Mounting Irregular Expenditure Highlights Deep Systemic Failures
The National Student Financial Aid Scheme (NSFAS) faces severe criticism following revelations of gross financial mismanagement that have significantly impacted South African students’ lives. Tebogo Letsie, chairperson of the Portfolio Committee on Higher Education, has attributed NSFAS’s ongoing failures to students resorting to dating older men and engaging in criminal activities for survival.
Irregular Expenditure Totals Nearly R60 Billion
The Auditor-General of South Africa (AGSA) revealed that NSFAS incurred approximately R60 billion in irregular expenditure between 2019/20 and 2022/23. Much of this is linked to student disbursements and mismanaged direct payment tenders. In a recent parliamentary briefing, AGSA’s Western Cape deputy business unit leader, Thomas Mamogwe, highlighted NSFAS’s inability to manage its reporting requirements and the institutional dysfunction within the scheme.
Students Forced Into Desperation
During the briefing, Letsie emphasized the human toll of NSFAS’s inefficiencies.
“Students’ lives were destroyed. When they don’t receive money on time, they are left with no choice but to date older men or commit crimes,” he said.
He further criticized the entity for failing to address the life-altering consequences its actions—or lack thereof—have on vulnerable students.
Systemic Failures and Leadership Issues
NSFAS’s financial instability stems from outdated technology systems and inefficient management. In the 2021/22 financial year, NSFAS reported R1.9 billion in irregular expenditure, which slightly improved to R136 million in 2022/23. However, these figures are just the tip of the iceberg.
Freeman Nomvalo, NSFAS administrator, admitted that the organisation’s internal systems are obsolete, often leaving students uncertain about their funding statuses. Efforts to upgrade IT systems have been slow, despite a R160 million allocation for this purpose in the 2021/22 financial year.
The scheme achieved only seven out of its 17 performance targets, with leadership instability and critical vacancies contributing to the ongoing crisis.
Calls for Accountability and Reform
Higher Education and Training Minister Dr. Nobuhle Pamela Nkabane acknowledged the severity of NSFAS’s governance crisis. She outlined potential remedies, including:
- Appointing an independent assessor.
- Conducting forensic investigations.
- Referring the matter to the Special Investigating Unit (SIU).
The Portfolio Committee has also initiated investigations into irregular appointments and material irregularities. Letsie expressed frustration over the lack of progress since the investigations began in 2021.
“We need accountability,” he said. “I’m tired of us using soft gloves to pursue these cases.”
Future Prospects
Despite promises of reform, the outlook for NSFAS remains bleak. The 2023/24 financial statements are anticipated to reflect continued mismanagement. Letsie stressed the need for consequences, stating, “Public officials must stop treating the public service as a joke.”
