Perspective Chapter: The Role NSFAS has Played to Facilitate Poor Students in South Africa

Abstract

With the political policy of Apartheid that was followed in South Africa from 1948 until the early 1990s, educational funds (and opportunities) were spread very unequally between racial groups. Non-white students were totally underrepresented at universities. This, and the high cost of university education led to the introduction of the National Student Financial Aid Scheme (NSFAS) in 1991 to make higher education more affordable to poor students in South Africa. Funds spent by the government on higher education and the number of students helped through NSFAS since 1995 will be analysed. Using individual data, the throughput rates of NSFAS students are discussed in relation to non-NFAS students as well as to see how their performance changed over time. NSFAS students outperform non-NSFAS students – a higher percentage of each first-time first-year cohorts obtain qualifications and a smaller percentage drop out of the system without qualifications. NSFAS funds alone were not responsible to increase the number of students from poorer communities. However, NSFAS did contribute substantially to getting poorer students into the higher education system and the greater financial stability (that comes with less financial risks) motivated poorer students to stay longer in the system until they obtained their qualifications.

1. Introduction

South Africa formally implemented the policy of apartheid¹ for 46 years, from 1948 when the National Party (NP) became the ruling party until the country’s first democratic election in 1994 when the African National Congress (ANC) came into power. During the apartheid years, much more public funds were spent on white learners in the school system and students in the post-secondary school phase than those from other racial groups. One of the results of this unequal spending was that the vast majority of students at Higher Education Institutions (HEIs) in South Africa were white. In 1955, for example, they constituted 89.7% of students, compared to the 5.5% that was black. More than three decades later – in 1990 – black students still represented only 37.7% of all students [1]. This disproportionate relationship between demographic share and representation at higher education institutions of the different racial groups reflects the broader injustice of the previous political dispensation.

In 1990 the ANC was unbanned and in 1994 South Africa held its first democratic election. High expectations emerged around the time of the country’s political transition that it would herald in a period of increased access to higher education for those groups that were previously denied access, based on racial criteria. In the period after 1994 tuition fees at HEIs increased substantially, which made it very difficult for students from poor communities to afford it. The National Student Financial Aid Scheme (NSFAS) was introduced to address this matter of affordability and to change the student profile at South African universities to make it more representative of the demographics of the country.

This chapter briefly looks at the public financing of higher education in South Africa. The emphasis will be on the two and a half decades since the democratic election, although some context will be provided about what happened during the preceding century. The development of NSFAS since its introduction in the mid-1990s will be analysed. The performance of students that received NSFAS awards (loans and bursaries) will receive attention as well as the change in the demographic profile of university students since the NSFAS has been in place.

2. The South African higher education landscape

The focus of this chapter is on the public higher education system of South Africa. The post-school education system of South Africa can be divided into universities and Technical and Vocational Education and Training (TVET) colleges. The university sector is divided into 26 public universities – 11 general academic universities, 9 comprehensive universities (an amalgamation of traditional universities and technikons), and 6 universities of technology. When we refer to HEIs in this chapter, we refer to the 26 public universities, unless noted otherwise.

In 2020 there were 2,005,408 students enrolled in post-school education and training in South Africa [2]. Of these students, 1,094,808 students were enrolled in the 26 public universities. There are also a further 132 accredited private universities attended by 219,031 students. This means that 83.3% of university students attended public institutions. There were 50 public TVET colleges with a total intake of 452,277 students. There were also 9 public Community Education and Training (CET) colleges with 142,538 students, while 96,754 students attended 126 private colleges (The numbers of the CET and private colleges were not audited.). This means that 84.3% of the total number of post-secondary students attended public institutions, and 77.2% attended public universities and TVET colleges. The percentage distribution of these students is portrayed in Figure 1.

Figure 1.

Composition of students in post-secondary education in South Africa according to institution type, 2020. Source: [2].

3. Financing of higher education in South Africa

To understand South Africa’s education system, it is important to note that separate schools for different racial groups were introduced more than a century ago. Previously, South Africa was divided into four provinces – Transvaal, Natal, Orange Free State, and the Cape Province – and in 1907 compulsory education was introduced for white learners only [3]. This established a culture of learning among white learners, and they (or their parents) understood the value (especially measured in future earnings potential) of education better than the other racial groups. Because the government did not provide sufficient educational resources to non-white learners and because these learners’ parents did not have the financial capacity to pay for additional resources, non-white racial groups did not receive the same quality of education. As a result of the introduction of compulsory schooling, the number of South African learners increased by 92% between 1910 and 1920 [3]. This increase was mainly driven by the increase in white pupils, which represented 57.9% of all learners in schools in 1921.

