NSFAS placed under administration amid governance and audit collapse

The National Student Financial Aid Scheme (NSFAS), the country’s largest vehicle for funding poor and working-class students, has been placed under administration following a prolonged governance and operational crisis that Higher Education and Training Minister Buti Manamela said could no longer be resolved through ordinary board structures. 

Announcing the decision at a briefing in Pretoria on Monday, Manamela confirmed the appointment of professor Hlengani Mathebula as administrator of NSFAS, invoking sections 17A to 17D of the National Student Financial Aid Scheme Act.

Manamela said the move was “not taken lightly” but followed months of legal assessment, governance interventions, and the exhaustion of alternative remedies as instability at NSFAS deepened. 

“NSFAS is one of the most important public institutions in our democratic project. It exists to ensure that young people from poor and working-class backgrounds are able to access higher education and training,” the minister said.

“For many families, NSFAS is not an abstract institution — it is the difference between exclusion and opportunity, between hope and despair. 

“Any instability within NSFAS therefore has implications not only for universities and TVET colleges, but for students, households, communities, the fiscus and public confidence in the ability of the democratic state to advance social justice.”

It is for this reason, Manamela said, that the government has a responsibility to act when the effective functioning of the institution is “seriously undermined”.

Why government intervened

The crisis at NSFAS has been shaped by a combination of legal irregularities, governance breakdowns and institutional failures that, according to the minister, posed a direct threat to students and public confidence in the scheme.

Concerns over the legality of the NSFAS board were already present when Manamela assumed office, prompting the department to approach the courts through a self-review process over how the board had been constituted. 

This process unfolded alongside a spate of resignations, including that of the board chairperson, further weakening governance capacity.

While interim leadership was appointed in an attempt to stabilise the institution, unresolved legal questions made it untenable to simply fill board vacancies. At the same time, NSFAS’s own reports and engagements with the department revealed deepening operational failures.

These included a disclaimer audit outcome for the 2024/25 financial year, material irregularities flagged by the auditor-general, weak consequence management and serious data integrity concerns. 

Operational failures compounded the crisis, with unresolved student appeals caused by system deficiencies, delayed ICT modernisation and accommodation failures affecting student safety and dignity.

Manamela said the central question eventually shifted from whether the board could technically function to whether NSFAS, as an institution, was operating “effectively, sustainably and credibly in the interests of students and the country”.

Following further resignations by the interim chairperson and deputy chairperson, the minister formally initiated the statutory process toward administration, consulting remaining board members and considering alternatives such as intensified oversight and additional time for governance recovery.  

Those options, he said, no longer offered sufficient assurance.

Who is the administrator?

The appointment of Mathebula signals the government’s intention to stabilise the scheme through experienced and independent leadership.

Mathebula brings more than three decades of experience across public governance, financial services and higher education. 

His career spans senior roles in corporate and central banking, public finance and institutional leadership, including governance positions at the South African Reserve Bank, the South African Revenue Service, and major financial institutions.

He currently serves as director and head of the Tshwane School for Business and Society

at the Tshwane University of Technology and has held professorial and senate leadership roles within the university sector — experience the minister said would be critical in navigating NSFAS’s complex relationship with institutions and students.

What the administrator is tasked to do

Under the terms of his appointment, Mathebula’s mandate is focused on stabilisation, accountability, operational continuity and institutional renewal.

His key tasks include strengthening governance and internal controls, addressing audit failures and consequence-management weaknesses, accelerating long-delayed ICT and systems integration reforms, stabilising student funding operations and improving oversight of student accommodation. 

He is also tasked with clearing appeals backlogs and preparing NSFAS for a return to stable, ordinary governance.

The administration, Manamela emphasised, is intended to be temporary but necessary to restore institutional credibility and protect public funds.

What it means for students

Seeking to reassure a sector long buffeted by NSFAS instability, Manamela was unequivocal that the intervention is not meant to disrupt student support.

“Student funding will continue. Allowances will continue. Appeals processes will continue,”

Manamela said, adding that universities and TVET colleges would continue engaging NSFAS operationally.

The intervention, he stressed, is designed precisely to protect continuity while resolving the structural failures that have repeatedly undermined service delivery.

“This intervention is not about personalities or factions,” he said. “It is about protecting students, stabilising a critical public institution, restoring accountability, and ensuring that NSFAS performs its mandate effectively and lawfully.”

NSFAS funds hundreds of thousands of students annually and remains central to the government’s higher education access commitments.

Manamela concluded by reaffirming the state’s commitment to ensuring the scheme fulfils its mandate to poor and working-class students, while engaging institutions, Parliament and the public as the administration unfolds.

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