University fees: Free higher education is possible in South Africa

The question that has been raised this week is whether it is possible to increase funding for universities. Most mainstream analysts, commentators in the media, and the higher education minister have suggested it is not. However, analysis by the South African Institute of Race Relations suggests it is, if government spending priorities can be adjusted.

Contrary to prevailing opinions, and despite current fiscal pressures, estimates produced by the South African Institute of Race Relations this week suggest that free higher education for all undergraduate students is affordable for South Africa. Currently, levels of public spending on universities sit at around 0.8% of gross domestic product (GDP), which is low by global standards. A more appropriate number would be 2.5% of GDP. In addition, data we have produced on household spending levels suggests that only 5% of South African families could comfortably afford to pay university fees for their children. Ensuring access to children from less prosperous backgrounds will require a significant degree of subsidy or grant funding. The question that has been raised this week is whether such levels of funding are possible. Most mainstream analysts, commentators in the media, and the higher education minister have suggested that it is not.

However, our analysis suggests that it is, if government spending priorities could be adjusted. Currently there are just over 800,000 undergraduate students at university. Our own experience of funding tertiary education, through our bursaries department, is that an amount in the region of R100,000 per annum is generally sufficient to cover the annual tuition, accommodation, and related costs of an undergraduate student. This cost is over and above the current amount of approximately R25-billion that taxpayers spend on funding universities. In other words our estimated average unit cost per student – once the cost of the existing taxpayer subsidy is taken into account – is closer to R120,000 per annum.

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Roshuma Phungo, Daily Maverick, 21 October 2015