IMPROVING LIVES THROUGH DATA ECOSYSTEMS

The COVID-19 pandemic in 2020‒2021 disrupted the operations of higher education institutions, with notable effects on revenue streams. After declining in 2020, the amount of money collected from tuition fees jumped by 21,6% in 2021.

Tuition fees are the second biggest source of revenue cash flows

South Africa’s 26 higher education institutions depend on three main sources of revenue, according to the Financial statistics of higher education institutions statistical release.¹ In 2021 the second biggest source of money after government grants was tuition fees, accounting for 36% of total revenue (Figure 1). Government grants contributed 47%, while the remainder was from other sources, such as donations and research income. Not to be confused with social grants, government grants are financial transfers between government institutions.

Mangosuthu University of Technology, based in Durban, depends the most on tuition fees. For every R100 of revenue generated or received by the institution in 2021, R56 was in the form of student fees. Durban University of Technology received half of its income from tuition fees in the same year.

At the other end of the scale, tuition fees accounted for 16% of total revenue received or generated by Central University of Technology in Free State. This institution relied heavily on government financing in 2021, receiving 76% of its revenue in the form of grants.

Tuition fees jump in 2021

If we consider all higher education institutions, the percentage of total revenue from tuition fees shifted from 33% in 2019 (before the pandemic) to 36% in 2021 (Figure 2). As the lockdown disrupted operations in 2020, government transfers increased while the amount received from tuition fees declined.²

As institutions began reopening their doors of learning in 2021, the situation reversed. Government grants declined while the amount collected from tuition fees climbed significantly. This resulted in tuition fees taking up more of the revenue pie in 2021.

In rand values, tuition fees accounted for R29,3 billion of total revenue in 2019, declining to R28,8 billion in 2020 and jumping to R35,1 billion in 2021.

Breaking this down by institution, and comparing 2021 with 2019, the share of tuition fees in total revenue increased for nineteen institutions, remained stable for two, and decreased for five (Figure 2).

Central University of Technology in Free State registered the largest decline (from 35% to 16%). The institution experienced a significant fall in revenue from student fees, from R414 million in 2019 to R165 million in 2020. In 2021, the figure improved slightly to R171 million.

For more information, download the 2021 Financial statistics of higher education institutions statistical release and Excel files here.

¹ The statistical release is based on data that comply with Government Finance Statistics 2014 principles, presented on a cash-flow basis.

² Stats SA, 2021. A decline in tuition fees dents higher education revenue (read here).