The National Student Financial Aid Scheme (NSFAS) is considering reporting student accommodation providers to the Competition Commission. This follows reports that several accommodation providers had increased their prices beyond the cap introduced by NSFAS in 2023.
Earlier this year, NSFAS introduced an accommodation allowance cap of R45,000 to manage the unregulated costs of student accommodation and manage profiteering and price collusion by private student accommodation providers.
While the financial aid scheme acknowledged that some private and institutional accommodation was above the cap of R45,000 they are working with the affected institutions and are fast-tracking the accreditation in the affected areas.
Students from four universities were left without accommodation as they could not afford the costs set by the providers. These students were from the University of Pretoria, Stellenbosch University, the University of Witwatersrand and the University of Cape Town.
Nsfas spokesperson Slumezi Skosana warned that if challenges concerning student accommodation costs are not addressed, thousands of students will be affected. This as students funded by Nsfas won’t be able to pay the monthly rent of up to R9,000.
Currently, Nsfas spends R18 billion on student accommodation annually. However, accommodation providers can charge up to R90,000 annually for beds which the financial aid scheme said is unsustainable.
The financial aid scheme is calling on stakeholders to confront the issue of student accommodation costs as it could impact the future of thousands of students.
In 2023, Nsfas will play an active role in deciding if student accommodation facilities are appropriate for students and conducive to their development.
This will see Nsfas take responsibility for identifying and accrediting student accommodation providers. This was previously the responsibility of institutions.
Higher education minister Blade Nzimande revealed that R7.584 billion has been invested in infrastructure projects across the 26 universities located in South Africa. This investment aims to improve and increase student accommodation facilities around the country.
The minister explained, “R2.953 billion of this investment will be dedicated towards student housing for the delivery of 16,858 beds across 11 universities. This will ensure that we have additional 15,898 new beds and that we refurbish 960 beds.”
Nsfas announced their intention to engage with accommodation providers to consider accommodating students within the cap of R45,000.
