University councils need an overhaul if they are to perform their fiduciary functions effectively

“I am concerned that governance challenges continue to plague some universities, and there is a need for both a code of good governance practices and minimum qualifications criteria for anyone who wishes to serve on university councils. In this regard, going forward, all ministerial council appointees will necessarily need to have a PhD.”

These words from Dr Clarence Tshitereke, Senior Special Adviser to Minister of Higher Education and Training Dr Nobuhle Nkabane, drew hearty applause from senior university leadership including Vice-Chancellors, their deputies, researchers and stakeholders gathered at Universities South Africa’s 3rd Higher Education Conference in Pretoria this week.

In this information age, he said, the key competitive asset was constantly renewed human capital.

“A skilled workforce confers real national competitive advantages – while intellectual capital drives economic prosperity.” The challenge, he told university leadership, was their institutional state of readiness in responding to the rapidly digitising world of artificial intelligence and the emerging green economy as they prepare graduates for the future world of work.

He said that given national demographic changes, Universities South Africa (USAf) had a responsibility to determine critical areas of workforce training, a decisive factor in national competitiveness in the global economy.

Dr Tshitereke said the acronym “NEET” – meaning youth between 15-24 who are Not in Employment, Education or Training – had entered the lexicon. In August 2024, there were 10.2million South Africans in this category, of whom 35.3% (3.6million) were neither working nor enrolled in any higher education institution.

The Ministerial advisor then shone a spotlight on three Conference sub-themes:

• Higher education leadership, management and governance
• Financial Sustainability of higher education institutions
• The future of transformation in higher education institutions

He said although it was the sector’s collective responsibility to sustain a comprehensive and equitable education system that is responsive to South Africa’s challenges, several universities had been placed under administration over the past several years, as a result of poor institutional governance and mismanagement.

“The work done by the independent assessors revealed serious challenges with regard to governance, administration and management of some universities that were destabilising, thus undermining the effective functioning of the institutions.”

He also referred to councils, the highest decision-making bodies of universities responsible for good governance and for their mission, financial policy, performance, quality of teaching and learning and reputation.

“Various governance failings stemmed from amongst others:

• inexperience and lack of the required expertise among some of the council members in governance and fiduciary responsibilities;
• fraught relationships between councils and executive management and members of staff;
• failure of leadership especially at the level of the chairpersons of councils;
• unacceptable and counter-productive conduct by some council members; and
• non-adherence to proper meeting procedures.

“Lately, there are suspensions and litigation by either council against executives – or executives against councils. This is not desirable. Higher education leaders are expected to uphold the highest standards of integrity, both personally and institutionally. This includes maintaining ethical governance ensuring academic honesty, and fostering a culture where values such as accountability, fairness, and respect are paramount.”

He then announced, to thunderous applause, that going forward, all ministerial council appointees would need a PhD.

“This is critically important – and it is an approach that is gaining consolidation at our Technical and Vocational Education and Training (TVET) Colleges in our efforts to improve the quality of their value proposition.”

• Currently, 57 ministerial appointees out of 235 council members in 47 TVET colleges hold a PhD ( 24%).
• In the financial year 2023/2024, the Auditor-General ruled that out of 26 public universities, 17 achieved unqualified audits with no findings.
• Five universities had unqualified audits with findings
• One university had a disclaimer on audit with findings
• Three universities had outstanding audits.

“This is cause for concern as it undermines our efforts in motivating for additional funding with National Treasury. It is generally accepted that universities have requisite financial and administrative skills to meet financial reporting obligations,” Dr Tshitereke said. He said good governance at universities was important because it enabled them to realise their goals by regulating their internal affairs accordingly. His department, as the main funder of higher education, therefore had a special interest in the quality of governance of universities.

“Universities must account on how public funds are spent… so that  employers have confidence in their graduates.” He therefore challenge USAf as a representative body representing to engage towards developing the requisite competencies to resolve financial compliance matters at universities.

