Funding Higher Education and
Research in South Africa
Prof. Bassey E. Antia
University of the Western Cape
Outline
• Chapter one: Introduction – contextualising research
productivity:
– Africa within the world
– South Africa within Africa
• Chapter two: Funding of higher education in South
Africa
• Chapter three: Funding and the broader research
landscape in South Africa
• Chapter four: Conclusion
– Assessment
– What is innovative and what are the lessons?
CHAPTER ONE: CONTEXTUALISING
RESEARCH PRODUCTIVITY
Two views of Africa in the World: population and
scientific research output
World population in 2001
Source: http://www.worldmapper.org/imagemaps/
imagemap2.html
Territory size shows the proportion of all scientific papers
published in 2001 written by authors living there.
Source: http://www.worldmapper.org/display.php?selected=205#
Africa within the World
Picturing Africa from Within (1)
Picturing Africa from Within (2)
SA=1st in 15 (4 with 1%); Egypt = 1st in 5; Nigeria= 1st in 1
South Africa: not yet “there”, but some
successes
•
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A fact sheet
GERD as a percentage of GDP: in 2013 = 0.87%. Target of 1.5%*
Even given this GERD, low R & D workforce (World Bank: bottom 30%:
about 1.5 per 1000 total employment. Argentina: 2.9%, Russia: 6.4%,
China: 1.9%)*
Higher education participation rate under 20% norm for middle-income
countries**
Demographic imbalances (esp. race) in RDI participation levels
Dominates scientific publications in sub-Saharan Africa: “46.4% of the subcontinent’s share, far ahead of the two next most prolific countries,
Nigeria (11.4%) and Kenya (6.6%)” (UNESCO 2010)
Highest African country share to world publications: 2000 ranking = 35th;
2010 ranking = 33rd
23 universities and several research institutes, over 10 of which appear in
the top 20 league of most research-related rankings in Africa
34% of university academics have a PhD
CHAPTER TWO: FUNDING OF HIGHER
EDUCATION IN SOUTH AFRICA
“New” Funding Framework
Background:
• A “new” funding framework came into effect in 2004 (esp. 2007,
given transition period)
• Rationales: Transformation to address apartheid-era injustices
(inequitable access to HE, specific disciplines). Other concerns with
earlier framework (South African Post-secondary Education Funding
Framework (SAPSE)), implemented from 1983–2003:
– (a) responsibility of government in financing higher education was
simply to contribute to institutional costs
– (b) market forces (student choices) determine the enrolment size and
shape of the higher education system, and funding having to follow
students
• Premise of new funding framework:
– There are national development needs (access, redress, human
resource) which the higher education system needs to address
– The higher education system needs to be planned, governed and
funded as a single national coordinated system
– Instruments relevant for such steering are planning, funding, quality
assurance
General Features
• Goal-oriented and performance-related:
government grants distributed to institutions
according to national goals and approved
institutional plans. Payment for services and
outputs
• Improvement-oriented: rather than necessarily
being punitive, it has instruments for encouraging
improvements when targets not met
• Caveat! On-going reviews, changing
benchmarks*. Examples drawn largely from
funding architecture, categories and benchmarks
of the first triennium of the new funding
framework (2004/5 – 2006/7)
Ministry analyses enrolment data + student output for a cycle
P
R
O
C
E
S
S
Ministry (iteratively) interacts with institutions on likely size and shape of
funding
For next cycle, Ministry sets totals of student funded places per institution
and aggregates to obtain system-wide totals
Ministry submits Medium Term Expenditure Framework (MTEF) budget +
budget for following financial year to National Treasury
National Treasury considers and determines MTEF budget and budget for
following financial year
Minister of Education allocates grants to individual institutions based on
allocation from Treasury and approved enrolment plans
Components
Formula for teaching input grant
• Formula: i = [a/A] * I
passed through
funding grid
• where
– i = a given institution’s teaching input grant
