1. FET Colleges Finances and Financial Aid Scheme 20 February 2007

2. Overview of college finances  Audited statements show strong growth in income over recent years  Growth in income from variety of resources from R409 million in 2000/1 to R736 million in 2003/4

3. Income 2000 to 2003 at FET Colleges

4. Reasons for re-capitalisation of FET Colleges  Colleges offering outdated programmes that did not meet the needs of the economy  Need to plan new programmes and provide infrastructure and equipment to offer new programmes

5. Key principles of re-capitalisation The re-capitalisation process will be driven by  programmes that meet the needs of society and the economy  research and information  redress strategies

6. Allocation of Funds  R50 million planning grant for 2005/6  R500 million in each of 2006/7; R600 million in 2007/8 and R800 million in 2008/9 for re- capitalisation

7. Budget proposals by province ProvinceColleges Pop 15 - 24 % population Request Free State 4 550 000 6% R574 million E. Cape 8 1 350 000 14% R578 million Gauteng8 1 800 000 18% R517 million KZN9 2 200 000 22% R535 million Limpopo7 1 600 000 16% R567 million Mpumalanga3 600 000 6% R212 million N. Cape 2 150 000 1% R100 million N. West 3 730 000 7% R301 million W. Cape 6 870 000 9% R604 million

8. Principles for allocation At provincial level  Weighted formula using youth population, contribution of province to GDP and student FTEs / enrolment at colleges At college level  Programmes where there is evidence of need and part of Growth and Development Plan of province

9. Funds allocated Province Number of colleges Amount requested Amount allocated Free State 4 R574 million R118 200 000 E. Cape 8 R578 million R225 550 000 Gauteng8 R517 million R409 080 000 KZN9 R535 million R367 930 000 Limpopo7 R567 million R224 245 000 Mpumalanga3 R212 million R109 500 000 N. Cape 2 R100 million R25 620 000 N. West 3 R301 million R122 570 000 W. Cape 6 R604 million R227 305 000

10. Budget items for funding All allocations in relation to programmes offered  Infrastructure – new and development of  Equipment and ICT  Development of professional staff in relation to programmes offered  Administrative systems  Curriculum development

11. Allocation by line item Infrastructure R1 156 000 R1 156 000 Site upgrading R 32 105 R 32 105 New land buildings R 84 330 Equipment R 378 788 Curriculum R 107 235 HRD R 76 670 Admin systems R 25 000 Total R1 860 000

12. Implementation in 2006  Funds transferred  Curriculum preparation  Lecturer training  Preparation of LTSM  Tenders and specifications for infrastructure and equipment  Appointment of examiners  Recruitment of students

13. Monitoring of re-cap and readiness  State of readiness instrument developed  Provincial Departments of Education  National Department and Treasury  Independent Ministerial Task Team

14. Progress on re-cap spending December report As at Friday, 26 January 2007, 35 colleges had submitted their reports. January report As at Monday, 12 February 2007, 46 colleges had submitted their reports.

15. SPENDING BY COLLEGES AS AT THE END OF JANUARY 2007 1. Actual spending per Province: Amount Amount % Amount Amount % Allocated Spent Spent Allocated Spent Spent EC R 61 000 000R 41 970 234 68,8% EC R 61 000 000R 41 970 234 68,8% FS R 30 000 000R 15 403 067 51,3% FS R 30 000 000R 15 403 067 51,3% GP R106 000 000R 37 963 126 40,4% GP R106 000 000R 37 963 126 40,4% KZN R 90 000 000R 54 278 669 60,3% KZN R 90 000 000R 54 278 669 60,3% LP R 43 000 000R 18 419 040 47,2% LP R 43 000 000R 18 419 040 47,2% MP R 32 000 000R 17 048 291 53,3% MP R 32 000 000R 17 048 291 53,3% NC R 10 000 000R 6 761 898 67,6% NC R 10 000 000R 6 761 898 67,6% NW R 28 000 000R 3 319 085 30,2% NW R 28 000 000R 3 319 085 30,2% WC R 70 000 000R 44 186 160 63.1% WC R 70 000 000R 44 186 160 63.1% TOTAL R470 000 000 R239 349 570 54.8% TOTAL R470 000 000 R239 349 570 54.8%

