The first draft of the abovementioned Bill was published in Government Gazette no 22218 on 9 April 2001, and comments had to be lodged by 7 May 2001. This organisation duly lodged its comments, dated 7 May 2001, and a copy is attached hereto for easy reference.

We have since received a copy of a revised draft of the Bill bearing the date 7 August 2001, and these comments refer to the said draft which we assume will be the version on the agenda of the Portfolio Committee on 31 August 2001. For sake of clarity we shall refer to these two drafts as the "first draft" and the "final draft".

1. AD SECTION 1: Proposed Amendment to Section 11 of the South African Schools Act No 84 of 1996 (as amended) ("SASA"):

1. We note that the final draft uses the expression "only recognised and legitimate learner body" in subsection (1), which at least incorporates our proposal that the word "learner" is more appropriate than "student".
2. In all other respects we abide by our criticisms and objections to the proposed amendments of section 11, contained in our initial comments attached hereto.

1. AD SECTION 2: Proposed Amendment to Section 15 of SASA:

We are pleased to note that the suggested wording contained in our initial comments has been partially adopted. It is, however, unfortunate that the words "the Constitution or any other law" have been omitted – it waters down the effect of an otherwise sensible formulation.

We therefore confirm our initial objection to the apparent motivation behind the proposed amendment.

2. AD SECTION 4: Proposed Amendment to Section 25 of SASA:

We are pleased to note that some of our suggestions have been adopted, with reference to subsections (1) and (3).

We also agree with the omission of the reference to the Public Finance Management Act in clause 3.1.4 of the Explanatory Memorandum, which is also in line with clause 4.5 of our initial comments.

3. AD SECTION 5: The Substitution of Section 36 of SASA:

The inclusion of the words "without the written approval of the Member of the Executive Council" in the proposed new Subsection (2) is certainly an improvement, but we abide by our objections contained in our initial comments. The proposed subsection is not only totally impractical and unnecessarily restrictive, but it is going to cause substantial red tape due to all the applications for the MEC’s consent – at least in every case where electronic or photocopier equipment has to be purchased by a school.

It is unfortunate that the Minister has not heeded our warning, contained in clause 5.1 of our initial comments, that provisions must be made for existing overdraft and loan agreements.

The motivation contained in clause 3.1.5 of the Explanatory Memorandum (as amended) is cause for grave concern:

Whether the Public Finance Management Act, 1999 contains sound principles is immaterial – it simply is not applicable to public schools! Surely every Act of Parliament contains sound principles, but that does not mean that they are all applicable to public schools?

Apparently the drafter of the proposed amendments has a problem with the meaning of the expressions "deficit" and "deficit balance", with all due respect. If a school borrows money to buy a photocopier because it does not have the money available to pay cash for it, it must be allowed to budget for the instalments on the loan for the relevant financial year. That does not mean that it has a "deficit" or "deficit balance" on its budget.

We do not agree with the interpretation of Section 60 of SASA. In our view the words "damage or loss as a result of any act or omission" in Section 60 refers to delictual and not contractual liability – a breach of a loan agreement would be a contractual liability and in our view the State would not be liable, as is suggested in the Explanatory Memorandum.

4. AD SECTION 6: The Proposed Insertion of New Subsections in Section 37 of SASA:

The proposed amendment of Subsection (3) was not contained in the first draft of the Amendment Bill and appears to have been inserted in the final draft as an "afterthought"– and a most unfortunate afterthought indeed! Limiting a school to one banking account is the most serious of all the hurdles placed in the path of functioning SGB’s by the Amendment Bill.

We firstly refer to the minutes of the meeting of the Portfolio Committee of 21 August, where we find the following astonishing statement: "Previously schools were only allowed to open one account." We are at a complete loss how anyone can interpret the existing Subsection 37(3) ("The governing body of a public school must open and maintain a banking account") as limiting a school to only one banking account. The incorrect impression is then given to the Committee, namely that the proposed amendment places the school in a better position since it can now operate two accounts! Why else was it considered necessary to insert the word "one" into the existing provision?

