NSFAS Is Being Placed Under Administration

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Stakeholders in the higher education sector have welcomed Minister Nzimande's decision to dissolve the NSFAS board and place the scheme under administration. Several challenges have led the minister to make this decision. 


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The National Student Financial Aid Scheme (NSFAS) is undergoing a major shakeup with Minister of Higher Education and Training deciding to dissolve the NSFAS board and placee the organisation under administration to improve its efficiency in delivering financial aid to students.

In a statement released, the Minister said:

... the Minister's decision to dissolve the NSFAS board, with immediate effect and place the institution under administration.

Why the Change?

Higher Education Minister Nzimande said the move aims to streamline NSFAS operations and address challenges like delayed student allowances. Universities and colleges missing deadlines for submitting student data reportedly contributed to these delays.

Student Groups Welcome the Decision

South African Union of Students (SAUS) welcomed Nzimande’s decision to dissolve the NSFAS board. They argue that the board has been ineffective in carrying out its mandate and called for restructuring of the scheme. 

It is our solemn and painstaking view that the organisation is populated by some of the most inept and useless people to ever live. This can through an empirical observation and the lived experiences of NSFAS beneficiaries be concluded.

SAUS wants to assume they can still expect allowances despite the dissolution of the board. However, NSFAS allowance payments for April may be delayed. 

Thousands of students are likely not to receive their allowances on time for April, as was the case for the last few months. 

The non-payment of student allowances at the beginning of April 2024 was the first month where Direct Payment Service Providers would be responsible for the disbursement of NSFAS allowances. 

First introduced in 2022, the implementation of the NSFAS bank account has faced several challenges. Students marched to parliament in 2023 due to high bank charges associated with the use of NSFAS bank accounts.

Later in 2023, the NSFAS CEO was fired over a potential conflict of interest in choosing the service provided to facilitate direct payments. These same contracts were flagged and led former board chair Ernest Khosa to take a leave of absence to allow NSFAS to investigate corruption claims against him. 

While NSFAS said they intended to terminate these contracts based on the Werksmans report recommendations, NSFAS anticipated legal challenges could delay their termination 

NSFAS's decision to allow these companies to continue disbursing student allowances has remained controversial. 

This will however be exacerbated by the fact that NSFAS along with the department persist in contracting illegally appointed and incompetent private service providers to disburse these allowances.

The South African Students Congress (SASCO) echoed SAUS’ sentiments welcoming the dissolution of the board. They too are calling for structural reform at NSFAS. 

Furthermore, we emphasise the urgent need for structural transformation at an administrative level within NSFAS. The current system is plagued by inefficiencies and bureaucratic hurdles that impede students' access to financial assistance. SASCO will continue to push for reforms that ensure NSFAS operates in a manner that prioritises the needs of students.

What's Next for NSFAS?

An administrator will now oversee NSFAS, focusing on several key areas:

  • Ensuring timely funding decisions and accurate student data.
  • Streamlining the application process for 2025 scholarships and loans.
  • Developing a plan for the 2025 funding cycle with clear roles for all parties involved.
  • Strengthening NSFAS's governance and management to prevent future issues.
  • Investigating past problems to ensure smoother operations moving forward.

Minister Nzimande is expected to provide more details about the decision and future plans on April 14, 2024. Students facing allowance delays can expect updates on resolving this issue.

Suggested Article:

blade nzimande with nsfas board chairperson

While the National Student Financial Aid Scheme appointed a Board to improve operations and ensure that students receive support effectively, it's introduction has brought about many challenges. The Minister of Higher Education has now made a major announcement.

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