16. SPENDING BY COLLEGES AS AT THE END OF JANUARY 2007 2. Uncommitted funds per province: Allocated Amount % Allocated Amount % Amount Uncommitted Uncommitted Amount Uncommitted Uncommitted ECR 61 000 000 R 2 172 560 3,6% ECR 61 000 000 R 2 172 560 3,6% FS R 30 000 000 R 4 619 608 15,4% FS R 30 000 000 R 4 619 608 15,4% GP R106 000 000 R10 521 472 11,2% GP R106 000 000 R10 521 472 11,2% KZNR 90 000 000 R 6 071 894 6,7% KZNR 90 000 000 R 6 071 894 6,7% LP R 43 000 000 R 6 089 951 15,6% LP R 43 000 000 R 6 089 951 15,6% MP R 32 000 000 R 8 010 966 25,1% MP R 32 000 000 R 8 010 966 25,1% NC R 10 000 000 R 1 349 183 13,5% NC R 10 000 000 R 1 349 183 13,5% NWR 28 000 000 R 372 915 3,4% NWR 28 000 000 R 372 915 3,4% WCR 70 000 000 R 6 888 435 9,8% WCR 70 000 000 R 6 888 435 9,8% TOTALR470 000 000 R46 096 984 10,5%

17. Bursary scheme  Recent changes in FET sector geared at increasing access (merger, recapitilisation, NC(V) programmes)  New curriculum addressing SA’s skills shortage  R600 million allocated for FET Colleges Financial Aid Scheme – over 3 years  2007 = R100 million  2008 = R200 million  2009 = R300 million

18. NSFAS - Mode of Operation  Financial Aid Offices:  Bursary applications  Send batches of forms with interim reports to NSFAS claiming money on behalf of the students  NSFAS processes the claims and makes payment  Financial Aid Offices credit student fee accounts

19. NSFAS  NSFAS – administration & management of funds on behalf of DoE  NSFAS is a loan and bursary scheme operating in terms of Act 56 of 1999  It was set up by the SA Government in 1996  It was set up to create access to education for students with potential but who could not afford to fund their own studies

20. Allocation of Bursaries  Only South African students registered for NC(V) courses will be eligible for bursaries  Provincial & College allocation done using the Crouch model  Crouch model considers NC(V) enrolments and the % of poor population per province  Allocation method approved by the Minister of Education on 5 December 2006

21. Bursary Allocations ItemCostNotes Registration fees R200 Standard for all NC(V) programmes Tuition fees Cost of NC(V) programmes As per DoE approved student fees Books R120 per book Maximum 7 books Academic levies  Engineering – R500  Hospitality – R500  Internet – R300 Not applicable to all students Accommodation & Travel R 3000 All the above amounts are MAXIMUM amounts that can be allocated.

22. Notification to Colleges  Provinces & Colleges advised on 8 December 2006 of allocations  Training for DoE, PDE & Colleges conducted from 31 January to 6 February 2007  A total of 122 officials & College staff trained

23. Provincial Allocation Province 2007 Allocation R’000 Free State 7 500 North West 5 500 KwaZulu-Natal 18 500 Mpumalanga 7 000 Limpopo 15 000 Northern Cape 3 000 Western Cape 9 500 Gauteng 18 500 Eastern Cape 15 500 TOTAL 100 000

24. Conditions & Process for awarding bursaries  College bursaries based on approved NC(V) programmes & student enrolments  College to allocate a dedicated staff member to administer the scheme – student support officer recommended  Awarding of bursaries to be based on Means Test – evidence thereof required  Approved & signed bursary agreements required

25. Conditions & Process for awarding bursaries  Colleges to set up a Financial Aid Committee, suggested members:  student support services officer/manager  finance officer / manager  student administration officer / manager  student representative council (SRC) member (s)  Committee makes bursary awards recommendations  College CEO – Accounting Officer

26. Role of Colleges  Serve as DoE, PDE & NSFAS agencies (accountability & reports)  Advertise bursaries to all students  Counsel & advise students  Administer bursary application forms and Means Test  Issue receipts to students as proof of applications received

27. Monitoring & Support  DoE, PDE & NSFAS – monitoring & support  Colleges to provide reports to DoE, PDE & NSFAS  NSFAS – regular audit

28. Thank you