Education Laws Amd Bill; General & Further Educ & Training Quality Assurance Bill: deliberations
Basic Education
16 October 2001
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Meeting report
EDUCATION PORTFOLIO COMMITTEE
16 October 2001
GENERAL AND FURTHER EDUCATION AND TRAINING QUALITY ASSURANCE BILL; EDUCATION
LAWS AMENDMENT BILL: DELIBERATIONS
Chairperson: Prof Mayatula (ANC)
Documents handed out:
General and
Further Education and Training Quality Assurance Bill [B 57B - 2001]
Education Laws Amendment Bill [B 55B - 2001]
Proposed Amendments: Education Laws Amendment Bill - Dr B Geldenhuys(NNP). (See
Appendix)
SUMMARY
The
Committee considered the two Bills which had been amended by the Select
Committee on Education and Recreation in the National Council of Provinces. The
Members held differing views on Clause 6 (7)(a) of the Education Laws Amendment
Bill on whether money from a school fund of a public school may not be paid
into a trust or be used to establish a trust. While some were of the view that
money from a school fund should indeed not be paid into a trust account because
of the historical abuse of trust accounts. Others argued that even if money is
credited into a trust from external sources, such as a donation, there should
be transparency surrounding the underlying circumstances or transactions that
led to the advance of money into a trust.
MINUTES
General and Further Education and Training Quality Assurance Bill
Clauses 1-5
These
clauses were all agreed to and no concerns were raised regarding its content.
Clause 6 Composition of
Council
Dr
Geldenhuys (NNP) remarked that the Independent Schools Association of South
Africa distributed a circular, soon after the public hearings, raising concerns
over Clause 6 (1)(a) and Clause 6 (3)(b). The organisation argued that, in
connection with Clause 6 (3)(b)(i), provision should be made for representation
by the private sector as well. It was proposed that subclause (i) should be
redrafted to read “is broadly representative of public and private sectors of
the general and further education and training sectors�. It was also proposed
that membership of the council should be extended from fifteen to twenty
members in order to make ample provision for private sector representation.
Prof Mayatula asked the Department for clarification.
Adv Boshoff (Department of Education) pointed out that that the language
employed in subsection (i) was also meant to be inclusive of the private
sector. It does not exclude any of the sectors. When the Minister makes an
appointment he has to ensure that there is sufficient representation of the
members from the private sector. The reason for the limitation of Council
membership to fifteen members was that it was felt that there should be a
smaller rather than a larger council. A small council is usually composed of
fifteen members. If the total membership were to be increased to twenty such
would mean a shift in the original decision that was taken to have a smaller
council. If Council membership is increased to twenty it would amount to an
institution of a medium sized council.
Mr Cwele (ANC) added that Dr Geldenhuys's concern has been adequately covered.
If one looks at a careful reading of Clause 6 (3)(b)(i) it does make adequate
provision for private sector representation.
The clause was finally agreed to.
Clauses 7-12
These
clauses were all agreed to and no concerns were raised by Members.
Clause 13 Funds of the
Council
Dr
Geldenhuys also remarked that the Independent Schools Association of South
Africa noted a concern with regard to Clause 13 (1)(c). The organisation
contended that it is a service provider in the rural areas. Thus if it cannot
afford to pay for the services rendered it may end up in a position where it
would not be in a position to continue providing good education. It suggested
that these fees should be determined in consultation with private providers.
Adv Boshoff replied that the authority given to the Council to receive money
must be read with other provisions in the Bill and it must also be seen in the
light of other measures in place such as the funding norms. Another safeguard
that is in place is contained in Clause 13(3), namely that the Minister must
approve the budget of the Council. Failing which he must require the Council to
provide a revised budget within a specified period. Thus, the concerns that
have been raised are fully covered.
Clause 13 was finally agreed to.
Clauses 14-22
These
clauses were all agreed to.
Clause 23 Accreditation of
Private Providers
Dr
Geldenhuys recalled an earlier point that it would be difficult to credit every
individual private provider. The argument was raised that this Bill should
provide for block accreditation by private providers. A private provider must
be registered by the Department and to be registered they must meet certain
standards.
Adv Boshoff replied that in the public hearings one of the organisations had
submitted that it was a preferred option to accredit all providers including
the State. Private providers also need to register with the State and must also
register for accreditation.
The clause was finally agreed to by all members.
Clauses 24-30
These
clauses were all agreed to.
Education Laws Amendment
Bill
Clauses 1-4
The
clauses were all agreed to.
Clause 5
Doctor
Geldenhuys remarked that his party objects to the fact that a school may not be
allowed to enter into a loan or overdraft agreement so as to supplement the
school fund. He said that they will move an amendment to make sure that the
Member of the Executive Council who must approve a loan must do so within a
time frame, for example where there is an urgent need for a loan or money due
to a shortage. It is common cause that the MEC must approve a loan but he
cannot be allowed to sit on an application for funding for an indefinite
period.
