An Open letter to the Minister of Higher Education and the Minister of Training and Public Enterprises.

By aegjardinhardie, 24 June, 2011

I am an unemployed graduate, a product of the National Student Financial Aid Scheme with more than six years in the labour market, seemingly with no prospect of ever getting a job, and the interests in the NSFAS loan accumulating that I am in serious debt even before I get employed. The fact that I am not the only product of this scheme facing this problem means the scheme will inevitably face a sustainability crisis in the not so distant a future. It is a fact that the country is facing serious skills shortage in various sectors while there are many African black graduates sitting idle in the townships with no hope of ever getting formal employment despite the many years spent at universities with the hope that they will finally break the chains of poverty. The argument given for their plight is that these people lack the necessary skills to be employable ignores the fact that many of these are black African graduates went to reputable universities known to churn out high caliber graduates who are all-rounded.

Many of these black graduates feel betrayed by society after all the exhortation by society to seek education to achieve a better life. It is not far-fetched to state uncategorically that most unemployed graduates in this country are blacks, or to put it more succinctly are black South Africans. This is a scar that blemishes our national conscience, a scar that proves that you may seek but never find. Access to education may be a reality but entry into the formal economy remains very, very limited to many blacks today as it was it the old days.

We read in the papers and hear that our universities produce graduates who are not work ready. In other words graduates who do not the skills needed by the industry. This is a fallacy that needs to be debunked once and for all. Why it is that it is a mostly black graduate are deemed to be unemployable? Separate education is no longer in existence today; white and black students go to the same universities and study the same curriculum but its only blacks that roam the streets in search of employment.

Some of these graduates , like me went to university at a late age, and came out of universities past the stage of being considered as youths thereby not qualifying for internships and learnerships since these have an age limit. Some like me, went to renowned universities, like UCT, Stellenbosch, KZN University, Witwatersrand etc; the so-called cream of the Historically White Institutions and graduated well in standard time with honours degrees.

Such an experience is really painful, spending years at a respected university in the hope that this will help one achieve a better life and assist his or her family, only to find that this was like wasted years and effort. The promise of the struggle that the doors of education shall be opened for all meant a lot to many, was an inspiration and when the government set up the National Student Financial Aid Scheme (NSFAS) to help disadvantaged get tertiary education they grabbed the opportunity.

The dream they had was that this will benefit the country as they would be able to meaningful contribute to the economy as well as assist their siblings realize their dreams of going through higher education. The dream has but turned into a nightmare. Another danger is that such a situation discourages the young to aspire to go through university education.

I appeal to the Minister to consider the case of unemployed graduates like me and fight for the New Growth Path to create a mechanism of ensuring that this plight we face is addressed. The Minister in conjunction with the Minister of Public Enterprises should consider utilizing the public service and state-owned enterprises to give graduates the experience required by industry.

While the financial assistance that the government gives to students who would not afford tertiary education costs is commendable, it has become a debt-trap for many beneficiaries. If one fails to get gainful employment to service the NSFAS debt one surely set to be trapped in debt forever. The NSFAS loan continues to accumulate through interests overtime irrespective of the situation one is in. Now many like me find themselves in default and with a threat of formal legal action being taken against them .There is no intention on their part to default but it is the socio-economic situation they are in that paralyses all their good intentions.

The NSFAS will prove unsustainable in the not so long a distant future as long as it assists students who are set up to default on their obligations. There are ways to avoid this undesirable situation. The Financial aid scheme, the SETAs and the SOEs (State Owned Enterprises) should work in tandem if the problems of skills shortage and unemployment are to be solved.

The National Student Financial Aid Scheme is a noble idea that should be treasured and the government has a duty that it cannot derelict to ensure its survival. The government put up infrastructure like the Sector Education and Training Authorities (SETAs) to provide training needed in different sectors of the economy and these should work with NSFAS. These authorities know the skills required in their sectors and have large funds in their coffers from the Skills Development Levy paid by their constituent industries. SETAs should inform the Financial Aid Scheme of the skills required by their industries and work with NSFAS sponsoring students through tertiary education in the identified skills thereby ensuring that students study exactly what industry wants. This will ensure that many things are achieved.

First it will ensure that the SETAs funds are fully utilized rather than be stashed in some bank accounts while the country needs various skills. These industries should have companies within the sector who sign an undertaking to employ the graduates who completed studies in the fields they have identified as lacking skilled people. The SETAs would ensure that companies’ undertakings to absorb graduates becomes a reality upon graduation and are even prepared to give such students practice time during their vacations. Large corporations give bursaries to students to pursue studies in areas they have identified as needing certain skills but not all companies can afford to do that hence a need for them to inform their industries who in turn enter into contract with the NSFAS to support identified areas of study.

