Presentation to Parliamentary Portfolio Committee

Presentation to Parliamentary Portfolio Committee on Education,

22 June 2004

Restructuring the Higher Education Landscape: Mergers and Incorporations

A. Background

In December 2002, the Ministry released its proposals, which were approved by the Cabinet, for the transformation and restructuring of the institutional landscape of the higher education system through mergers and incorporations.

The proposals result in the consolidation in the number of higher education institutions from 35 to 22, although all delivery sites would be retained and continue to offer higher education programmes. The proposals in total consist of 10 mergers and 9 campus incorporations. Although, the final decision regarding Mangosuthu Technikon is yet to be taken.

Following the Cabinet announcement, and in terms of the Higher Education Act the Ministry wrote to all the merging institutions requesting the councils to provide him, by no later than June 2003, with:

nominations to the interim councils;

proposals for the name of the new institution;

preferred date of implementation, and

the address of the new institution.

In the case of incorporations, the only legal requirement was in relation to the preferred date for the incorporation. The information is a requirement for the formal gazetting of the mergers and incorporations, which notices were published in November 2003.

The following mergers and incorporations were effected on 1 January 2004:

University of Durban-Westville and University of Natal, creating the University of KwaZulu-Natal;

University of North-West and the University of Potchefstroom, and the incorporation of the students and staff of the Sebokeng Campus of Vista University creating the North-West University;

Technikon Northern Gauteng, Technikon North West and Pretoria Technikon, creating the Tshwane University of Technology;

University of South Africa and Technikon South Africa, and the incorporation of Vista University Distance Education Campus, creating the University of South Africa;

The incorporation of the Port Elizabeth campus of Vista University into the University of Port Elizabeth;

The incorporation of the East Rand and Soweto campuses of Vista University into RAU;

The incorporation of the Bloemfontein campus of Vista University into the University of Free State;

The incorporation of the Welkom campus of Vista University into the Central University of Technology, Free State (previously known as Technikon Free State);

The incorporation of the Mamelodi campus of Vista University into the University of Pretoria;

The incorporation of the East London Campus of Rhodes University into the University of Fort Hare;

The incorporation of the Faculty of Dentistry of the University of Stellenbosch into the University of the Western Cape.

(Note: The closure of Vista University is schedule to take place at the end of this month. The notice of closure was published in May.)

In addition to the above, the following mergers are scheduled to take effect on 1 January 2005.

The University of Port Elizabeth and Port Elizabeth Technikon.

(New Name: Nelson Mandela Metropolitan University)

The Medical University of South Africa and the University of the North. (New Name: The University of Limpopo)

Rand Afrikaans University and Technikon Witwatersrand.

(New Name: The University of Johannesburg)

The University of Transkei, Border and Eastern Cape Technikons. (New Name:The Walter Sisulu University for Technology and Science , Eastern Cape)

B. Facilitating the Implementation Process

The role of the Ministry in the implementation process lies in the provision of financial and technical support and guidance, and in monitoring the implementation process at the institutional level, in particular, to ensure that due regard is given to the central principles underpinning the restructuring and transformation agenda, as well as to facilitate and mediate in cases of dispute and conflict, where required.

With regard to financial support, a total amount of R 3 billion has been allocated over a period of 5 years to support the institutional restructuring process. Of this amount, approximately half will be used for the recapitalisation of higher education institutions. The recapitalisation funds are not only for merging institutions, but will also be used to support other qualifying institutions.

To further facilitate and support the implementation process, the Ministry established a Merger Unit within the Higher Education Branch to oversee, support and monitor the process, including the provision of technical and financial support to the affected institutions.

The Merger Unit, which was established in January 2003, consists of a combination of full-time staff and contracted staff with specialised expertise in a range of key functional areas - finance, legal, human resources and labour relations, information and communications technology, academic, student affairs and governance, which are critical to the successful implementation of the restructuring proposals.

As one of its first tasks, the Merger Unit released a comprehensive set of guidelines entitled "Higher Education Restructuring and Transformation: Guidelines for Mergers and Incorporation" to assist the affected institutions in identifying the key elements, steps and processes necessary to give effect to the restructuring proposals and to establish the new institutions.

