Edwin Naidu
Embattled funding agency, the National Student Financial Aid Scheme (NSFAS), is under pressure from civil society body, the Organisation Undoing Tax Abuse (OUTA), over another crisis brewing around student accommodation.
“OUTA can confirm that we have been alerted to this by concerned accommodation providers who are still – at this very late stage – waiting to hear whether NSFAS has approved their accommodation for returning and new students,” said Rudie Heyneke, the head of investigations at OUTA at the weekend.
“We are aware of students in Cape Town who have been spending the last two weeks sleeping on the streets since the NSFAS accommodation portal won’t allow them access to look for available accommodation. Landlords, in turn, are not allowed to give students access to accommodation without pre-approval by NSFAS.”
OUTA, which focuses on exposing government corruption and the abuse of taxes and public funds in South Africa, has called on Minister of Higher Education, Science Innovation, Dr Blade Nzimande, to step aside pending a probe into NSFAS.
Earlier in January, OUTA published a damning expose on the corruption at the national student funding body, linking Nzimande to kickbacks for the South African Communist Party which he leads.
Amid calls for him to resign – or President Cyril Ramaphosa to give him the boot – Nzimande called a media conference two weeks ago, threatening legal action.
OUTA told Inside Education it has not received summons from the Minister.
A request for comment from Ramaphosa’s office on whether it would act against Nzimande went unanswered.
On Friday, OUTA again placed accountability on Nzimande, considering a looming student accommodation crisis.
“It is our view that Minister Blade Nzimande should be asked to step aside while a full, independent investigation into allegations of widespread corruption at NSFAS is being conducted,” said Heyneke.
According to OUTA, corrupt syndicates have infiltrated NSFAS and linked to other departments within the department of Higher Education, Science and Innovation and the system of accommodation allocations and accreditation has all but collapsed.
OUTA claimed that at least 11 000 students are awaiting outstanding payments of their monthly allowances and thousands more waiting for NSFAS to settle their outstanding tuition fees at TVET colleges and universities. The new crisis is around the availability of accommodation for NSFAS students.
Heyneke says these inspection and accreditation services were normally handled by accredited service providers on behalf of universities and colleges, but that NSFAS had contracted this function to inexperienced and understaffed service providers.
OUTA foresees that this situation will only get worse once universities open for the academic year. “NSFAS themselves told Parliament in October last year that they need accommodation for at least 397,000 students at institutions countrywide,” Heyneke explained. “We want them to answer a few very basic questions which they seemed to avoid so far.”
According to Heyneke, NSFAS should be transparent about the number of beds accredited so far. “We also want to know where these beds are – at exactly which institutions and in which areas? Who inspected them? Are the institutions’ own beds included in this number? Did they also have to pay to get their beds registered on the system, and will NSFAS also withhold a percentage of their fees?”
OUTA said it is imperative that students get access to the accommodation portal as a matter of urgency. “TVET colleges started classes on Wednesday, and while students are homeless, they are also missing classes.”
NSFAS must also be transparent about agreements with accommodation owners. “According to our information, many of them haven’t even seen rental agreements, and many are refusing to take part in the pilot project because of all the uncertainty caused by how NSFAS is handling the situations.
Heyneke says OUTA is aware of the outcry by students on social media. “Some have also reached out to us. It is despicable that NSFAS is allowed to gamble with the future of young people who want to better their lives through education. At this stage, the only logical decision would be for NSFAS management to stop the pilot project before this becomes a full-blown accommodation crisis that can easily spill over into student protests.”
According to Heyneke, NSFAS has included 17 out of the 26 public universities in SA on the ‘Pilot Project’ and 22 out of 50 colleges. “Now the portal doesn’t work, the accreditation process is way too slow and accommodation providers and institutions are left in the dark.
“NSFAS should do a proper pilot project and analyse the outcome first before forcing more than 50% of tertiary institutions to use a system that has not been tested. Allow universities and accommodation owners to continue with previous contracts while NSFAS cleans its house.”
During 2022, OUTA began investigating mismanagement of student funds by the NSFAS triggered by its alleged corrupt links to the Services Sector Education and Training Authority (Services SETA). Both entities fall under the Department of Higher Education and Training.
OUTA said the failure by institutions, such as the Services SETA and NSFAS, to manage their funds responsibly fails the unemployed youth and the country.
Two years ago, OUTA probed tender corruption at NSFAS. This followed OUTA’s investigation into corruption and irregular contracts at the Services Sector Education and Training Authority (SSETA) after a successful PAIA application relating to a R170 million tender for a biometric attendance monitoring system awarded to the Grayson Reed consortium.
OUTA’s scrutiny of the documents for the Grayson Reed contract found maladministration, corrupt activities, and non-performance by Grayson Reed. The Grayson Reed contract was subsequently cancelled by SSETA.
But OUTA found that some of the same individuals who were involved in the cancelled Grayson Reed, registered new companies with relatives as the directors. One of these companies was awarded a tender by NSFAS for similar services that the Grayson Reed Consortium provided to SSETA.
Under Nzimande’s watch, there has been corruption within NSFAS, evidence of wrongdoing at universities described by leading academic Professor Jonathan Jansen in a book last year, and ongoing financial mismanagement at skills training institutions which fall under the 21 Sector Education and Training Authorities.
The Chairperson of NSFAS, Ernest Khosa, has taken a leave of absence following allegations that he and Nzimande had allegedly defrauded the student funding body through kickbacks from service providers.
But following the release of the OUTA report on 4 January, which contained leaked recorded conversations as part of its evidence, the Minister denied the claims, saying OUTA was trying to derail the start of the 2024 academic year.
Nzimande threatened legal action over the claim that the South African Communist Party which he leads, benefited from cash or services worth R1 million for its 2022 conference from the student funding body. Nzimande labelled the claim “malicious and false”. But OUTA insisted it stands by its investigation.
Andile Nongogo was axed as NSFAS chief executive in October 2023 over “irregularities” related to four firms selected to pay around 1.1 million students their R1 650 monthly allowances directly and not through tertiary institutions, which had been the previous payment method.
He was head of the Services SETA implicated in wasteful expenditure – and paying over the odds for items ordered. AS SETA CEO, Nongogo, authorised an overpriced branding campaign that cost taxpayers R37 million, including a branded T-shirt at R4 600, R44 000 for a branded umbrella, R980 for a coaster, R668 200 to print 100 copies of the SSETA Annual Performance Plan.
Nongogo was rewarded with the NSFAS role after his stint at the SSETA.
INSIDE EDUCATION
