{"id":870851,"date":"2026-08-19T09:28:45","date_gmt":"2026-08-19T07:28:45","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=870851"},"modified":"2026-08-19T09:37:43","modified_gmt":"2026-08-19T07:37:43","slug":"r50-billion-failed-state-fund-in-south-africa-under-investigation","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/government\/870851\/r50-billion-failed-state-fund-in-south-africa-under-investigation\/","title":{"rendered":"R50 billion failed state fund in South Africa under investigation"},"content":{"rendered":"\n

The Public Protector, Advocate Kholeka Gcaleka, says her office has evidence that the National Student Financial Aid Scheme (NSFAS) has failed in its mandate, leaving students destitute.<\/p>\n\n\n\n

She has now urged three parties to work together to remodel South Africa\u2019s student financial aid scheme.<\/p>\n\n\n\n

There are the Minister of Higher Education, the Finance Minister, and the South African Revenue Service (SARS).<\/p>\n\n\n\n

They have been called to collaborate to address the growing crisis in the student financial aid scheme and develop a more effective benchmarking model for NSFAS.<\/p>\n\n\n\n

This comes after the Public Protector\u2019s office launched an investigation into the financial aid scheme in 2021.<\/p>\n\n\n\n

This investigation cited findings by the Special Investigating Unit that more than 40,000 students across 76 institutions were not properly funded.<\/p>\n\n\n\n

The improper funding for these students cost the financial aid scheme R5.1 billion. Due to these findings, the Public Protector sought to conduct a deeper search into the financial aid scheme.<\/p>\n\n\n\n

“We have evidence that NSFAS has failed to execute its mandate<\/strong>. It has left many students destitute,\u201d said Gcaleka.<\/p>\n\n\n\n

Unsettled accounts have also forced higher education institutions to withhold academic qualifications from graduating students.<\/p>\n\n\n\n

The issues have been worsened by ongoing administrative inefficiencies, such as delays in confirming funding and processing allowance payments. Gcaleka has not yet released her final report. <\/p>\n\n\n\n

She has initiated a proactive follow-up investigation into irregularities related to student accommodation and housing.<\/p>\n\n\n\n

Professor Linda Meyer, member of the National Council on Higher Education, said that 26 universities are suffering due to inefficiencies at the NSFAS. <\/p>\n\n\n\n

She indicated that funding shortfalls are jeopardising salaries, university operations, and academic programs.<\/p>\n\n\n\n

\u201cThis crisis affects all of the 26 public South African universities, although not every institution is affected equally,\u201d she said.<\/p>\n\n\n\n

\u201cNSFAS owes public institutions well over R10.5 billion in tuition payments for funded students.\u201d<\/p>\n\n\n\n

She said that universities have already provided teaching support and other services, but that the expected funding has not followed.<\/p>\n\n\n\n

Meyer noted that there is still uncertainty regarding the resolution of the funding backlog. <\/p>\n\n\n\n

She explained that long-term measures include an audit improvement plan, enhanced data integration, and investigations into irregular payments.<\/p>\n\n\n\n

She said that the number of funded students should align with the available budget.<\/p>\n\n\n\n

\u201cAccess cannot be expanded through policy commitments that are not supported through adequate funding, dependable systems and the institutional capacity to deliver,\u201d she said.<\/p>\n\n\n\n

NSFAS must be shut down<\/h2>\n\n\n\n
\"\"<\/a><\/figure>\n\n\n\n

Earlier this month, the R54.3 billion National Student Financial Aid Scheme (NSFAS) came under increased scrutiny.<\/p>\n\n\n\n

This is because it still needs to address funding issues in 10,000 cases, with over 4,000 students awaiting resolution.<\/p>\n\n\n\n

Many students reliant on NSFAS funding to complete their studies have been left unable to register for the following academic year of their tertiary studies.<\/p>\n\n\n\n

NSFAS revealed that it is still awaiting academic information from institutions for 4,138 students whose cases are under investigation.<\/p>\n\n\n\n

The state-owned funding scheme said it had processed 2,361 investigations and restored funding to the affected students.<\/p>\n\n\n\n

\u201cThe Deputy Minister emphasised that he respected the GAP investigations and vetting processes conducted by NSFAS,\u201d said the Department of Higher Education and Training.<\/p>\n\n\n\n

The Department said that the vetting process includes verifying student registration, enrollment, accommodations, and academic results to eliminate potential fraud and confirm beneficiaries\u2019 academic eligibility.<\/p>\n\n\n\n

However, the minister said it is unacceptable for students to wait up to five months for their GAP investigations to be completed.<\/p>\n\n\n\n

The government has placed NSFAS under administration and appointed advisors to help fix the problems and restore some confidence in the system.<\/p>\n\n\n\n

Earlier this month, Deputy Minister of Higher Education Yusuf Cassim submitted written complaints and inquiries from students at the University of South Africa (Unisa) to the institution\u2019s management.<\/p>\n\n\n\n

These complaints address concerns over delays in the NSFAS Personal Care Allowance payments and the discontinuation of monthly data allowances.<\/p>\n\n\n\n

The complaints revealed widespread frustration among students over delayed Personal Care Allowance payments for July and ongoing data and connectivity issues.<\/p>\n\n\n\n

These issues are particularly critical for distance-learning students. More than 93,000 Unisa students have been affected by these delays.<\/p>\n","protected":false},"excerpt":{"rendered":"

The Public Protector says the NSFAS has failed in its mandate, and wants SARS, Treasury and the Higher Education Department to find a solution.<\/p>\n","protected":false},"author":127,"featured_media":788637,"comment_status":"open","ping_status":"closed","sticky":true,"template":"","format":"standard","meta":{"_sma_x_autopost_status":"posted","_sma_x_autopost_error":"","_sma_x_post_id":"2089977932710134136","_sma_facebook_post_id":"191437357620492_2180499962770403","_sma_instagram_post_id":"17986316628018947","_sma_x_attempts":1,"footnotes":""},"categories":[23],"tags":[23841,24107,1968],"class_list":["post-870851","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-government","tag-department-of-higher-education-and-training","tag-national-student-financial-aid-scheme-nsfas","tag-public-protector"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/870851","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/127"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=870851"}],"version-history":[{"count":7,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/870851\/revisions"}],"predecessor-version":[{"id":870872,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/870851\/revisions\/870872"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/788637"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=870851"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=870851"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=870851"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}