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Opinion SA’s forgotten youth to benefit from code revisions


The ISFAP is part of a national effort to solve the ‘missing middle’ funding challenge.

South Africa has one of the highest unemployment rates in the world. According to The Economist’s Pocket World in Figures, South Africa’s youth unemployment rate is the highest of any other country. Just last month, Stats SA reported an increase to 29% of the labour force in the second half of 2019 from 27.6% recorded in the first few months of the year

Sizwe Nxasana says an enormous amount of effort is required to ensure that SA’s lost youth do not fall through the cracks. Picture: Supplied

According to Stats SA, youth aged 15–24 years are the most vulnerable in the South African labour market. “The unemployment rate among this age group was 55.2% in the first quarter of 2019. Among graduates in this age group, the unemployment rate was 31% during this period compared to 19.5% in the fourth quarter of 2018.”

What does this mean?

Any country that has an alarming number of young people who are detached from both the workforce and the education system (this forgotten generation generally referred to as those not in education, employment or training) places challenges on a country’s ability to participate in a globally competitive environment. This is one of the most challenging issues facing South Africa and is the reason why President Cyril Ramaphosa has highlighted job creation among the youth as one of the government’s top priorities.

What can be done?

Currently, over 500 000 South African youth require funding to attend a tertiary education institution to develop the skill sets necessary to enter the job market and gain meaningful employment.

Of these, 40% (roughly 216 000 students) belong to the so called ‘missing middle’ – families whose family income threshold exceeds the threshold to receive financial assistance from the National Financial Aid Scheme (Nsfas), but is still too low to be able to afford tertiary education without financial assistance. The cost of financial aid for the ‘missing middle’ to study at universities is estimated to be around R26 billion a year. This amount includes full cost of study including fees, accommodation, book and computer allowance and stipend.

What can be done to dismantle this barrier to meaningful employment?

To reach the target of R26 billion in funding a year, the business sector is needed to step in and assist as the budgetary allocation by government only covers students who are eligible for support from Nsfas.

To encourage the private sector to assist in the national effort to solve the funding challenge, the Department of Trade and Industry recently made revisions to the generic B-BBEE Codes of Good Practice with key changes specifically to Code 300, which addresses skills development expenditure.

Under the revised code, employers can now gain an extra four B-BBEE points by contributing up to 2.5% of their payroll to a bursary for black students at tertiary educational facilities. Such contribution includes providing “wrap around” support, which means mentoring, tutoring and access to a programme manager who actively engages with students and monitors progress using technology.

This could be the true pivotal moment for alleviating the plight of South Africa’s ‘missing middle’.

Launched at the height of the 2017 “fees must fall” crisis, the Ikusasa Student Financial Aid Programme (ISFAP) is part of a national effort to solve the funding challenge of ‘missing middle’ students by providing funding for the full cost of their tertiary education, including wraparound, non-academic financial support.

Focusing on degrees leading to occupations in high demand, ISFAP gives students an opportunity to attend one of 11 universities currently involved in the ISFAP programme to complete a tertiary degree in one of 11 defined faculties which include medicine, engineering, and actuarial science.

The intent is to enable these students to enter the job market with the qualifications that the Human Resource Development Council has deemed necessary to deal with the skills shortage in South Africa. The current pilot only covers 11 universities, but the intention is to roll this out to all 26 universities.

ISFAP has been set up as a NPO organisation. It is an operating entity with a duly constituted board and an operational team which deal with engagement with programme managers and data collection, payment processing, IT development and fund raising.

Although ISFAP has grown from strength to strength since inception – currently funding 1 700 students this year – an enormous amount of effort is required to ensure that SA’s lost youth do not fall through the cracks.

Sizwe Nxasana is chairman of ISFAP.



Disclaimer - The views expressed here are not necessarily those of the BEE CHAMBER

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