Prof. Mayatula commented that the MEC's are not allowed or supposed to sit upon
anything in any event. There are laws that exist which compel them to take
adequate steps. If applications for funding are unnecessarily delayed, recourse
can be had to the courts for an appropriate remedy.
Mr Kgwele remarked that Doctor Geldenhuys's remarks do not close the avenues
that schools can follow in order to raise loans. The clause only regulated the
provision of loans. He was of the opinion that there was no need to fix time
frames within which an MEC has to have a loan approved. His view was that this
matter can adequately be dealt with in the Regulations.
Adv. Boshoff was also of the opinion that there was nothing wrong with this
clause and that the MEC is required to act promptly in the circumstances.
Dr Geldenhuys remarked that his party is not satisfied with the wording of
Clause 1(2) of the Education Laws Amendment Bill that has been amended by the
Select Committee on Education and Recreation in the National Council of
Provinces and that the party prefers the original clause 1(2) of the Education
Laws Amendment Bill that was introduced in the NCOP as a section 76 Bill. The
National Minister should not determineÂ
the functions of the learner's representative council as this function
lay with the Member of the Executive Council.
Prof. Mayatula adopted a different view and remarked that the clause reads that
it is the Member of the Executive Council who has this obligation.
Dr. Geldenhuys replied that his interpretation was that this clause is not the
same as the one contained in the original Bill. The original Bill simply said
that those functions should be determined by the Member of the Executive
Council. Now there is the additional wording which makes the Member of the
Executive Council's duties subject to policy made in terms of section 3 (4)(g)
of the National Education Policy Act -
and this is made by the National Minister. These functions will be determined
by the National Minister.
Adv. Boshoff replied that the function lies with the Member of the Executive
Council. However, in performing that function he must adhere to the legal
framework set by the Act and the policy framework in terms of the National
Education Policy Act. The amended clause 1(b) alludes to this fact.
Dr Geldenhuys asked for an explanation or the reason why it was deleted in the
original version of the Bill.
Adv. Boshoff replied that the original version did not specifically refer to
the current provision.
Mr Randall (ANC) remarked that this was implied in the original version of the
legislation.
Mr Kgwele remarked that this clause affirms that this duty shall be carried out
by the Member of the Executive Council.
Dr Geldenhuys remarked that he was not convinced that the power lies with the
Member of the Executive Council but that this was part of the centralization
process in education and hence would not support the clause as it stands.
Clause 5 was ultimately agreed to.
Clause 6 - Amendment of
section 37 of Act 84 of 1996
Mr Ntuli remarked that he
appreciates the good intentions of this clause. He accepted that trust funds
may easily be abused. However, this must be underpinned by the understanding of
some of the Model C schools where due to the state funding norms such schools
do not get enough money. The reality then is that they need to create trust
funds. This clause may incapacitate some of these schools. If one looks at
clause 6(7)(a) it reads that “money from a school fund of a public school may
not be paid into a trust or be used to establish a trust�. School funds include
all monies that come to a school. It would have been better if the clause read
“money from school fees�. This would have made sense because these are direct
contributions from parents. However, if a school benefits money from other
sources, then such money may be credited to its trust account. He said that his
party would appreciate that clause be changed to read “money from school fees�
instead of “money from the school fund�. The wording “school fund� completely
incapacitates schools from raising money.
Adv. Boshoff replied that it was important to know what a school fund was. A
school fund is all the money paid to a school. A trust and trust funds are
separate from school funds, although the school may be the beneficiary the
school is not the holder of those funds. A school fund is an account to which
all the school monies must be paid, e.g. compulsory and voluntary contributions
and funds raised by means of utilization of school facilities. Different
ledgers may be created in order to identify how the money is to be utilized.
Whenever a school receives money from whatever source, the moment it becomes
school money it is controlled by the school and may be used to perform school
functions and for the benefit of all learners. This is the reason for the
amendment into this Act.
A member (ANC) remarked that the reason behind the introduction of this clause
was to bring a cessation of abuse that has occurred in the past. Trust and
trust funds were continually been abused in the past. This is the main purpose
of the amendment.
Mr M Kgwele remarked that money collected into a school fund cannot be
transferred into a trust. A trust is only supposed to raise funds on behalf of
a school and transfer money into a school fund.
Dr Geldenhuys remarked that his party is not against controlling trust funds
and to try to root out abuse of school funds. Whenever a trust fund is abused
that problem should be addressed. Misuse of trust funds is an exception to the
general rule. The proposed amendment that the NNP puts forward is that departmental
control should be strengthened over existing trust funds. The NNP also objects
to retrospective legality as it is part of the clause. Furthermore, a trust
fund is used for the benefit of all the learners at school but if it is misused
this problem must be addressed. Trusts should be allowed to exist but stricter
controls should be imposed over them by provincial departments and departmental
heads in the provinces.
A member (ANC) remarked that trusts must be done away with because they have
been operated adversely to the disadvantaged communities who do not benefit
from these instruments.
