Shrinking budget leaves thousands of students with no pathway to higher education

As the South African tertiary academic year begins this month, there are 337,000 newly matriculants with bachelor passes competing for only 202,000 spots. The Class of 2024 that produced record-beating results in last year’s examinations now have little guarantee for further studies, skills development or employment.

Challenges with university placements, accommodation, living expenses and fees are all deeply tied to austerity and real cuts to government spending, which continue to undermine access to higher education. 

A decade has passed since #FeesMustFall but the same structural barriers persist. The average annual cost of tuition alone for universities in South Africa is R55,900. In 2023, the median household income was R95,770 per annum. Paying for university education out of pocket is out of reach for the majority of South Africans, but still very much needed to survive in a competitive, slow-growth and jobless labour market. 

The stark reality of the labour market illustrates the desire to pursue tertiary education. According to the Quarterly Labour Force Survey (QLFS), the unemployment rate is 10% for university graduates compared with 36% for those with a matric.

The Income and Expenditure Survey released by Statistics South Africa this year showed that in 2022/23, households headed by someone with a tertiary degree earned three times as much annually as someone with secondary education, and almost five times as much as someone with no schooling.

Unable to cope

Universities are now unable to cope with the improved gains made in secondary schooling to the extent that even people who qualify and want to attend university will be unable to do so. 

All students, whether on bursaries, financial aid or pay-out-of-pocket, receive heavy subsidies from the state for higher education learning. On average, universities receive just less than half of their income from the government, meaning that tuition and third-stream funding such as donations cover the remaining bulk of university revenue.

When the government slowly withdraws from adequately funding institutions, tuition increases usually follow. Some universities, predominantly historically white institutions, are able to weather the storm by relying on third-stream income. It is often the historically black institutions that are hit hardest by budget cuts, widening the gap in support, services and admissions between universities. 

According to the Medium Term Budget Policy Statement, the government plans to slash funding for post-school education and training by R5.6-billion in real terms between 2024 and 2025.

The Medium Term Budget Policy Statement in 2024 stated that “universities, technical and vocational education and training colleges, and community education and training colleges need to align student enrolment with budgets and improve the quality of offerings”.

This rhetoric thinly veils the reality: a shrinking budget that leaves thousands of deserving students without a pathway to further learning and increased earnings. 

The National Student Financial Aid Scheme (NSFAS), meant to be a lifeline for poor and working-class students, is in disarray. The scheme received 608,488 applications, with 442,079 approved for provisional funding in 2025.

As of the end of November last year, there were more than 150,000 students whose NSFAS applications had not been processed, leaving thousands of students in limbo. The calls for the decommodification of education from 10 years ago during #FeesMustFall have not materialised. 

Housing remains another pressing crisis. In Limpopo, students have been forced to live in shacks while NSFAS pays R3,500 per month for supposed accommodations. A parliamentary committee revealed that misleading photos were submitted to NSFAS to justify these payments, exposing widespread corruption and inefficiency. 

The cost of student accommodation also differs vastly, with some beds costing as much as R9,000 per month. Private Student Housing Accommodation in the Western Cape, whose CEO is the former NSFAS executive of corporate services, has threatened to prevent students from returning to residences unless NSFAS pays the R44-million debt that is owed to them. 

The Department of Higher Education and Training is not alone in having its policy parameters and targets laid out by the National Treasury. There are more than 1,800 unemployed doctors in a country where there are 0.33 doctors for every 1,000 patients. The international target for the doctor-patient ratio is three times higher than it is in South Africa.

Real-life consequences

The real-life consequences of this are dire where reports of staff shortages and unfilled vacancies compromise the constitutionally protected right to access quality healthcare in this country.

Austerity measures are also affecting basic education, with teacher cuts, increasing class sizes and the cutting of scholar transport. The State of the Nation Address (Sona) rightly highlighted the importance of foundation phase teachers in addressing literacy and numeracy challenges.

However, this commitment is being set up to fail without proper resource allocation. Just last year, the Funza Lushaka Bursary was slashed by a staggering R397.9-million, a devastating blow to a programme designed to train the very teachers needed to deliver on this promise.

Can you imagine how many well-trained foundation phase teachers could have been funded? How many overcrowded classrooms could have been relieved?

South Africa has both a teacher shortage and a youth unemployment crisis — yet this government is cutting a direct solution to both. A decade after #FeesMustFall, the government must do better. It must prioritise resolving the crisis in higher and basic education, while tackling structural youth unemployment — not deepening it.

The consequences of austerity do not end at graduation. Even for those who manage to complete university, employment prospects remain bleak. The billions allocated annually to post-school education and training are rendered ineffective if the government refuses to invest in job creation in critical sectors such as health, education, and essential public services. 

It is often argued that we suffer from the problem of structural unemployment, but if we have trained teachers and doctors at the same time that we have overcrowded schools and clinics, then the unemployment disaster is rooted in the state’s unwillingness to invest in public services and public jobs. 

On 18 and 19 February 2025, a collective of trade unions and social movements will be coming together to host a People’s Budget Assembly and Budget Day demonstration to strengthen and build a popular front to challenge the government's austerity and privatisation measures. DM

Aliya Chikte is a Project Officer at the Alternative Information & Development Centre (AIDC). Matshidiso Lencoasa is a budget analyst at SECTION27. Both serve on the Steering Committee of the Budget Justice Coalition (BJC).