NSFAS CEO Wassim Carrim indicated that the SIU is better equipped to handle the Close-Out project for the period between April 2021 and March 31, 2023. The unit has already recovered billions of rands and secured acknowledgment of debt agreements from undeserving beneficiaries.
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.
For the 2024 academic year, NSFAS will focus its efforts on data reconciliation to regularise its financial statements and auditing processes. The scheme plans to implement monthly and annual reconciliations with financial penalties for Universities and TVET Colleges failing to submit data.
Background to Financial Mismanagement
Launched in 2021, the Close-Out project was initiated to address years of financial mismanagement and data inconsistencies. Its primary goal was to resolve individual student funding issues, align data between NSFAS and institutions, quantify outstanding amounts to institutions, students, and accommodation partners, and recover funds owed to NSFAS. This project is expected to involve billions of rands in transactions.
The PFMA legislation governs financial management in national and provincial governments, including public departments and entities, aiming for efficient, effective, and transparent use of public funds.
NSFAS 2024 Close-Out Project Progress and Challenges
Institutions received letters requesting the submission of full cost of study (FCoS) data, which includes total claims for tuition and NSFAS-allowable allowances for funded students. While all universities submitted FCoS data, only 60% of TVET Colleges (20 institutions) complied.
Challenges faced by NSFAS include difficulties in obtaining accurate and complete FCoS data mirroring student fee accounts, lack of institutional capacity for data formatting, inconsistencies in recording allowances, and non-allocation of NSFAS funds to student accounts. Internal challenges included changes within the Close-Out project team, decisions on historical debt, financial team capacity issues, leadership changes, and the absence of annual reconciliations.
Addressing Discrepancies
To tackle these issues, NSFAS conducted roadshows, engaging 95% of higher education institutions to resolve data discrepancies. The scheme also partnered with system providers COLTECH and ADAPT IT, along with the Department of Higher Education and Training (DHET), to extract historical billing data from 2017 to 2024.
NSFAS has begun recovering unfunded amounts from students in collaboration with the SIU. Additionally, two new key performance indicators have been added to the Annual Performance Plan, and several critical financial oversight positions have been filled to strengthen internal capacity and enhance accountability.
