NSFAS R5.1bn scandal deepens as Parliament demands action

Parliament has demanded urgent action after an investigation found that the National Student Financial Aid Scheme (NSFAS) improperly funded more than 40 000 students at an estimated cost of R5.1 billion.

The finding forms part of a broader investigation by Public Protector Advocate Kholeka Gcaleka into problems affecting the student funding scheme.

The R5.1 billion figure stems from a Special Investigating Unit (SIU) investigation conducted under Proclamation R88 of 2022.

The SIU identified approximately 40 000 students across 76 higher education institutions who received funding despite not qualifying for it.

Public Protector finds systemic failures at NSFAS

Gcaleka’s investigation went beyond the improper payments and examined broader problems affecting the administration, governance, funding, coordination and oversight of student financial aid.

Recurring student protests, funding delays and concerns over governance and administration at NSFAS prompted the investigation.

The Public Protector found that the problems extended beyond isolated cases involving individual students or institutions and pointed to recurring failures across the higher education funding system.

Her investigation examined inadequate access to tuition funding, inefficiencies and maladministration in funding mechanisms, student accommodation problems, funding criteria and delays in allowance payments.

Gcaleka also identified persistent governance instability, administrative weaknesses and inadequate systems at NSFAS.

How did R5.1 billion go to students who did not qualify?

The SIU previously told Parliament that more than 40 000 students identified across 76 institutions had household incomes above R350 000 and therefore did not qualify for NSFAS funding under the applicable rules.

According to the SIU, some applicants failed to submit their parents’ details. As a result, NSFAS did not properly conduct the required means test before approving their funding.

The SIU interviewed several affected students and parents during its investigation. Some students admitted that they did not qualify for the funding.

Investigators also sought to establish who had signed the applications.

Authorities have since recovered more than R2 billion of the improperly allocated funds, according to information cited by the Public Protector.

Parliament demands accountability

Portfolio Committee on Higher Education and Training chairperson Tebogo Letsie has described the R5.1 billion figure as “astronomical”.

In an 18 August statement, Parliament said the findings concerned Letsie but did not entirely surprise him given the persistent problems at NSFAS.

“R5.1 billion is not a small amount, and we cannot treat this matter as just another administrative failure,” Letsie said.

“These weaknesses have real consequences for students, particularly those from poor and vulnerable households who depend on NSFAS to access and remain in higher education.”

Letsie said students should not have to bear the consequences of governance failures and administrative weaknesses at an institution established to support them.

“We have said repeatedly that NSFAS must put students first,” he said.

“Students cannot be left to suffer while those entrusted with the administration of the scheme are preoccupied with governance disputes and boardroom squabbles.”

NSFAS Board told to act

Letsie called on the recently restored NSFAS Board to urgently address the weaknesses identified in the investigation.

“It must act swiftly to strengthen governance, improve systems and ensure proper accountability for every rand entrusted to NSFAS,” he said.

“We cannot continue to have the same failures year after year.”

The Portfolio Committee will now process the Public Protector’s report.

According to Parliament, the committee has 30 days to process the report and secure Parliament’s approval before submitting it to the Public Protector.

The findings leave NSFAS facing serious questions over how it approved billions of rands in funding for students who did not qualify, how much of the outstanding money authorities can still recover and whether those responsible will face consequences.