Tuition debt in South Africa – what schools and parents need to know
Managing tuition-related debts and preventing defaults often require balancing a combination of proactive communication and effective financial planning. TPN Credit Bureau would advise the following for schools and parents:
Recommendations for schools:
- Utilise clear fee agreements that parents can understand
School fee agreements should be clear and comprehensible in providing information about tuition fees, payment plans, and deadlines. This way, it is binding between the parties and there is no room for ambiguity.
- Send timely notification of fees and exemptions
Ensure that parents are timeously notified of the amount of annual school fees to be paid and, in the instance of fee-paying public schools, that they understand the procedure in applying for an exemption.
The Exemption Regulations set a clear obligation on our governing bodies and principals to notify parents of the annual school fee amount and assist in applying for an exemption or lodging an appeal if a parent may have been unsuccessful in applying for an exemption.
- Send proactive communication to defaulting parents
Schools should reach out to parents who miss payments to discuss repayment options. If unsuccessful, schools are entitled to enforce payment once it’s established that a parent does not qualify for exemption. This process begins with sending a letter of demand for the outstanding amount.
- Take legal measures
Both fee-paying public and independent schools have the right to list defaulting parents with credit bureaus or seek judgments against them for non-payment of school fees, provided they comply with the South African Schools Act, the Exemption Regulations, and the National Credit Act.
Recommendations for parents:
- Understand fee agreements before signing
Ensure that you have read and that you understand the school fee agreement before signing, be sure to ask the principal or school governing body any questions you may have.
- Apply for exemptions early and yearly
If you are in a fee-paying public school, be sure to timeously apply for an exemption annually. The Exemption Regulations are clear in that if a parent wishes to be exempted from the payment of school fees for a child at a particular school, they must apply annually to the chairperson of the governing body in writing.
- Address payment issues early
Be proactive and do not wait for overdue fees to escalate. Reach out to the school to address the issue early, the school can then assist a parent in applying for an exemption if they have not done so already. Alternatively, the school may be open to discussing a payment plan. It is, however, imperative for parents to note that there is no obligation on a school to accept a payment plan.
- Consider more affordable schooling options
A parent can also explore alternative schools that may be more affordable. Whilst this may be a difficult option, it does manage tuition-related debts and prevent defaults. Be sure to read through your current school agreement to give the correct notice and per the notice period set out in the agreement so that both parent and school can end on good terms.
To ensure that financial challenges do not halt or hinder the education of learners, schools and parents can work collaboratively to manage tuition-related debts effectively.
Learn more about how TPN can help your school collect fees faster: https://mrisoftware.tpn.co.za/schools/
Written by Ashleigh Laurent, Staff Attorney at TPN from MRI Software
