KEY PERSPECTIVES ON THE PRESENCE OF TSHWANE UNIVERSITY OF TECHNOLOGY IN MPUMALANGA

A SUMMARY OF THE POSITION PAPER ON THE STRATEGIC VIEW OF THE PRESENCE OF TSHWANE UNIVERSITY OF TECHNOLOGY IN MPUMALANGA

TSHWANE UNIVERSITY OF TECHNOLOGY

MPUMALANGA DELIVERY SITES

June 2006

KEY PERSPECTIVES ON THE PRESENCE OF TSHWANE UNIVERSITY OF TECHNOLOGY IN MPUMALANGA

TABLE OF CONTENTS

1 1.1 1.2 1.3	OVERVIEW OF THE MPUMALANGA PROVINCE Introduction The economy of Mpumalanga Regional profile	1 1 1 4
2 2.1 2.2 2.3	THE GROWTH AND HUMAN RESOURCE STRATEGIES OF THE MPUMALANGA PROVINCE (2005-2010) The provincial growth and development strategy (PGDS) 2004-2014 The Provincial skills development Plan (PSDP) Influence on the presence of TUT in Mpumalanga	4 4 5 6
3 3.1 3.2	THE EDUCATION ENVIRONMENT IN MPUMALANGA Secondary Education in Mpumalanga Higher Eduction in Mpumalanga	8 8 8
4 4.1 4.2	CURRENT TUT PROFILE IN MPUMALANGA Status quo of the Mpumalanga campuses Proposal for the intermediate strategic positioning of the Witbank and Nelspruit delivery sites	10 10 10
5 5.1 5.2 5.3 5.4 5.4.1 5.4.2 5.4.3	STRATEGIC POSITION OF TUT IN MPUMALANGA Introduction Key driving forces in higher education in Mpumalanga Strategic focus of TUT in Mpumalanga Guiding Principles A PQM that is demand based and future directed Institutional arrangements Management model	12 12 12 13 13 13 14 14
6 6.1 6.2 6.3 6.3.1 6.3.2	STRATEGIC THRUST OF THE NELSPRUIT CAMPUS Introduction Strategic thrust of the Nelspruit campus The Financial viability of Nelspruit campus Principles for viability model Scenarios	17 17 17 18 18 19
7 7.1 7.2 7.3 7.3.1 7.3.2	STRATEGIC THRUST OF THE WITBANK CAMPUS Introduction Strategic thrust of the Witbank campus The Financial viability of Witbank campus Principles for viability model Scenarios	20 20 20 21 21 22
8 8.1 8.2 8.3	THE WAY FORWARD Outstanding issues Start positioning for the new university Use 2007 as determining year	23 23 24 24
9	CONCLUSION	24
BIBLIOGRAPHY	26

KEY PERSPECTIVES ON THE PRESENCE OF TSHWANE UNIVERSITY OF TECHNOLOGY IN MPUMALANGA

A demand driven approach

1.	AN OVERVIEW OF MPUMALANGA PROVINCE

1.1	Introduction

Mpumalanga Province, meaning the “place of the rising sun”, lies in the north-eastern region of South Africa, with the capital, Nelspruit, situated approximately 350 km east of Johannesburg. The Province occupies 6.5% of the surface area of South Africa. Demographic projections indicate that Mpumalanga Province is home to approximately 3,1 million people, which constitute less than 7% of the total population of South Africa. (DBSA, 2004:1). The Mpumalanga Province is a predominantly rural province with 38% of the population younger than 15 years and only 38,9% of the population being economically active. Due to the capital-intensive nature of the dominant industries, namely mining, manufacturing and electricity, these industries contributed only 24,4% to formal employment in the province while contributing 59,6% to the province's GVA. In contrast, due to the labour-intensive production processes inherent in the agriculture, commerce and services sectors, they represent 63,1% of formal employment while contributing 28,9% to the province's GVA.

