Hundreds of students have been deregistered and evicted from Cida City Campus in Johannesburg after the institution filed for business rescue.
Deregistered from the institution that promised them free tertiary education because they were from poor backgrounds but academically well-performing, a last batch of hundreds of students Cida City Campus decided to cull as part of its “business rescue plan” are now idling home in parts of the country.
The students were evicted from the institution’s only campus in Lyndhurst, Johannesburg last Friday. “They came room to room with a list of people who’ve been deregistered. They took keys and locked the rooms. We no longer had any choice but to leave. Luckily I found transport home,” Isaac Hlungwana, a third-year student, told the Mail & Guardian this week speaking from Limpopo.
The financially distressed Cida is undergoing business rescue to avoid liquidation. Its directors filed for voluntary business rescue last December after it became apparent that its dried out coffers had “led to working capital shortages”, as Nonkqubela Mazwai, chairperson of board of directors and a Cida trustee, stated in her affidavit.
Cida’s founding by social entrepreneur Taddy Blecher in 1999 was largely received as a ground-breaking education innovation. Blacher left under a clout in 2007.
What now puts Cida at a threat of liquidation is that, in addition to dwindled donor funding, it owes over 50 creditors, including the City of Johannesburg for unpaid water and electricity, and a number of service and food providers for unpaid debt, nearly R20million.
Rob Devereux, director of company Sturns who was appointed by court as Cida’s business rescue practitioner, decided upon taking over the reins that the number of students at Cida should be “reduce[d] to around 400 to 350 circumstances prevailing” from the original 743. Now 400 students remain in campus. Debate is raging more intensely over 236 of those kicked out, as all were still in second and third year.
In one letter seen by the M&G Devereux told said plans to cut numbers were endorsed by the Department of Higher Education and Training.
Told they were no longer covered by scholarships because they had not passed 75% of the courses they registered for the previous year, students were finally informed by letters in April that they had been deregistered.
Students were given three days to fork out up to R30 000 for the first semester. The letter from management said: “You are, however, able to continue with your studies if your find an alternative source of funding. Should that be the case, the management expects you to have paid your fees in full by Friday, April 19. Should you fail to do so, you will be expected to leave the institution by the end of the weekend, i.e. Sunday, April 21″.
But no one of them could pay the money. “The reason we’re here in the first place is that we’re from disadvantaged families, how can we raise such money even given more days?” an angry Tsepang Nenzinane, who was doing his third year and was elected secretary general of the current students representative council, asked.
Students accuse Devereux of caring for nothing less than making Cida profitable. Learning conditions in campus have not been favourable for some years now, they say. While they have not been taught by suitably qualified lecturers, textbooks are in dismal shortage and lecturers and other staff go months without salaries. Students’ campus strike last year was driven by demand for a qualified and experienced academic to be appointed as Cida’s executive dean (“Varsity axes dean after protest”, M&G, May 2012).
“Rob doesn’t care about the human factor, our future and our families,” said Nenzinane.
Devereux admitted to the M&G not all the students who have been kicked out have performed too badly. Some did achieve over 70% “but not 75%”, he said. He agreed conditions were unfavourable to learning.
“But at the end of the day my role in terms of the law is to save the institution and to protect the creditors. If no money comes in, regardless of what happened in the past, then I must liquidate this thing. If we do not apply the rules there’s no way Cida can continue.”
The rescue plan details the irregularities that led to Cida’s “demise”. Top of the list is the longstanding problem of “weak” management and governance. “After the founders had left the organisation it has been plagued with leadership issues … it appears that the board are unable to resolve the issues,” said the plan.
“Fundraising generally died down due to lack of momentum”. Also, “activities of two foundations in London and New York have ceased thus all overseas contact have become stagnant”.
Mazwai, who is chief executive of a mining company and also sits on boards of various companies, said because Cida was now under business rescue she would not respond to the M&G’s questions.
But the root of all problems at Cida, according to Devereux, is its foundation. The institution was built on a “flawed business model” because Blecher was its face. “It’s the thing of an individual being larger than the organisation. Cida City Campus was Blecher. In terms of governance procedures, that is wrong.”
But “that’s nonsense,” Blecher told the M&G this week. “People did not support the institution because of one individual. It’s sad that it’s now in this position. It means it has not been cared for.”
It was also “imaginary” that the institution was built on a flawed business model, Blecher said. “It’s a proven working concept. If Cida could last for 14 years, why can’t it last for 50 more years?”
But Sibongiseni Dlamini, the department’s spokesperson, denied this, saying: “Devereux did inform [us] about his business rescue plan, [but] the department did not endorse any of the measures and in particular the deregistration of students”.
A dream of free university education turned to tragedy
Cida City Campus burst into the scene in 1999 as a free education university that would help curb inter-generational poverty in many disadvantaged families.
An internet search of the institution still gives hundreds of hits linking it to its charismatic founder Taddy Blacher, though he severed ties with it in 2007 following controversy about a compulsory requirement for students to perform transcendental meditation.
Besides its high-powered marketing drive then, endorsements from important figures aided Cida raise the much-needed funds. According to Cida’s website former president Thabo Mbeki told Parliament in 2001: “The education offered at CIDA City Campus is designed to make students relevant, truly empowered, integrated citizens and leaders that are skilled and equipped to build the South African economy and society.”
Mbeki’s wife Zanele became the Cida’s chancellor in 2006. Her inauguration was highly publicised. It is not clear when she resigned, but according to the business rescue plan chairperson of Cida board Nonkqubela Mazwai, a business executive in the mining sector, is currently filling the position. “It is recommended that she be replaced with a new candidate,” said the plan.
Philanthropic moguls such as Oprah Winfrey and Charles Branson became openly associated with Cida as donors, and so did a number of multi-national companies.
Blecher this week told the Mail & Guardian he is proud of achievements Cida has made. “It’s a tragedy” that it is now facing problems that could see it liquidated, he said. “Cida has helped thousands of kids. Many are in good jobs. They’ve built houses for their parent.”
The Maharishi Institute in the Johannesburg city centre, which Blecher established in 2007 using same principals, is a thriving school with flowing donations. But he said, “I love Cida. Since I left I’ve always offered to help it. For me it’s like a baby that you brought up. You don’t want to it suffer. I’m hoping they rescue it”.
The rescue efforts led by Rob Devereux, a business rescue practitioner, are meant to return Cida to its glory days. “When I leave here there will be a proper management team and a proper board. It’s key to the longevity of Cida,” Devereux said.