“This is a step in the right direction for young people,” says Buhlebethu Magwaza, Project Lead at Youth Capital. “It proves that when youth raise their voices collectively, they can influence national policy. We commend all the young people, their allies and organisations that spoke out – together, you played a key role in ensuring that student debt and youth credit access could not be ignored.”
However, this episode has also exposed serious flaws in the national policymaking process. Much of the public anger stemmed from the Department of Trade, Industry and Competition’s (DTIC) poor communication. When asked for clarifications, officials claimed the amendments aimed to unlock finance for SMMEs, with a focus on sole proprietors but with more than 50% operating as sole proprietorships. In an interview with Newzroom Afrika, the DTIC admitted it was still modelling the amendments’ impact on sole proprietors – this shows little due diligence on the part of the Department. “In a country where the majority of the population lives below the food poverty line, where 1 in 2 young people between the ages of 15-34 years old are unemployed but asked to create their own livelihoods, the DTIC was prepared to change the Act without understanding the deep consequences,” notes Magwaza. “This is a reckless approach that undermines trust in public institutions.”
Equally troubling is the dismissal of higher education concerns, as the DTIC argued that student credit was irrelevant because universities have had the right since 2006 to act on student debt. “This ignores the lived reality of thousands of young people who try pursue tertiary education with the promise of a productive future,” says Magwaza. “On the contrary, students have been handed over to debt collectors by their institutions, blocked from registering, or denied access to their results or qualifications. These experiences prove that the current system already harms students and further tightening without safeguards would only make a broken system worse. This makes it harder to complete their studies or enter a job market that is competitive and has shrunk overtime. Tightening regulations without safeguards would only worsen an already broken system.”
The statement released by the DTIC expressed Minister Tau’s commitment to undertaking a process which will consider the necessary changes to protect students, while continuing with efforts aimed at improving access to finance for MSME’s to fill the credit funding gap. The Minister has also declared its commitment to engage relevant stakeholders. Youth Capital believes this is a turning point. “Withdrawing flawed regulations is not enough,” says Magwaza. “The DTIC must commit to youth-centred reform through ongoing engagements and transparent impact assessments”. Education and entrepreneurship should be bridges to opportunity, not barriers that trap young people in cycles of debt and exclusion.”
The Youth Capital campaigns call on the DTIC and all relevant stakeholders to engage openly and directly with young people in shaping the next steps. “This moment has proven the power of youth voices. But it has also shone a light on their right to be at the centre of policymaking. Debt should never be a life sentence.”
For interviews with Youth Capital, contact Clotilde, 082 6815927.