The National Student Financial Aid Scheme (NSFAS) wants the Special Investigating Unit (SIU) to fully take over its Close-Out project, citing the unit’s capability to recover mismanaged funds and conduct investigations.
“The period 1 April 2017 – 31 March 2023 [should be] consolidated and treated as an investigative process managed by the SIU given that they possess the skills and capabilities to execute this task,” NSFAS said.
The SIU has already recovered billions of rands and signed acknowledgment of debt agreements with students who unduly benefited from NSFAS funds.
NSFAS believes handing over the Close-Out project, which dates back to 2017, will help resolve longstanding financial mismanagement and improve audit outcomes. The move is part of a broader strategy to strengthen internal controls and financial accountability.
2024 Focus: Compliance and Reconciliation
NSFAS will now prioritise data reconciliation for the 2024 academic year to comply with the Public Finance Management Act (PFMA). The PFMA requires efficient, effective, and transparent use of public funds across government entities.
NSFAS CEO Wassim Carrim said the reconciliation process would support regular financial audits. The scheme also plans monthly and annual reconciliations, introducing penalties for universities and TVET colleges that fail to submit complete data.
Close-Out Project Challenges
The Close-Out project was initiated in 2021 to fix years of poor financial oversight and data mismatches. It aims to align records between NSFAS and institutions and disburse or recover outstanding funds.
While all universities submitted their Full Cost of Study (FCoS) data, only 60% of TVET colleges did the same. NSFAS flagged issues such as data inaccuracies, inconsistent allowance recording, and the non-allocation of funds to student accounts.
Internal difficulties included leadership changes, unresolved historical debt, and capacity constraints in its financial team. A lack of consistent annual reconciliations also worsened the situation.
Efforts to Fix the System
To resolve data issues, NSFAS conducted roadshows with 95% of higher education institutions. It also partnered with system providers COLTECH and ADAPT IT, and the Department of Higher Education and Training (DHET), to extract billing data from 2017 to 2024.
Recovery efforts for misallocated funds continue through the SIU.
Two new key performance indicators have been added to NSFAS’ Annual Performance Plan. Critical financial oversight roles have been filled to improve accountability and prevent future mismanagement.