1.2	The economy of Mpumalanga

The major sectors in the economy of the Province are manufacturing, mining and quarrying, community, social and personal services, and electricity, gas and water. An analysis of the structure of the economy of Mpumalanga for 2002 shows that the Province contributed significantly to the national economy in respect of six sub-sectors. which are linked largely to the natural resources available in the Province, i.e. coal mining and forestry, and the supporting industries, i.e. logging, manufacturing and electricity provision.

Mining, manufacturing and electricity comprise almost 60% of the total value added and yet contribute only 20% of the jobs in the Province. The following industries drive the economy of Mpumalanga:

At 27, 2% of the total GVA, the manufacturing sector is still the most important contributor to the province's economy (DBSA, 2004:38).

The Province appears to possess comparative advantages in the production of agriculture, mining, manufacturing and energy production (DBSA, 2004:38).

The Province has the biggest competitive advantage in energy production (DBSA, 2004:38).

Agriculture as a sector grew between 1996 and 2000 at a faster rate in the Province (2, 2%) than the national total (0, 3%).

Table 1.1 is a summary of the Province’s economic profile and the growth rate per sector.

Table 1.1: Provincial composition of gross value added and employment (2002), and average annual economic growth by sector (1990-1996 and 1996-2002).

Economic Sectors	% of GGP	% of total employment	Average annual % growth in value added (1990-1996)	Average annual % growth in value added (1996-2002)
Agriculture, hunting, forestry and fishing	6.1	18.1	-0.1	1.0
Community, social and personal services	14.6	15.4	1.6	0.4
Construction	1.6	6.1	-1.6	0.7
Electricity, gas and water	10.1	1.8	4.1	2.0
Finance, insurance, real estate and business services	5.4	5.3	2.9	6.6
Manufacturing	27.2	11.2	0.4	4.7
Mining and quarrying	22.3	7.5	-0.3	0.5
Transport, storage and communication	4.5	3.6	3.7	5.9
Wholesale and retail trade	8.2	13.9	1.4	1.8
Private households	-	10.9	-	-
Undetermined	-	6.3	-	-
Total	-	-	1.2	2.5

(DBSA, 2004: Mpumalanga at a glance, 14-16, 37)

Table 1.2 will highlight the nature of the economic drivers in the Province:

Table 1,2. Economic activity drivers in the Mpumalanga Province

Manufacturing	Agriculture: Forestry and other agricultural activities	Mining	Energy provision	Tourism
The dominant industries include : The refined petroleum products, chemicals, rubber and plastic which contributed 38.5% to the value added. The base metals, steel and stainless steel industry manufactured metal products, machinery and equipment industry which contributed 31%. The food, food products and beverages industry which contributed 15% to GGP. Manufacturing as a whole appeared to be very capital-intensive – while comprising 27.2% of the total value added it provided only 11.2% of the jobs in the Province. From an employment perspective, the wood and wood products industry dominated the manufacturing sector, followed by the basic iron and steel industries, food and finally chemical product sectors.	Provide jobs far in excess of their contributions to provincial GGP – the sector comprises 6.1% of total GGP yet provides 18.1% of the employment opportunities in the Province. The dominant branch of farming in Mpumalanga is field crops, followed by animal and animal products and horticulture products. Forestry, which contributes 16, 5% to the province's gross income from agriculture, represents 37, 8% of gross income from forestry in the country. One-third of South Africa’s forestry activity takes place in the Province.	The mining industry is an important contributor to Mpumalanga's economy in terms of economic production. Mining in Mpumalanga is primarily related to coal and gold, with the Province accounting for almost 90% of the country’s coal production. Nearly two-thirds of processed mineral sales generated by the Province are produced from chromium alloys. Mining is relatively capital-intensive – the sector account for more than one-fifth of Provincial output, but provides less than 8% of the jobs in Mpumalanga.	Mpumalanga is a major producer of energy. Currently over 70% of South Africa’s electricity is produced in the Province. This will rise to 75% over the next four to six years as mothballed power plants enter service. The electricity industry produces 10.1% of the Province’s GDP, but only 1.8% of jobs are found in this sector.	The natural environment of Mpumalanga makes the Province an important tourist destination in South Africa. Mpumalanga hosted the third-most foreign tourists in the country after Gauteng and the Western Cape, and captured 10% of total tourism money/revenue spent in the country. Expenditure by tourists contributed 5.2% towards the Provincial GGP. Nationally, tourism has been growing at a rate of 5% per year.

