KwaZulu-Natal's Education Department grapples with R250 million debt crisis

A financial report has laid bare the deepening financial crises faced by the KwaZulu-Natal Department of Education, painting a picture of an entity drowning in debt.

The department owes close to R250 million to the eThekwini Municipality for water delivered by water tankers, as detailed in the financial report released by the municipality last week.

This comes as the department is already battling to service a debt owed by Section 21 schools to the municipality for services. It was not immediately clear over what period the debt has been accumulated, but the report covers the latest period from January to March and details all debts owed to the municipality, including by consumers, business, and government.

The financial state of the department is a concern to political parties and the South African Democratic Teachers Union (Sadtu), which claims that the department has collapsed financially.

KZN Education faced serious budget cuts over the past few years and has revealed that it is struggling to meet its obligations. It has emerged that it has not paid all the suppliers of the school nutrition programme and missed salary payments to Grade R teachers, who were expected to be paid late last week.

The financial report stated, “An amount of R250 million is owed by the Department of Education for the supply of water tankers.”

The City’s eThekwini Water Services and the Department of Education have established that the water was supplied without a valid Service Level Agreement (SLA) in place; but the issue of the accumulated debt has not been resolved.

Discussions are ongoing between the water service and the department on how to resolve the debt issue. The report also indicated that the department’s Section 21 schools are struggling to keep up with their accounts, which have fallen into arrears despite a payment arrangement being in place.

“After engagements with the Department of Education, in May 2024, a payment arrangement was concluded for an amount of R169.1m, which was the debt owed by 521 schools at the time. The arrangement was that the department would pay this amount in equal instalments of R11m over 13 months after the initial down payment of R17m was made. The Department of Education has paid as per the agreement, with the last instalment for March still to be received.

“It should be noted that although an arrangement was reached with the Department of Education in May last year, the debt for 521 schools has continued to escalate due to schools not paying their current charges, which have now escalated into arrears,” said the report.

The DA spokesperson on Education, Sakhile Mngadi, expressed alarm at the deepening financial implosion within the province’s department. He said a crisis is now threatening the well-being of millions of pupils and the constitutional viability of KZN’s education system.

“This is no longer just a financial issue. It is a humanitarian and constitutional crisis, born out of poor leadership and a toxic culture of evasion and spin. Every day that passes without urgent intervention places more children at risk, undermines their right to education, and erodes the public’s faith in government,” he said.

Sadtu provincial secretary Nomarashiya Caluza said the department has collapsed.

“As we speak, some Grade R practitioners have not been paid. The department is struggling to pay service providers for school nutrition programmes, acting personnel have not received acting allowances, and some officials cannot attend important workshops. Some service providers that assisted with stationery at the beginning of the year have not been paid.

"Schools have not received their full basic allocation for 2024. What else do we need to see to say that the department has collapsed?” she asked.

Addressing the issue of unpaid school nutrition service providers, the department said it is addressing this and blamed a system glitch for the delay in payment.

“We acknowledge the concerns raised by our valued service providers and wish to assure them that the department is doing everything possible to resolve the technical glitches affecting payment processes. The problem has nothing to do with the financial difficulties of the department, as the NSNP is paid from the grant allocation. We remain committed to transparency, timely communication, and the uninterrupted provision of meals to our pupils across the province,” it said.

Speaking on the issue of the debt, Education Department spokesperson Muzi Mahlambi said: “We are in agreement with them (municipality) as to how this is being addressed. We hold meetings with them and discuss these issues.”

THE MERCURY