NSFAS | SRCs demand scrapping of accommodation price cap

[00:00:00]Students' representative councils at 10 universities have called for the 52,000 rand annual NSFAS accommodation cap to be scrapped, saying that funding shortfalls are driving poor and working class students into debts and putting their studies at risk. Chairperson of the Portfolio Committee on Higher Education and Training, Tebogo Letsie, says the student leaders of these institutions appear to be defending accommodation costs rather than questioning how the universities justify such high prices in the first place. He joins us now for more on this. Tebogo, good evening. Thank you so much for your time. Really do appreciate it. Let's talk about that. What do you mean by high and exorbitant prices being defended by student representative councils rather than challenging those prices, given that these prices are a function and an output of market dynamics?

[00:00:51]>> No, thank you very much, Oliver. Good evening to yourself. Good evening to the viewers of SABC.

[00:00:58]Um, indeed we have um, waiting our opinion on this, and we believe that we're we're actually shocked that student leaders have indicated that the money that NSFAS is paying is not enough.

[00:01:14]And if you read the um, media statements or their joint statements, they don't question anywhere how the universities arrive at this um, at these exorbitant fees that they're charging. Um, um, and I want to clear from the beginning that not every student that is at a university um, is a NSFAS student. So, there are students who are self-funded. And the student leaders have not touched anywhere how this capping that they're talking about will affect or is affecting students who are currently at these institutions who are expected to pay at some point 9,000 rand for a bed sharing by that you know you know sharing beds. So for a small room universities sometimes charge 18,000 or they lease student accommodation to private accommodation who they are charging 18,000 rand for a small room that Oliver you and I if we were to go and look for a bed space or a a room you know will not pay >> Sure. Let's let's let's let's students do not look at that point. They only look at NS first cap.

[00:02:46]>> Well, let's break that down because I don't think that's all too fair characterization Deborah Ho.

[00:02:50]If you go to any I'll use this because I've posed this question to them exactly the price cap why certain university residence costs as much as they do at your Vitz University. The response that I had then gotten from the spokesperson of the institution was that they don't actually make a profit on the student residences. They charge them what it cost them for largely upkeep. The difference comes in in newly built student residences where they still have debt to repay on which of course you can imagine the development costs having been very high. If you in a legacy residence institution you might be paying significantly lower but it might still cost more than the price cap. So even at the lowest end of the spectrum take them at their best the student representatives that is Deborah Ho.

[00:03:33]If you are in a legacy in residence in your institution that's on the lower end of the price price spectrum it might still be higher than the price cap and this is important to note because that is what university says it costs to upkeep these these organizations the residences that is.

[00:03:52]>> Yeah, so um well, I don't take that Oliver, let me tell you why. We We interact with these universities um ourselves. We have interacted with them.

[00:04:05]University of Pretoria, let me make an example about them because we interacted with them recently. University of Pretoria, cheapest rent cost around 7,000 something rands. And if you look at the number of residences that they own, which is around 8,200 beds, um and you we we we met with them, we calculated how much it will cost for them to run the student accommodation, including paying of everything else that they need to to have. Um we were informed by them, not us. We were informed by them that it will cost around 150 million rands to run the student accommodation.

[00:04:51]>> Okay.

[00:04:52]>> But what they are getting there is around 600 million >> I I want us to Yeah, I want us to just put a pin in that because there's an important part of the conversation we also need to address. And that is university residences accommodate, in fact, a lower percentage of students than private residences, which also depend where students living there also depend on the NSFAS allocation. Private residences have also set their prices.

[00:05:14]If you live in South Point, hypothetically speaking, in the Braamfontein CBD, uh you're expected to pay a certain price, which is significantly higher uh than the price cap. The reason why that is necessary is because universities don't have enough beds for the amount of students in this university. So, something has to give, Tebogo. And my one might then say, uh student accommodation for private in residences in a place like Braamfontein CBD versus, say, Woodstock in the city of Cape Town might be significantly different. Let's Let's another province, for example. Accommodation costs in uh Polokwane, if you go to Turfloop, might be significantly higher than if you go to Univen, for instance, living in Thohoyandou. I think it's important that that market disparity is considered in this price gap. A universal price gap seems to be unsustainable.