1.3	Regional profile

Mpumalanga is divided into three district municipalities; Ehlanzeni (north-east portion of Mpumalanga), Gert Sibande (southern Mpumalanga) and Nkangala (western Mpumalanga). The Ehlanzeni district has the highest population density in Mpumalanga Province. Four local municipalities dominate gross value added in Mpumalanga, and produce more than 70% of the Province’s GGP. These are Govan Mbeki (containing the town of Secunda), Steve Tshwete (including Middelburg), Emalahleni (which incorporates Witbank) and Mbombela (containing Nelspruit). Manufacturing is a major contributor to the GVA in the three large district municipalities, while mining also makes a significant contribution to the economies of Gert Sibande and Nkangala.

2.	THE GROWTH AND HUMAN RESOURCE STRATEGIES OF THE MPUMALANGA PROVINCE (2005-2010)

2.1	The Provincial Growth and Development Strategy (PGDS) 2004-2014

The PGDS is intended to provide a macro approach to growth and development in the Province, taking into account the current socio-economic policy environment, the requirements of the Accelerated and Shared Growth Initiative for South Africa (AsgiSA), the National Spatial Development Perspective (NSDP) and the Integrated Development Plans (IDP) of Municipalities. The Province has identified six priority areas of intervention. These priority areas have been identified primarily based on the social, economic and developmental needs of the Province. The six priority areas are; economic development, social development infrastructure, social development, sustainable environmental development, good governance and human resource development.

According to the objectives for growth, set by the PGDS, most of the economic growth and job creation will take place in the wholesale and retail, agricultural, manufacturing, tourism and financial services sectors.

A number of industrial clusters with potential for growth have also been identified in the Province. These are stainless steel, agri-processing, agri-products, wood products, chemicals and tourism.

Chapter 6 of the PGDS outlines the importance of human resource development to stimulate social development and economic growth through the creation of up- and downstream opportunities in the agro-processing, agro-products, stainless steel, chemical and chemical products and wood product industrial sectors, and in tourism, services (e.g. wholesale, banking, insurance, security, repair & maintenance etc), and the SMME, arts and craft sectors.

Facilitating human resource development, the PGDS key development priorities focus on two distinct clusters:

Education (specific reference is made to higher education)

Skills development, being staff development and skills training (Mpumalanga Provincial Government, 2003:16)

2.2	The Provincial Skills Development Plan (PSDP)

The strategy for developing the human resource capacity of the Province is contained in the Mpumalanga Province Human Resource Development strategy, published in 2003. The HRD strategy is based on principles of responsiveness to changing demands over time, cost-effective delivery of high quality human resource development strategies and system flexibility to adjust to changing demands.

The Mpumalanga Human Resource Development Strategy requires tertiary institutions to:

Be responsive to changing demands over time

Ensure cost-effective delivery of high quality programs

Implement a system that suits the needs of a wide range of employers and individuals. This system should also be flexible to satisfy different learning styles

Target all vulnerable groups of the society.

Invest in the principles of a need-focused system

Meet the needs of employers and individuals rather than being formulated and delivered at the convenience of the provider.

One of the key strategic thrusts for human resource development was identified as the establishment and consolidation of a provincial higher education capacity and infrastructure through the National Institute for Higher Education (Mpumalanga).

2.3	Influence on the presence of TUT in Mpumalanga

A directive was also issued by the Premier of Mpumalanga that all public institutions should develop their own implementation plans to ensure the successful completion of the targets set by the PGDS. The Provincial Growth and Development Strategy is very clear in its strategy that institutions of higher education should position themselves to meet the skills demand of the Province and be sufficiently flexible to address future demands. The PGDS further demands a strategic thrust by role-players in the Province to invest in people skills to promote service delivery, economic growth and development.

