The decision of Higher Education and Training Minister Buti Manamela to place the National Student Finance Aid Scheme (NSFAS) under administration has been criticised.
Image: Ayanda Ndamane / Independent Newspapers
The decision by Higher Education and Training Minister Buti Manamela to put the National Student Finance Aid Scheme (NSFAS) under administration has been met with resistance, as unions contend that this does not provide a sustainable solution to the governance and administrative issues plaguing the scheme.
NSFAS has been placed under administration due to a severe leadership crisis, including the resignation of key board members.
Manamela appointed Professor Hlengani Mathebula as the administrator.
This is the third time NSFAS has been placed under administration, following interventions in 2020 and 2024.
However, the South African Union of Students (SAUS) said these interventions have not resulted in long-term stability and have instead contributed to cycles of uncertainty, leadership disruptions, and policy inconsistency.
The funding scheme has faced persistent, systemic failures for years, characterised by severe governance, operational, and financial mismanagement.
Key challenges include massive payment delays to students and landlords, IT system failures, corruption in tender processes, and high leadership turnover.
SAUS spokesperson, Dr Thato Masekoa, said from the perspective of students on the ground, NSFAS has shown measurable improvements in recent periods, including more consistent disbursement of allowances, improved turnaround times in the processing of appeals, and better coordination of student accommodation.
Masekoa said that while the challenges persist, these do not reflect a system in total collapse, which would warrant such an extreme intervention.
The scheme implemented several operational improvements leading to the 2026 academic year. First-time entering students knew their funding status before matric results were released, while continuing students were notified before the end of the previous academic year, reducing anxiety and improving institutional planning.
NSFAS also approved funding for over 660,000 first-time entering students, with total funding growing significantly from R27 billion in 2019 to nearly R54 billion in 2024.
“We do not believe that placing NSFAS under administration is a sustainable or effective solution to these challenges. Historical experience has shown that repeated administrative interventions have not resulted in long-term stability, but have instead contributed to cycles of uncertainty, leadership disruptions, and policy inconsistency,” said Masekoa.
“The resolution of NSFAS challenges requires consistent and capable leadership, strengthened governance systems, timely policy decisions from the Ministry, and meaningful engagement with student stakeholders. Critical issues such as the finalisation of funding guidelines, accommodation frameworks, and the resolution of budget shortfalls remain outstanding and require urgent attention,” he said.
Masekoa added that SAUS is not convinced that the legal threshold outlined in the NSFAS Act, particularly Section 17A, which empowers the Minister of Higher Education and Training to intervene when NSFAS is not performing its functions efficiently, has been transparently met.
He said this decision risks undermining existing governance structures, including the role of the board, and raises serious concerns about due process and institutional stability.
Higher Education and Training spokesperson Matshepo Seedat said Manamela has noted the concerns and remains open to engaging with the union and other stakeholders.
She added that the administrator will strengthen governance and internal controls, address audit and consequence management weaknesses, accelerate ICT and systems integration reforms, stabilise student funding operations, improve student accommodation oversight and prepare the institution for a return to stable ordinary governance.
During his announcement on Tuesday, Manamela said this move followed a series of failed attempts to stabilise the institution through ordinary governance mechanisms.
He added that the decision was taken after legal and governance considerations under sections 17A to 17D of the NSFAS Act, 1999, following what he described as a prolonged period of intervention attempts and assessments.
The National Education, Health and Allied Workers' Union (Nehawu), which raised concern about the lack of consultation in the process, said previous administrators failed to stabilise and put in place proper systems, which resulted in the decay and rot at the scheme.
Nehawu said this was characterised by maladministration, financial irregularities, human resources failures, weak ICT environment, culture of fear, intimidation and bullying and questionable management decisions, amongst others.
“We are dismayed that the Minister has gone and announced the appointment of an administrator without consulting us on the process to stabilise NSFAS. We demand that the Minister urgently re-examine his posture towards important stakeholders at NSFAS, as the union shall not fight for its recognition at this age and stage of our democracy, particularly under an institution that we were instrumental in its formation and establishment as a transformative union,” said spokesperson Lwazi Nkolonzi.
Dr Delmaine Chesley Christians, a DA MP and member of the Portfolio Committee on Higher Education, said that although the decision to place NSFAS under administration is concerning, it confirms what the DA has been saying for some time - that the “administration will not fix a fundamentally broken system.”
Christians added that although the finance scheme had been placed under administration in 2020 and again in 2024, the same failures persist.
“This repeated cycle of intervention without lasting improvement makes it clear that the problem is not just governance, it is the model itself,” she said, adding that NSFAS, in its current form, must be scrapped and replaced with a decentralised model that allows funding to flow directly to institutions and ultimately to students, in a more efficient and accountable manner.
Meanwhile, the EFF said the appointment of Mathebula as administrator raises serious concerns about transparency and accountability within NSFAS. The party added that the administration removed proper governance structures and weakened institutional oversight, creating fertile ground for corruption and looting.
The chairperson of the Parliament Portfolio Committee on Higher Education and Training, Tebogo Letsie, said the placement of NSFAS through another administrative cycle is deeply troubling and points to a gross breakdown in governance systems, adding that something needs to be done to save the entity, following a series of resignations from the board of NSFAS in recent weeks.
*This story has been updated to include comment from Higher Education and Training spokesperson, Matshepo Seedat.