– a = units derived from number of FTE enrolled students in the
institution. Derived by placing students in subject matter
(CESM) categories and applying weighting factors by funding
group, course level and delivery mode
– A = ‘a’ at level of all higher education institutions in the system
– I = sum allocated in the national budget for teaching input grant
Sample calculation of teaching input grant
• Suppose institution X’s enrolments converted into weighted total of
teaching input as shown in Table generates 24 650 units
Funding
group
1
2
3
4
Total
weighting
Undergraduate Honours &
Masters
equivalent
1 x 3500
2 X 200
3 X 600
1.5 x 2500
3 X 100
4.5 X 500
2.5 X 1000
5 X 150
7.5 X 300
3.5 X 500
7 X 50
10.5 X 100
24 650
Doctoral
4 X 100
6 X 200
10 X 100
14 X 100
• Suppose also that weighted teaching input for entire system in year Y is:
870 000
• Suppose finally government’s allocation for teaching input for year Y for
entire system is: Rands 5 500 000 000
• Then institution X’s teaching input allocation for year Y is:
24650/870000 x 5 500 000 000 = Rands 155.8 million
Normative
weighted
teaching
total for X
institution X
Actual
weighted
teaching
outputoutput
for institution
Benchmark x Contact total
x0Distance total
1st certificates or diplomas of 2 years
0.5 X Benchmark
0
diplomas
and
22.5% x 8000 = 1800 1.0 X 13.5%
= 405
1st3-year
diplomas
and bachelor’s
of 3 years
1600 x 30001600
bachelor’s degrees
Professional
bachelor’s: 4 years or more
1.5 X 750
1125
st
4-year professional
1
22.5% x 4000 = 900
= 202.5
Postgraduate
diplomas
0.5 X 13.5%
200 x 1500100
• Formula:
o = [c/D] * O
bachelor’s
degrees
Postgraduate
bachelor’s degrees
1.0 X 350
350
Postgraduate
diplomas
18% x 1000 =180
Honours
degrees
0.5 X 9%
200x 0 = 0 100
processed through
funding grid18% x 500 = 90
Postgraduatemasters
bachelor’s
Non-research
0.5 X 9%
200x 500 = 45
100
• Where:
degrees
TOTAL
3375
–
o
=
an
institution’s
teaching
outputs
grant
Honours degrees
500 x 18% = 90
0 X 9% = 0
– c = an institution’s actual weighted total of teaching outputs for
Non-research masters
x 54% = 540
0 X 27% = 0
year Y. Determined1000
by multiplying
non-research
graduate totals
GRAND TOTAL
4252.5 NB: Aggregating ‘c’
by weightings for each qualification category.
Formula for teaching outputs grant
from all institutions gives system-wide C.
– D = Aggregated ‘d’ from all institutions, where ‘d’ is the
weighted normative teaching output for one institution. Small
‘d’ derived by multiplying headcount enrolment totals per
qualification category in institution by graduation benchmarks
approved by Education Minister for 3-year rolling period
– O = sum allocated in national budget for teaching outputs
Teaching outputs grant (2)
• Suppose the following system-wide totals:
– normative total of weighted teaching outputs (D) =
121 000
– actual total of weighted teaching outputs (C) = 90 000
– budget allocation for teaching outputs (O) = Rands 1
378 000 000
• Then institution X’s teaching output grant is:
c (actual output = 3375)/D (system normative
output = 121 000) x budget (Rands 1 378 000
000) = Rands 38.4 million
Teaching output grants (3)
• Where normative total of teaching outputs for entire
system (D) exceeds actual weighted total (C), the
amount disbursed as teaching output grant will be less
than amount provided for in national budget.
• Surplus is then distributed as teaching development
grants to all institutions whose ‘c’ is lower than ‘d’.
• An eligible institution X’s teaching development grant is
its output shortfall e (i.e. d – c), divided by the system
shortfall ‘E’ (that is, D – C) multiplied by surplus ‘S’.
• Thus, possible development grant is:
[e/E] * S
Research outputs grant
• Formula: r = [f/G] * Q
Weightings in
for2004/5
research
– outputs
Permanently employed
Institution’s output
Weighted
x weighting
normative
through 70 x 1staff research output (g) for
Publication units 1 passedacademic/research
2006/7
fundingin
Research masters graduate
1 grid
university X80 x 1
university X
Doctoral
Universities
graduate
1.25 3
200
10 x 3
1.25 x 200 = 250
• Where
TOTAL
Technikons
0.5
180 to an institution
– r = research
output grant allocated
NB: Aggregate
each
institution’s
weighted
normative
research
to get
– f = total
of actual
weighted
research
output
in theoutput
institution.