The PGDS identified the following key human resource strategic thrusts (Mpumalanga Province, S.a.:54).	The following strategies and their interventions have particular reference to the presence of TUT in Mpumalanga:
The positioning of higher education institutions to meet the skills demand of the Province. Implementation of strategies to ensure quality education. The building of strategic partnerships with institutions of higher learning based on the Province’s requirements. To facilitate coordination in ensuring that higher educational institutions provide relevant courses. Increasing the number of post matric students enrolling in and completing these programs. Approved higher education programs/ courses linked to addressing scarce skills. Increased participation by industry in curriculum design to address labour market demands. Establish and consolidate provincial higher education capacity and infrastructure through the Provincial Institute for Higher Education. Improvement of higher education capacity and infrastructure and its accessibility and affordability.	Building and improving the Province’s skills competitive advantage by the establishment and consolidation of the provincial higher education capacity, infrastructure, accessibility and affordability; Linking HRD with Economic Transformation & Growth, 2nd Economy support and SMME Development through the improvement of technical skills in the economic sectors with the highest potential, i.e. agriculture, petro-chemical, wood processing, tourism, services, and steel & stainless steel industry. Linking Integrated HRD with Social Development through alignment of formal education and training with provincial HRD requirements. Linking HRD with Development Infrastructure through building community and civil society skills and capability on project and programme governance and management. Linking HRD with conservation, environment and sustainable development through the development of infrastructure, conservation, environment and sustainable development processes and programs in the Province. Linking HRD with Good Governance Realignment with the HRD strategies of the Province

3.	THE EDUCATION ENVIRONMENT IN MPUMALANGA

3.1	Secondary education in Mpumalanga

Public Education in Mpumalanga is subdivided into three school districts corresponding to the District municipality borders of Ehlanzeni, Ekangala and Gert Sibande. The level of education composition reveals relatively low levels of schooling. Despite several management interventions over the last four years, the Grade 12 results still occupied the last two places on the national listing of all the provinces in 2005. The grade 12 results have a direct influence on the quality of the first year intake of students at the Mpumalanga delivery sites.

3.2	Higher education in Mpumalanga

The National Institute for Higher Education (NIHE)

On 15 December 2003, the Higher Education Amendment Act , Act number 38 of 2003 was published. This Act provides for the establishment of a national institute for higher education in Mpumalanga, (section 38A). The functions of the NIHE are outlined in section 38B as follows:

Section 38B (a): Coordinate the regional provision of higher education.

Section 38B (b): Ensure the cohered provision of higher education through programme collaboration between public higher education institutions operating in the Province.

Section 28B (c): Advise the Minister on matters relating to the coordination of the provision of higher education.

Section 38B (d): Perform any other duties, which may be prescribed.

Although the launching of such an institute is a national competency, the Mpumalanga Provincial Government felt that the establishment of a fully-fledged university for Mpumalanga would be of greater advantage to the Province. The National Department of Education has now rejected the Provincial university proposals of the Mpumalanga government and announced that the NIHE will be launched on 21 August 2006. The Premier announced in his state of the Province address, that R6m was budgeted to populate the initial structure with nine directors and a CEO.

TUT has taken a strategic decision that Tshwane University of Technology (TUT) should become the hub for the establishment of a tertiary institution in Mpumalanga. All the designated role players in the Province have since established a Mpumalanga Higher Education Forum.

4.	CURRENT TUT PROFILE IN MPUMALANGA

4.1	Status quo of the Mpumalanga campuses

TUT, through its predecessor, Technikon Pretoria, has been active in the Mpumalanga Province since 1991. Various programs were presented at the Witbank and Nelspruit campuses. The following figure indicates the current program mix at the two Mpumalanga delivery sites:

4.2.	Proposal for the intermediate strategic positioning of the Witbank and Nelspruit delivery sites

The academic topography initiative of the TUT’s “scenario B” impacted upon the two Mpumalanga delivery sites and culminated in a strategic positioning workshop with members of the EMC on 14 October 2005.

