Student debts an issue ‘we cannot leave to students and higher education dept’

As South African students continue to battle study debts, ANC treasurer-general Dr Gwen Ramokgopa has called on the private sector, government and civil society organisations to establish a dialogue in relieving student debts and financial exclusion.

Ramokgopa provided a keynote address at a breakfast dialogue hosted by the Progression Business Forum and the South African Union of Students under the theme “Breaking barriers of financial barricades in institutions of higher learning”.

‘National interest’

Speaking to The Citizen, Ramokgopa said student debt and financial exclusion were a matter of national interest and it was important to find ways to assist students from the pressures of having to deal with financial problems every year.

“We need to deal with this in terms of access to higher education, continuing education or acquiring qualifications. This has become an issue we cannot leave to students and the department of higher education,” she said.

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“In my world, when we have a crisis of public health nature like we had with the Covid pandemic, the public and private sector pulled together so now it is for the future of our youth.

“Let’s pull together cohesively as partners to support the young people so that they do not have to protest every year.”

Ramokgopa said a special fund was required which had tight governance around it, so that it can boost the National Student Financial Aid Scheme (Nsfas). She said Nsfas was only able to assist students who met a certain criteria.

“This would be what we call the more vulnerable students from poor families. So to stretch that and to meet the needs of other students, we would need to have a national solution,” she said.

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“There will be many people who would want to contribute at an individual level. As individuals, without a coordinated effort, the impact is less than if there could be a national solution.”

With regard to the issue of higher education institutions transferring student debts to banks, Ramokgopa said this brought immense pressure on individuals and students. She said this move was more for those students who were not covered by Nsfas.

“According to my understanding, it is an acknowledgment of debt where the student acknowledges the debt and there were processes the higher education institution has put in place to look at how to deal with student debts,” she said.

“It is a relatively new issue. Previously, students would have to first pay the debt before acquiring their results, but now it was different. You would have to deal with it outside university as your own personal debt.”

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Ramokgopa said this was an area to be flagged and it was crucial to find ways to resolve it. She said young people do not start on a “zero sum basis but with a huge debt”.

“It is a major concern. People end up starting employment on a negative and with this high inflation rate and cost of living, it becomes a huge battle,” she said.

Selling student debts to bank collectors

Saus financial aid chair Nhlonipho Nxumalo said it was a major issue that universities had the tendency of selling student debts to bank and debt collectors.

“How do institutions expect these people to go and pay back these debts if they cannot afford it?” she asked.

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“Their qualifications are withheld so they are not employable and cannot compete in the job market. It is really a difficult situation the students are in.”

Acting PBF chief executive Humaira Choonara-Mooketsi said it was essential civil society and other organisations came together to discuss matters of financial barricades and gender equity.

“We need to find solutions and move forward,” she said.