NSFAS blames universities for failure to pay students as promised

21 Jan 2024

The scheme claims it’s managed to pay just under half of last year’s outstanding allowances, suggesting universities are to blame for late submissions.

Monday, 15 January – the deadline the National Student Financial Aid Scheme (NSFAS) gave itself to finally pay what it claims to be about 20,000 students their outstanding allowances from last year — came and went, with no explanation, or apology.

Then, the press conference scheduled for 18 January to discuss outstanding payments and other issues was summarily cancelled, and a press release was released late at night blaming universities for tardiness in filing registration data.

But student organisations are not buying the excuses, calling out the scheme for its “perpetual inability” to do its job – to provide financial support for needy students.

NSFAS claims that of the 20,000 outstanding allowances, 9,128 allowances have been “successfully resolved”, with the remainder being prioritised and processed as part of the 2024 normal disbursement procedure.

Universities blamed

In a statement issued late on Thursday night, NSFAS attributed these remaining outstanding allowances to delays in the submission of registration data by universities. The scheme said it would engage with universities for a speedy resolution.

NSFAS now says, having considered the impact of late submission of student data on the disbursement of allowances, the fund expects that in future, the details of all eligible students studying for funded, approved qualifications to be submitted by no later than 31 March of the academic year.

“As soon as institutions have received the approved eligibility criteria and conditions for financial aid guidelines, they should submit registration information speedily to allow for proper processing of allowances.

“Universities will not be permitted to change allowance types submitted within a particular academic term without the change being approved by NSFAS prior to such a claim being submitted, and the necessary budgetary approval obtained.”

On 4 January, the Organisation Undoing Tax Abuse (Outa) released a bombshell report on corruption at NSFAS, naming four suppliers that had allegedly been awarded corruption-tainted contracts to manage direct payment contracts: Coinvest Africa, Tenet Technology, eZaga Holdings and Norraco Corporation.

‘Kickbacks’

In response to allegations in the Outa report that it was linked to kickbacks from suppliers, the SA Communist Party denied receiving kickbacks and Higher Education and Training Minister Blade Nzimande threatened legal action.

NSFAS’s former CEO, Andile Nongogo, who was fired in October last year, lost his labour court bid on 9 January challenging his dismissal, and Mandla Makhubela was appointed in his place.

Professor Lourens van Staden was appointed as acting chairperson in Ernest Khosa’s place after Khosa was also linked in the report to alleged kickbacks from suppliers.

Tshegofatso Ntumba, a director of Coinvest and the wife of Thula Ntumba, one of the men in the Outa audio recordings, told News24 they had been inundated by requests for comment.

“We, as Coinvest, have no knowledge of any previous donations to any political party and have not been approached by any political party or individual for a donation,” she said.

Coinvest has failed to respond to Daily Maverick’s requests for comment.

Another supplier, eZaga, has denied involvement in alleged kickbacks, saying it has sought legal advice after claims that its contract was going to be cancelled by NSFAS.

Charges

The DA has pressed criminal charges against Nzimande.

NSFAS says it has already received a wave of new applications for 2024, with 1,406,189 received as of 15 January 2024. It says it expects more than a million more applications before 31 January 2024.

The SA Union of Students said in a Facebook post it was appalled at the “regrettable and perpetual inability” of NSFAS to deliver on its mandate and commitments, first made on 21 December to pay students their outstanding allowances by 15 January. “We must with regret inform the public that we have met with all stakeholders in the sector in preparation of the commencement of that academic year except the leadership [at] NSFAS, which has failed to honour our meetings.

“On 18 January we were scheduled to meet with the acting CEO and his team and mere hours before the meeting he pulled out and failed to honour the meeting.”

The organisation added it had written to the Minister of Higher Education to immediately remove “this inept excuse of an acting CEO”.

SA Students Congress (Sasco) president Vezinhlanhla Simelane said on Friday that Sasco did not support nor endorse any form of misappropriation or corruption of public funds.

Thursday’s announcement of the matric results signalled the beginning of one of the most difficult periods in higher education, as thousands of students seek accommodation and financial assistance for their studies. “It is disturbing to note that this takes place while other students are still waiting for their allocation [from NSFAS] … as the government has taken the decision to cut public spending in the higher education sector.

“Only 9,128 students have been paid; only 9,128 student issues have been resolved.”

Sasco is calling for the immediate payment of all outstanding allowances, before the closure of registration.

Previously, it threatened to pay the NSFAS offices a “revolutionary visit”.

It was uncertain whether the organisations were prepared to escalate their threats, as neither Sasco nor the SA Union of Students responded to requests for comment on Friday. DM

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South Africa

Universities blamed

‘Kickbacks’

Charges