It is therefore no surprise that in the decades before the first democratic election in 1994, educational funds were spent very unequally between racial groups. One way to illustrate this is to use the total amount that was spent on education per racial group and divide it by the population numbers in the 5–24-year-old cohort groups.² Figure 2 clearly illustrates the unequal distribution of funds and the privileged position of whites. In 1920, for example, 97.9% of educational funds were spent on whites. Although per capita spending was still very unequal at the end of the period, the per capita spending on whites started to stagnate from around 1970. In 1970 74.9% of educational funds were spent on whites, but this percentage decreased to 37.2% by 1990. This unequal spending pattern is important to bear in mind when we look at how things changed after 1994 and why the introduction of NSFAS was necessary.

Figure 2.

Per capita educational spending on 5–24-year-olds: 1910–1991. Source: [1].

To evaluate the trends in public expenditure on higher education, three criteria are normally used, namely public financing of higher education in terms of total educational expenditure, in terms of total public expenditure, and in terms of Gross Domestic Product (GDP). All three ratios increased after the elections in 1994, reached a peak before the end of the previous century, and then went down until about 2010. In the years after that, there is an increasing trend in higher educational expenditure, especially since 2018 when President Jacob Zuma announced that all post-secondary education will be free (see Figure 3). Clearly, the disconcerting trend of a smaller percentage of educational funds or total state expenditure or in terms of the GDP being spent on higher education turned around over the last couple of years.

Figure 3.

Public expenditure on higher education in terms of total educational expenditure; total public expenditure and in terms of GDP: 1994–2019. Source: [4, 5, 6].

Although the abovementioned indicators initially show an increasing trend in public higher education expenditure after 1994, this expenditure did not keep up with the increase in student numbers. This resulted in a decrease of 36% for universities and 43% for technikons (before technikons and certain universities merged into comprehensive universities in 2003) in the real state appropriation per weighted full-time equivalent (FTE)³ students between 1987 and 2005 [7]. This trend continued during the period 2000–2009, when real state appropriations decreased by 1.1% per annum per FTE student [8]. Due to the decrease in the real value of per capita state subsidies to universities, these institutions were forced to increase tuition fees to still be financially sustainable. Between 1987 and 2003, tuition fees increased by 49% at universities and 85% at technikons in real terms. During the decade 2000–2010, class fees per FTE student increased by 2.5% per annum in real terms [7]. Calitz and Fourie [9] also indicated that higher education fees consistently increased by between one and five percentage points more than the headline inflation rate for the period 2009–2015.

While universities were expected to become more inclusive in terms of attracting more diverse students, the inevitable cost increases became a prohibitive factor for poor students to enter the system. Those who did became saddled with huge debts, and a solution had to be found to relieve the financial situation of poor students.

4. The National student financial aid scheme (NSFAS)

4.1 Background

Since the early 1990s, when South Africa embarked on a reform process towards becoming a democracy, the problem of outstanding student debt has been threatening the survival of some HEIs. Because many students from poor communities struggled to afford higher some form of financial assistance had to be given to those students. This was also an effort to create equal access to higher education and to prevent finances to be the stumbling block that kept poor students out of the system. This was also an effort to eradicate the racial imbalances that characterised the student body of South African university students (which was the result of legal restrictions as well as the unequal division of educational funds, as illustrated in Figure 2).

The National Commission for Higher Education advocated for a national financial aid scheme in its report of 1996 [10], a view that was fully endorsed in the Education White Paper 3 [11]. The Tertiary Education Fund of South Africa (TEFSA), established in 1991 by the Independent Development Trust, was contracted by the Minister of Education to administer this new scheme. The first NSFAS awards were made in 1995, but they could not satisfy the huge demand. For example, in 1996, only 70,000 of the 223,000 students that applied for loans received NSFAS funding. The NSFAS was formally established by an Act of Parliament in 1999 (Act no 56 of 1999) and in 2000, TEFSA was formally changed to the NSFAS. The NSFAS was also allowed to collect donor funding that then could be distributed to needy students through loans or bursaries.