In this way the great debate of skills shortage will be seen for what it is, self-made and within the nation’s ability to solve. It is a welcome development that the SETAs have been moved from the department of Labour to Higher Education and Training. The department of Higher Education and Training should give a directive to all SETAs to enter into contracts with companies within their sectors to list the number of people in each identified scarce skill and undertake to absorb them after graduation. The country has no reason to be suffering from skills shortage when there are funds and institutions that through capable management can and should be producing all sorts of skilled people that the economy wants. Industry as well has no reason to be lamenting the shortage of skilled workers when they pay skills levy.

Secondly it will ensure that all graduates are employed upon graduation; levels of poverty are reduced and the economy functions at full capacity. Thirdly where industry cannot absorb graduates sponsored by NSFAS there are State Owned Enterprises (SOEs) who should be obliged to take these graduates and give them the necessary industry experience. Where the SETAs cannot or have not identified as scarce skills the NSFAS sponsor students as it currently does. It is true that the skills needed by the economy cannot be provided by universities only; industry should play its part in training people in identified scarce skills. This is the role state-owned -enterprises should take the lead in as their mandate is to support the national economy and not to maximize profits for shareholders.

This brings us to another debate that should be regarded as out of order, the call for the government to privatize these state-owned enterprises. The mandate to support the national economy includes training people in skills that the economy needs instead of aiming for astronomical profits while the country grinds to a halt due to lack of a skilled labour force.

Fourthly, such an arrangement will ensure that the scheme becomes sustainable and many more desiring students are assisted in future. It will also ensure that skills needed by industry are available. The apprentice programmes that used to produce many artisans in the old days should be revived and the SOEs should be given a directive to churn out as many artisans as the economy requires. Training should be a core mandate of the SOEs and they be required to announce the number of trained people in each financial year and these be used as a measure of success.

The country cannot afford to privatize these enterprises when it does not know who will train people in the skills the country desires. The profits that these SOEs make should be channeled into training in the skills needed by the whole economy before they declare profits. The government is the major shareholder on behalf of all citizens in these enterprises and the way to pay dividends to all, is to train citizens for skills needed by the national economy. This mandate to support the national economy as well as to ensure that the nation has the skills required should be written in bold in the mission and vision statements of all state-owned enterprises. As citizens we should not be worried about how much of profit they register at the end of the financial year but about the degree to which these SOEs truly support the prosperity of the economy. In this era the performance of these parastatals leaves much to be desired as they have behaved like private companies focusing on profitability and ignoring the function of skilling the workforce. The success of SOEs needs to be measured on their ability to support economic growth and in their readiness to meet the urgent needs of the nation. The urgent needs of the economy today are a skilled workforce; therefore the training our young people to fully participate in the economy should be the biggest measure of success.

Back to the NSFAS and the plight of unemployed graduates sponsored by this scheme, that it is a brainchild of the government in its noble desire to educate the unfortunate is not debatable. The government therefore has an obligation to see to it the scheme is sustainable. The reality that there are graduates who are beneficiaries of this scheme who are idle is undoubtedly the government’s problem as this situation threatens the viability of the scheme going into the future. The concept behind its establishment is a noble one but when its sustainability is under threat it raises questions about the research undertaken before its establishment to guard against unsustainability.

Beneficiary graduates would be able to service their debts thereby ensuring its sustainability, if they get gainful employment where they also contribute to the development of the national economy. It still boggles my mind how it did not dawn on the architects of the scheme that failure of graduates sponsored by the scheme to get gainful employment will inevitably threaten the continued existence of the scheme. The responsibility is with the government that these graduates get employment if they are not all absorbed by the private sector.

Private companies that sponsor students through tertiary education expect these students to work for them for many reasons among them to recoup their expenditure, to close their skills gaps and to give them the experience they need. This makes simple business sense. Why and how the architects of the scheme never thought of possible losses in revenue and the possibility of creating an army of frustrated unemployed graduates astonishes me. The existence of the National Student Financial Aid Scheme is under threat and in the streets the country is witnessing an ever increasing army of unemployed graduates, who can be threat to the order of the day, as they say a hungry man is an angry man and more so if the man is educated.

The great debate of skills shortage in the country is self-made and can be addressed. It is possible for the nation to supply all forms of skills that the economy requires at any given time and even export surplus. This is within the nation’s means if there is a will and commitment to plan carefully and prudently utilize the resources at its disposal as well as the infrastructure so far put in place. The NSFAS and the Skills Development Levy generated funds can train many engineers of all sorts, doctors, artisans and managers the country needs. On the job experience and practice can be gained in the infrastructure development that the developmental state should be developing to support economic growth.

There is no doubt that such thinking will supply the skills that the country desires and do away with the scourge of unemployed graduates which is a blemish on our national conscience.

Fikile Dube is a UCT BCom (HR) Honours; BSocSc IOLS (HR) (UCT) graduate; former SRC member and Speaker of Student Parliament. Cell # 0838973302



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