The correct position is that there was no limit on the number of accounts schools could operate, but the proposed limitation is a very serious one – a second account only with the written permission of the MEC. A simple example will illustrate the complication: A school has surplus cash and wants to earn interest. It obtains the MEC’s permission and invests it in a 12 month fixed deposit account. After 3 months it has further surplus cash available, but obviously cannot add it to the existing fixed deposit and is in fact unable to invest it, since the totally impractical limitation does not allow it to open a third account. Everyone loses in this scenario – totally unnecessarily.

The motivation for this proposed amendment, as set out in clause 3.1.6 of the Explanatory Memorandum, is totally unconvincing: "A tendency has developed where public schools have various accounts (what is wrong with that?), some of which are in the name of structures without any legal personality (this can be dealt with on its own). This has the potential of stashing money away, an act which may mislead parents about the real financial position of the school when compulsory school fees are determined." (it surely is in order for a school to budget for savings or reserve funds?)

With all due respect, we cannot escape the impression that the originators of this particular proposed amendment have very limited knowledge or experience of the financial aspects of running a functional school. These schools receive, apart from salaries of departmental staff, a mere pittance from the State to finance their other expenses, and have to apply all their financial skills to earn as much interest as possible on surplus money. They do not deserve to be sabotaged in their efforts in this way.

If there are so many instances of schools opening accounts in the name of structures other than the school itself, or of misleading parents, surely this can be dealt with without having to place this totally unnecessary limitation on all the other "innocent" schools?

We urge the Committee to do away with the limitation as well as the required permission by the MEC (unnecessary further red tape) and suggest that Subsection (3) rather be worded as follows:

"(3) The governing body of a public school must open and maintain at least one banking account in the name of the school, hereinafter called the "main account"; and will in addition be entitled to open such further banking or investment accounts for purposes of investing surplus funds as it may consider appropriate, provided that

(a) all such accounts are opened in the name of the school and are fully controlled by the governing body; and

(b) all payments into and all withdrawals from such additional accounts are channelled through the main account."

As regards the issue of trusts, we abide by what we said in our initial comments and again point out the danger of simply trying to declare certain trusts "invalid" (Subsection (7)(b)).

5. AD SECTION 7: Proposed Substitution of Section 38 of SASA:

In the first draft the proposed amendment resulted in the optional "guidelines" that the MEC could determine being changed to "prescriptions" that he will be obliged to determine. Our problem remains that we have no idea what these prescriptions are going to be, bearing in mind that most MEC’s have not yet determined any guidelines despite the fact that SASA has been in effect since 1^st January 1997.

The final draft contains an astonishing new provision, namely that all budgets of public schools must be published in a Provincial Gazette. No reason is given in the Explanatory Memorandum and, quite frankly, we tried our very best but could not come up with any plausible explanation, other than a possible printing or typing error. This should clearly be corrected – it is the MEC’s guidelines that must be published in the Provincial Gazette.

In the Explanatory Memorandum reference is made to "standards set by the State", "format which all parents can understand" and "uniformity of budget standards in a province", without any such standards or formats being known to us.

If, as we suspect, the MEC’s are going to use this provision to limit governing bodies as to what they may budget for, we are unfortunately heading for unnecessary confrontation between governing bodies and Education Departments.

We further abide by our initial comments on this proposed amendment, and again urge the Minister to follow a more persuasive and less prescriptive approach.

In conclusion: We have it on good authority that out of approximately 28 000 public schools in this country only about 4 000 are functional. Ninety nine percent of our members form part of this small group. The bulk of the above proposed amendments are unnecessary hurdles placed in the paths of these functional schools. How does the National Education Department think they will ever manage to increase this pitiful number of functional schools if they continue to make these kinds of provisions? We urge Parliament to make use of the vast experience of these functional schools and to accommodate our problems set out above, especially as regards the financial aspects of the running of a public school.

