President Jacob Zuma has announced that government will introduce fully subsidised free higher education and training for poor and working-class undergraduate students.

This will start in 2018 for first-year students at public universities and be phased in over five years.

The announcement comes on the day the ANC’s 54th national conference is set to start in Nasrec, Johannesburg, where Zuma’s successor will be elected.

Zuma’s announcement follows the release of the Heher Commission report last month.

However, it differs from what was recommended by the commission – that all undergraduate and postgraduate students be funded through a cost-sharing model of government-guaranteed, income-contingent loans sourced from commercial banks.

The definition of poor and working-class students will now refer to “currently enrolled TVET [technical and vocational education and training] colleges or university students from South African households with a combined annual income of up to R350,000” by the 2018 academic year.

Zuma said students categorised as poor and working class, under the new definition, would be funded and supported through government grants, not loans.

National Student Financial Aid Scheme packages already allocated to existing students in their further years of study will be converted from loans to 100% grants with immediate effect.

“This policy intervention will enable the government to extend fully subsidised free higher education to youths from well over 90% of South African households,” the president said.

From next year, eligible children of the unemployed, social grant recipients, people earning below a minimum wage, domestic workers, farm workers, mine workers and entry-level civil servants such as teachers, nurses, police officers, municipal workers, security guards, refuse collectors and informal traders, among others, will be able to attend public universities and TVET colleges for free through grants provided by the government.

“To achieve its intended targets of access and success, fully subsidised full cost of study will include [the] tuition fee, prescribed study material, meals, accommodation and/or transport,” Zuma said.

The government will also increase subsidies to universities from 0.68% to 1% of gross domestic product over the next five years as recommended by the Heher Commission.


Finance Minister Malusi Gigagba said on Saturday that he was unable to provide any further details on Zuma's announcement on free higher education, other than to say that it was something both Treasury and the Presidential Fiscal Committee had been working on.

"The president's announcement comes from the process we established a few months ago. We will announce all the details at the budget. We had indicated that our fiscal consolidation would include funding higher education in a sustainable way. The budget process is still in motion. "

Zuma said last month that government would implement R30bn in tax hikes and more than R50bn in spending cuts in 2018 in order to stabilise the ballooning public debt ratio and respond to the concerns of ratings agencies and investors.

The statement also committed to more funding for higher education "in a sustainable way".

Gigaba said he had engaged with rating agencies over this matter and it would not come as a surprise to them.