The newly appointed Higher Education Minister, Dr. Nobuhle Nkabane, has revealed that the previous National Student Financial Aid Scheme (NSFAS) board was terminated due to its failure to address irregular contracts. NSFAS provides crucial financial assistance to students pursuing tertiary education in South Africa, offering bursaries and loans for tuition, accommodation, and living expenses.
In 2023, an investigation by Werksmans Attorneys uncovered significant irregularities in the bidding process for four service providers tasked with managing student allowance payments. The report raised concerns about potential conflicts of interest involving the former NSFAS CEO, Andile Nongogo, and fintech companies involved in distributing the funds.
The first one is the inability of the NSFAS to fully implement the recommendations of the Werksmans report, including the termination of the contract of the direct payments that it provides to those who had been appointed irregularly.
The Werksmans report recommended the termination of these contracts, a decision initially endorsed by the NSFAS board but ultimately ignored. This inaction led to the dissolution of the board by former Higher Education Minister Blade Nzimande.
Minister Committed to Implementing Reforms
Minister Nkabane has pledged to ensure the full implementation of the Werksmans report's recommendations.
"I am committed to addressing Werkmans in the report, and as such employees who are implicated in wrongdoing will face consequences within our processes, including criminal charges."
In June, the Western Cape High Court ruled in favor of NSFAS, allowing it to proceed with the contract terminations. However, a recent court decision reinstated the contract of eZaga Holdings.
The termination of a service provider's contract is a matter before our legal system, and it is best to leave it to the courts for education.
NSFAS is appealing this decision and is also pursuing legal action at the Special Tribunal to void the contracts due to procurement irregularities. Both NSFAS and the Special Investigating Unit (SIU) have filed applications with the Special Tribunal to declare the contracts invalid.
NSFAS administrator Freeman Nomvalo has reiterated the scheme's commitment to terminating the service provider contracts and taking disciplinary action against any employees implicated in wrongdoing.
We have responded in response to the challenge, that, interdicted, which we had lost in July, and we are appealing we are appealing that process and the process is underway.
"As it relates to the disciplinary process of the employee, the CEO is not with us and the CFO. The other employees even reported was, the level of capability of the rest of the employees was not as severe as part of the CFO as well as the CEO."
