamble to the Act) “loans or bursaries granted by the Board may be subject to 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

SLIDE 5

Two-pronged core eligibility criteria

4

Financial Need

• 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 Academic potential

• 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

• f 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.

Accessibility Transparency Affordability Reliability Authenticity

“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)

SLIDE 6

Eligible

South African citizens only, registered to study for an accredited, funded

programme at a South African public university or TVET college.

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

• rder to practice in a professional

field (e.g. PGCE, LLB); unless funder

determines otherwise CORE: Student is able to demonstrate potential for academic success, and that he/she is financially needy.

Not eligible

Students who have already graduated from a first undergraduate degree or diploma (regardless of whether or not this was funded by NSFAS) OTHER FUNDING: Students who have received loans, bursaries

• r scholarships from non-NSFAS sources

that cover the full cost of study EXCLUSIONS: General rule: no Btech’s (but list of those that can be funded in Handbook);

No short courses or

qualifications/courses that are non-

degree/diploma purposes

Eligibility for financial aid

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)

Helping students build a brighter tomorrow

SLIDE 7

Full cost of study – How do we understand this, and how has this changed over time?* NSFAS funding CAP – how is this determined?

How is the split between fee tuition and

• ther allowances, is determined

Allocation Formula – Constructed on the basis of projected full cost of study * and enrolment by race Expected Family Contribution – a

calculation from the means test that determines the relative need of students in respect to family income and household costs

Data-driven decision making at NSFAS

* An allocations standard

• perating

procedure

• utlines this

process

SLIDE 8

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

• f actual fee account

charges and allowances



NSFAS has data as far back as 2005 on these estimates.

Accessibility Transparency Affordability Reliability Authenticity

WITWATERSRAND

R 46 802,00 R 9 340,00 R 33 660,00 R 19 008,00 R 108 810,00

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 R 99 900,00

RHODES

R 38 950,00 R 1 650,00 R 49 300,00 R 5 000,00 R 94 900,00

DURBAN

R 27 635,05 R 21 615,25 R 22 320,00 R 9 600,00 R 81 170,30

VENDA

R 28 543,22 R 2 720,00 R 17 590,00 R 24 410,00 R 5 000,00 R 78 263,22

NELSON MANDELA

R 25 710,00 R 950,00 R 23 740,00 R 17 610,00 R 3 000,00 R 71 010,00

LIMPOPO

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 R 86 990,00

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 2 837,00 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 R 23 500,00 R 3 973,33 R 6 716,67 R 58 315,97

UMP (UNIV MPUMALANGA)

R 25 246,40 R 3 000,00 R 16 500,00 R 16 500,00 R 1 809,30 R 63 055,70

SMU (SEFAKO MAKGATHO UNIV.)

R 38 945,00 R 5 000,00 R 16 052,00 R 28 000,00 R 7 000,00 R 94 997,00 AVERAGE R 27 957,80 R 2 518,82 R 24 090,59 R 16 593,26 R 4 880,48 R 72 402,96

TABLE A4 - FULL COST OF STUDY - 2015

Institution Tuition Registration Residence Meals Books FCS (A) Actual Fee

* Tuition costs account for between 31% (MUT) and 52% (WITS) of the FCS

** Average FCS of 12 universities above NSFAS cap. In 2015, cap was R71 800. *** allowance costs recommended by NSFAS but determined at university discretion

SLIDE 9

Allocations formula – the basis of NSFAS’ funding of universities

‘Circles’ of influence Racial breakdown

• f students – FTE

enrolment

• Disadvantaged

student index (DSI) Full cost of study (FSC) Tuition Residence Allowances Allocation (and allocation formula) for the previous year + MTEF grant HEIs NSFAS HEMIS

SLIDE 10

FCS

X

DSI (weighting based on race)

=

Apportionment Factor (AF) applied to the MTEF grant

=

DSCI DISADVANTAGED STUDENT INDEX DISADVANTAGED STUDENT COST INDEX (notional value)

Helping students build a brighter tomorrow

SLIDE 11

NSFAS’ means test

Differentiating between those who are able to pay and those that can’t

SLIDE 12

NSFAS Act 56 of 1999

Purpose of means test



Determines the relative need

• f 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

* For all means-test waived students, EFC = R0

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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) cost-

• f-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)

SLIDE 14

Means test – Calculating EFC and award size

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)

NSFAS loan

• r bursary

awarded

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) Expected family contribution (EFC) = disposable income x 0.33 (one tertiary level student) OR 0.20 (two/more tertiary level students) * Learning materials allowance (incl. laptops, books, art equipment, Labcoats, etc.), meals where not provided, private accommodation where applicable,

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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

25

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.

SLIDE 16

Overview of funding to Universities and TVETs

Mapping the funding to universities and TVET colleges in the last few years

SLIDE 17

2016 Academic Year - Funding Allocations

27

Source: NSFAS Strategic Plan 2016/17-2019/20

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 Total R14.922bn

2016 - Mid-term budget: Funding Allocation Additional R9,2bn made available for student funding – over the MTEF Period.

