South African Students Are Drowning In Debt

By Erin Howard

Student debt is a struggle for many young South Africans.

Despite 1,3 million students receiving support through the National Student Financial Aid Scheme (NSFAS), fee shortfalls or loss of NSFAS funding results in crippling debt. Students cannot register at another university, receive their marks, or graduate when they owe money to a university. Students also can’t receive their degree which hinders their ability to find work or get shortlisted for jobs.

Deputy Dean for undergraduate students in the Faculty of Commerce at the University of Cape Town, Professor Ulrike Rivett shares her insights into the student debt crisis.

Do you think South Africa has a student debt issue, and why?

Student debt is a real issue all over the world where tertiary education is not free or integrated into a system where student fees are supported without the student having to pay back to either a bank or government organisation.

Within a country like South Africa, student debt has far more wide-reaching impacts.

To understand this impact, one needs to look closely at the real costs, i.e., the debt a student has, but also the issue such as debt has on the wider eco-system such as families, the economy, social mobility, and other aspects.

Social mobility refers to the ability of a student to move within a society or have opportunities to move “up” within society, i.e., move from a low-income family to a middle-class environment.

Student debt results in a student starting their career at a disadvantage. They have debt before they even receive their first paycheck.

One study found that in the 2017-18 academic year, student debt already sat at an astonishing R11.3 billion. What are your thoughts on that?

I would have thought it would have been substantially more.

For example, here at UCT, on average, the fees of an undergraduate degree are about R70 000 per year. That is just fees.

On top of that, there’s about R100 000 for accommodation. So that means the average student needs approximately R200 000 per year. UCT has about 30 000 students.

That means that our students alone need R6-Billion annually to study here.

Some would have it that student debt is caused by the inheritance left behind by apartheid’s enforcement of race-based capitalism. Thoughts?

We certainly know that apartheid created a system of racial inequality that remains firmly in place, and we have made little headway in changing our way of thinking when it comes to economic models for university students.

We continue to rely on a fee system. We continue to withhold degree certificates when a student has not paid their fees and we haven’t come up with new models or approaches to unpack fees and debt.

We have done so little to turn it around – and that is partially also the responsibility of universities. We have not done enough to push this, and it has been to a great extent students who have pushed us to think about it.

It is infuriating to think that the people who should be studying are spending their time arguing for student debt relief. I think that as university management, we could do more.

Do you believe the #FeesMustFall-movement was an appropriate reaction from students to student debt?

Yes, I do think so.

Students had raised this for a very long time, it merely culminated in 2016 in the protests after the #RhodesMustFall-movement was successful. Until then, students had never realised their power of standing together as a community country-wide and pushing back on the issues that impact them.

The reality is that without that protest, we would not even have started the wider debates on funding.

Do you believe the National Student Financial Aid Scheme (NSFAS) is a reliable source of funding for students?

NSFAS is supporting a very small group of citizens in the country, so it will never be reliable.

The moment we face a different crisis that impacts a bigger group, it is likely that this funding will be sent to someone else. NSFAS is merely a vehicle to distribute a relatively small amount of money to tertiary students.

It isn’t reliable, nor sustainable, as we are currently not recuperating the money students receive.

Is it fair that students are disallowed to register or graduate due to debt?It is a very counterproductive approach to managing debt.

Why would you keep the person who owes you money from making money by not letting them graduate?

Again, this is unfortunately how it was done in the past and we haven’t come up with more creative solutions to manage fee payments or restructure our repayments.

Do you believe free higher education will improve the youth unemployment rate?

Yes, absolutely.

Being debt-free when you start out with your life is an amazing starter and will set every person up to be more confident.

I also think that “free” has to be clarified. It is free to the receiver up to a point and we would need to discuss what that point is, but having access to free education is indeed key to turning the country around.

How would you advise the students being held back by their debt?

I would encourage every university student who receives funding to engage and come up with new models for how we can do funding differently.

I would encourage every student to not only hold us as universities accountable for thinking and doing more, but also hold student leaders accountable to not only push political slogans and stage protests but to really engage with the difficult aspects of finding a new way to think about fees, free higher education and reducing student debt.

This article was originally published by Khulani!, a youth media project by the Department of Media and Communication of Nelson Mandela University, based in Gqeberha, Eastern Cape.