FET Colleges Finances and Financial Aid Scheme

1
FET Colleges Finances and Financial Aid Scheme

• 20 February 2007

2
Overview of college finances

• Audited statements show strong growth in income
  over recent years
• Growth in income from variety of resources from
  R409 million in 2000/1 to R736 million in 2003/4
  

3
Income 2000 to 2003 at FET Colleges
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Reasons for re-capitalisation of FET Colleges

• Colleges offering outdated programmes that did
  not meet the needs of the economy
• Need to plan new programmes and provide
  infrastructure and equipment to offer new
  programmes

5
Key principles of re-capitalisation

• The re-capitalisation process will be driven by
• programmes that meet the needs of society and the
  economy
• research and information
• redress strategies

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Allocation of Funds

• R50 million planning grant for 2005/6
• R500 million in each of 2006/7 R600 million in
  2007/8 and R800 million in 2008/9 for
  re-capitalisation

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Budget proposals by province
Province Colleges Pop 15 - 24 population Request
Free State 4 550 000 6 R574 million
E. Cape 8 1 350 000 14 R578 million
Gauteng 8 1 800 000 18 R517 million
KZN 9 2 200 000 22 R535 million
Limpopo 7 1 600 000 16 R567 million
Mpumalanga 3 600 000 6 R212 million
N. Cape 2 150 000 1 R100 million
N. West 3 730 000 7 R301 million
W. Cape 6 870 000 9 R604 million
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Principles for allocation

• At provincial level
• Weighted formula using youth population,
  contribution of province to GDP and student FTEs
  / enrolment at colleges
• At college level
• Programmes where there is evidence of need and
  part of Growth and Development Plan of province

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Funds allocated
Province Number of colleges Amount requested Amount allocated
Free State 4 R574 million R118 200 000
E. Cape 8 R578 million R225 550 000
Gauteng 8 R517 million R409 080 000
KZN 9 R535 million R367 930 000
Limpopo 7 R567 million R224 245 000
Mpumalanga 3 R212 million R109 500 000
N. Cape 2 R100 million R25 620 000
N. West 3 R301 million R122 570 000
W. Cape 6 R604 million R227 305 000
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Budget items for funding

• All allocations in relation to programmes offered
• Infrastructure new and development of
• Equipment and ICT
• Development of professional staff in relation to
  programmes offered
• Administrative systems
• Curriculum development

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Allocation by line item
Infrastructure R1 156 000
Site upgrading R 32 105
New land buildings R 84 330
Equipment R 378 788
Curriculum R 107 235
HRD R 76 670
Admin systems R 25 000
Total R1 860 000
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Implementation in 2006

• Funds transferred
• Curriculum preparation
• Lecturer training
• Preparation of LTSM
• Tenders and specifications for infrastructure
  and equipment
• Appointment of examiners
• Recruitment of students

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Monitoring of re-cap and readiness

• State of readiness instrument developed
• Provincial Departments of Education
• National Department and Treasury
• Independent Ministerial Task Team

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Progress on re-cap spending

• December report
• As at Friday, 26 January 2007, 35 colleges had
  submitted their reports.
• January report
• As at Monday, 12 February 2007, 46 colleges had
  submitted their reports.

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SPENDING BY COLLEGES AS AT THE END OF JANUARY
2007

• 1. Actual spending per Province
• Amount Amount
  
• Allocated Spent
  Spent
• EC R 61 000 000 R 41 970 234 68,8
• FS R 30 000 000 R 15 403 067
  51,3
• GP R106 000 000 R 37 963 126
  40,4
• KZN R 90 000 000 R 54 278 669
  60,3
• LP R 43 000 000 R 18 419 040
  47,2
• MP R 32 000 000 R 17 048 291
  53,3
• NC R 10 000 000 R 6 761 898
  67,6
• NW R 28 000 000 R 3 319 085
  30,2
• WC R 70 000 000 R 44 186 160
  63.1
• TOTAL R470 000 000 R239 349 570
  54.8

