Court rules University of Johannesburg must consider developer of student accommodation buildings
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Pretoria - A developer of student accommodation buildings successfully asked the court to set aside the decision of the University of Johannesburg not to consider it as a private service provider.
Gaetal (Pty) Ltd said it had spent about R90 million in converting buildings close to the university to serve as accommodation. The contractor told the Johannesburg High Court that it acquired a building near the university’s campus in Doornfontein and converted it to meet the required standards for student accommodation.
The aim was to house students funded by the National Student Financial Aid Scheme (NSFAS). Although it did apply last year to be considered as accredited accommodation for this year’s student intake and paid the application deposit, it was not even considered.
The court was told that the university endeavoured to provide access to accommodate students who require it. Only a small fraction of these students could be accommodated at the on-campus residences that were owned and run by the university.
The remainder are referred to approved private landlords for off-campus accommodation. The aim of approving private providers of student accommodation is to ensure that an adequate standard of accommodation, suitable for students, is maintained.
Students who qualify for state funding via NSFAS also qualify, where required, for a contribution of around R45 000 a year towards their accommodation costs.
This, the court was told, created a strong commercial incentive for private property developers and smaller landlords to obtain accreditation from a university, as it effectively guaranteed the receipt of rental income.
NSFAS relies on the university to ensure that public funds are not misspent. The university (and any other learning institution receiving NFSAS-funded students) is obliged to take the necessary steps to ensure a sufficient supply of student accommodation that meets minimum standards set by the government, and to ensure that student accommodation money is not misspent.
The university developed a policy that regulated the Providers of Student Accommodation. This policy also regulates applications for new providers or new buildings by existing providers.
The applicant said it applied to be part of this last year, in the hope of housing NSFAS students from this year.
By the middle of last year, when the university would normally start the process of inviting applications for new buildings and accommodation providers, it was apparent that the demand for student accommodation had plummeted with the onset of lockdown and that it was unlikely to fully recover in the short term.
It was decided by the management executive committee not to consider new applications for this year, but simply to continue using existing providers of student accommodation.
It is this decision which the applicant managed to set aside successfully.
The university said this academic year would be over within about two months, thus this application was moot as the applicant would not be able to attract new students for the remaining two months.
The university added that it was in any event in the process of revising the policy, as it had proven to be problematic.
The applicant, however, said if it obtained success in court, it might be able to recover more than R12m in accommodation fees.
The court found the issue not to be moot, as the outcome would still have “real-world consequences” between the parties and might assist the applicant to provide accommodation next year.
The university was concerned that the oversupply of accommodation might increase the abuse of the state-funded student accommodation scheme. It said in some cases students abused the accommodation and that the pandemic, which resulted in lockdowns and online classes, had reduced the need for accommodation near campus.
The court, however, said the university had at least to consider the applicant’s application to render accommodation, as it had, after all, called for submissions.