SLIDE 18

Accessibility Transparency Affordability Reliability Authenticity

University Allocations 2016

R12,6bn in 2016

 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

SLIDE 19

Programme costs are approved by the DHET annually ito funding norms DHET makes allocation to each college on the basis of enrolment for Report 191 and NCV Bursary covers the 20% student own contribution to tuition

Accessibility Transparency Affordability Reliability Authenticity

TVET bursary programme



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

SLIDE 20

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

SLIDE 21

Year # university students Value of funding

2009 135 202 R 2 818 220 032 2010 148 387 R3 343 530 674 2011 216 874 R4 833 866 379 2012 194 504 R5 871 489 880 2013 194 923 R6 729 069 970 2014 186 150 R 6 969 940 822 2015 178 961 R 7 194 618 509

Year # of TVET college students Value of funding

2009 55 173 R 312 666 821 2010 61 707 R317 998 191 2011 114 968 R1 116 590 548 2012 188 182 R 1 822 497 265 2013 220 978 R 1 953 253 361 2014 228 642 R1 991 487 809 2015 235 988 R 2 095 129 942

University vs TVET funding

SLIDE 22

What NSFAS funds?

Supporting students to access funding that will contribute to the human resource development needs of the Country

SLIDE 23

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.

Accessibility Transparency Affordability Reliability Authenticity 33

NSFAS loan product ‘typology’



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)

SLIDE 24

34

Discounting NSFAS loans – the “hidden grant”

 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 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 drop-

• ut

 Depending on academic performance, up to 40% converted to a loan at the end of financial year  Annual adjustment to the loan value  Unutilised funds on the student fee account (tuition payment to university) and on allowances (sBux) annually credited to loan account as ‘repayment’

LOAN TO BURSARY CONVERSION INTEREST HOLIDAY INTEREST RATE CREDIT BALANCES

SLIDE 25

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. Accessibility Transparency Affordability Reliability Authenticity 35

NSFAS bursary products for scarce skills



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

* SETAs have also developed SSPs (sector skills plans) that identifies scarce skills in their sector, and pivotal skills (top-10)

SLIDE 26

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

• f R2,039bn

SLIDE 27

Historic Debt

Unfunded is a NSFAS- eligible student not funded as there were no NSFAS funds remaining (EFC too high) 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

• r a graduation certificate

those who had a loan award that was top- sliced, OR those who added courses or costs after their NSFAS contract had been signed, and no funds available

Unfunded Underfunded

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.

SLIDE 28

Student centred model – who, what, why?

Meeting the mandate to provide systems through which qualifying students can apply for and receive loans

SLIDE 29

Applications Options

Processing Loans & Bursary Operations

Online Fax/Email Posted

Application Results to Students

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

SLIDE 30

Allowances pocket for students Students receive Money for allowances in a form of a voucher

Student-centred allowance payment system - sBux

Helping students build a brighter tomorrow

Student checks voucher number by dialling *134*176# and will see R50 is available for books Student provides voucher number to merchant Merchant enters number into POS (till) sBux 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. Student registers and has signed LAFSOP

SLIDE 31

4 991 427 transactions to date (Q2 802 913) R 778 95 116 spent to date in 4 categories (Q2 99 539 049) 3 413 merchant

• utlets in total

R 816 829 203 disbursed to date (Q2 85 132 076) 124 385 student accounts since February 2014

sBux spend 2016

SLIDE 32

Measuring impact

Using different mechanisms to track the success of the Scheme in student funding and producing graduates

SLIDE 33

Performance information - Universities

53% 55%

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%

Completion.

55% of students (SU study) received qualifications within 9 years, most in N+1, with

• nly 38% drop-out (2000

cohort) 25,2%

76,6% Drop-out.

While it is estimated that 30-40% of students drop-out in the first year

• f study, data shows

53% never graduate

Academic pass rate.

From 1996 to 2015, average courses passed rate was 76,6%*.

* 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. ** These include UCT, UP, UKZN, NWU, Rhodes, UL, SUN and WITS

SLIDE 34

Key Findings - Throughput

# of students who enter higher education # of students who progress through higher education # of students who complete their qualification

• 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.

Throughput is a factor of : … in regulation time (N)

Helping students build a brighter tomorrow

SLIDE 35

2017 Academic Year

Preparation for the 2017 academic year, progress to date and the plans in place

SLIDE 36

Registrars

Flight Plan

2017

Jan Mar May Jul Sep Nov 2017

1st Entrants Applications Open

1/8/2016

University results

15/12/2016

TVET results

22/12/2016

Umalusi Results

6/1/2017

VC/ CFO engagements FAO/ SRC Registrars Working Group Registrars Working Group

Including Pilot Institutions

Disability Group Engagement

7/10/2016

Returning Students

1/09/2016

• 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

NSFAS Solution Build Sector Engagements

Today

SLIDE 37

Application open window Create MyNSFAS account Generation of LAFSOPs, signing and appeals Cycle 1 Disbursement of funds – Tuition to university (quarterly) Allowances to students via sBux (monthly)

Key activity milestones

January to November 2017 January to March 2017 Countdown to application closing date

48

Ranking and provisional funding Registration – actual costs January and February 2017 Assessment of applications received – both online and paper-based 1 August to 30 November 1 September to 31 December 2016 January to March 2017 Reporting to stakeholders Monitoring drawdown on funds Planning for the 2018 implementation April 2017 to March 2018 Target migration to the “SCM”

SLIDE 38

Application Status Update

Accessibility Transparency Affordability Reliability Authenticity 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)

SLIDE 39

………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

2017 and beyond …..

SLIDE 40

Becoming more situated within the post-school sector

Helping students build a brighter tomorrow

SLIDE 41

QUESTIONS