The education system plays a key role in economic development and prosperity in any
country since it is the primary channel through which employable skills and knowledge are
transferred to new generations of potential workers. Consequently, policies affecting the way
in which educational institutions fulfil this function can have significant long-term
socioeconomic results. This is also true of the degree to which educational institutions
themselves are able to successfully and efficiently harness the resources at their disposal.
In South Africa, skilled workers are in short supply. This is evidenced by the large
difference between the unemployment rates of degreed individuals and that of the population
as a whole: only 4.5 percent of degreed South Africans were unemployed in 2004 according
to the expanded definition, compared to the overall rate of 41.0 percent (Oosthuizen 2006,
forthcoming). However, to increase the number of graduates, the supply of matriculants with
matriculation exemption needs to be increased too. For this reason, amongst others, the
release of the Senior Certificate Examination (commonly referred to as matric) pass rates is
eagerly anticipated by matric candidates, parents, teachers, principals, and government
officials and politicians. Inevitably, the quality of both individual schools and the education
system as a whole are generally judged by the proportion of candidates that pass the Senior
Certificate Examinations. The public debate tends to centre on ways of improving pass rates,
with the underlying assumption being that there is a way to affect pass rates by changing the
mix of educational ‘inputs’. The academic debate too has tried to establish whether or not
there are links between the quantity and quality of educational inputs, including family,
household or community characteristics, and the outputs generated by the school in some
form or other.