[00:06:05]>> No, you know, Oliver, let's not run away from the facts that I want to put before you. The first one is that I was addressing the point firstly about university university owned residences. I was making an example about University of Pretoria, where University of Pretoria would have told us it cost them around 150 million rand to maintain the residences that they owned.

[00:06:34]But, if you look at how much they were charging, it's around 600 million. So, if you look at that, that is a a profit based from a university point of view.

[00:06:44]Let me come to your point about >> private residences.

[00:06:49]>> owned private owned residences. In fact, before we close this interview, I want to address something about this private owned residences. There's a residence you know, when Parliament is in Cape Town, so work in Cape Town. There's a residence that we have went to to look at there. It's called Ekaya.

[00:07:10]It is accredited and leased or there's a lease agreement with the with the CP UT, for an example. I'm making just There are too many. I I have a list of all of them, who, by the way, most of them don't even meet the minimum norms and standards.

[00:07:30]So, when they are being assessed, whether they are supposed to exist >> No, but you're running away from the question. Let's talk about the institutions that do meet the norms and standards.

[00:07:42]>> No, I'm coming there, Oliver. I'm making an example that they charge the students 9,000 per beds. For what? When they don't have the minimum norms and standards that D head has put there for them. So, if you get into the room, you know, they must be assessed for a university for them to lease or accredit these institutions.

[00:08:07]And these institutions are giving our students accommodation that is not fit for purpose. That you know, some of them you can look when you look at them, you can see they can even collapse at any given moment. So, the argument that says we must pay 5,200 is too little for what? What are we paying for?

[00:08:29]We do oversight. We go to these accommodation providers or accommodation beds ourselves. And when we get there, we bring people, you know, professionals who must say to us, is this thing can can a student stay here? And they can't. So, you are saying the cap or students are saying the cap must be scrapped. Whatever the university say must be done.

[00:08:57]It is what it is. We must pay whatever it is even when they don't meet the minimum norms and standards. It can't. And I was making an example with one called Akaya. It's not the only one. There are just too many.

[00:09:10]Secondly, um >> Very very briefly, please.

[00:09:13]>> Lastly, very briefly on this point is that when a university advertise and say, I want to put NSFAS funded students in this accommodation. NSFAS, as we speak currently, pays 5,200.

[00:09:28]You go and sign a lease as a university of 9,000. Next door to where you are signing that lease, You've got a commercial flats and these flats are two beds with a parking, with a fully furnished kitchen. They're just 9,000 for two beds. But you are you are signing a lease with these people.

[00:09:51]You mentioned South Point here in Braamfontein for an example. I can go with you at some point South Point and show you um flats where you and I can go and lease those flats. I would have a two-bedroom, a fully furnished kitchen, a parking lot >> Unfortunately yeah, I'm unfortunately out of time. So I'm going to I'm going to have to leave it there.

[00:10:15]Hopefully you and I can have this conversation again because there's a lot more elements to it to unpack. Tebogo let's hear >> There's only last point There's only last point that I want to make with the last >> 10 10 seconds, please. 10 seconds.

[00:10:25]>> Yeah, is that we've also gotten information that there's a an association of student accommodation which has met with student leaders from this institution. We've received now a proof of that, pictures and videos where we believe we're going to now forward these things to law enforcement because we believe they're being coerced in the fighting this battles. So this is captured some sort >> Okay.

[00:10:55]>> of the NSFAS by this especially I can mention this one because I've seen the pictures and videos of PSH PSH A which is an association of this uh >> Okay, I mean I have to now I have to now give them a right of response cuz you've accused them of capture. So you're going to have to share that information with us so that we can have that conversation. Tebogo Let's hear is the portfolio committee chairperson on higher education and training. Let's take a short break. We'll continue on the other side of this.

[00:11:36]>> Mhm.