Statistics released at the end of 2012 by the Department of Higher Education and Training (DHET) indicated a backlog of about 200 000 university beds and, since then, the department’s prime focus has been on student housing funding.

The DHET announced at the end of that same year that the National Treasury had allocated R6-billion to the department for infrastructure funding from 2013 to 2015.

With its strong focus on addressing transformation in historically disadvantaged institutions (HDIs), the department pointed out in 2012 that the infrastructure funding made available to universities represented a significant investment by government, particularly in the current economic and financial climate.

Higher Education and Training Minister Blade Nzimande pointed out in a statement on University Funding in 2012 that these funds must be used to deal with South Africa’s transformation agenda, in addition to being used prudently and efficiently to respond to the national shortages of scarce and critical skills in engineering, health sciences, life and physical sciences, and teacher training.

“It is for this reason that some universities with capacity constraints have been allocated funding to assist in improving their project management to ensure that there is value for money in all infrastructure projects,” he noted.

During the Development Bank of Southern Africa’s (DBSA’s) Infrastructure Dialogues, titled Financing Public Infrastructure, earlier this month, DHET financial and physical planning director Brenda Swart said the department had allocated about R1.7-billion of the R6-billion to student housing infrastructure to date.

She added that the majority of institutions that received the funding were the HDIs, “as it is the Minister’s current focus”.

DBSA business development principal Louis Strydom suggested at the dialogues that, if government was concerned about the backlog of student housing, alternative ways of decreasing the unitary cost for student housing should be considered, for example, using capital investments as replaceable infrastructure.

“If we are looking at building new residences over a long period, unitary costs will still be a challenge, but if we concentrate on decreasing those costs, then we should look at how we can use less expensive material, which would need to be replaced over time.

“In this way, we would have an extended debt in terms of having to replace, for example, water pipes and sewer pipes, but more accommodation would have been built to alleviate the backlog,” he said.

Swart added that establishing business relationships with the private sector was pivotal in dealing with the infrastructure backlog that universities currently faced.

However, Association for Savings and Investment consultant Stephen Smith pointed out during the dialogue that it was important to identify the reason for the backlog to adequately tackle the problem.

He stated that, since 1994, student enrolment at universities had doubled, which resulted in more money having to be allocated to teaching than accommodation.

Consequently, International Housing Solutions (IHS) managing partner Rob Wesselo alluded in a daily newspaper earlier this year that the National Student Financial Aid Scheme was driving the growth of the student population, which, in turn, led to an increase in demand for accommodation.

He added that this resulted in the need for IHS to service the market, as more students needed accommodation off campus.

However, Wesselo also indicated that, although student housing offered excellent opportunities to investors, it must be approached through a different strategy to mitigate any sector- specific challenges.

Property consulting firm Dakibo Consulting MD Bian Jooste shared the same sentiment, while pointing out during the dialogue that the need for collaboration between the public and private sector in dealing with the backlog was quite critical.