GRADING THE INDEPENDENT
SCHOOL SECTOR
Despite a turbulent and an agitated economic and
political context, the growth of fee-paying independent/
private schools continues across South Africa’s different
income groups.
The tertiary education crisis and the spectre of racial
intolerance continue to intensify in South African society. Tough
times lie ahead, with forecasts predicting only 1% GDP growth
for 2016.
South Africa’s workers and middle class are feeling the weight
of increasing costs, inequality and indebtedness. Youngsters
from the black aspiring, middle and elite classes are at the
vanguard of the #FeesMustFall campaign, which ignited in
2015 across our tertiary institutions. Restlessness is rife. And
yet the growth of independent schools in the country has
continued unabated.
The Department of Basic Education (DBE)’s latest education
statistics reveal that the number of learners in independent
schools has increased by 120.9% over the past 15 years,
although the total learner numbers remain only 566 194
compared to those in public schools at 12.3 million. During
the same period, enrolment at public schools increased
by 5.2%. The new schools financed by the Schools and
Education Investment Impact Fund South Africa (Schools Fund)
that opened over the past two years in Gauteng did so with
record high numbers of between 900 and 1 000 learners.
In 2016, all existing schools located in Gauteng increased
their learner numbers, while those in more rural locations grew
at a slower pace. Curro Holding’s 2015 results, released in
February, show a 16% increase in learner numbers from 2015 to 2016 and they remain upbeat about future growth. The
Independent Schools Association of Southern Africa (ISASA)
indicates that its membership numbers continue to grow year
on year across all market segments.
A MARCH AGAINST FEES?
Despite these strong growth figures and due to recent events
at the universities, concerns have been raised about whether
an #IndependentSchoolFeesMustFall campaign will emerge.
In the short to medium term, this is not the most likely challenge
the independent school sector will need to withstand, for three
reasons.
Firstly, independent schools are scattered across thousands of
school sites countrywide, unlike the concentrated sites of the
25 universities (traditional and technology) in SA. Secondly, a
diffuse group of schools, many of whom are embedded within
communities, does not provide the ground for significant gains.
In the case of widescale non-payment of fees at independent
schools, there is no recourse to Government for a bail-out. The
school will simply not be able to pay its teachers and will
close. Thirdly, the high value parents place on their children’s
education is the driving force behind the growth of the
independent school sector. This sentiment was well expressed
by Ms Phumzile Sikhosana, whose motivation for sending her
child to an affordable independent school is: “I want the best.
I am prepared to pay for quality.” Writing on education and black upward social mobility, Roger Southall, Head of the
Sociology Department at the University of the Witwatersrand,
says: “…levels of black access to educational opportunities
have been massively increased. These openings are being
seized upon by black parents and students themselves, who
recognise the crucial role played by education in enhancing
life opportunities. A good education is explicitly perceived as
necessary for staying within, or entering, the middle class.”
Parents are prepared to pay for quality education because of
the huge challenges facing the education sector. Only half of
the learners who start school will complete Grade 12; and only
a third of those who reach Grade 12 will pass well enough
to qualify for admission to bachelor’s level university studies.
South Africa’s numeracy and literacy levels at primary school
are much lower than those of comparable countries. In 2015,
South Africa’s education sector ranked 139th out of 143
countries in the World Economic Forum’s Global Information
Technology Report, while the standard of Mathematics and
Science education was ranked last (143th out of 143).
TOWARDS EQUITABLE ACCESS TO EDUCATION
In response to our education crisis, the Schools Fund was
established by Old Mutual and the Government Employees
Pension Fund and its asset manager, the Public Investment
Corporation (PIC). As the first impact fund of its kind in South
Africa, it has already spent over half a billion rand on behalf of
its investors to develop affordable independent schools in South
Africa. The Fund is an innovative initiative that utilises pension
finance, in the form of debt and equity, to create additional
quality schooling opportunities for learners at affordable
independent schools. These schools work alongside public
schools and Government in delivering quality education for
learners from previously disadvantaged backgrounds.
For the 2015 National Senior Certificate (NSC) exam results,
the Schools Fund schools achieved a 97.6% pass rate, well
ahead of the national NSC pass rate for South African schools,
which was 70.7%. And 57.7% of the Schools Fund’s students
obtained university exemption (Bachelor pass), 31.9% higher
than the national average of 25.8%. This is an important
achievement as it means that the quality of the matric pass is
good enough to afford these youngsters an opportunity for a
university education.
This much is clear – to be successful, the Schools Fund needs to
provide both quality education and an acceptable commercial
return. But there is a third critical factor to be considered when
measuring success: impact. This year there are approximately 15 600 learners at 22 schools with 1 000 staff in which
the Schools Fund has invested. By the time the R1.2 billion
funds under management have been spent, learner numbers
should reach about 40 000. The number of youngsters
needing education in SA presently stands at 12 million. To
reach just 3% of these learner numbers as they increase, an
estimated R7.2 billion will need to be invested. This is the
time for additional finance to be allocated to the country’s
independent schooling.
The key value that impact investing in education offers is that
it aligns the creation of economic value and social value.
Through the mobilisation of long-term commitment of capital,
the private sector is invested in the future as it only sees returns
in 10 to 15 years’ time. Parents, learners, teachers, businesses
and investors become excited about this approach when they
see the possibilities, and this creates the kind of hope that helps
drive change. The scale of investment can be significant and
an impact can be created for large numbers of learners.
The challenges facing education are many, but so too are the
opportunities that arise. An African proverb states: “Smooth
seas do not make skilful sailors.” Let’s move skilfully into this
space.