The guidelines also outlined the criteria and processes that institutions needed to follow in order to access financial support for the costs of implementing the mergers and incorporations, including, where applicable, re-capitalisation funds to ensure the financial sustainability of the new institution. The guidelines have proved invaluable for the affected institutions in implementing the merger activities, as well as for the Department in monitoring the progress of the mergers.

Much of our emphasis at the institutional level has been on the establishment of single merged institutions with respect to the governance, management and academic structures/programmes. In this regard, interactions and meetings between the relevant governing structures, technical task teams and the Merger Unit have been ongoing. The Merger Unit has conducted a series of on-site institutional visits that usually extended over two days to discuss technical support, monitor progress and offer advice and clarification on key issues.

In addition, the Merger Unit has convened workshops to address specific issues, such as on academic planning, human resources and student governance and participation. It has also held workshop for the 2004 and 2005 Interim Councils to brief them on their role, functions and responsibilities.

Furthermore, to ensure that the process is inclusive and participatory, the Merger Unit has also held meetings with national labour unions and student organisations to clarify and address issues of concern relating to the merger process. The Merger Unit has made numerous presentations at conferences and workshops organised by national higher education constituencies and interest groups.

The monitoring role of the Merger Unit is complemented by the establishment of a Ministerial Reference Group, whose role is to monitor progress, in particular, to ensure that due regard is given to the central principles underpinning the restructuring and transformation agenda, as well as to facilitate and mediate in cases of dispute and conflict, where required. The Reference Group is comprised of individuals with extensive experience in higher education or in large-scale organisations, and who are committed to the ideals of transformation and command respect both inside and outside the higher education sector.

The Department continues to monitor and support the 2004 mergers and incorporations. We are furthermore involved in the preparations for those mergers planned in 2005.

Some of the key challenge facing merging institutions and those that have incorporated campuses are the following:

student fees and financial aid. The approach adopted by merged institutions, including those have incorporated campuses has been to retain the existing fee structures, except for the normal inflationary increase. In certain institutions this has resulted in fee differentials across campuses. Thus from a tuition fee perspective students, in particular, pipeline students have not been prejudiced. With regard to student financial aid, the institutions have for the most part retained the existing institutional policies regarding the allocation of financial aid, while consideration is now being given to the development of a uniform policy within the context of access and affordability.

Harmonisation of staff conditions of service and benefit structures. In terms of the HE Act all existing staff retain their current conditions of service and benefits until such times as new policies have been developed in accordance with due processes as prescribed by the Labour Relations Act. Notwithstanding this, achieving a uniform set of conditions of service and remuneration benefits will take time, particularly given that merging institutions have vastly differing conditions of service and benefits.

The creation of new institutions in which all campuses are accorded the same status. The Ministry has made it clear that the principle of equality between merging institutions should be the starting point for giving effect to the merger and, in particular, for arriving at decisions relating to the adoption of new policies, procedures, structures and systems. In addition, mergers should not result in a federal arrangement, but must be premised on a unitary model.

The development of single new identities and institutional cultures that break with the past, especially since the mergers bring together institutions with diverse histories and academic traditions. This will require an unwavering commitment on the part of new institutional management and governing structures to ensure that new integrated cultures of shared values and loyalties, attitudes and conditions of work are being addressed.

Conclusion

From a legal compliance standpoint, all the mergers and incorporations scheduled for 1 January 2004 went off successfully. The Interim Councils all took office on schedule. More importantly, they all started with their preparatory work towards the end of 2003, a factor that became critical in fast tracking decision-making and avoiding a management vacuum arising in any of the new formed institutions.

Three of the four merged institutions (i.e., UKZN, UNISA and North West University) would by the end of this month have their permanent Councils in place. In fact, in the case of North West University the new Council has already taken office. In the case of Tshwane University of Technology (TUT) the Interim Council is likely to remain in office for another month or two.

The 2005 Interim Council elect have also begun their preparatory work.

While there remain a number of challenges that must be addressed in the short to medium term by the institutions, the Department remains confident that the mergers and incorporations will realise the goals of the national plan for higher education. Whilst both generic and institution specific problems remain and are likely to continue arising as time passes, there is no reason to believe that these will substantively threaten the course of the restructuring process.

The institutional restructuring process is part of the broader transformation of the higher education system, which must involve all institutions. In this regard, all institutions not involved in mergers are required to develop plans that clearly articulate transformation goals and targets.