Diagnóstico

The South African School Act, (SASA) (Act No. 84 of 1996) which was promulgated to transform and drive the new Education System in South Africa came into effect on January 1997. The principal objective of the act was to provide a uniform system for the organisation, governance and funding of public schools in South Africa. Section 21 of the SASA gives a list of functions, which the public school may apply to undertake – allocated functions that include managing their own budgets. It is also provided in the same Act that the state must fund the public schools from the public revenue on equitable bases in order to ensure the proper exercise of the rights of learners to education and the redress of past funding inequalities in education (South African Schools Act Section 34 (1)). Section 34 (2) of the same act requires the state to provide sufficient information on annual basis to public schools regarding the funding to enable schools to prepare their budgets for the next financial year.

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According to SASA (1996), the resource allocation to schools is based on the learner data contained in the 10th _{day Snap Survey of the previous year. The resource} targeting list comprises all the public schools in the province sorted by “need” or poverty. Two equally weighted factors are used to rank schools:

(a) The physical condition, facilities and crowding of the school: utilisation of the school register of need data, provincial education department may create indices based on the range of physical facilities at the school for effective learning to take place: classroom ratio, the overall condition and need for repairs and availability of basic services. This factor was weighed 50%.

(b) The relative poverty of the community around the school: Using census, household survey or data, provincial education departments may create indices based on, for example, the proportion of households with electricity and piped water in the community served by the school, and other similar criteria.

2.3 Table 1: SHOWS THE ALLOCATION OF FUNDS PER QUINTILES (SOURCE) 2007 2008 2009 % possible fee exemptions Quintile1(Poorest) R 738 R 775 R 807 100% Quintile 2 R 677 R 711 R 740 100% Quintile 3 R 554 R 581 R 605 100% Quintile 4 R 369 R 388 R 404 67% Quintile 5 (least poor) R123 R 129 R 134 22%

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No fee threshold R 551 R 581 R 605

This means that the target for learners in the poorest quintile will be by R738 per year in 2007, whereas the target for learners in the least poor quintile will be R123 per year. This indicates that government funding is assumed to be enough to cover the cost for each learner, and that all learners in the first three quintiles could potentially be exempted from paying school fees. In quintile 4, for example, if school fees can cover 33% of learners’ needs, then 67% of learner could potentially be exempted from paying fees. In quintile 5, if school fees are charged, 22% of learners could be exempted (Norms and Standards for School Funding, 2006).

Section 35 of the South African Schools Act also requires that the Minister must determine the norms and minimum standards for the funding of public schools after consultation with the Council of Education Ministers, the Financial and Fiscal Commission and the Minister of Finance. According to Norms and Standards for school funding (2006, p. 7), the state allocates a certain amount of funding to each public school, which is intended to cover key inputs other than personnel and capital costs. Some examples are, for instance, textbooks, stationery, cleaning materials, and electricity costs. Traditionally, at least, some of these costs have been covered by school fees. However, some communities are unable to meet even a portion of these costs. The state must, therefore, ensure that the school allocation is sufficient to cover the needs and rights of children to quality education.

The Norms and Standards (2006, p. 7) gives examples of what schools could spend their allocation on. Because the needs of schools vary, this is not prescriptive. However, the allocation is intended to cover non-personnel recurrent items and small capital items, as well as repairs and maintenance. It is primarily and exclusively intended for the promotion of quality education in public schools. The Norms and Standard for funding policy has very clearly stated that the school allocation may not be used to cover the cost of personnel and new buildings.

According to Norms and Standards (2006), each Provincial Education Department is required to produce a “Resource Target List” of all the schools in its province, based

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on the poverty criteria. The Department must rank all the schools from the poorest to the least poor. This is done so that the poorest schools are targeted to get the most financial resources. This formula applies to both section 21 (self-managing) schools and section 20 schools. Each school in the province is allocated a per- learner-allocation for funding, and is assigned a poverty score based on the relative poverty of the community around the school. This assessment should be based on the national data (usually, the national census conducted every five years by Statistics South Africa).The variables that are taken into account are the household or individual income of the community in the school’s catchment area; dependency ratio (the proportion of income earners to people who are dependent) or unemployment rates and the level of education of the community.

