Sizwe Nxasana: Proposed contingency loan model may hamper poorer students

President Jacob Zuma released the highly-anticipated 700-page document on Monday which suggests that R50 billion should be poured into the expansion and development of Technical Vocational Education and Training (TVET) institutions.

The report recommended establishing a cost-sharing model between the state and commercial banks to fund university students. This model would see the National Student Financial Aid Scheme (Nsfas) being replaced by a new income-contingent loan system.

Sizwe Nxasana, the chairperson of Ikusasa Student Financial Aid Programme (ISFAP) spoke to Bongani Bingwa host of the Afternoon Drive show on 702 on the feasibility of the report's findings.

He says there a few recommendations he supports such as the additional funding proposed for TVET colleges as well as the need to increase funding towards historically disadvantaged universities.

The recommendations I have a difficulty with are the proposed income contingent loans.

Sizwe Nxasana, the Chairperson of Ikusasa Student Financial Aid Programme (ISFAP)

Even though the recommendations speak of a cost sharing model, it also contradicts itself because those loans would be guaranteed by government.

Sizwe Nxasana, the Chairperson of Ikusasa Student Financial Aid Programme (ISFAP)

I don't think the state will have the capacity to guarantee that all loans are available to students for a while explains Nxasana.

The other is that all these loans would be available to all students including those who can afford. Now it has been proven many times in different countries that those who are likely to afford these loans and apply may crowd out poorer students.

Sizwe Nxasana, the Chairperson of Ikusasa Student Financial Aid Programme (ISFAP)

With the drop rates being higher, you may even end up with anti-selection environment where banks may feel more inclined to approve these contingency loans to the working class students, leaving the poor out in the cold adds Nxasana.

Sizwe Nxasana is also the National Student Financial Aid Scheme (NSFAS) chairperson

For more of Nxasana's analysis on the Hefer commission of inquiry into Higher Education and Training fees click on audio below:


Recommended

by NEWSROOM AI
Read More
'Fees Commission Report fell far short of what students wanted'

'Fees Commission Report fell far short of what students wanted'

Economist Xhanti Payi says the Commission's recommendations do not provide the free education demanded by students.

Opinion: The political symphony playing out in SA is reaching a crescendo

Opinion: The political symphony playing out in SA is reaching a crescendo

Stephen Grootes gives his take on some of the political news that made headlines on Monday.

Income-contingent loan model opens the way to deal with missing middle - Bawa

Income-contingent loan model opens the way to deal with missing middle - Bawa

The Commission recommends that NSFAS be replaced at universities by Income-Contingency Loans.

Banks can't lend money without expecting it back: Fees Report

Banks can't lend money without expecting it back: Fees Report

Director of Banking Association of SA says they are prepared to play a role but the fees recommendations need to be sustainable.

Zuma's rumoured free education plan could be ploy for 2019, says Ralph Mathekga

Zuma's rumoured free education plan could be ploy for 2019, says Ralph Mathekga

Political analyst Ralph Mathekga says rumors of free education are in line with Zuma's 'radical economic transformation' rhetoric.

Free education for TVETs and university loans provided says Presidency

Free education for TVETs and university loans provided says Presidency

Spokesperson for the Presidency Bongani Ngqulunga outlines some of the recommendations made in the Fees Commission Report.

DA 'thrilled' over PAIA success as Fees Commission report is set for release

DA 'thrilled' over PAIA success as Fees Commission report is set for release

President Jacob Zuma will release the #FeesCommission Report on Monday afternoon.

Free education should've been implemented a long time ago - Holomisa

Free education should've been implemented a long time ago - Holomisa

UDM Leader, Bantu Holomisa responded to reports that the President is interfering in the operations of National Treasury.

UCT students bemoan poor mental health support, Parly committee visits campus

UCT students bemoan poor mental health support, Parly committee visits campus

Classes were canceled and some students arrested last week when a group of at least 200 protesters caused disruptions.

Student leaders can make populist activism work in SA, says Professor Swartz

Student leaders can make populist activism work in SA, says Professor Swartz

She says student leaders understand how to use populist activism to bring about implement change.

[LISTEN] Ndlozi: Mazzotti donated R200 000 to EFF registration in 2014 election

[LISTEN] Ndlozi: Mazzotti donated R200 000 to EFF registration in 2014 election

EFF's Mbuyiseni Ndlozi says the party was not aware of Mazzotti's alleged links to the underworld when it accepted party funding.

Popular articles
New visa rules a relief for our economy and for jobs, says WC MEC

New visa rules a relief for our economy and for jobs, says WC MEC

The Western Cape government and SA Tourism have welcomed the amendments to South Africa's visa regulations.

How the IDC helped this entrepreneur get his water-saving invention in SA stores

How the IDC helped this entrepreneur get his water-saving invention in SA stores

From developing prototypes in his gran's garage to partnering with a huge global retailer. Paseka Lesolang shares his story.

Did Ramaphosa announce a 'cupcake' of a stimulus package? Experts debate...

Did Ramaphosa announce a 'cupcake' of a stimulus package? Experts debate...

Eusebius McKaiser facilitates an economics debate with a panel of economists. about how the state should respond to the recession.

'She says I'm just waiting for this c**lie to move so I can take the photo'

'She says I'm just waiting for this c**lie to move so I can take the photo'

A caller on the Eusebius McKaiser Show, Zeenat says she was called a derogatory word for Indian on Heritage Day.

'This leaked document is calling a spade a spade'

'This leaked document is calling a spade a spade'

Breakfast Show Host Bongani Bngwa shares his views on the leaked report from the Thabo Mbeki Foundation.

[WATCH] Vietnam's The Bachelor uproar as female contestants run away together

[WATCH] Vietnam's The Bachelor uproar as female contestants run away together

Khabazela shares some of the most popular tweets, posts, and videos on 'What's gone viral'.

SAHRC Vaal River crisis inquiry begins on Monday

SAHRC Vaal River crisis inquiry begins on Monday

As a response to residents' concerns, The Human Rights Commission is set to begin their inquiry into the Vaal River.