The goal of NSFAS is to ensure that all South African citizens will be able to afford higher education. The state is the main financial contributor to NSFAS, but they also receive funds from local and international donors. It is the task of NSFAS to distribute these funds to needy students in the form of loans or bursaries. Only South African citizens registered at a South African university and that is studying towards a first qualification are eligible for NSFAS awards. They can receive NSFAS awards if they are studying for a second qualification only if that qualification will enable them to practice a chosen profession. In the past, only households earning less than R130 000 per annum qualified for NSFAS awards, but since 2018 this has been extended to include households with an annual income below R350 000.

To ensure that the correct poor students receive NSFAS funds a means test must be completed. The gross family income must be calculated as well as the number of dependents in a household, whether it is a single-parent household and whether any other dependent in the household is currently studying at a higher education institution. It must also be calculated whether that household will be able to contribute anything towards the costs of study of the student. An interview with the student must be undertaken to further determine the potential of the prospective student.

These criteria demand high levels of administrative capacity, and because TEFSA/NSFAS had trouble handling this administrative burden, they requested the financial offices at the HEIs to handle it on their behalf. The universities were then responsible to report on the progress of NSFAS students and to inform the NSFAS board if students discontinued their studies. This changed in 2018 when the process was centralised, and all applications are now centrally handled by NSFAS itself.

The spread of NSFAS funds was determined by the demographic profile of the student body at each university as well as the cost of study (for each programme) that differs between HEIs. To calculate the average full cost of study (FCS) the tuition fees, as well as the boarding fees, are taken into account. When calculating the weighted number of disadvantaged students (WDS) at each institution, black students had a weight of 3, coloured students a weight of 2, and Indian students a weight of 1. White students did not enter this formula. The WDS and FCT at each institution were used to calculate each institution’s NSFAS allocation. This means universities with more non-white students (especially black students) received more of the funds than universities where the majority of students were white. However, once an institution received the NSFAS funds, race played no role in determining who gets the NSFAS awards. The poorest students should receive the NSFAS awards, irrespective of race.

HEIs were supposed to use the formula below to determine the size of the NSFAS award (although most HEIs experienced that the maximum amount available through the NSFAS scheme was not enough to cover all the costs of a student):

$$\text{NSFAS award}=\text{costs}-\text{bursaries}-\text{expected family contribution}.$$E1

One of the disadvantages of this system was that because the HEIs with the most non-white students received the most NSFAS funds, students were forced to follow the money. Hence, affordability was a problem for poor students who wanted to attend the historically advantaged institutions, because these institutions received less of the NSFAS funds than their historically disadvantaged counterparts. In 2003, before the higher education landscape changed with the merging of several HEIs, more than 60% of academic research in South Africa was done at five of the previously advantaged institutions (the University of Cape Town, University of Pretoria, Witwatersrand University, Stellenbosch University and University of KwaZulu-Natal) [7]. Attending the previously advantaged institutions carries with it a certain prestige and certain courses like medicine were only taught at these institutions. Even in 2020, the five institutions mentioned were responsible for more than 50% of accredited journal articles [12]. With the distribution of NSFAS awards now being centrally determined, the money can follow the students. In other words, once a student receives NSFAS funding they can attend the institution of their choice. South African universities have different tuition fee structures, with the previously advantaged institutions having the highest fees. A drawback of this new centralised approach is that students from poorer backgrounds may still find it unaffordable to enrol at these institutions.

Some events in recent years quite dramatically increased the funds that the government channelled to higher education via NSFAS payments. At the end of 2015, unrest broke out on virtually all university campuses as part of the #FeesMustFall campaign. Students protested about the high tuition fees and demanded free education. The government then announced that HEIs were not allowed to increase tuition fees for 2016. After renewed protests in 2018, Jacob Zuma, the then-president of South Africa, announced that higher education will be free. In practice, however, this was an empty promise because free higher education is not possible for a developing country like South Africa, and this policy was never fully implemented. Regardless, based on the number of students helped financially via NSFAS awards and the amount of money spent on NSFAS payments, it becomes clear that a renewed effort was made to make higher education affordable to a broader spectrum of students.