P H T COLDITZ
CHAIRPERSON: FEDSAS NATIONAL

7 May 2001

 

COMMENTS ON THE EDUCATION LAWS AMENDMENT BILL, 2001

Our comments at this stage are restricted to the Education Laws Amendments only, as published in Government Gazette no 22218 dated 9 April 2001. We reserve our rights to comment on the other sections of the Government Gazette at a later stage.

6. AD SECTION 1: Amendment of Section 11 of the South African Schools Act No 84 of 1996 (as amended) ("SASA"):
1. The original aim of the establishment of Representative Councils of Learners (RCL) was to promote democracy and representivity at the level of public school governance. (Education White Paper 2 paras 3.12 – 3.14). It is ironic that intolerance and non-democracy should motivate amendments such as those proposed.
2. The Explanatory Memorandum accompanying the Bill conveys that the thrust of the proposed amendment is to vest the status of "the only recognised student body" at a public school in the RCL and to move away from enabling the MEC to determine guidelines for the establishment, election and functions of RCL's, to a position where he/she can prescribe such matters.
3. We have no difficulty with the conferral of prescriptive powers on an MEC to promulgate measures regarding the establishment and election of RCL's. Our difficulties are twofold:-
1. We question and take issue with the proposal to confer the status of the "only recognised student body" at a school, and we interrogate the concept of "only recognised student body".
2. We question and oppose the conferral of power on a MEC to confer functions on a RCL without any constraints in the form of criteria, conditions or directives accompanying the proposed amendment of Section 11(2).
4. We are concerned that the undisclosed motive for the Section 11(1) amendment is the abolition of prefect bodies. If this is so, transparency demands disclosure of such an intent, the reasons for such an approach and the courage to entertain debate on the matter – as one would expect in a democracy. Indeed, one would expect that educators and parents (both major role-players in the school community) be closely consulted about the matter before Bills are prepared. We are confident that a formidable case can be put up for the retention and promotion of the prefect system in tandem with the existence of RCL's. We urge the Minister to disclose the true motivation behind the proposed amendment and engage with us, the interested public and key stakeholders, in public debate of the matter.
5. We cannot understand why, if the Minister insists on taking the matter of the functions of RCL's (other than those already prescribed) out of the hands of school communities, he has not dealt with the matter in a normative way by setting out the functions in SASA so that the public will be able to comment and take issue effectively. Why must such an important matter be delegated to the whim of MEC's? Why is such an important matter diverted away from the scrutiny of Parliament into subordinate legislation?
6. Unlike the provisions relating to the functions of SGB's – there are several starting with "Subject to this Act" – there is no constraint upon the power of the MEC to prescribe functions which overlap or override or limit the functions of SGB's. The potential exists of the whole pattern of organization and governance of public schools to be subverted. If the omission of constraints is not an oversight, we request the Minister to divulge his thinking to the public.
7. Apropos of the concept of "only recognised student body", we must enquire –
1. What precisely is meant by "student body" ? A definition is called for;
2. The expression "learner" is used consistently in the Act; why is it necessary to create confusion by bringing in a totally strange term "student" ?
3. What precisely is meant by "recognition"? Does it mean that the opinions and views of individual students or groups of students or student societies are to be ignored, or not sought? Does it mean that students, who organise themselves for any purpose (eg media centre prefects, debating society committees, newspaper editorial committees, choir committees, numerous sports committees, to name but a few), are to be denied the right of association, freedom of speech and opinion, and so forth? A definition is called for.
4. Who must recognise the RCL as the only student body and for what purposes? Clarification is required.
8. We urge the Minister to hold the proposed measures in abeyance until the implications have been fully considered in conjunction with stakeholders.
7. AD SECTION 2: Proposed Amendment of Section 15 of SASA:
1. We support autonomous school management subject to legal accountability in line with the declared approach of the minimum State intervention in school governance for legal accountability, set out in Education White Paper 2. We vigorously oppose every step taken by the State to renege on this approach.
2. We have, with respect, great difficulty in understanding the logic behind this amendment. The Minister’s insecurity about the existing provisions is unjustified; we are unaware of any "legal uncertainty" about the status of public schools and are curious to learn of the underlying rationale. If a school is not performing functions provided for in the Act, it is acting without legal capacity and its acts are without legal effect. There is no need to tamper with the school's juristic personality by making it conditional upon the performance of functions set out in the Act. Indeed, the ownership of assets can hardly be regarded as the performance of a function – it is a right conferred by the Act, and such a right can only inhere in a legal persona (juristic person) or natural persona. Similarly, the burden of a liability, such as those transferred to a public school by its predecessor (Section 52(2) ) can hardly be regarded as the performance of a function, and such a liability can only be borne by a juristic or legal or natural persona.
3. Further, the word "prescribed" is inappropriate, having regard to the provisions of Section 21, the enabling provisions of Sections 6, 7 and 9 of SASA, inter alia.
4. We suggest the following, whilst persisting in our opposition to the infringement of autonomy in school management -

