Free education is a promise made by the ANC. "Students categorised as poor and working class, under the new definition, will be funded and supported through government grants not loans", the Presidency said in a statement.
The definition of poor and working class students will now refer to currently enrolled technical vocational education and training (TVET) college or university students from South African households with a combined annual income of up to 350,000 rand (about 26,700 US dollars) by 2018 academic year, Zuma explained.
Grants for poor and working class South African students at universities and TVET colleges would continue to be managed and administered by the NSFAS through their recently completed student centred-model. Students considered to be in the "missing middle" (those in households earning more than R120 000 but less than R600 000) would have to find bursaries or make other sacrifices in order to pay tuition. In its congress in 2007, the party made a resolution, pledging to have free education in seven years.
The announcements follow the #FeesMustFall protests that led to the president setting up the Heher Commission of Inquiry into the feasibility of free education and the viability of government financing of student tuition.
The National Student Financial Aid Scheme (NSFAS) loan system will be converted to a "100% grants effective immediately".
This loan would then have to be paid back, but only once the student had graduated and passed a certain income threshold. But now, in their further years of study, they will instead receive a grant that will be administered by NSFAS.
In addition‚ the announcement that university subsidies would be increased from 0.68% to 1% of gross domestic product over the next five years‚ while welcome‚ "is completely uncosted". This solution was also proposed by the fees commission.
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Despite this, Zuma dropped a bombshell with the release of a statement at the beginning of the ANC's 54th conference in Nasrec, stating that government will subsidise free higher education for poor and working-class students.
The government would further invest in the training and development of existing TVET staff and the recruitment of additional qualified staff to improve the quality of teaching and learning at TVET colleges.
The announcement of no fee increase for students whose families earn less than R600‚000 was also uncosted‚ she said.
In justifying his plan that critics said would be disastrous for the fiscus and National Treasury's budgeting process, Zuma said free-higher education for poor students is in line with ANC policies.
Speaking to journalists after the announcement on Saturday, Finance Minister Malusi Gigaba said Treasury would provide details on how it would fund the free education during the 2018 Budget.
Accommodation at historically disadvantaged universities will be addressed "urgently".
The government will extend fully subsidised free higher education to "poor and working class" youth from 2018, the presidency said on Saturday.