4.2 Number of students helped, and amount of funds spent on NSFAS

Table 1 provides a breakdown of the number of university and TVET college students that received financial support from the first recipients in 1995 until 2020. We will not focus on the TVET students, but they are included for greater accuracy. It is clear from the table that the number of university students that received financial NSFAS support increased substantially over time. It started with a meagre 40,000 students in 1995 and expanded to more than 500,000 in 2020. However, the trend can be broken up into phases that are clearly illustrated in Figure 3. There was an initial increase in the number of university students receiving NSFAS funding from 1995 until 2011 when 216,874 received funding. After that, the number of university students receiving NSFAS funding decreases until 2015, when only 178,961 students received NSFAS awards. It is therefore not surprising that the #FeesMustFall campaign started that year.

Year	University students	TVET students*
1995	40,002
1996	67,641
1997	63,272
1998	67,558
1999	68,363
2000	72,038
2001	80,513
2002	86,147
2003	96,552
2004	98,813
2005	106,852
2006	107,586
2007	113,519	12,283
2008	118,450	35,352
2009	135,208	55,838
2010	148,387	62,205
2011	216,874	115,313
2012	194,504	188,182
2013	194,923	220,978
2014	186,150	228,642
2015	178,961	235,988
2016	225,950	225,557
2017	260,002	200,339
2018	346,966	239,797
2019	393,767	346,270
2020	504,336	261,404

Table 1.

NSFAS awards paid out: 1995–2020.

*

Until 2007 no distinction was made about the recipients of NSFAS awards, but it was almost exclusively university students that received the awards. Then another category FET and agriculture college recipients was created. Currently it is classified as TVET payments.

Source: [4, 13, 14, 15, 16, 17].

The funds paid out in NSFAS awards increased from R154 million in 1995 to R7.2 billion in 2015 (see Figure 4). Although this seems like a huge increase, one must consider that these are nominal values and do not take into account the huge increase in educational costs during this time period. It is also clear from Table 1 that more emphasis was placed on the financing of TVET students (who receive 100% bursaries) rather than university students, and in 2015 no less than 235,988 TVET students received NSFAS financial support. However, one may get the wrong impression by just looking at the student numbers. In 2015, the average NSFAS award size was R40 199, but on average only R8 878 was paid per TVET student. About 80% of NSFAS expenditure in 2015 was still spent on more expensive university education.

Figure 4.

NSFAS students and amount (millions) paid out 1995–2020. Source: [4, 18, 19, 20, 21, 22, 23].

After 2015 the number of university students receiving NSFAS funding increased substantially – from almost 179,000 in 2015 to more than 504,000 in 2020 (an increase of 181%), while the funds paid out to university students increased from R7.2 billion to R30.8 billion over the same period. In 2020, 83.2% of NSFAS funding was spent on university students and the average size of an NSFAS award was R61 562, while the corresponding amount for TVET students was only R23 825 (This TVET amount is artificially high due to the unexplained decrease in TVET students that received NSFAS funding in 2020).

In total, 4,172,650 university students received NSFAS funding to a total value of R144.5 billion over the period 1995 to 2020. From 2007 to 2020 an additional 2,428,148 TVET students received NSFAS funding of R28.1 billion. In total, about 84% of NSFAS funding was paid out to university students over the period 1995 to 2020. As stated before, further analysis will be done for the situation of only university students.

Figure 5 provides a clear picture of what happened to state funding for NSFAS. When the scheme started in 1995 it budgeted a mere R40 million for NSFAS. This increased steadily over the years and by 2015 (when the #FeesMustFall campaign started) the state contributed R9.2 billion towards NSFAS. From then on there was an almost exponential increase in the state’s budget for NSFAS. The amount of R14 billion that was budgeted for NSFAS in 2016 was an increase of 51.8% from 2015. In 2022, R46.1 billion is budgeted towards NSFAS, translating to an annual increase over the period 2015 to 2022 of 25.8%. In total, R248.7 billion was paid by the government towards NSFAS since its introduction in 1995, with more than 82% of that amount being paid since 2016. The government’s intention to make higher education more affordable for needy students through NSFAS awards is indisputable.

Figure 5.

State budget for NSFAS 1995–2022 (R million). Source: [4, 18, 19, 20, 21, 22, 23].

