Continuing Education and Training Act, 2006 (Act No. 16 of 2006)NoticesNational Norms and Standards for Funding Technical and Vocational Education and Training CollegesD. Formula Funding of Programmes32 - 33. The earmarked grants should be allocated as follows |
32.
| (a) | Capital funding was allocated as Capital Infrastructure Efficiency Grant (CIEG) on a project basis addressing national priority areas as well as needs and it is explained in paragraph 61 onwards. |
| (b) | There should be a special funding for student accommodation to fund all the cost of managing residences which cover all the three economic categories. |
| (c) | Development funding, this public funding stream is similar to the earmarked capital stream, except that it deals with development items: |
| (i) | It is earmarked for projects of a developmental nature, in particular staff development and implementation of computerised systems, and college-level research. In addition, the earmarked development funding stream covers inputs that are considered part of a basic minimum package of recurrent inputs required more or less equally by all colleges. |
| (ii) | DHET may determine a basic minimum package required by all colleges to cover basic overhead expenses outside of the formula funding of programmes stream. Such a package, which should be considered earmarked recurrent funding, could take the form of a financial transfer, employee posts or goods and services. Regardless of its form, the monetary value of the basic minimum package should be clearly reflected in the financial statements of colleges. DHET may vary the size of the basic minimum package by college, based on criteria that are fair and fully transparent. |
| (iii) | Transparency and equity requirements for earmarked recurrent grants directed towards development projects are the same as those applicable to earmarked capital grants and described in paragraph 59 onwards. |
| (d) | Student support services can be allocated on the basis of full-time equivalents of government funded programmes. |
| (e) | Programme diversification must be allocated on a project basis at colleges earmarked for the establishment of centres of excellence and need to establish new programmes in certain colleges. |
(f) Special needs education to provide additional funding to colleges for special needs enrolments.
Subsidy Calculation is proposed as followed:
| (a) | If a college did not deviate more than 3% from the planned enrolment targets, the DHET should fund the college based on all the enrolled FTEs. |
| (b) | If the actual enrolments deviate more than 3% from the target, the DHET must adjust the enrolment targets for year n+ 1. |
| (c) | If there is no adequate additional funding, over enrolments should not be funded, since it affects the subsidy allocations of other colleges that have managed their enrolments within the targets. This implies that the college will have to fund the over enrolment itself from its own coffers. |
| (d) | The DHET should allocate a portion of the programme funding based on the performance/outputs of the colleges. In the longer term this should constitute a maximum of 10% of the allocation but to ensure financial stability it could be phased in over a period of time. |
| (i) | A simple way of implementing such an output subsidy is to allocate output weights to various types of certificates and diplomas awarded by Colleges based on either the duration or credits of the programmes. One could for example allocate an output credit of 1 to one full year of study (1 full-time equivalent) and then allocate credits to other programmes in relation to a full year of study. This approach would allow for the determination of output weights for a variety of programmes as new programmes are introduced in TVET Colleges. Only certificates awarded for ministerial funded programmes should qualify for output subsidy. All certificates and diplomas obtained in year n-1 then gets an output credit weight. The total for the system is calculated and the portion obtained by each college is calculated. The total amount set aside for output funding is then allocated to each college based on their share of the total weighted outputs. As noted, the percentage of the programme funding set aside for this could be a small percentage in the beginning of implementation but it should be increased over time. |
| (e) | The DHET should introduce an additional funding weight for Rural Colleges, e.g. a 10% additional weight or multiplying their unweighted full-time equivalents with 1.1. There is a need to identify the cost drivers and distance appear to be the most important factor. Rurality contributes to additional delivery and travel costs, accommodation costs, and need for rural allowances for travel and accommodation costs for staff, etc. The classification of colleges/campuses of colleges as urban and rural is needed to identify those that qualify for a rural funding weight. If only certain campuses of a TVET College are rural then the weighting should only be applied to the FTEs of those campuses. Rural costs need to be benchmarked against urban cost. Rural colleges will also attract more disadvantaged students that will require more student support to be successful. There would probably have to be a weight for peri-rural (e.g. 5% additional unweighted FTEs). The exact additional FTEs need to be determined by a technical exercise that will focus on determining the cost differentials for the three groupings of colleges. This will be catered for in the funding rates or in the programme costing. |
| (f) | Additional funding for Special education needs (SNE) in TVET must be catered for and funded by adding weightings for SNE per category on the funding grid. The amount needed could be calculated on the basis of the indicative category given in Appendix B (Attached) per special needs education student in the funding grid. |
| 33. | The funding formulae must take into account variables, including: Performance-based funding for student success, weighting for disability, staff development and academic support. |