Nzimande gives reasons for dissolving NSFAS board and appointing administrator

Minister of higher education Dr Blade Nzimande on Sunday gave his reasons for dissolving the National Student Financial Aid Scheme (NSFAS) board and appointing an administrator.

In a press briefing, Nzimande stated the NSFAS board, which he dissolved on Thursday, was unable to carry out some of its basic responsibilities. 

The decision came amid the nonpayment of student allowances, which has left thousands of them stranded without accommodation, among other needs.

Nzimande said the board was unable to implement the recommendations of the Werksmans’ report fully, which include the termination of contracts with some of the service providers. 

This, according to Nzimande, includes the direct payment service providers which, according to the Werksmans’ report, were appointed irregularly. 

“I must say, I raised this in December that steps must be taken to remove these service providers and that hasn't happened. Also, the constant inability to oversee payment of students' allowances timeously by management has resulted in unnecessary stress for students and parents,” said Nzimande.

He said there was an inability to submit a correct annual report to parliament and manage and finalise the close-out report of NSFAS arising from an old scheme. 

There was also an inability to address the serious and glaring capacity deficiency in the organisation, including the call centre which was still not working. 

“There was a consistent inability to respond to student queries in a timeous and efficient manner, and an inability to consult on guidelines for the missing middle and implementation of the missing middle solutions. In an attempt to resolve these problems, as minister I engaged the board on several occasions on various solutions including a turnaround strategy yet it has not been achieved within the agreed time,” said Nzimande. 

Even though some board members were working hard, others were pulling in the opposite direction, leading to a divided board. 

Nzimande said despite several engagements, NSFAS continued to face serious challenges in its business processes, IT systems, capacity, policies and control.

Unfortunately this affected the wellbeing of students and caused serious reputational damage to the department, NSFAS, and the government, he said. 

Freeman Nomvalo, former accountant-general and previous CEO of the South African Institute of Chartered Accountants (SAICA), was appointed as NSFAS administrator on Friday. 

Nzimande said as an administrator, Nomvalo may appoint technical experts where necessary and where he deems fit to assist in different areas of co-operation at NSFAS. 

These appointments would be made in consultation with him, Nzimande said. 

“The dissolution of the board would will not affect the normal functioning of NSFAS and all the payments that have got to be made,” he added.

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