Although the percentage split between racial groups and sexes differed between years, on average about 54% of NSFAS recipients were women and 46% were men. Approximately 93% of recipients were black, 5% coloured, 2% white, and 1% Indian (NSFAS website). This is hardly surprising, as this distribution closely correlates with the demographics and poverty distribution in the country.

4.3 Repayment of NSFAS loans

The NSFAS functioned as an income-contingent loan (ICL) and bursary scheme. Loan recipients only started repayments once they were employed, and their earnings were above a certain income threshold. The principle is simple: It is a student that gets the loan/bursary, but a working person (mostly graduates) that repays the costs. A NSFAS recipient only starts repaying a loan once they earn more than R30 000 per annum, and then only 3% of the income. This percentage increases on a sliding scale to a maximum of 8% once their income is R59 300 per annum. The initial award that a student received was regarded as a 100% loan. For every 25% of the courses passed a student can convert 10% of the loan into a bursary. If students are successful with all their courses, 40% of the loan is converted into a bursary. Interest accrued on loans at approximately 2% above the previous year’s consumer price index, but since 1 April 2008 it has been pegged at 80% of the repo rate as determined by the South African Reserve Bank. This policy changed in 2018 and most NSFAS awards are now – after President Zuma announced in 2018 that higher education will be free – given as bursaries.

The repayment of loans after recipients left the HEIs seems to be the biggest problem that ICL schemes experience internationally and NSFAS is experiencing the same problems. Once students leave the higher education system, NSFAS has great difficulty linking these debtors to their first place of employment. It is even more difficult to track students that fail and drop out of the system. These problems have persisted even though employers are obliged by law to report when they employ NSFAS students. In theory, linking ex-NSFAS students to NSFAS headquarters and the South African Revenue Service should be a simple procedure to monitor the repayment of loans. However, theory and practical experience are very different, and as experienced elsewhere in the world, this is a much more complicated process than in theory.

Despite these problems, Figure 6 shows that the payments received from former recipients of NSFAS awards increased substantially over the years from R30.3 million in 1998 to R719.4 million in 2011. However, it is not clear whether NSFAS’ records are up to date and whether they know exactly who owes them what. It is thus unclear whether South Africa’s experience is better or worse than with other ICL schemes. NSFAS revised its debt book, which may explain the decrease after 2013. They made improvements to collect more repayments on loans after 2015, but that dropped again after 2018. The latter decrease in repayments may be explained by the fact that the majority of current student funding is provided as bursaries, along with an unwillingness of students who previously received NSFAS awards as loans to repay them.

Figure 6.

Repayment of NSFAS loans (R million). Source: [13, 14, 15, 16, 17, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34].

5. Performance of students that received NSFAS awards

5.1 Performance of NSFAS students based on aggregate data

As was explained in Section 4.3, up to 40% of a NSFAS loan could be converted to a bursary if a student passed all the modules. Table 2 shows that, according to the reported statistics of NSFAS, their students were very successful with their studies. Over the period 1996–2009, NSFAS reported that students passed on average 74.3% of the courses for which they registered. On average 28.5% of the NSFAS loans were converted into bursaries, which is consistent with an approximately 70% success rate. However, the Ministerial Committee [35] reported totally different results in 2010. They reported that 33% of all NFAS students that received NSFAS funding since 1995 were still studying. Of the 67% that left HEIs 28% graduated, but 72% dropped out without obtaining a qualification. Thus, the NSFAS and Ministerial Committee statistics seem to be contradictory. Courses passed are not the same as obtaining a qualification, which may partly explain these contradictory results; however, Section 5.2 provides a more accurate picture.

Year	Percentage	Per cent of capital converted into bursaries
1996	72.6	26.6
1997	75.3	28.9
1998	76.1	29.4
1999	73.8	28.8
2000	74.6	29.4
2001	73.1	28.9
2002	73.9	28.7
2003	72.3	28.2
2004	74.3	29.1
2005	73.9	28.6
2006	73.4	27.5
2007	74.7	27.9
2008	72.9	28.3
2009	73.9	28.0
Average	74.3	28.5

Table 2.

Percentage of courses passed by recipients of NSFAS awards and of capital converted into bursaries: 1996–2009.

Source: [24, 27].