"Every public school is a juristic person with legal capacity to perform only such functions and to exercise only such rights and perform only such obligations as are provided for in terms of this Act, the Constitution, or any other law."

8. AD SECTION 3 : Proposed Amendment to Section 20(1)(i) of SASA:

We do not oppose this cosmetic amendment.

10. AD SECTION 4: Proposed Amendments to Section 25 of SASA:
1. We propose the following alternative wording for the proposed subsection 25(1) -

"If a governing body has ceased altogether to perform the functions allocated to it in terms of this Act, or has failed to perform one or some of such functions, the Head of Department may appoint sufficient persons to perform all such functions, or one or some of such functions, as the case may be, for a period not exceeding three months."

2. We propose the opening words "If a governing body has ceased altogether to perform its functions ......" for the proposed subsection 25(3).
3. We propose the following opening words for the proposed subsection 25(4), namely -

"If a governing body fails to perform one or some of its functions, as envisaged in subsection (1) ........"

4. We propose the insertion of a further provision to ensure that due process is followed and that governing bodies do not fall prey to arbitrariness:

(a) "In exercising the power conferred upon him or her in terms of this section, the Head of Department shall comply with all the relevant provisions of the Constitution and the Promotion of Administrative Justice Act No 3 of 2000". OR

(b) "In relation to the appointment of persons, as contemplated in this Section, the provisions of Sections 22(2), 22(3), 22(4) and 22(5) of this Act shall apply mutatis mutandis."

5. In clause 3.1.4 of the Explanatory Memorandum reference is made to the Public Finance Management Act, an act that is clearly not applicable to public schools. Furthermore, the Memorandum contains a statement that in our view is questionable, namely that the State will be liable to compensate claims against a public school if the school cannot comply with its obligations or liabilities. This is probably a reference to Section 60 of SASA which makes the State liable for "any damage or loss caused as a result of any Act or omission in connection with any education activity conducted by a public school". We are not convinced that the expression "damage or loss" refers to contractual liability.
11. AD SECTION 5: The Substitution of Section 36 of SASA:

It is clear that this matter has not been considered with due regard to the provisions of Section 21(1)(c) of SASA, the reality on the ground in schools and the exigencies of school governance. Our comments are as follows:-

