In January 2021, the Minister of Higher Education, Blade Nzimande inducted the new Board for the National Student Financial Aid Scheme (NSFAS). This came after NSFAS was under administration of Dr Randall Carolissen for two and a half years.
Now, the Minister has announced that the NSFAS board will be dissolved. In a statement released, he said:
... the Minister's decision to dissolve the NSFAS board, with immediate effect and place the institution under administration.
Prior to the announcement, Nzimande met with the Board to communicate his decision. The decision was taken, "as part of the set of interventions to improve the organisation efficiency" of NSFAS in order to "ensure it remains focused on its mandate".
With the appointment of an Administrator, the Minister would have more direct control over NSFAS as the Administrator covers both the management and board roles - and reports directly to the Minister.
The NSFAS Board’s chairperson, Ernest Khosa resigned just before Nzimande announced his decision to dissolve the board. Khosa was recently placed on special leave following NSFAS launching an investigation into his involvement in receiving irregular payments in connection with the NSFAS Direct Payment System.
NSFAS Direct Payment System Challenges
The NSFAS direct payment system has been plagued by problems since its inception, raising concerns among students, universities, and government officials.
In 2023, students protested against excessive bank fees associated with the NSFAS accounts, highlighting a financial burden for recipients. The shift to direct payments through inexperienced fintech companies has proved problematic.
The CEO's dismissal in 2023 due to a potential conflict of interest in selecting companies to manage direct payments was also another challenge which presented itself. These companies will face termination based on a Werksman's report's recommendations, but legal challenges could delay the process.
Disruptions in receiving student allowances have continued into 2024, leaving vulnerable students struggling to cover living expenses. This has sparked calls for nationwide university shutdowns.
To provide further details on this major announcement, the Minister is set to hold a special briefing on Sunday, 14 April at 2pm. During this briefing, he is said to explain the reasons behind firing the NSFAS board and what comes next.