Once the schools are listed in rank order according to Norms and Standards (2006) for school funding, the list is divided into five quintiles from poorest to the least poor. The distribution per quintile determines the per-learner-allocation in terms of the resource Targeting Table below. Quintile means one fifth. Thus, allocation is made on a variable per learner basis that favours the poor segments of the population. The neediest and largest schools are prioritised in terms of funding (SASA, 1996 B-52). See table 2 below:

2.4 TABLE 2: RESOURCE TARGETING TABLE BASED ON COMMUNITIES OF SCHOOLS AND POVERTY OF COMMUNITIES

School quintiles from poorest to least poor Expenditure allocation Cumulative percentage of schools Cumulative % of non- personnel and capital recurrent expenditure Per learner expenditure indexed to average of 100 Poorest 20% 35% of the resources 20% 35% 175 Next 20% 25% of the 40% 60% 125

32 resources Next 20% 20% of the resources 60% 80% 100 Next 20% 15% of the resources 80% 95% 75% Least poor 20% 5% of the resources 100% 100% 25%

The Amended Norms and Standards for School Funding Gazette no 31496 (2008) stipulates that 45% of the school allocation is ring fenced for Learner Teacher Support Material (LTSM) and may be used for the purchasing of textbooks. This is done to ensure progressive movement to a ratio of one textbook per learner per learning area. Twelve percent (12%) of the allocation is for stationery required for the different learning areas; 10% and 5% for educational consumables and non- education consumables, respectively, in support of curriculum, whilst 8% of the school allocation is ring fenced for maintenance and must be used for minor repairs e.g. replacement of broken windows and minor plumbing repairs. All these efforts are aimed at improving the quality of teaching and learning in all schools. The above school improvement task is given to the School Governing Bodies and the School Management Teams.

The Schools Act categorises schools into Section 20 and Section 21. Section 20 schools are schools that do not receive an allocation in cash. Instead of cash Section 20 schools are required to draw up their budgets and to submit them to the Department of Education (DoE), and purchases are then made against the budgeted items. These schools are no-fee schools, which have their needs paid directly by the Department and are categorised as poor schools with no resources to administer their funds. According to the SASA provisions and the existing departmental arrangements on Section 20 schools, the Provincial Departments of Education and Training are mandated to procure goods and services on behalf of Section 20

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schools. In other words, the DoE administers the budget allocation on behalf of Section 20 schools (Mestry, 2004, 2006, 2014b; Xaba, 2011; Bagarette, 2014, Lekonyane and Maja, 2014).

But Section 21 schools, on the other hand, receive an allocation in cash and are required to perform the following functions: (1) maintaining and improving the school’s property, buildings and grounds, (2) purchasing textbooks, educational materials or equipment for the school and (3) paying for services rendered to the school. They have their finances paid into their accounts by the Department, which they administer.

Section 21 of the SASA legislation is all about the school’s capacity to manage itself effectively in finance, and the Provincial Education Department (PED) is required by the Schools Act to determine whether each school has the necessary managerial capacity to do so (Department of Education and Culture, 2002). But the funds received from the State are presently insufficient to cover the past backlog. Hence, schools are required to supplement their funds through fundraising, donations, sponsorships and school fees.

In accordance with the new SASA school improvement framework, schools need to monitor and control income and expenditure regularly. This is expected to be done as part of an established monitoring and evaluation mechanism, which uses the budget as a yardstick in ensuring that schools spend according to a planned budget (Mestry, 2014b). The purpose of this financial control measure is to avoid overspending, and working towards the achievement of the school set objectives. The achievement of the SGB-SMT financial management efficiency strategy depends upon the SGB-SMT knowledge competence and skills capabilities.