1. Clear provisions must be inserted to exclude existing loan and overdraft agreements from the purview of the proposed Subsection 36(2), that is if the Minister persists with the amendment. We feel reasonably confident that it is not the intention of the State to disrupt existing legal arrangements. Chaos will follow in many schools if actions are instituted by third persons for the restoration of benefits conferred on public schools if existing agreements may be voided or are rendered void.
2. There are many contingencies that arise in the sphere of school governance that may require the taking of urgent steps to obtain short term financing or even long term financing: A dangerous situation may arise in the structure of a school building and the State has other priorities, resulting in a long waiting period for essential repairs to be effected; an unforeseen, yet temporary cash flow problem arises, the reserve is committed to a 32 day call account and a small loan is required to pay the water and lights bill; motor vehicles and other large capital items such as photocopiers are usually bought on instalment sales agreements (hire purchase); and so forth. There must be some flexibility, despite the need for vigilance and the hands of the Head of Department must still be left free to allow a SGB in terms of Section 21(1)(e) to enter into an overdraft or loan arrangement subject to terms prescribed by him. The subjection of such agreements to the prior written consent of the HOD is also a possibility, provided channels can be opened allowing for urgent applications for consent to be dealt with according to due process. (See for example, the proposed amendment to Sections 20(2) and 48(4) and 48(5) of the Further Education and Training Act No. 98 of 1998).
3. The words " ... may not be bound" in the proposed subsection 36(3) is vague. It suggests that such agreements may be voided but it is not specified by whom that may be done.
4. The word "loan" in the proposed subsection 36(2) should be replaced by "contract of lending money" to make the terminology consistent with subsection 36(3).
12. AD SECTION 6: The Proposed Insertion of New Subsections in Section 37 of SASA:
1. We preface our comments by pointing out that something must be wrong in a system when school communities start establishing trusts in order to circumvent unreasonable and indefensible strictures on their ability and capacity to manage their schools effectively. The Minister is intent upon treating the symptom, but not on addressing the root of the problem. The more the State seeks to stifle the ability and freedom of communities to manage their schools the more legislation the Minister will have to pass to close more loopholes and to frustrate increasing schemes to throw off the unreasonable strictures. Warning will not conduce to sound partnerships in education. Understanding will.
2. We agree that governing bodies cannot be allowed to transfer money from school funds into a trust, and that the practice must be stopped. However, we have grave difficulties with the approach taken. Our comments follow.
3. A trust is a separate legal entity established in terms of a Deed of Trust, which is registered with the Master of the High Court and which functions through its Trustees. It has certain objects, which can or cannot be altered or changed, depending upon the terms of the Deed of Trust, which are by no means uniform. Far be it from the Minister to seek to declare a Trust invalid merely because moneys were transferred to it from school funds. It admits of no doubt that the equivalent amount of money transferred has to be returned. Consequently, "such trust ... is invalid" must be stricken from subsection (4B).
4. The burning question to answer in each case will be whether or not the money sought to be recovered constituted "moneys from a school fund of a public school" (4A) or "moneys of a school fund" (4B). It is trite law that payment is a bilateral juristic act requiring an intention to pay and an intention to receive payment. Moneys thus paid to a school, either as school fees or as payment for the use of facilities or for goods bought, etc, clearly constitute moneys of the school fund envisaged in Section 37(1) and 37(2). Similarly, donation requires an intention to donate and an intention to receive as a donation (the so-called voluntary contributions fall into this category). Such donated moneys form part of the school fund. Also, the funds envisaged in Section 37(4) may to the extent and subject to the conditions referred to, constitute part of the school fund.
5. It is against this background that it is amazing, but not surprising, that one encounters the draconian and high-handed provisions of (4C).
   