A member (ANC) asked for clarity on who
controls trust funds, are trusts controlled by school governing bodies or are
they controlled by persons outside the schools. She was of the opinion that if
these instruments are controlled elsewhere other than by schools governing
bodies then such may be a problem.
Prof. Mayatula echoed the above sentiment and said that it was even raised
during the public hearings.
Adv. Boshoff replied that this amendment does not attempt to regulate trusts
but attempts to regulate school funds. School funds are not paid out of a
school fund into a trust.
Dr Geldenhuys asked what would be the position if a private individual were to
donate R10 000 into a school. Would this amount to school funds? He asked if
this may not be credited to a trust. Most members agreed that if a private
individual donates an amount of R10 000 to a school that amount of money would
be regarded as school funds.
Adv. Boshoff replied that the Act is clear that the moment money is given to a
school it becomes a school fund. A school's governing body cannot be involved
in setting up a trust. If an alumni donates money to his old school through an
independent trust that established by him for that purpose, then section 37(4)
of the Act is relevant. This section provides that “any money or goods donated
or bequeathed to or received in trust by a public school must be applied in
accordance with the conditions of such donations, bequest or trust�. It is
therefore possible for private persons to donate money. However, the current
amendment in the Bill says that school funds, that is the total of all school
fees, donations and whatsoever, that money is school money and must not be paid
into a trust.
Mr Kgwele remarked that the issue of trusts needs to be clarified to avoid the
danger of the public being misled.
Dr Geldenhuys remarked that the implications of this clause in practice would
be that the “old boys� will set up a trust and donate money into it. That trust
will be far removed from the school's governing body. He said that he was aware
of the fact that schools have already been instructed on how to circumvent this
provision. The alternative was to allow the governing body to have a trust fund
and it would be easier to execute stricter control over that trust.
Prof. Mayatula noted that the circumvention tactics have been born out of fear
that schools will no longer derive benefits that they were getting out of
trusts and that these benefits would be realized through circumvention tactics.
Mr Mpontshane (IFP) remarked that the circumvention tactics were also born out
of protectionism.
A member (ANC) remarked that the establishment of trusts will have the effect
of adding more problems to the Education Ministry because there have been
instances where school principals have abused (misused) school funds.
Mr Ntuli posed a question to Advocate Boshoff and asked to what extent
according to his (Boshoff's) experience as a bureaucrat has he experienced the
abuse (misuse) of trust funds.
Prof. Mayatula replied that the money donated to a trust became trust funds.
Mr Ntuli opined that it was important that even if monies are donated into a
trust there has to be transparency regarding the underlying circumstances
surrounding the donation of money into a trust.
Prof. Mayatula said that it was important to note that the Bill does not
prevent the forming of a trust by old alumni of a school whereby they can
deposit money for the benefit of the school.
Adv. Boshoff stressed the importance of defining what school funds are, because
the extra money donated to a trust would not become school funds.
Prof. Mayatula also reiterated that there is no law that prevents individuals
from forming trusts in order that they may contribute money to it from their
own pockets and trust money can be transferred from a trust to a school.
Dr Geldenhuys expanded on the point of retrospective illegality to which he had
alluded to earlier on. This is contained in clause 6 (7)(b) which provides that
if a trust was established from a school fund of a public school or if such
money was paid into a trust prior to 1 January 2002, such trust or payment is
invalid and the money must be paid back into the school fund. He said that this
clause was bad law and was potentially unconstitutional.
Adv. Boshoff replied that the provision is correct If the trust does not have
funds to repay to the school it would cease to exist as it would be liquidated
and the school would suffer the loss.
Dr Geldenhuys stressed that he would move for the amendments listed in the
document that he had submitted which is entitled: Proposed Amendments -
Education Laws Amendment Bill (See Appendix)
Clauses 7 - 15
These clauses were all agreed to.        Â
The meeting was adjourned.
PROPOSED AMENDMENTS:
EDUCATION LAWS AMENDMENT BILL
PROPOSED AMENDMENTS:
Clause 1 (b) to be deleted and replaced by the following wording:
The substitution for subsection (2) of the following subsection:
"(2) A Member of the Executive Council [may] must, by notice in the
Provincial Gazette, determine [guidelines] the functions and the procedures
for the establishment [,]Â and
election
          Â
1Â Â Â Â Â Â Â Â Â All trusts established from a
school fund of the public school must be
administered in accordance with directions issued by the Head of
Department and which are not inconsistent with the provisions of this
Act (The South African Schools Act).
2Â Â Â Â Â Â Â Â Â If the Member of the Executive
Committee deems it necessary, he or She may request the Auditor-General to
undertake an audit of the records and financial statements of a trust belonging
to and administered by a public school.
3Â Â Â Â Â Â Â Â Â A governing body must submit to
the Head of Department within six months after the end of each financial year,
a copy of the audited annual financial statements of a trust belonging to and
administered by a public school
4Â Â Â Â Â Â Â Â Â All monies generated by a trust
which belongs to and is administered by a public school, must be used in terms
of S37(6).
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