The strategic workshop, under the guidance of the vice chancellor, accepted the principles of a regional, needs-based, program focus for the Mpumalanga campuses within a phase realignment process. The workshop agreed that the interim topography of TUT in Mpumalanga will be driven by eventual realignment with the principle of a regional, needs-based, program focus, an interim regional focus, the current program mix with all its academic requirements, the current distribution of facilities and the introduction of the NIHE

The workshop then proposed the following interim academic topography with the following program based, focus-areas per campus:

Witbank – ICT, Engineering

Nelspruit – Tourism, Economics, Humanities

The focus-area approach utilized was in line with the needs-driven approach and culminated in the following proposed academic topography:

Process challenges in TUT resulted in a phased implementation of the new faculty model (See communiqué after the special EMC meeting on Thursday, 11 May 2006), which culminated in only one adjustment of the PQM of the Witbank delivery site (Phasing out the National Diploma in Public Management, Faculty of Humanities in 2007).

5.	STRATEGIC POSITION OF TUT IN MPUMALANGA

5.1	Introduction

Strategic positioning of the TUT campuses in Mpumalanga require the open and transparent interaction of all institutional structures, with the environmental factors driving socio and economic growth in the Province. On both theoretical and political levels, there is a need for the redefinition and a reconstruction of the vision of higher educations that will ensure the dynamic gravitation to a demand driven education system and the creation of sustainable economic growth through job creation and entrepreneurial competencies. Higher education has a dynamic role to ensure the future of human resource development in the Mpumalanga Province and the eradication of poverty through the creation of jobs.

5.2	Key driving forces in higher education in Mpumalanga

The Provincial Growth and Development strategy (PGDS): The future of any tertiary initiative in the Province will have to take into account the guidelines of the Provincial Growth and Development strategy (PGDS)

The national and provincial skills development strategies: The following key attributes will have to be adhered to (Mpumalanga Provincial Government, 2003:24):

Responsiveness to changing demands over time.

Cost-effective delivery of high quality development.

Flexibility. A system that suits the needs of a wide range of employers and individuals must be flexible to satisfy different learning styles as well as target all vulnerable groups of the society.

The principles of a need-focused system, which will meet the needs of employers and individuals rather than being formulated and delivered at the convenience of the provider (Mpumalanga Provincial Government, 2003:20).

The creation of an enabling framework to support a demand-led system: In order to be demand-driven institutions, able to adapt to the changing demands of local labour markets, flexible and responsive institutional frameworks must be in place.

The regional economic profile: In evaluating the demand for programs based on the economic profile of the Province, the regional profile must be taken into account (DBSA, 2004:40).

The Local Economic Development (LED) strategies of the district and the local municipalities within the footprint of the delivery site.

The strategic focus of the Mpumalanga campuses should change from replicating the Tshwane scenario to a demand-driven approach for Mpumalanga. A demand-driven TUT will have to establish itself as regional centres of academic excellence addressing the regional needs of their environment.

5.3	Strategic focus of TUT in Mpumalanga

The strategic rationale for the future topography of TUT in Mpumalanga is driven by a demand-driven, regional, needs-based strategy for the Mpumalanga campuses of TUT.

5.4	Guiding principles

5.4.1	A PQM that is demand based and future directed

The realignment of the Mpumalanga delivery sites’ PQM with the accelerated and shared growth initiative for South Africa” (AsgiSA), the PDGS growth perspectives, the Provincial Human Resource Development Strategy and other regional (SADC) driving forces in higher education in Mpumalanga.

A focus on local economic developmental needs as identified by the various local governments’ LEDs.

All programmes presented should be financially viable.

Phased migration to self-sufficiency and ultimate autonomy in NIHE (5-8 years).

Institutional arrangements

In view of the distances involved between the Tshwane and the Mpumalanga delivery sites, the applicability of the conceptual single-site faculty placement model of TUT should be revisited. Revisiting the single site faculty model could also be necessary due to the regional demand driven nature of their PQM, that might be across faculties.

5.4.3	Management Model

The following aspects need to be addressed in developing a management model for the distance campuses in Mpumalanga.

