‘Our market outlook confirms that South Africa’s absorption rate in the market is critically low, in the face of an ever-growing young population. Statistics SA confirms that young people with a tertiary education have a greater chance of making an income. A working national funding scheme could promote skills matching to contribute to our economic growth – but sadly, we’re all aware of NSFAS scandals. What we don’t know, is how this is tragically impacting generations of young South Africans who are stuck in a limbo, unable to complete their studies and participate in the labour market” says Kristal Duncan-Williams, Project Lead at Youth Capital.
Youth unemployment is a structural issue that is heightened by the opportunities young people have access to depending on their socio-economic status and race – in South Africa, 2 in 3 young people are unemployed even though are able and willing to work.
NSFAS is a government entity, established in 1999 under the Department of Higher Education and Training, to provide financial support to disadvantaged students for their studies at public universities or Technical and Vocational colleges. In its design, students who are part of the scheme would receive financial support to cover accommodation, a living allowance, transport and learning materials. However, since its inception, the fund has been embroiled in corruption scandals, with the funds often not reaching the intended students. Earlier in April 2024, the board was dissolved, and the scheme was placed under administration.
Students pay the price of mismanagement and corruption. Unpaid accommodation fees and allowances have led to eviction, empty stomachs and the inability to complete their academic qualifications and then make a living. ‘What is often not mentioned, is that the students funded by the scheme are breadwinners in their households; in many cases, these young people are first generation university students, and carry the hopes and dreams of their families. This survey is critical in documenting the issues students face when applying and appealing, the financial support received, and the avenues to contact NSFAS as well as the mental health impact when funding does not materialise ‘, adds Duncan -Williams.
One of the key priorities of the National Development Plan 2030 is improving the quality of education, skills development and innovation. But on average only six in 10 students make it through university, and only about four in 10 do so in minimum time- a large part of this low throughput rate is a lack of finances. ‘NSFAS inefficiency and continuous scandals don’t only affect young people’s futures; financial support is key in accelerating academic throughput and therefore, graduate contributions to a skilled economy’ says Duncan-Williams.
Youth Capital’s survey can be found here
To arrange interviews or for more information, contact clotilde@youthcapital.co.za