Higher Education Minister Blade Nzimande announced that university fee increases for 2017 would be capped at 8%.
Nzimande says universities should individually determine the annual increase, but it should not exceed 8%.
NSFAS students and the so-called "missing middle" will not experience a 2017 fee increase, as government will pick up the tab for that gap.
Political economist Liepollo Lebohang Pheko says universities have the opportunity to consider alternative ways to generate funding to subsidise fees and the subsequent shortfall.
She explains that institutions will bear the brunt of whatever decision they make based on Nzimande announcement.
This is an added burden for institutions for higher education.— Liepollo Lebohang Pheko, political economist
According to Pheko, it is important for the state to create resource interventions at the foundation phases of the education system.
University is the end game. We really need to be thinking about how we build an education system that is truly inclusive.— Liepollo Lebohang Pheko, political economist
Listen to the full conversation from The Pippa Hudson Show:
At the same time, students at the University of Cape Town (UCT) are set to hold a mass meeting this afternoon to address Nzimande's announcement, as well as their dissatisfaction over a disciplinary hearing against three students.