(i)	Academic environment

Macro-managed by the TUT, Tshwane structures.

Campuses to be viewed as program-driven not faculty-driven.

Thrust / Cluster managers to be appointed

Number and level of thrust managers will be based on roles and responsibilities of the positions.

The thrust managers’ appointment will be based on the financial viability of the relevant campus.

Clarification of roles and responsibilities of Campus Directors.

In establishing the academic topography the following matters would eventually guide the final decisions taken concerning the academic topography:

Financial viability.

Distance restriction imposed on the sharing of infrastructure between programs.

Human resource implications of proposed program expansions and/or closures.

Ability to render effective community service.

Ability to effectively engage in R & I, with specific focus on the needs of the surrounding industries, businesses, communities and the region.

Ability to generate third stream-income.

Quality HEQC - 2007 Institutional Audit for TUT.

Suitable support services topography.

Development of a provincial and campus-based leadership and management model.

The realignment should be incremental to accommodate the exiting students in the system. This is especially valid due to limited residence facilities at both the Mpumalanga campuses. Care should, however, be taken that the incremental change does not deteriorate into “a business as usual” approach.

(ii)	Student development and support, academic support and development and the library

Must be positioned as part of the academic environment.

Clarification of roles and responsibilities of Campus Directors.

(iii)	Research

In-thrust research to continue.

Appoint research professors as soon as possible.

(iv)	Support environment

Clarification of roles and responsibilities of Campus Directors.

Budget allocation processes to be clarified

(v)	The importance of input and output responsibility through a management matrix

On any campus confusion re decision-making can exist. That means that no-one takes either responsibility or accountability when something goes wrong. Every staff member must have a clear picture of what their roles and responsibilities are. By using a matrix decision-making framework, tension and unnessesary conflict can be avoided. The Management Matrix incorporates different tasks, like Initiate, Responsible, Approve and Support. It addresses a broad spectrum of activities on campus and allocates the above to each role player.

6.	STRATEGIC THRUST OF THE NELSPRUIT CAMPUS

Introduction

The strategies for Nelspruit delivery site should have a human resource capacity building focus on the wholesale, retail, trade, agriculture, hunting, forestry and farming industries as these industries are dominant in the Ehlanzeni district of Mpumalanga. A further focus should be on public service delivery as Nelspruit is the capital of the province and the seat of Government. Nelspruit and the surrounding area is also the main contributor to the tourism industry in the Province.

6.2	Strategic thrust of the Nelspruit campus

The strategic thrust of the Nelspruit Campus rests on a demand driven, needs-based regional approach. All programmes will have a human resource capacity building focus where the PQM will be adjusted to ensure flexibility to the demand. The following main thrusts will ensure the sustained competitive edge of the Nelspruit Campus:

A business thrust focusing on building human resource capacity as professionals in the wholesale, retail, trade, financial, insurance, real estate, business services, marketing, distribution, supply chain management, logistics management, farming, and related industries. In line with the requirements of the PGDS, this business approach will include an Entrepreneurial development thrust which will enhance labour sector realignment and ensure the sustained development of successful SMME’s in the Province.

A responsible and sustainable agricultural, nature conservation and environmental resource utilisation thrust focussing on the down stream beneficiation of agricultural and forestry products (agri-processing, agri-products and wood processing). This thrust will include programmes focusing on the sustainable utilisation of natural resources, environmental management, pollution management, waste management, environmental rehabilitation programmes and community based natural resource management.

An institutional thrust focussing on the Introduction of programmes addressing service delivery in the public sector:

Local Economic Development and Spatial Development Initiatives, local government management and Urban and Rural Development Programme.

The training and development of educators in economic and business related disciplines.

Programmes Health care management

Programmes to promote the arts and culture industry.,

Institutional infrastructure development programmes building capacity in the development of multi-faceted infrastructure to address basic socio economic needs to drive accelerate growth and development.

A responsible tourism thrust focussing on the development of eco, rural, agricultural and adventure tourism as well as on the SMME, craft and arts sectors.

