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Pressure on authorities to resolve NSFAS funding problems

A probe into allegations of tender irregularities against NSFAS CEO, Andile Nongogo, gets under way. FILE PIC

A probe into allegations of tender irregularities against NSFAS CEO, Andile Nongogo, gets under way. FILE PIC

Published Aug 26, 2023


As the investigation initiated by the National Student Aid Financial Scheme (NSFAS) gets under way, pressure is mounting on lawmakers to hold key leaders accountable.

NSFAS board chairperson Ernest Khoza announced that he had appointed a law firm and top legal people to probe allegations of tender irregularities against the CEO, Andile Nongogo.

A specialist in governance issues, Dr Bernard Koma, said “poor administration” of the close to R50 billion fund was of concern to citizens of the country and those who were meant to advance their education through it.

“The current administrators, from the top level down, should be removed and replaced with those who are committed to the aims and objectives of the fund,” Koma said.

He also said that the “silence” of the Minister of Higher Education, Blade Nzimande on the matter and how it affected students was “worrisome”.

“Until Nzimande takes charge, the problems besetting the fund will remain unresolved,” said Koma.

Frustrated students appealed to lawmakers to intervene in the NSFAS debacle. Picture: Armand Hough/African News Agency (ANA)

NSFAS spokesperson Slumezi Skosana said the lawyers were briefed on August 24 regarding the investigation into the alleged tender irregularities over the appointment of  four service providers to disburse  student allowances over a five- year period.

The tender contract for the programme estimated to cost over R1.5 billion was awarded to Norraco  Corporation, Coinvest Africa, Tenet Technology and Ezaga Holdings.

Leaked audio recordings showed that Nongogo, who was supposed to be an observer,  participated in the bid meetings and made contributions.

Skosana said NSFAS expected the lawyers to complete the investigation as soon as possible.

The public protector (PP) also confirmed that a separate probe was also under way after a complaint was lodged by a member of the DA Students Organisation, William Sezoe.

Sezoe asked the public protector to investigate the procurement process of the four service providers appointed to disburse student allowances.

He confirmed that he met investigators from the Public Protector’s Office on August  24 and was told that some issues pertaining to the complaint would be probed separately.

However, if there were any findings of irregularities from those investigations, the financial authorities would be notified.

“There is a potential that many witnesses would be called, including members of the NSFAS bid committee. I was assured that no stone will be left unturned.”

In a response to student representative council (SRC) leaders, the parliamentary portfolio committee on higher education and training indicated that it would meet NSFAS on September 6 .

Universities South Africa (Usaf) expressed concern over the instability created at universities as a result of the NSFAS funding issues.

In a statement, the USAF board of directors called for a speedy resolution of the challenges as they affected the “well-functioning” of the higher education sector.

The Bboard noted that several institutions affected by the new NSFAS allowance system, defunding and accommodation capping, faced “violent” protests.

According to the board, the defunding of students in the middle of the academic year caused challenges for the students and the universities.

“NSFAS has provided neither the reasons for the revocation of student bursaries nor a mechanism of appeal for the defunded students. Those students who have tried to reach NSFAS have been unsuccessful. This is a source of frustration among students and staff alike, and an instability at universities.”

The Usaf board also took issue with the decision to disburse students’ allowances directly to the students, out of concern that the system that NSFAS was implementing had not been tested at universities.

“These direct payments pose a risk of NSFAS continuing to pay deregistered students or those who have stopped attending classes, given that the universities’ databases are not integrated with that of NSFAS,” the board said.

It further noted that based on NSFAS’s latest reports, 14% of students (more than 50 000) were still to be on-boarded, resulting in undue pressure on these students who had to pay rent to their landlords, or face eviction.

“This is clearly placing universities in jeopardy as they have to deal with students’ concern, yet the contracts for direct payment of students exclude them.”

Regarding the new accommodation capping  imposed in January, the board said this had created a discrepancy between multi-year contracts with landlords for outsourced and accredited accommodation, on the one hand, and what NSFAS was prepared to pay.

“This has implications on student debt and on students’ continued stay when landlords cannot be paid fully. The impact of this policy implementation on universities is that student debt has accumulated at over R700 million.”

The board further noted that the accommodation cap was raised with Nzimande at a meeting on March 3 and  followed up by a written communique to the minister, requesting that the policy be withdrawn as universities’ budgets for 2023 had long been concluded.

From the end of June, the Usaf board of directors said it made numerous attempts to meet the minister again to resolve these issues. It said that since then, even though meetings had been agreed to by the ministry and the department, they were yet to materialise.

“It is our view that the minister should intervene with urgency in this situation.

“Universities had already placed students in residences costing, in some cases, higher than what the NSFAS policy on capping was making provision for. Students continue to be levied full accommodation fees, plunging them into debt that will result in them being blocked from registering in 2024, at a huge risk to the sector,” the board said.

Meanwhile, the National Education and Health Workers’ Union (Nehawu) said it was available and would co-operate with investigation into NSFAS supply chain matters.

The union’s secretary for the Ikapa region, Temba Gubula, said the union would provide all the evidence it had to help with the probe.

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