The main purpose of the National Student Financial Aid Scheme (NSFAS) is to enable young people from poor households to obtain a higher education. This is essential for expanding South Africa’s skills base and a powerful mechanism for breaking the intergenerational cycle of household poverty and exclusion. Tertiary education is unaffordable for most households (see Figure 1). While the average full cost of study for a single year at university was about R28 000 in 2003, this figure was three times greater than the incomes of households in the poorest 20% of the population. It was also more than 30% greater than the annual incomes of households in the second poorest quintile, and just 20% less than the total income of households in the middle 20%. In 2003, in other words, none of the poorest 50% of households could realistically afford to send a child to university.