Determined
output for
the systemthus:
(G) institution’s output of research graduates and
publications for preceding 2 years multiplied by weighting.
– G = total of weighted normative outputs for the entire system; thus an
aggregation of ‘g’ in all institutions, where ‘g’ is determined as follows:
institution’s total of permanently employed academics for preceding
two years multiplied by annual publication unit approved by Minister
of Education for rolling period.
– Q = amount allocated in national budget for research outputs
Weightings for research outputs
Publication units 1
Research masters graduate 1
Doctoral graduate 3
TOTAL
Weightings in 2004/5 –
2006/7
Institution’s output x weighting
70 x 1
80 x 1
10 x 3
180
Permanently employed
academic/research staff
in university X
200
Weighted normative
research output (g) for
university X
1.25 x 200 = 250
Universities 1.25
Technikons 0.5
NB: Aggregate each institution’s weighted normative research output to get
output for the system (G)
Research outputs grant (2)
• Suppose the following system totals:
– weighted normative total of research outputs is:
15 500
– budget allocation for research output is:
Rands 1 123 000 000
• Then institution X’s research output grant for
year Y is:
f (180)/G(15 500) x 1 123 000 000 =
Rands 13 million
Research output grants (3)
• Where normative total of research outputs for entire
system (G) exceeds actual weighted total, the amount
disbursed as research output grant will be less than
amount provided for in national budget.
• Surplus Q is then distributed as research development
grants to all institutions whose ‘f’ is lower than ‘g’.
• An eligible institution X’s teaching development grant is
its output shortfall ‘h’ (the difference between ‘f’ and
‘g’) relative to the entire system shortfall H multiplied
by surplus Q.
• Thus, possible research development grant is:
[h/H] * Q
Institutional factor grants
• Of two kinds:
– (1) to encourage admission of (racially) disadvantaged students
(African and coloured who are South African citizens)
– (2) for small sized institutions that do not enjoy economies of
scale
• For both, grant in form of addition to teaching input grant.
• Re: 1: institutions with disadvantaged students constituting
80% and above of their population can have as much as
10% of their teaching grant as top-up.
• Re: 2, while institutions with 25 000 and more FTE enrolled
students do not obtain any top-up, those with 4000 and
less can have as much as 15% of their approved teaching
grant as top-up.
CHAPTER THREE: FUNDING AND THE
BROADER RESEARCH LANDSCAPE IN
SOUTH AFRICA
Overview of R & D expenditure and
performance (1)
Overview of R & D expenditure and
performance (2)
Source: Enhanced>>>
What is the organizational & strategic framework for funding and research performance?
National System of Innovation
in South Africa
Level 1
Level 2
Level 3
Level 4
• High-level policy: Government advisory
• E.g. Council on Higher Education, Academy of
Science of South Africa, …
• Ministry
• E.g. Science & Technology, Higher Education &
Training, Trade & Industry, Treasury, Health, Energy,
Arts & Culture, …
• Agency
• E.g. NRF, Technology Innovation Agency, Medical
Research Council, National Institute for Humanities
& Social Sciences, …
• Research and Innovation Performers
• E.g. NRF (DST), Universities, National Research
Facilities (DST), Human Sciences Research Council
(DHET), MRC (DoH), National Arts Council (DAC), ...
NRF: Place within NSI and Objectives
• The NRF performs a dual function in the National System of
Innovation (NSI): as an agency that steers the system
according to strategic policies, and as a research performer
(via management of national research facilities).
• Objectives:
– The promotion of internationally competitive research as the
basis for a knowledge economy;
– The growth of a representative science and technology
workforce in South Africa;
– The provision of cutting-edge research, technology and
innovation platforms;
– The operation of world-class evaluation and grant-making
systems; and
– Contribution to a vibrant national innovation system.
