An analysis of higher education funding: consideration towards a viable model for South Africa.

Abstract

The funding framework for Higher Education has always been a contentious issue in South Africa, and more so in recent years. For some time now, it has continued to adopt a predominantly performance-based model within a shared costs system, continuously developing and enhancing its funding framework, with individual Higher Education institutions adapting this as needed, depending on their contexts. The #FeesMustFall movement and other challenges in higher education financing have entrenched the view, despite the dismantling of apartheid; South Africa still remains one of the world’s most unequal countries from a socio-economic standpoint. Given the disparities that existed in its apartheid system coupled with challenges in post-apartheid South Africa, this research asks key questions around higher education funding, and specifically: to what extent were resources allocated to universities, promoting the principals of satisficing, justice and fairness, and critical capacity? These notions emanate from the theories of Simon (1959); Rawls (1982) and Boltanski (2011) respectively, which form the theoretical basis of this qualitative study. All public universities in South Africa are heavily dependent on state resources to meet their mandate of providing post-school education to qualifying students. The purpose of this research was thus to analyse resource allocation models in public universities within the Higher Education sector in South Africa. It also focuses on the variables that are considered by the government in determining the subsidy or block grant allocated to universities. By engaging the literature on resource allocation, taking cognisance of the history of the country, its higher education systems and funding frameworks, and its challenges, the research reflects on the experiences of financing higher education from a global, continental and national perspective. Particular focus is placed on the presentation then analysis of the South African Higher Education funding framework, and considerations that could be offered towards a viable funding model for South Africa. The methodology employed in this qualitative research surveys global literature on the financing of higher education, South African government policy documents and related reports as well as inputs from a sample of key financial personnel of seven (of ten) nationally sampled universities. The sampled universities whose geographical locations spread across South Africa were selected on the basis of their block grant received from the state. The unstructured face ix to face interviews focused on budget frameworks specifically in relation to the main financial operations at sampled institutions. Findings emerging from these interviews related to issues around timelines, top-slicing, cross-subsidisation, wish lists, communication, levels of transparency and treatment of surplus budget funds with a few unique models that centred around benchmarks. A further finding confirmed that budget frameworks remain within the confines of the respective university with each university believing that their framework is the most appropriate for their organisation. From this range of findings, the study synthesises the mechanisms that drive the allocation of resources from governments to universities and the onward dissemination to faculty and support services. A series of recommendations for both State and University consideration is made based on universities radical transformative nature. These are discussed then fused into a ‘Roadmap’ for consideration in the future funding models devised for Higher Education in South Africa. The research concludes with a challenge to University leaders, particularly it's Chief Finance Officers, to critically engage and refine their leadership stance and communication capabilities in line with the principals of satisficing, justice and fairness.