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Debt write-off will cripple varsities

Some universities have seen an increase in the number of students failing to pay their debt following the announcement that there would be a 0% fee increase this year.

The institutions said they were owed millions of rands by students, and that if they were to clear the debt, they would be broke before the end of the year.

This was their reaction to a call by student representative council (SRC) presidents who demanded the scrapping of historical debt, in a meeting with Minister of Higher Education and Training Blade Nzimande recently. However, the universities that spoke to Sowetan were unequivocal in their responses that it would not be affordable for them to write off the debt.

Gauteng vice-chancellors also made it clear during a press briefing last week that clearance of the historical debt was no option, as it would leave institutions bankrupt .

North West University is one of the institutions that said it had seen an increase in the number of students who failed to make payments following the 0% fees hike announcement for 2016.

However, spokesman for the university Louis Jacobs said the students would be forced to pay their debt before the March 2016 graduation because they would not receive their qualifications. Jacobs said the university was owed R164.067-million, which dates back to 2013.

He said it was impossible to simply forget about the debt and that students who fail to make arrangements with the university are handed to the university's attorneys for debt collection.

"There is no way that we would be able to do this, since the university only has limited reserves which can be tapped, and it would not be financially viable. With the announcement of the 0% increase, the university is left with a deficit of close to R45-million after the collection of just over R134-million from government," said Jacobs.

Vaal University of Technology spokesman Mike Khuboni said the university recovered about R800000 per month from historical debt.

It is currently owed R262-million, which dates back to 2013. "Scrapping historical debt will result in the university becoming insolvent."

Even though the Cape Peninsula University of Technology took the initiative to scrap historical debt for needy students last year, spokeswoman Lauren Kansley said it would not be sustainable to scrap all debt. Kansley said the university was owed R332.4-million after having written off R111-million last year covering 5000 students who were eligible for National Student Financial Aid funding but did not get it.

Just a year since it started operating, Sefako Makgatho Health Sciences, formerly Medunsa, says it is already owed R20-million in student debt. Interim executive director Joel Nkhuna said without recovering the money it would be difficult to sustain the the university. Some universities allow students to register despite owing fees .