Turning to the National Student Financial Aid Scheme (NSFAS), Dr Tshitereke said the facility represents government’s intervention to widen access to post school education and training to those within the poor and working-class sections of society

To date, the investment in skills had produced hundreds of thousands of skilled professionals and the middle class, thus becoming Government’s one of the most profound achievements in eliminating poverty and inequality over the past 30 years.

Statistics:

• In the 2024 academic year, NSFAS funds more than 1.1million students in universities and TVET colleges. Budget allocation: R54billion.
• Between 2019 and 2022, NSFAS disbursed R123billion reaching just under 3million beneficiaries.

He said between 2019 and 2022, government spending in education as a percentage of government expenditure was 22.7%, equivalent to 7.2% of Gross Domestic Product.

“This exceeded the benchmarks set by the United Nations Educational, Scientific and Cultural Organisation (UNESCO), which recommends allocating 15-20% of public spending to education and 4-6% of GDP to education.”

“However, there are challenges of sustainability of this funding commitment in the long term – which we are trying to resolve,” Dr Tshitereke said.

He said they were aware of universities that are highly dependent on NSFAS for their sustainability. Dr Tshitereke therefore encouraged strengthened collaboration between government, universities, and the private (financial) sector, to optimise benefits for students and prevent pilferage and theft of public funds.

“Collaboration is critical now more than ever; it is a signifier of efficiency in the context of global fiscal constraints.”

He also cautioned that potential disruptions in the global oil supply and associated price increases would adversely affect Africa’s economy. How universities responded to these and global changes (including climate variability, adaptability, and environmental sustainability) would determine the future of the university, of society and humanity.

Regarding government’s part, he mentioned the Government of National Unity’s commitment to dedicate the next five years to actions that would advance three strategic priorities:

• Inclusive growth and job creation
• Reducing poverty and tackling the high cost of living
• Building a capable, ethical and developmental state

“There is an element of training in all of these strategic priorities. It is our primary objective to develop a skilled, capable workforce whilst broadening the skills base of the country to support an inclusive growth path,” he told conference delegates.

He also cautioned that even though the DHET budget appeared to be growing from R137.5billion in for 2024 to R142.6billion in 2025/26 and to R R150.2billion in 2026/27, and even though universities would receive adjusted transfers from R48.9billion in the current financial year to R53.8billion in the 2026/27 financial year, “in real terms, these increases may not be sufficient to meet all your needs,” Dr Tshitereke. “But we remain committed to reverse declining funding – it requires our collective efforts.”

On Transformation, Dr Tshitereke said this was characterised by deliberate, purposeful and explicit decisions to engage in a programme or process of change. This involved internal and external expertise guided by a strategy of collaboration and power-sharing. Transformation in universities, he added, should be reflected in all facets of the institution:

• Governance
• Management and leadership
• Student environment (reasonable access and academic success)
• Equity in staffing
• Institutional cultures
• Progressive and inclusive teaching and learning, research and knowledge systems
• Institutional equity
• Political economy of higher education funding

“The Constitution and the Higher Education Act provide a sound and clear framework for the leadership, governance, and management of public higher education institutions as another dimension of transformation. Sound  governance, strong management and accountable leadership are essential requirements for the transformation of the post-school education and training sector,” Dr Tshitereke said.

He referred to the PhD thesis of a politician, Dr Naledi Pandor, that had investigated transformation in higher education in post-apartheid South Africa, reflecting on the policy steps adopted and the successes achieved.  He encouraged the audience to read Dr Pandor’s thesis, saying that the “the study findings have implications for policy makers as they require higher education stakeholders to devote increased attention to the contested meanings of transformation, thus supporting higher education to achieve the goals desired by society.”

He then commended evident change in universities’ executive leadership, where seven out of 26 public universities were now led by women. He also acknowledged growth in academic staff with a PhD at universities: from 38.6% in 2012 to 49.3% in 2020.

The 3^rd Higher Education Conference went on to dissect numerous topics which represent the collective agenda of USAf’s six strategy groups. The sector is collectively exploring what must be done to ensure the long-term sustainability of the university, given the challenges confronting it, locally and globally.  The Conference, hosted from the CSIR International Convention Centre in Pretoria, wraps up today.

Charmain Naidoo is a contract writer for Universities South Africa.