A parliamentary inquiry into the National Student Financial Aid Scheme (NSFAS) has exposed deep governance failures, allegations of ministerial interference, and ongoing administrative breakdowns that continue to leave students without critical funding, according to testimony presented to the Portfolio Committee on Higher Education.
Former NSFAS board members told the committee that Higher Education Minister Buti Manamela attempted to influence the appointment of the scheme’s Chief Executive Officer during an April meeting in Johannesburg, which they described as “unusual.” One board member testified that the minister appeared to arrive with predetermined instructions that should pause the board’s processes, stating: “I felt and I think it was a feeling that we shared with colleagues post that engagement that the minister’s interaction with us could not have been a normal lawful interaction between the executive authority and a member of a board of an entity.”
Minister Manamela firmly rejected the allegations. “In no way in any of my decision did I seek to influence that a particular individual should be appointed as the CEO,” he stated, distinguishing between the board’s appointment process and his ministerial responsibility for ensuring the board’s proper constitution and functioning.
Committee members raised concerns about the absence of official minutes from the disputed meeting. An EFF representative emphasized that “administrative justice is very clear that when you exercise public power, we ought to have a public record,” adding that the conflicting accounts from the minister and former board members create a “constitutional quagmire” where “someone is lying.”
The probe also examined the resignation of board members, which decreased from 18 to 7 prior to the board’s dissolution. Questions were raised about potential connections between these resignations and threats of self-resignation, though Minister Manamela denied any involvement: “I deny any involvement in the resignation of any of the board members.”
Central to the dispute is whether the NSFAS board was legally constituted and able to meet quorum requirements—a matter now headed to court. Committee members expressed concern about making determinations on quorum without first establishing what the governing legislation requires, urging amicable solutions to avoid “unnecessary fights between the minister and people whether in councils or boards of our entities.”
Expert Calls for Structural Overhaul
Mlamuli Hlatshwayo of North-West University argued that repeated leadership changes at NSFAS have failed to address deep-rooted problems. He noted this marks the third time an administrator has been appointed to lead the entity, yet governance issues, board incompetence, financial mismanagement, and adverse audit opinions persist.
“Over 70 billion that went missing and that is unaccounted for within the NSFAS budgetary allocations,” Hlatshwayo stated, referencing ongoing financial irregularities. He highlighted the human impact of administrative failures: students facing “gap investigations” experience funding pauses lasting three to six months, leaving them without stipends or allowances.
“These students now [face] food insecurity, hunger, homelessness,” Hlatshwayo said, describing students squatting in computer labs and lecture halls. He emphasized the devastating effect on academic performance and mental health, calling for NSFAS to be “criminally held liable for what I would call organized dysfunctionality.”
Hlatshwayo proposed dissolving NSFAS as an organizational entity while preserving its core mission of state financial support for poor and working-class students. He recommended that the Department of Higher Education and Training and National Treasury assume direct responsibility for fund disbursement, supported by SARS and law enforcement agencies to monitor allocations and combat fraud.
“Treasury, together with SARS, they’ve got access to our financial records, to our tax records. They can do better credit checks and affordability mechanisms way better than NSFAS as an entity,” he explained.
Addressing concerns about transition disruptions, Hlatshwayo advocated for a phased, cohort-based approach: initially routing funds through Treasury and the Department for first- and second-year students, then gradually expanding to other cohorts. He argued this would mitigate chaos while leveraging existing government capacity for verification and oversight.
When asked about alternative reforms if government rejects dissolving NSFAS, Hlatshwayo expressed skepticism. “Since the early 2000s we’ve had about three different administrators. I’m not entirely sure I understand the stability that they brought into this organization,” he said, calling for “bold solutions” and “brave solutions” rather than piecemeal adjustments.
He stressed that law enforcement involvement is essential to address accommodation cartels, unqualified beneficiaries, and corruption involving funding officers. “That law enforcement capacity is necessary to assist us to gain the public trust and the integrity that is required,” Hlatshwayo concluded, affirming that protecting students’ right to accessible higher education remains a vital public good worth preserving through structural reform.