5.2 Performance of NSFAS students using individual data

This section deals with the performance of students when using individual data to track individual students through the higher education system. By making use of the Higher Education Management and Information System (HEMIS) the progress of a student can be monitored. It is possible to see whether a student changed courses or institutions and when they dropped out of the higher education system. Because one is using individual data it is possible to determine when these students drop back into the system. It is also possible to determine what qualifications(s) students obtained at which institutions as well as what students are still in the system without qualifications. The first study that investigated the performance of individual NSFAS students used the data of students that received NSFAS awards in the period 2000–2004 using HEMIS data up to 2009 [36]. In their analysis, they calculated how students that received their first NSFAS award in 2000 progressed through the HE system over the period 2000–2009. This process was repeated for the other cohorts that received their first NSFAS award in 2001, 2002, 2003 and 2004. To make results comparable, they calculated results for first-time first-year students for the 2000–2004 cohorts.

Of the first-time first-year NSFAS-funded students in 2000, 55% obtained at least one qualification (diploma, certificate or degree) by the end of 2008, Of this original cohort group, 6% were still in the system without obtaining a qualification and 38% of the original cohort group dropped out of the system without a qualification. The NSFAS-funded students outperformed the non-NSFAS students. Of the non-NSFAS students that were first-time first-year students in 2000, 46% of them obtained a qualification by 2008, 46% dropped out without a qualification and 6% of the cohort group was still in the system without a qualification. The other cohorts (2001–2004) showed remarkable consistency in success/failure rates (for both NSFAS and non-NSFAS students).

Their analysis indicates that NSFAS-funded students outperformed non-NSFAS students. A higher percentage of them obtain qualifications and a smaller percentage drop out of the higher education system without qualifications (and this holds for all 5 cohorts). The financial support of NSFAS (with lower risks attached to it than conventional loans at financial institutions) seems to persuade students to stay longer in the HE system although they may not be successful initially. This is supported by the smaller percentage of NSFAS students that drop out without qualifications. One could argue that the money was spent efficiently, given that 71.2% of the money spent on the 2000 cohort group was spent on successful students (those that obtained at least one qualification). However, in some instances, it took too long to identify unsuccessful students that were still receiving an award. Some students received NSFAS awards for 9 years, without having obtained any qualifications.

Since 2016, the Department of Higher Education and Training (DHET) publishes an annual report that follows all first-time first-year students for a maximum of 10 years through the system since 2000. The latest report [37] looks at the progress of all first-time first-year undergraduate students until 2019. Their results are in line with the findings of [36], and a couple of clear trends emerge from the data. After about 6 years, most of the students that will obtain a qualification have already done so. For example, after 6 years, 52.9% of the 2005 first-time first-year cohort obtained a qualification (contact and distance education) and after 10 years, 63% of the cohort had obtained qualifications. The other characteristic is that a higher percentage of the successive cohorts obtained qualifications over time. Figure 7 clearly illustrates this pattern. After 6 years of study, only 52.9% of the 2005 cohort obtained a qualification, but after 6 years 70.5% of the 2015 cohort had already obtained a qualification. Fewer students also tend to drop out without qualifications. After 6 years of study, 29.5% of the 2005 cohort group dropped out, but after 6 years only 13.1% of the 2015 cohort group had dropped out without obtaining a qualification. There is therefore a clear improvement in the performance of NSFAS-funded students over time.

Figure 7.

Percentage of the graduates and dropouts of the 2005 and 2015 first-time first-year students that received NSFAS funding (contact and distance education). The graph is not drawn according to calendar years, but according to the number of years students received NSFAS funding. This is because some students drop out of the system, work a couple of years and then drop in again. Source: [37].

The other interesting phenomenon is that students that received official NSFAS funding via DHET or Thuthuka⁴ on average performed much better than the students from that cohort that did not receive funding (see Figure 8). Of the 2011 cohort group (that was followed for a maximum of 10 years), 32.4% of national students dropped out while the corresponding figure for DHET-NSFAS students was 20.8% and for Thuthuka-NSFAS students a mere 7.7%. Likewise, while just more than 61% of the national student body of the 2011 cohort obtained a qualification by 2021, more than 71% of DHET-NSFAS students and 89% of the Thuthuka-NSFAS students obtained qualifications.

Figure 8.

Dropout and throughput for National; DHET-NSFAS funding and Thuthuka-NSFAS funding students for the 2011 cohort. Source: [37].

