Parliamentary Committee Calls For NSFAS Maladministration To Be Resolved


The National Student Financial Aid Scheme is no stranger to controversy and allegations of fraud, corruption and maladministration. The Parliamentary Committee has expressed serious concern and dissatisfaction with the scheme's poor handling of operations.


The National Student Financial Aid Scheme (NSFAS) has come under fire recently, receiving harsh criticism from the Parliamentary Committee of Higher Education regarding appeals and ongoing maladministration. 

Chairperson of the committee Nompendulo Mkhatshwa (ANC) opened the meeting with harsh words for the funding scheme.

This entity, with the mandate it has, should be the best run entity in the country... but right now it is not. It’s an embarrassment.

This follows backlash the scheme received regarding student funding, particularly delays in distributing student allowances, the new NSFAS banking system as well incorrectly defunding thousands of students.

Mkhatshwa emphasized the widespread unhappiness among students, citing anxiety as a major concern.

Continuous Grievances With NSFAS 

Poor Communication From NSFAS 

Parliamentary Members also directed strong criticism at the NSFAS contact centre, its portal and query systems, and for gross inefficiencies. The Committee also instructed the entity to urgently resolve the challenges, as they were destabilising the sector by failing to service the students. 

They further emphasized the urgent need for resolution, as these issues were negatively impacting students. Some members even suggested that the staff responsible for these systems should not receive payment until improvements were made.

The NSFAS Board and management were warned of potential consequences if the situation persisted. 

Students often remained in the dark, and their queries often went unanswered; Committee members expressed shock that even their own queries were ignored by NSFAS.

NSFAS Wrongfully Defunded Over 10 000 Students 

During the briefing the committee expressed disappointment over a mistake that led to more than 14 000 eligible students wrongfully losing their funding. They demanded information on steps being taken to rectify the situation and prevent future incidents.

The bursary scheme explained that the decision to commence with a remedial process of defunding students came in response to the funding that they paid more than R5 billion to students who did not meet the eligibility criteria but received funding. 

The Special Investigating Unit (SIU) presented draft findings to the Standing Committee on Public Accounts (SCOPA) that revealed that a staggering 76 institutions, involving approximately 40 044 students, were improperly granted bursaries between 2018 and 2021. 

However, it was later revealed that some students had been mistakenly defunded due to NSFAS errors.

NSFAS acting CEO, Masile Ramorwesi, explained that 45,927 students were disqualified for submitting falsified or fraudulent documents.

The main reason for disqualification [of funding] was that most first-time entering students had a household income of more than R350,000, while returning students either did not meet the required academic progression – which is 50% of all registered modules – or exceeded the minimum number of years allocated to achieve the qualification. 

NSFAS Is Still Dealing With Appeals In September 

The academic year is soon coming to an end for university students, but many who have submitted appeals to the National Student Financial Aid Scheme for 2023 funding, have yet to hear back from the bursary scheme.

The delay in dealing with appeals has been harshly criticized by the Parliamentary Committee.

Not every student's application gains immediate approval; if rejected, students can submit an appeal, essentially asking that NSFAS reconsider their application. The appeal must be submitted within 30 days of seeing the "unsuccessful" NSFAS application status. 

The Committee has been adamant in reminding the scheme that it could not be dealing with appeals in September, as students are nearing their final examinations, meaning majority of the academic year has passed, and students have been left without funding. 

Minister of Higher Education, Blade Nzimande, explained that many first-time entering students who had been approved for funding were suddenly defunded due to newly discovered parental relationships. 

These relationships are verified through information obtained from government agencies such as the Department of Home Affairs (DHA) and the South African Revenue Service (SARS). 

According to NSFAS, some students declared they were from a single-parent household or provided incorrect parental information. This information went initially undetected by the DHA, which led to the students receiving funding. 

Nzimande says due to this trend of misrepresentations, NSFAS worked to establish the parental relationships of students. 

Additional Criticisms From the Committee 

A focal point of the Committee's concern was the appointment of four service providers to distribute funds to universities and technical and vocational education and training (TVET) colleges, as part of the newest direct payment method for NSFAS allowances.

The direct payment system has caused a lot of controversy and frustration, for both NSFAS stakeholders and student beneficiaries, which has lead to an investigation from the Public Protector.

This comes after Stellenbosch SRC Vice Chairperson, William Sezoe, lodged a complaint asking the Public Protector to look into the awarding of the contract for the new NSFAS direct payment system. 

Sezoe explained:

I have last week written to the Public Protector to investigate the National Student Financial Aid Scheme direct payment system and in particular the involvement of the CEO of NSFAS with the awarding of the specific tender.

According to investigation findings by the Organisation Undoing Tax Abuse (Outa), all four service providers NSFAS partners with are young and unexperienced companies. Outa further revealed that the companies were also not registered as Financial Service Providers at the Financial Sector Conduct Authority (FSCA). 

The Committee has further emphasized the urgent need for resolution, calling the bursary scheme an "embarrassment", as these issues were continuously having a negative impact on students. The NSFAS Board and management were warned of potential consequences if the situation persisted.

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