Challenges Mount for Schools as a Growing Number of Parents Default on Fees

Amidst a cost-of-living crisis and declining household disposable incomes, a growing number of parents are defaulting on school fees. In fact, collecting fees has become the number one challenge facing schools according to the latest school survey conducted by TPN Credit Bureau.

A frequently asked question is what schools can do when parents stop paying school fees?

Independent schools have a contractual agreement with parents. This means that if a parent defaults on school fee payments, they are in breach of the agreement and the school is entitled to send a letter of demand giving them 20 business days in which to settle the outstanding fees. If the parent fails to settle the outstanding fees in this time, the school is within its rights to embark on debt collection options.

Below are some of the most frequently asked questions posed to TPN Credit Bureau regarding the issue of school fee collections:

Can a school adversely list non-paying parents?
Independent schools have the right to adversely list non-paying parents, but only once a letter of demand giving parents 20 business days to pay the arrears owing has been sent and a total of three billing cycles has passed.

Can a school withhold or refuse to give the learner and their non-paying parents a report?
Neither government nor independent schools are allowed to withhold an academic report for any reason.

Can a school demand payment of school fees from both parents?
Yes, independent schools can demand payment of school fees from both parents, irrespective of whether parents are married, not married, or divorced, they are legally regarded as jointly liable for their child’s education. Even if the parents are divorced and the divorce order requires one parent to pay the child’s school fees, the school is allowed to demand payment from both parents.

Can a school refuse admission or suspend a learner due to non-payment by parents?
The courts don’t take kindly to an independent school suspending learners due to non-payment of their school fees, maintaining that schools have a duty not to inhibit a child’s right to education. This means that any exclusion or suspension policy can only be a last resort after all other efforts to get the parents to settle outstanding fees have been exhausted.

Can a school attach movable property of non-paying parents?
Both government and independent schools can attach movable property of non-paying parents once they have obtained a judgement to do so.

About TPN Credit Bureau:

TPN Credit Bureau helps schools to keep track of parents’ payment profiles, monitor payment trends, send letters of demand when parents default, and where necessary, to adversely list parents. Our data indicates that parents are more inclined to pay school fees if they know that they are at risk of adversely affecting their credit profile if they default.

The opposite also holds true; parents who pay their child’s school fees on time have an opportunity to improve their credit record.

For more information, please visit our website.

By Ashleigh Laurent, Legal Counsel at TPN Credit Bureau

TPN Newsletter July 2023

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