NSFAS rescue plan in tatters, students left high and dry … again

It’s gone from bad to worse for the embattled NSFAS (National Student Financial Aid Scheme). Earlier this month (August 2026) the scheme’s administrator, Professor Hlengani Mathebula, submitted a rescue plan.

This was duly delivered to the Minister of Higher Education and Training, Buti Manamela, in line with Government Gazette requirements.  

The plan listed governance, audits, consequence management, student support, accommodation and stakeholder confidence among its top priorities.

The Mathebula report says the NSFAS has been systematically hollowed out over years, its resources stripped of institutional safeguards. And Special Investigating Unit (SIU) intervention, authorised by President Cyril Ramaphosa back in August 2022, backs this up …

SYSTEMATIC DISMANTLING OF THE NSFAS

Since then, the SIU has recovered more than R2 billion in mismanaged funds from higher education institutions. And most of that has gone directly back to the financial aid scheme.

As such, the NSFAS was placed under administration in May 2026, the third time this has occurred since 2018. The Auditor-General of SA (AGSA) handed it a disclaimed audit opinion, flagging 66 major findings and 115 overdue audit items.

Of the numerous material irregularities, deceased-beneficiary funding, duplicate payouts and procurement maladministration were rife.

“My administration’s decisive actions against the rot have provoked spirited opposition from those whose interests are being threatened,” says Mathebula. ICT was named the single biggest operational risk. Then followed student accommodation. However, just over a week ago (11 August), reports emerged that the NSFAS was in hot water yet again. This time over R500 000 in allegedly irregular procurement and payment of four advisers appointed by Mathebula. The National Treasury swung into action, and on 13 August, Minister Manamela and Mathebula were arguing their case in Parliament.

HAULED BEFORE PARLIAMENT

A day later (14 August), the Pretoria High Court suspended Mathebula’s appointment outright. Judge Neil Labuschagne’s ruling suspends any appointments ‘pending finalisation of investigations.’

The judgment is brutal for the Higher Education and Training Minister. Manemela was obliged to disclose the administrator’s identity to the board before appointing him … and failed to do so. On Mathebula’s suitability, the judge went further, finding him unfit for the role given his conduct previously at SARS. Mathebula faced disciplinary proceedings back in 2019 and resigned before investigations were concluded.

DISSOLUTION OF NSFAS BOARD OVERTURNED

Furthermore, Judge Neil Labuschagne also rejected Minister Manamela’s central justification for dissolving the NSFAS board in the first place.

The court found that the remaining seven members still formed a quorum and could keep functioning. In turn, the board welcomed the ruling, saying it will focus on stabilisation, and ‘appropriate action against any wrongdoers’ it finds. The scheme also insists student funding won’t be disrupted in the interim.

Meanwhile, critics were less complimentary. The likes of OUTA are saying the judgment raises serious questions about Minister Manamela’s judgement and his fitness to run the portfolio.

However, the reinstated board says it wants to keep working with the minister towards the same governance goals. The final question is whether Mathebula’s original NSFAS rescue roadmap even survives this latest upheaval …

But what do you think? Do you trust anyone at the NSFAS? Please share your thoughts in the comments section below …