DA begins budget amendment process to fund R2.7 billion fees shortfall

25 October 2015

The Democratic Alliance (DA) has begun the process, in terms of Section 77(3) of the Constitution, to amend the national budget in order fund the R2.7 billion shortfall in higher education funding. 

In President Zuma’s statement to the nation on Friday he said that there would be no fee increases in Universities for 2016. While this announcement will be a relief for all students, the President made no mention of where the resulting shortfall in University income, estimated to be in the region of R2.7 billion, would come from. In addition to this, reports today suggest that the Minister of Higher Education and Training, Blade Nzimande, does not know where he will find the money to fund the shortfall. 

It is the DA’s contention that the ANC government had an opportune moment to address this funding crisis in the Medium Term Budget Policy Statement (MTBPS), delivered by the Minister of Finance in Parliament just 48 hours before the President’s decision to place a moratorium on fee increases. 

The Finance Minister’s failure to appreciate and adequately address the funding crisis in higher education in the MTBPS further indicates the fact that the ANC government had no intention of lightening the financial burden on students.

It is against this backdrop that the DA has begun the process of amending the budget through Parliament’s Standing Committee on Appropriations. My colleague,Malcolm Figg MP, tabled the following letter, addressed to Committee Chair, Paul Mashatile MP, in Friday’s sitting of the Appropriations Committee. 

The letter, addressed to the Chairperson, indicated that the DA intends to amend the budget, and requests the Committee to take the following steps:

To solicit the assistance of the Parliamentary Budget Office (PBO) in amending the relevant legislation, including the exact amount required to fund the shortfall, and the most appropriate areas in which this revenue can be found;

For the Portfolio Committee on Higher Education and Training to be invited to brief the Committee on the scope and extent of the funding crisis in higher education, as well as its Budget Review and Recommendation Report (BRRR); and 

For the Parliamentary Legal Adviser to provide advice on the process that must be followed as to avoid procedural error.

There is no doubt that the funding will not be found in the Department of Higher Education and Training’s (DHET) University budget. That budget is extremely tight already, with little or no surplus or identified wasteful expenditure that could be transferred. 

The DA has made several concrete proposals as to where the funds can be found, which amounts to R3.8 billion, including:

R2 billion from the sale of government’s stake in Vodacom, currently allocated to the BRICS bank.

R720 million allocated to the Department of International Relations and Cooperation to offset the impact of the depreciation of the rand on foreign missions.

An additional R69.7 million allocated to VIP Protection Services in the MTBPS.

R67 million allocated immediately for the preparatory work on the planned nuclear build, which the DA maintains should be abandoned.

R1 billion from the skills levy surplus.

It appears that the ANC has no idea on how to find short-term funds for the beleaguered and neglected Higher Education system, else it would have either been announced in the MTBPS or in the President’s address.

In light of this inability, the DA will be bringing these proposals into the Parliamentary process from next week onwards, starting with Tuesday’s sitting of the Appropriations Committee.

The DA urges the ANC to back us on this important matter for both students and universities. In the end, money must be found within the existing budget for a 0% increase, otherwise what should be a relief for students, will result in cuts at universities. This will be equally bad for students, and for innovative research which our economy so desperately needs. 

Statement issued by Prof Belinda Bozzoli MP, DA Shadow Minister of Higher Education, 25 October 2015