Continuing Education and Training Act, 2006 (Act No. 16 of 2006)

Notices

National Norms and Standards for Funding Technical and Vocational Education and Training Colleges

B. A Framework for the Public Funding of Technical and Vocational Education and Training

9 - 14. Positioning public funding of technical and vocational education and training at TVET Colleges
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9.Technical and vocational education and training is clearly a joint responsibility of government and the private sector. It is important that public and private funding of this activity should complement each other. Two major public areas of responsibility stand out. One is the promotion of widespread and appropriate technical and vocational education and training programmes for the historically disadvantaged, who are usually not in a position to purchase these services privately. Another is the development of skills in industries, including niche industries offering special opportunities for the country, where the private  sector is not investing  adequately  in the necessary  human resources development.

 

10.The goal of prioritising the poor in the public funding system is to be balanced with an approach, similar to the approach followed in the FET schooling system that promotes broadly inclusive public institutions that are representative of society in general. This balance is required in the interests of nation-building. To achieve this, the funding formula has three keys components. The first is the government subsidy for which covers 80% of the programme costs. The second is placing a cap on college level fees, thus limiting the portion of programme cost which may be charged to 20% of the programme cost. The third is the establishment of a national bursary system to ensure that students who are academically capable but do not afford to pay fees are assisted to pay college fees.

 

11.The funding model for the TVET sector must ensure that baseline funding does not perpetuate past underfunding of the colleges in certain provinces. Additional allocations must be used to achieve a more equitable funding regime across the provinces

 

12.Intervention must be made to improve fiscal governance in TVET Colleges, including recruitment of appropriate skills, ongoing training, and credible financial systems and processes.

 

13.A plan for developing management capacity both in the short term and in longer term training programmes will need to be costed and linked to a much clearer specification of the funding principles for the adequate staffing of these institutions.

 

14.Research indicates that private funding of technical and vocational education and training outside of the school system in South Africa is high, probably higher than public funding. At the same time, private spending directed towards on-the-job training has been declining substantially. It is imperative that public funding should be positioned in such a way that it complements private funding in the achievement of the country's development goals. Specifically, this involves a few key imperatives:

 

(a)The current practice in public TVET Colleges of offering public services whilst also selling services to the private sector should continue, and is in fact encouraged by this policy as a way of making these institutions more responsive and innovative. However, this policy also lays down certain guidelines and restrictions in this regard. In particular, it is important for there to be a clear accounting division between publicly funded and privately funded services in colleges in order to avoid a situation in which public funding is used to cross-subsidise privately offered services. This can put the quality of the public service at risk, and results in prices for private services that are below the market value, because they do not capture the full cost of the service. The issue of avoiding cross subsidisation is dealt with under Fee for Service in paragraph 78 onwards.

 

(b)Some public resources should be dedicated towards the monitoring and regulation of private TVET Colleges. This can provide government with important information that is needed in the planning of public funding in public TVET Colleges. In addition the regulation of private TVET College is an important public service that can combat illegal and unethical practices in the training market.  Provision for this has been made in Chapter 6 of the CET Act.

 

(c)South Africa has a well-developed legal framework for public-private partnerships (PPPs). Options such as PPPs in terms of which private TVET College utilises public facilities to offer training that is needed by the economy should be explored as part of the joint DHET-college planning process referred to in paragraph 95 onwards.