The National Student Financial Aid Scheme’s (NSFAS’s) lagging ICT systems have come under the spotlight once again, with the Public Protector calling for urgent action.
Public Protector advocate Kholeka Gcalekayesterday released findings of an investigation into allegations of administrative, governance and oversight deficiencies relating to funding and coordination of student financial aid within the higher education sector by the NSFAS.
The report depicts the NSFAS’s deficiencies, which it notes have impaired its ability to discharge its statutory mandate effectively, efficiently and consistent with the standards expected of a public entity.
The determination also draws on the findings of the 2023 Special Investigating Unit (SIU) investigation, which uncovered that the scheme incorrectly funded some 40 000 non-qualifying students to the tune of more than R5.1 billion.
The Public Protector says NSFAS’s inadequate systems and administrative weaknesses contributed to inefficiency, delays and poor service to students.
It highlights that the entity’s systems are not sufficiently integrated with key state data sources, such as the Department of Home Affairs, South African Social Security Agency and South African Revenue Service.
As a result, the Public Protector has instructed the board to develop a digital modernisation and systems integration plan, within 30 calendar days of receiving the final report.
The plan should cover full integration between NSFAS and other institutions’ systems; improved verification interfaces with key state data sources; strengthened fraud controls and cyber security; elimination of duplicate applications and manual workarounds; improved student-facing communication and case tracking; and specific milestones and funding requirements.
On technology governance, the report notes NSFAS systems were not strong enough to support accurate, efficient and accountable student funding administration.
According to the Public Protector, evidence obtained through the investigation also shows “severe” inaccessibility of the entity to beneficiaries it is intended to service.
The financial aid scheme reported an inability to resolve 80% of the queries received through its contact centre due to the need to escalate these queries through its internal units for resolution.
“NSFAS’s limited accessibility, particularly its centralised Cape Town-based walk-in service and ineffective query-resolution arrangements at institutional level, contravenes the Batho Pele principle three on access.
“It further undermines section 29(1)(b) of the Constitution, as NSFAS funding is one of the principal mechanisms through which the state is required to make further education progressively accessible.”
Never-ending saga
As part of the Department of Higher Education and Training, NSFAS runs a close to R50 billion annual budget, providing financial aid to eligible students at public TVET colleges and public universities.
NSFAS has, over the years, faced systemic governance issues, including IT system failures and mismanagement within the scheme.
In May, higher education and training minister Buti Manamela placed the entity under its third administration round in as many years, citing ICT modernisation delays among the reasons for his decision.
Earlier this month, NSFAS administrator professor Hlengani Mathebula, whose appointment has since been suspended, revealed that ICT was the biggest operational risk facing the financial aid scheme.
Mathebulawarned that outdated and fragmented technology systems were undermining funding administration, payments and student services.
Following the debacle with the direct-payment fintech providers, the NSFAS board was booted in 2024, leading to the entity being placed under administration by science, technology and innovation minister professor Blade Nzimande, who served as higher education minister at the time.
Nzimande also cited “serious” IT systems challenges as the reason for dissolving the board.
In 2023, the SIU said flaws and weaknesses in the IT systems of the financial aid scheme resulted in overpayments, underpayments and payments to ‘ghost students’ over the years.
In 2022, a group of tertiary students, named “Youthful Hope”, threatened a nationwide academic shutdown, because of frustrations with the scheme’s IT systems and mismanagement.
Meanwhile, in 2020, Nzimande said a ministerial committee of inquiry had been appointed to investigate business processes, including an “inadequate” R100 million IT system at NSFAS.
No surprises
Parliament’s Portfolio Committee on Higher Education and Training chairperson Tebogo Letsie says the Public Protector’s findings are concerning, but not entirely surprising, given the persistent governance, administrative and system challenges at NSFAS.
“These weaknesses have real consequences for students, particularly those from poor and vulnerable households who depend on NSFAS to access and remain in higher education.”
The chairperson highlights that students should not have to bear the consequences of governance failures and administrative weaknesses in an institution that exists to support their education.
“We have said repeatedly that NSFAS must put students first. Students cannot be left to suffer, while those entrusted with the administration of the scheme are preoccupied with governance disputes and boardroom squabbles. The focus must be on ensuring students receive the support they are entitled to, and that public funds are properly managed.”
Letsie concludes that the recently-restored NSFAS board must take the findings seriously and move with urgency to address the weaknesses identified.
“I hope the restored board is paying close attention to these findings. It must act swiftly to strengthen governance, improve systems and ensure proper accountability for every rand entrusted to NSFAS. We cannot continue to have the same failures year after year,” he notes.
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