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SPENDING BY COLLEGES AS AT THE END OF JANUARY
2007

• 2. Uncommitted funds per province
• Allocated
  Amount
• Amount
  Uncommitted Uncommitted
• EC R 61 000 000 R 2 172 560
  3,6
• FS R 30 000 000 R 4 619 608
  15,4
• GP R106 000 000 R10 521 472
  11,2
• KZN R 90 000 000 R 6 071 894
  6,7
• LP R 43 000 000 R 6 089 951
  15,6
• MP R 32 000 000 R 8 010 966
  25,1
• NC R 10 000 000 R 1 349 183
  13,5
• NW R 28 000 000 R 372 915
  3,4
• WC R 70 000 000 R 6 888 435
  9,8
• TOTAL R470 000 000 R46 096 984
  10,5

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Bursary scheme

• Recent changes in FET sector geared at increasing
  access (merger, recapitilisation, NC(V)
  programmes)
• New curriculum addressing SAs skills shortage
• R600 million allocated for FET Colleges Financial
  Aid Scheme over 3 years
• 2007 R100 million
• 2008 R200 million
• 2009 R300 million

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NSFAS - Mode of Operation

• Financial Aid Offices
• Bursary applications
• Send batches of forms with interim
  reports to NSFAS claiming money on behalf of the
  students
• NSFAS processes the claims and makes payment
• Financial Aid Offices credit student fee accounts

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NSFAS

• NSFAS administration management of funds on
  behalf of DoE
• NSFAS is a loan and bursary scheme operating in
  terms of Act 56 of 1999
• It was set up by the SA Government in 1996
• It was set up to create access to education for
  students with potential but who could not afford
  to fund their own studies

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Allocation of Bursaries

• Only South African students registered for NC(V)
  courses will be eligible for bursaries
• Provincial College allocation done using the
  Crouch model
• Crouch model considers NC(V) enrolments and the
  of poor population per province
• Allocation method approved by the Minister of
  Education on 5 December 2006

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Bursary Allocations
Item Cost Notes
Registration fees R200 Standard for all NC(V) programmes
Tuition fees Cost of NC(V) programmes As per DoE approved student fees
Books R120 per book Maximum 7 books
Academic levies Engineering R500 Hospitality R500 Internet R300 Not applicable to all students
Accommodation Travel R 3000
All the above amounts are MAXIMUM amounts that can be allocated. All the above amounts are MAXIMUM amounts that can be allocated. All the above amounts are MAXIMUM amounts that can be allocated.
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Notification to Colleges

• Provinces Colleges advised on 8 December 2006
  of allocations
• Training for DoE, PDE Colleges conducted from
  31 January to 6 February 2007
• A total of 122 officials College staff trained

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Provincial Allocation
Province 2007 Allocation R000
Free State 7 500
North West 5 500
KwaZulu-Natal 18 500
Mpumalanga 7 000
Limpopo 15 000
Northern Cape 3 000
Western Cape 9 500
Gauteng 18 500
Eastern Cape 15 500
TOTAL 100 000
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Conditions Process for awarding bursaries

• College bursaries based on approved NC(V)
  programmes student enrolments
• College to allocate a dedicated staff member to
  administer the scheme student support officer
  recommended
• Awarding of bursaries to be based on Means Test
  evidence thereof required
• Approved signed bursary agreements required

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Conditions Process for awarding bursaries

• Colleges to set up a Financial Aid Committee,
  suggested members
• student support services officer/manager
• finance officer / manager
• student administration officer / manager
• student representative council (SRC) member (s)
• Committee makes bursary awards recommendations
• College CEO Accounting Officer

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Role of Colleges

• Serve as DoE, PDE NSFAS agencies
  (accountability reports)
• Advertise bursaries to all students
• Counsel advise students
• Administer bursary application forms and Means
  Test
• Issue receipts to students as proof of
  applications received

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Monitoring Support

• DoE, PDE NSFAS monitoring support
• Colleges to provide reports to DoE, PDE NSFAS
• NSFAS regular audit

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• Thank you