The Financial viability of Nelspruit campus

6.3.1	Principles for viability model

The Nelspruit delivery site is a financial viable delivery site as it is structured now.

The financial model to contribute to TUT overheads and not carry overheads.

Use 2007 as determining year.

Adjust PQM over time.

Student and other viability assumptions based on realistic interpretation of the education and socio economic environment (see item 5.2).

The subsidy allocation should be as earned.

Executives (Campus Directors) cost to company not included.

Viability based on realistic assumptions

Scenarios

Scenario 1:	Status quo

The realignment of the PQM of the Nelspruit delivery site with the needs of the Province should be evaluated against the status quo. The status quo scenario provides for natural progression in subjects and students growth based on historical results. Scenario 1 will result in an excess income over expenditure of R 35,6m over the next 4 years .

SCENARIO 1: STATUS QUO
2005	2006	2007	2008	PERIOD
Net income academic sections	R 13,682,375	R 13,100,928	R 16,224,237	R 21,492,624	R 64,500,164
Total cost non-academic sections	R 6,963,842	R 7,129,548	R 7,303,538	R 7,486,229	R 28,883,157
Net Income	R 6,718,533	R 5,971,380	R 8,920,698	R 14,006,395	R 35,617,006
Student numbers	1264	1315	1663	2030

Scenario 2: Future topography

The future topography took into account the interim topography proposals (see item4.2) as well as the phased migration to a demand based PQM. The future topography will result in an excess income over the next four years of R 30,9m.

SCENARIO 2: TOPOGRAPHY PROPOSALS
2005	2006	2007	2008	PERIOD
Net income academic sections	R 13,682,375	R 13,100,928	R 14,126,209	R 18,888,321	R 59,797,832
Total cost non-academic sections	R 6,963,842	R 7,129,548	R 7,303,538	R 7,486,229	R 28,883,157
Net Income	R 6,718,533	R 5,971,380	R 6,822,671	R 11,402,092	R 30,914,675
STUDENTS	1,264	1,315	1,518	1,864

The effect on the financial viability and the student numbers of phasing out SET (Engineering and ICT) programmes at the Nelspruit Delivery site can clearly be seen. It is imperative that the Nelspruit Delivery site be granted an opportunity to pursue other SET opportunities.

7.	STRATEGIC THRUST OF THE WITBANK CAMPUS

7.1	Introduction

A need-based, regional approach identifies the electricity, manufacturing, mining and community industries in Mpumalanga as being dominant in Nkangala (Nkangala IDP. 2005: 13). Nkangala district municipality borders on the Gauteng Province and as such is subjected to a skills migration to Gauteng. The Nkangala IDP identifies the shortage of appropriate economic skills as one of the priority areas that should be addressed (Nkangala IDP. 2005:75). Witbank campus would also be able to address the needs of the Govan Mbeki local municipality in focusing on mining and manufacturing, although the distance would be a restricting factor without campus residences.

7.2	Strategic thrust of the Witbank campus

The strategic thrust of the Witbank Campus should be based on a needs-based regional approach and a human resource capacity building focusing on:

An engineering thrust

focusing on provision and maintenance of electricity and related industries.

Manufacturing, focusing on, supporting and developing the manufacturing sector in the Province e.g. downstream beneficiation of raw materials like stainless steel and agro-processing.

Chemical and chemical products focusing on the petro-chemical and related industries in the cluster linked to the Maputo corridor.

Mining and quarrying focusing specifically on small-scale mining linked with entrepreneurship as well as engineering-related training to the bigger mining houses.

Education focusing on the development of teachers in maths and science as well as art.

An ICT thrust focusing on the development of skilled IT professionals in all sectors of the economy as well as development, research and support to IT business systems and networks.

A management thrust

focusing on human resource management, training management and industrial relations.

Environmental management and safety focusing on large-scale industries in the surrounding areas.

Entrepreneurship and business development linked with the management thrust to aid the development of business in the Province.