NRF FUNDING SOURCES
• More than 90% of its funding from government … in three forms, namely:
MTEF baseline allocation: to fund programmes and operations,
• Ring-fenced funds: designated by the DST for particular projects, e.g.
equipment, Centres of Excellence), and
• Contract funds: for specific projects and programmes from DST and
other government departments).
Finances
Some strategy frameworks
• National Research and Development Strategy (NRDS) of 2002
– Objectives: human capital development, mastery of technology
change in society and economy, aligned government science &
technology system. Identifies knowledge investment priority areas
(Astronomy, Human Paleontology, Biodiversity, Antarctic Research,
Indigenous Knowledge)
• Complementary Ten-Year Innovation Plan in 2007. Broad Goals:
– Develop capacity to generate knowledge, especially in areas referred
to as grand challenges: Biodiversity, Space Science and Technology,
Energy Security, Global Change, and Human and Social Dynamics.
– Secure for South African Research, Development and Innovation (RDI)
a strong position internationally
– Develop human capital for RDI
– Build world-class RDI infrastructure
Synthesis of strategic thrusts
•
•
•
•
•
People
Knowledge
Infrastructure
Quality
Investments
NSI-ACTOR RESPONSES TO STRATEGIC
IMPERATIVES:
1. PEOPLE
2. KNOWLEDGE
3. INFRASTRUCTURE
4. QUALITY AND INTERNATIONALISATION
5. INVESTMENT
NRF and People (human capital)
NRF and Knowledge(1):
Geographical Advantage
NRF & Knowledge (2):
Grand Challenges
NRF and world class research platforms
• NATIONAL RESEARCH FACILITIES: grouped according to area of
knowledge production or addressed national need.
• Astro/Geosciences
South African Astronomical Observatory (SAAO), also responsible for
managing the Southern African Large Telescope (SALT); and ƒ.
Hartebeesthoek Radio Astronomy Observatory (HartRAO).
• Biodiversity/Conservation/Environment
Sƒ outh African Institute for Aquatic Biodiversity (SAIAB); ƒ. South African
Environmental Observation Network (SAEON); and ƒ. National Zoological
Gardens of South Africa (NZG).
• Nuclear Sciences
ƒiThemba Laboratory for Accelerator Based Sciences (iThemba LABS).
NRF AND OTHER ACTORS ON QUALITY
• NRF Researcher rating:
– A: Researchers who are unequivocally recognised by their peers
–
–
–
–
as leading international scholars in their field for the high quality and
impact of their recent research outputs
B: Researchers who enjoy considerable international recognition by
their peers for the high quality and impact of their recent research
outputs
C: Established researchers with a sustained recent record of
productivity in the field who are recognised by their peers….
P: Young researchers (normally younger than 35 years of age), who have
held the doctorate or equivalent qualification for less than five years at
the time of application and who, on the basis of exceptional
potential demonstrated in their published doctoral work and/or their
research outputs in their early post-doctoral careers are considered
likely to become future leaders in their field.
Y: Young researchers (40 years or younger), who have held the doctorate
or equivalent qualification for less than five years at the time of
application, and who are recognised as having the potential to establish
themselves as researchers within a five-year period after evaluation …
QUALITY CONT’D
• Department of Higher Education & Training (DHET)
and quality of publications + research subsidy
Department of Science & Technology,
the National Treasury and Investment
• Research and Development (R&D) tax incentive introduced to:
– encourage private-sector investment in scientific and technological
research and development (R&D) activities
– facilitate South Africa's goal of achieving R&D expenditure of 1% of
GDP (target of 2008)
• Operations: Tax deductions for 2 types of R&D expenditures.
– 150% deduction of R&D expenditures incurred
– accelerated depreciation deduction for expenses on building,
machinery, equipment, …used for R&D purposes.
• Logic: revenue lost through incentive is gained from tax to be paid
in future by companies making more money because they have
applied results of R&D undertaken; the job opportunities in
industry could attract young people to choose careers in science,
engineering and technology.
CHAPTER 4: CONCLUSION
Financing South African higher education (HE)
and research in theoretical perspective
• The new funding framework for HE and other
interventions from actors in the National
System for Innovation, especially the NRF,
confirm that, internationally, government
allocations to the HE sector consists of
– Block grants (based on formulas) to support
teaching, research and other operational costs
– Allocations to support loan schemes for students
– Ad hoc, earmarked and/or competitive allocations
Funding in theoretical perspective
cont’d
• Of three major funding approaches, viz.