6. The explanatory memorandum in this regard at the end of the Bill is totally unconvincing – "such trusts can lead to abuses". Well, the Master of the High Court and the Trust Protection Act have already been provided to cope with abuses. It is not for the Minister to encroach on a terrain not belonging to him.
7. It is also apparent from the explanatory memorandum that the Minister does not like the idea that he cannot control trusts in terms of SASA and that he sees such trusts as having "the potential of diverting away potential compulsory school fees into the trust", but further to stop parents at a school from paying money, which could otherwise have been recovered as compulsory school fees, into a trust. These are desperate measures. It appears that the Minister is desperate to maintain the stranglehold he has on SGB's – to limit their functions, and hence their ability to decide what they may or may not do with the parents' money in the school context – and is chagrined at the fact that school communities are weakening his attempt to hold them down by resorting to the mechanism of trusts.
8. Hence subsection (4C):
1. Not only does the Minister now seek to prohibit SGB's from collecting moneys or contributions from parents to establish or fund a trust, but he goes further and seeks to make the prohibition retrospective to, effectively, 1 January 1997, when SASA came into operation. This move will have to be measured against the Constitution. The effect of this prohibition as a means to the end of securing the recovery of funds collected before 1 January 2002 is unlikely to stand the test of a Court of Law. Consequently, the Minister has produced the ultimate surprise! He seeks to commandeer such funds in the hands of the trust and secure their payment into the school fund!
   
2. If the parents gave money to a SGB for payment to a trust, then, whether the SGB acted with or without authority or power to collect such funds and deal with it according to the intention of the paying parents, the Minister has no right to frustrate that intention and seize that money for a purpose not intended by the parents concerned. Again, the Constitution will have to be called in aid.
3. Then again, if money was paid over to a trust by a SGB as a conduit for parents intending it to be so paid over, that money belongs to the trust and in the Minister's attempt to seize it by retrospective measures, such as these, he is performing an act of expropriation and he will have to confront the relevant provisions of the Constitution in this regard.
9. The Minister is unlikely to succeed in his bid to achieve the objectives emerging from (4C). But even if he does, measures remain available to parents and other community members to ensure that their money is spent for the benefit of their (childrens') school, and in accordance with their wishes – which go further than the rein the Minister seeks to keep on the scope of functions available to SGB's. It must not be forgotten that parent representatives on SGB's are there, not only to participate in the functioning of the SGB, but also to represent the interests of their constituency in the school context, as well as the educational context.
   
10. The proposed amendment is also an unjustified attempt to eliminate any creative forms of funding to supplement school fees, which have become extremely onerous to parents, largely because of the State’s failure to provide adequate funding for school education in this country. Over the years it has become common practice for communities to establish trusts to support designated public schools through acquiring certain assets and making these available at a market related monthly or annual charge. Such arrangements are to the benefit of the school and its learners and has as sole objective the provision and maintenance of an acceptable quality of education for the learners of the school.
13. AD SECTION 7: The Substitution of Subsection 38(1) of SASA:
1. It is regrettable that the mood of the Minister has shifted to a prescriptive one.
2. The door is opened wide for an MEC to use the proposed prescriptive measures to prescribe to a SGB and school community how (and on what) it must spend its money.
   
3. The Minister must surely realize that he cannot always force people to bow down to the whip. It must be remembered that a SGB can refuse to follow the prescriptions. If that results in their dismissal, or the removal of the function from them and the State foists outsiders onto the school to prepare the budget according to the MEC's prescriptions, the parents are still free to reject the Budget.
4. We suggest a more persuasive approach, such as that provided for in the current provision for guidelines (yet to be made known in some Provinces after 4 years of the new system). An alternative approach would be for the Minister to introduce provisions for a Schedule to SASA after negotiation with schools or their representative stakeholders, in which Schedule normative minimum requirements or, preferably, guidelines for the preparation of the annual school budget are set out (or in which the standards for budget preparation, referred to in the explanatory memorandum, are set out). This will ensure national negotiated uniformity in the spirit of true partnership and in accordance with the principle of the minimum of State intervention in school governance for legal accountability.
14. Finally, we urge the Minister to take careful note of the provisions of the Promotion of Administrative Justice Act No 3 of 2000. We believe that many of the far reaching powers being conferred on HOD's and MEC's, and even on the Minister himself, will have to be contend with the behests of the said act.

PHT COLDITZ

CHAIRPERSON FEDSAS NATIONAL