The same picture emerges for the 2015 cohort. By 2021, 22.4% of the national student body of this cohort dropped out, while only 13.1% of the DHET-NSFAS students dropped out and 7.2% of the Thuthuka-NSFAS students. Likewise, while 64% of the national student body that was first-time first-year students in 2015 obtained a qualification, the corresponding figure for DHET-NSFAS students was 70.5% and for Thuthuka-NSFAS students 84.2%. It does seem that the availability of funds plays an important role for students from poor backgrounds to pursue their studies.

5.3 Enrolment at public higher education institutions

Over the years, the number of students enrolled in HEIs increased quite substantially. Figure 9 illustrates how the racial composition of these students changed over time. In 1994, there were 266,190 black students (representing 50.4% of the students) and 177,012 white students (representing 33.5% of the students). These two groups represented almost 84% of all the students enrolled at universities. There were also 28,949 coloured students (5.5%) and 31,908 Indian students (6.0%).⁵ By 2020, black students (862,313) represented 79.4% of the total number of students, and white students (118,505) dropped to only 10.9% of the students. While black students increased by 4.6% per annum over this period, white student numbers decreased by 1.5% per annum. Although Coloured and Indian numbers are small in comparison, they both increased over this period. Coloured students increased to 61,923 – indicating a healthy growth rate of 3.0% per annum. The growth rate of Indian students that increased to 41,262 in 2020 was 1.0% per annum. The big change, therefore, was the increase in black students to also make the student body more representative of the demographics of South Africa. NSFAS played no small part in making this happen.

Figure 9.

Number of headcounts in public HEIs per race, from 1994 to 2020. Source: [1, 2, 39, 40, 41].

Another aspect that changed over time was the gross enrolment rate (GER).⁶ The GER of Indians and whites are much higher than for the other racial groups – as illustrated in Table 3 Their GER decreased slightly over time, but there was a more substantial drop from 2018 to 2020, which may be COVID-related. Although the rates for coloured and blacks are still disappointingly low, they did increase over time and NSFAS funding must have played an important role in this regard. The GER of blacks increased by no less than 85% over the 18-year timespan or 3.5% per annum. Although there is still much room for improvement, the higher GER for blacks can to a large extent be attributed to the NSFAS funds that became available to qualifying black students.

	Black			Coloured			Indian			White
Year	Female	Male	Total	Female	Male	Total	Female	Male	Total	Female	Male	Total
2002	12.6	10.6	11.5	11.4	10.4	10.9	51.8	41.8	46.6	53.8	50.5	52.2
2003	12.6	10.7	11.7	12.5	11.0	11.8	54.7	43.1	48.7	56.3	51.6	53.9
2004	12.5	10.4	11.5	12.9	10.8	11.8	55.0	42.4	48.5	56.5	47.3	53.9
2005	12.4	10.2	11.3	13.2	10.6	11.9	55.7	41.9	48.6	56.7	50.6	53.7
2006	12.2	9.9	11.1	14.0	10.5	12.2	56.7	40.9	48.6	56.9	49.6	53.2
2007	12.7	10.1	11.4	14.0	10.1	12.1	54.1	39.3	46.4	56.3	48.5	52.4
2008	13.6	10.4	12.0	14.7	10.2	12.5	54.6	38.6	46.4	56.9	48.1	52.4
2009	15.4	11.3	13.4	16.3	10.8	13.6	57.7	39.1	48.1	57.5	48.3	52.9
2010	15.2	11.2	13.2	16.1	10.6	13.3	58.0	39.3	48.4	59.3	49.8	54.5
2011	16.4	11.9	14.2	16.3	10.7	13.5	59.1	39.5	48.8	61.1	50.6	55.8
2012	17.1	12.2	14.7	16.2	10.4	13.3	57.3	37.2	46.9	61.6	49.7	55.9
2013	48.0	12.9	15.4	17.1	10.7	13.9	59.8	37.9	48.5	63.6	51.2	57.4
2014	17.9	12.9	15.4	17.1	10.6	13.8	60.3	37.9	48.7	63.6	50.5	57.1
2015	18.5	13.4	16.0	17.7	10.8	14.3	61.0	37.9	49.0	64.2	50.2	57.1
2016	18.8	13.7	16.3	17.8	10.8	14.3	58.0	36.5	46.9	62.5	48.8	55.6
2017	21.0	15.1	18.1	19.0	11.2	15.1	58.9	36.7	47.4	63.4	48.4	55.9
2018	22.6	16.0	19.4	19.7	11.3	15.5	58.4	35.0	46.2	63.0	46.9	54.9
2019	24.2	16.2	20.1	18.6	10.6	14.6	53.6	30.9	41.6	56.5	41.5	49.0
2020	26.2	16.5	21.3	18.9	10.4	14.6	51.9	30.2	40.3	53.8	39.3	46.6

Table 3.

