NASTASSIA ARENDSE: In January last year, President Jacob Zuma established a commission of inquiry into higher education and training in order to find a sustainable solution to the ongoing higher-education funding matter. According to the recommendations of the Heher Commission of Inquiry, government-guaranteed bank loans could fund university fees.
This is a conversation we had with Adrian Saville, founder and CEO of Cannon Asset Managers about the model of free education.
ADRIAN SAVILLE: I think the challenge, from a South African perspective, is that the funding is just one component. There are two other – if I can call them that – elephants in the room.
The one is the effectiveness of the spend in education and the other is that you are solving essentially a supply-side problem, or you are solving for a supply-side problem where you have a demand-side challenge.
To put some context to those very sweeping observations, it’s all good and well if you spend or fund free education in South Africa. The tragedy or the challenges, if you look at the results of our spending on education, don’t tell a good story – that you are funding what is not an effectively delivered result.
The other issue – even if you are to solve for the education, can I call it, crisis in South Africa – is who is going to employ all of these educated people? So it’s all good and well to fund free education, but you have six million unemployed youth in South Africa, of which one million already have qualifications.
NASTASSIA ARENDSE: Is the issue then perhaps even trying to create a kind of free funding model, or a near-funding model, to primary and high school, as opposed to doing it at a tertiary level. I suppose at that point you are able to create mechanisms in which learners or students are able to think out of the box, create new opportunities for themselves and find other alternatives of being able to be educated?
ADRIAN SAVILLE: There are so many components of this that need to be remedied and repaired, and it really does speak of South Africa’s deep, deep social scarring that remains the tragic legacy of apartheid. I think you are referencing this reaching all the way from work-readiness programmes to ensuring that people who go into university have the skills to cope with very challenging circumstances, and these extend well beyond financial resources.
Work readiness says that when you are qualified you are equipped to cope with a new set of challenges in the workplace. But to rewind this, what we know is that many people who go into this schooling system forget about the tertiary system, and we’ll lose one in two on the way to matric.
So this is a problem far bigger than funding and the remedy extends well beyond money into much deeper social and economic ailments.
NASTASSIA ARENDSE: The commission spoke of finding ways to expand, improve and streamline the TVET [Technical Vocational Education and Training] sector, and it basically goes on to say that TVET colleges should be seen as institutions of first choice, rather than as second-class citizens only. How then do we get TVETs to be viewed in the same light as universities?
ADRIAN SAVILLE: I think that really points to an issue that is pronounced in South Africa, and that is an assumption that the solution sits in more than resources. So the reference in your quote is to do with improving or enhancing. The immediate or easy way to read that is to say, well, we’ve got to put more money into this.
South Africa already has a well-funded education system. Sadly, that well-funded education system doesn’t translate into well-resourced. So I would venture that talking about putting more resources in is not necessarily about more money.
It’s about making sure that the resources are well allocated, effectively allocated.
And the evidence doesn’t speak well of South Africa on this score. It’s not just the education sector that shows this ailment. Other sectors show a similar challenge, the healthcare sector being the most obvious.
NASTASSIA ARENDSE: The commission also recommends something – and I don’t know how you feel about it – that’s basically a cost-sharing model in the form of income-contingent loan schemes for all students, and the proposed model is based on a public-private partnership between the state and private financial sectors. Basically you get a loan and pay it back. I’m reading the comments on Twitter right now and people are saying well, the understanding from this entire suggestion is that the report is handing the whole system over to the banking sector, and they feel as though it’s going to be an unworkable, unnecessary complicated loan system.
What are your thoughts?
ADRIAN SAVILLE: I think this type of innovative thinking is important to rethink the system. But the jaundiced comments about handing over the problem to the banking sector – ja, I understand that sort of jaded response, and my comments here aren’t just about South Africa. If you look at how this has left people in other parts of the world deeply indebted, that does put a question mark over it.
But there’s a further issue, and that is it goes back to a point I was making right at the start when we began speaking, and that is it’s all good and well to get funding for your education – but if you don’t get a job you can’t pay this back. So South Africa’s problem is not just a supply-side problem of fixing the funding and getting people through the education system. It’s making sure that those who come out on the other side have a functional economy in which to work and operate, and sadly both sides of the equation are sick as things stand.
NASTASSIA ARENDSE: Adrian Saville, thank you so much for your time today.