Management of local government focussing on the skills development of public sector servants

7.3	The Financial viability of Witbank campus

7.3.1	Principles for viability model

The Witbank delivery site is a financial viable delivery site as it is structured now.

The financial model to contribute to TUT overheads and not carry overheads.

Use 2007 as determining year.

Adjust PQM over time.

Student and other viability assumptions based on realistic interpretation of the education and socio economic environment (see item 5.2).

The subsidy allocation should be as earned.

Executives (Campus Directors) cost to company not included.

Viability based on realistic assumptions

7.3.2	Scenarios

Scenario 1:	Status quo

The realignment of the PQM of the Witbank delivery site with the needs of the Province should be evaluated against the status quo. The status quo scenario provides for natural progression in subjects and students growth based on historical results. Scenario 1 will result in an excess income over expenditure of R70,9m over the next 4 years.

Scenario 2: Future topography

The future topography took into account the interim topography proposals (see item 4.2) as well as the phased migration to a demand based PQM. The future topography will result in an excess income over the next four years of R 70,5m. This was constructed based on assumptions regarding student enrolment for new programs, where the uncertainty factor is much bigger than in the status quo model, where a small growth in student numbers for existing, well established programs, is assumed.

8.	THE WAY FORWARD

8.1	Outstanding Issues

The success of the demand based future topography of the Mpumalanga delivery sites is dependent on the following issues that need to be debated:

The reporting lines and delegations of authority of the various interacting academic and support structures.

On any campus confusion re decision-making can exist. That means that no-one takes either responsibility or accountability when something goes wrong. Every staff member must have a clear picture of what their roles and responsibilities are. Clarity should be obtained regarding:

The implementation of a decision-matrix.

Academic and operational responsibility of Campus Directors vis-a-vis Deans/Directors.

Reporting lines of staff at distance campuses to be clarified.

Consistency in application of policy and procedures across faculties and functions.

Funding

A funding model must be decided upon that will accommodate the migration to the NIHE structures. The funding model must be transparent, consistently applied and afford the Mpumalanga delivery sites an opportunities to interact on the budget allocations.

Single Faculty site model

The applicability of the single site faculty model to the Mpumalanga delivery sites should be revisited. Centralising programme deliveries to dedicated sites will impact upon the economic growth and the development of human capital in the Province. This might result in TUT losing its competitive edge.

Start positioning for the new University

The establishment of the NIHE will impact upon the future of the Mpumalanga delivery sites. The establishment of the NIHE has taken almost 3 years and TUT needs to position itself as the core service provider. The Mpumalanga delivery sites must now establish an individual (own) identity moving to self-sufficiency and ultimate autonomy in NIHE (5-8 years).

Use 2007 as determining year

Based on the current planning, 2007 should be used to determine final implications of the proposed new topography. It is also foreseen that the establishment of the NIHE in August 2006 will provide some guidance on expectations from government in terms of the future provisioning of higher education in Mpumalanga.

CONCLUSION

The strategic positioning of the TUT campuses in Mpumalanga requires the open and transparent interaction of all institutional structures, with the environmental factors driving economic growth in the Province. It is clear from the various provincial government strategies that the focus of Higher Education in Mpumalanga should be on a demand-driven, human resource capacity-building strategy, dedicated to addressing the specific needs of Mpumalanga.

A regional approach to establishing a competitive edge in Mpumalanga must take into account the economic growth and development patterns in the dominant industries. A demand-driven TUT will have to establish itself by maintaining regional centres of academic excellence addressing the regional needs of the environment. The ability of TUT to address the academic needs and the economic requirements for growth of the Mpumalanga Province, will ensure the sustainable existence of TUT.

The proposals contained in the position paper, which is available on request, and summarised in this document, are based on a strategic realignment of the tertiary education focus of the TUT campuses in Mpumalanga.

It is the considered opinion of the management structures of the two campuses, that these proposals will ensure the presence of TUT in Mpumalanga and will create the necessary structures to act as the conduit and academic hub for the new NIHE in Mpumalanga.

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These structures include all government and local government structures as well as all state funded or partially funded organisations.