– incremental funding (line-item, historical, adjustments
to previous year’s allocation for all or specific line
items, encourages lobbying, little incentive for
performance)
– formula-based funding (using enrolment &
graduation data, anticipated trends, research output;
little room for lobbying)
– Performance-based funding (output-based, includes
contract mechanisms, KPIs and competition)
• South Africa, like most other countries, employs a
mix, especially of formula and performance
Assessment
Goals (1997 White Paper)
Targets (1997 White
Paper)
Status (2013 Review)
Student enrolments in the
public
higher education system
Goal 1: Opportunities for
entry into the
system must improve
Goal 2: The participation of
disadvantaged students in
the system
must increase
Goal 3: The participation of
female students in the
system must increase
Gross participation rate Overall GER grew from 14% in
of 20% by 2010
2001 to 18% in 2010. Goal 1 was
thus not attained, although
progress was made.
Gross participation
rates are equalised
African, coloured and Indian
students grew from 70.4% in 2000
to nearly 80% in 2010. Progress
made with regard to changes in
the racial profile of the students
(Goal 2)
Goal 3 was attained.
Goals (1997 White Paper)
Targets (1997 White
Paper)
Status (2013 Review)
Goal 4: Science,
engineering and
technology (SET) and
business/management
(BUS) enrolments in the
system must grow
Enrolment proportions to
be 30% SET and 30% BUS
The target for SET was
thus not attained. The
target for BUS was
however reached (31%).
Goal 5: Masters and
doctoral enrolments
in the system must grow
15% of enrolments to be
masters plus doctoral
students
Minimal progress: 4.6%
growth in postgraduate
enrolments
50% of permanent
academics to have
doctorates, and 40% to
have masters degrees
Staff with PhDs increased
from 32% in 2000 to 36% in
2010; staff with master
degrees from 29% to 35%
Academic staff in the
public higher
education system
Goal 6: The academic staff
in the system
must be well qualified
Goals (1997 White Paper)
Targets (1997 White Paper)
Status (2013 Review)
Goal 7: The output of
graduates of the
system must improve
a) Growth in total graduates
must exceed growth in
enrolments
b) Cohort completion rate to
be 65%
Progress with undergrad.
certificates and diplomas
(5.7% graduates vs. 4.9%
enrolments) more than with
number of graduates in
undergrad. degree progs.
(4.7% graduates vs. 5.2%
enrolments). Ditto for M/PhD.
Completion rate of cohorts of
M/PhD below 50%
Goal 8: The high-level
knowledge outputs of the
system must improve
a) Total research outputs
must increase
b) Ratios of doctoral
graduates to permanent
academics should be 0.15,
and of research publications
should be 1.0
Although there was marked
improvement in the
productivity of research
publications, there
was very little improvement
in productivity with regard to
doctoral graduates
Teaching and research
outputs of the
public higher education
system
Assessment
What is innovative and what lessons?
• Innovation as far as funding mechanisms are
concerned is not an absolute; it is contextual and
dependent on goals.
• Therefore, it is perhaps inappropriate to pass noncontextual value judgments on known funding
approaches.
• An innovative funding mechanism must ultimately be
seen as strategy-driven.
• South African initiatives are embedded in explicit
strategy that foregrounds the role of knowledge as
driver of development and as the basis of the new
global economy.
Lessons cont’d
• Funding occurs through a structured network, a delineated National
System of Innovation with clear pillars.
• National research productivity and innovation output not left to higher
educations alone.
• Private sector is incentivised (e.g. R & D tax incentive, Technology and
Human Resources for Industry Programme – THRIP) to contribute to RDI.
• Incentives for academics/researchers and institutions tied to goals that are
SMART (specific, measurable, attainable, relevant and time-bound)
• At the operational level, funding initiatives require a culture of
accountability, transparency and open communication, ethics. A strategic
culture has to be institutionalised, providing a goal-context for decisionmaking and behaving, even in the minutiae of daily administration.
• An effective monitoring system required, with options for constant
revision.
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