GER in public universities by race and gender, 2009–2020 (%).

Source: [42, 43, 44, 45, 46, 47, 48, 49, 50, 51, 52, 53, 54, 55, 56, 57, 58, 59, 60, 61, 62, 63].

Although NSFAS was not solely responsible for the change in the racial composition of permanent research and instructional staff members at universities, the system that is now up and running for more than 26 years must have helped many non-white students get access to higher education and further their studies. The racial composition of university staff changed drastically over the period from 2009 to 2020, as depicted in Figure 10. Although the number of Indian staff members increased by almost 18% over the period (from 1390 in 2009 to 1637 in 2020), it decreased as a percentage of total permanent research and instruction staff at HEIs in South Africa. The number of coloured staff members increased from 926 to 1498 (an increase of almost 62%) and increased from 5.7% of the total to 7.4%. Although their numbers changed quite significantly, the change is small relative to total staff numbers.

Figure 10.

Percentage of permanent research/instruction staff in public HEIs by race, from 2009 to 2020. Source: [39 for 2009–2015]; [64, 65, 66, 67, 68 for 2016–2020].

The big change occurred in white and black staff numbers. While the 9345 white staff members represented 57.3% of total staff members in 2009, this changed markedly over the next 11 years. White staff members decreased by more than 14% to 7995 in 2020. By 2020, they presented ‘only’ 39.4% of total staff members. On the other hand, black staff numbers increased from 4598 in 2009 to 8777 in 2020 – an increase of 91%. In the process, their share of total staff members increased from 28.2% in 2009 to 43.2% in 2020. NSFAS undoubtedly contributed to making staff numbers more representative of the demographics of South Africa.

6. Conclusion

With the new political dispensation, the government was under pressure to enable more students from poorer communities to get access to higher education in South Africa. Because government appropriations decreased in real per capita terms and higher education costs increased steeply, HEIs had to increase their tuition fees by more than the inflation rate to be able to “balance their books”. While racial criteria fell away after 1994 (although a lot of things already started to change before 1994), high fees at HEIs introduced a new economic barrier to a large percentage of students from poor communities.

The NSFAS began operating in 1995 to change the racially skewed composition of the student population in South Africa by providing funds for disadvantaged but deserving students. Over the period 1995 to 2020, NSFAS funded on average 198,697 university students per annum and spent R144.6 billion in total (while on average an additional 173,439 TVET students were supported financially through NSFAS since 2007 and R28.1 billion paid out). Especially since 2015 government has made a serious effort to make higher education more affordable to the poor by spending a much larger portion of their higher education budget on NSFAS than on state appropriations (subsidies).

NSFAS played no small role in the way the racial composition of the student population changed over time. In 1994 only 50.4% of students in higher education were black and 37.5% were white. By 2020, black students represented 79.4% of the total number of students at public universities, while the non-white component of the total number of students increased to 89.1%. Although NSFAS is not the sole contributor to this phenomenon, the scheme has played an instrumental role. For example, in 1994 NSFAS funded only 7.6% of university students, but this figure increased to more than 46% of the students in 2020.

The scheme undoubtedly contributed positively to making higher education more accessible and affordable to the poor. Furthermore, NSFAS students perform better than non-NSFAS students. A larger proportion of them obtains qualifications while a smaller share of them dropped out of the higher education system without qualifications, compared to the non-NSFAS students. NSFAS largely serves students from poorer backgrounds who are usually first-generation university students. Therefore, the success of these students in progressing through the higher education system is remarkable. Because almost all current NSFAS awards are bursaries the progress of NSFAS students will have to be closely monitored in the future to ensure that the money is still spent on successful students (that progress successfully through the system).