The National Student Financial Aid Scheme (NSFAS) is accusing the Organisation Undoing Tax Abuse (OUTA) of attempting to influence the South African political landscape. This comes after several investigative reports have been released by OUTA over the last 12 months indicating serious challenges and failures at NSFAS.
NSFAS plays a critical role in South Africa by ensuring that the lack of money does not prevent poor students from obtaining tertiary education qualifications. They do this by providing comprehensive bursaries to students from poor and working-class backgrounds.
The bursaries provided by NSFAS cover more than just tuition fees as students are provided with several allowances to pay for food, learning materials and accommodation.
OUTA’s latest investigative report, accompanied by two leaked recordings, indicates that the Minister of Higher Education and Training Blade Nzimande, NSFAS Board Chairperson Earnest Khosa as well as the South African Communist Party (SACP) received kickbacks. These kickbacks are related to the awarding of a lucrative tender to facilitate the Direct NSFAS allowance payment system.
Their investigation report came with calls for the minister along with Khosa to hand in their resignations.
In 2023, it was found that the awarding of the contracts to service providers facilitating direct allowance payments was irregular. It was revealed that tender requirements were adjusted to ensure some companies qualified for the awarding of the tender and that there may have been relationships between key individuals at NSFAS and service providers.
Former NSFAS CEO Andile Nongogo’s employment contract was terminated by the government scheme for his role in the awarding of the lucrative contracts. The companies are set to have their contracts terminated as well.
Khosa dismissed with contempt the voice recording released by OUTA and the insinuation that he allegedly received money meant for him, Minister Nzimande, the South Africa Communist Party (SACP) and other third parties.
Whilst the NSFAS board acknowledged the critical role played by civil organisations, they say OUTA is drifting away from their claimed “high moral values” and “impartiality”.
It is also a concerning trend that OUTA’s successive “investigative” reports are characterised by advocacy for the business interest of some individuals and companies who might have unsuccessfully attempted to solicit business from NSFAS.
NSFAS says OUTA has had the opportunity to engage with NSFAS if they were truly concerned about fighting corruption.
If OUTA was truthfully concerned about fighting corruption at NSFAS, it had the opportunity to engage NSFAS on its progress in dealing with corruption and malfeasance including the implementation of the recommendations of the Werksmans Attorneys report.
The Werksmans report recommended that the contracts with service providers should be terminated in a manner that does not disadvantage students. While NSFAS says it is in the process of terminating these contracts, it anticipates service providers will exercise legal action.
The NSFAS Board says they will continue to work with law enforcement agencies to further probe the recordings in circulation and all the reported instances of corruption and maladministration at NSFAS.
In the meantime, they remain focused on working towards the success of the 2024 academic year as 2024 NSFAS applications are closing soon.
The NSFAS Board reaffirms its commitment to transformation and clean governance and will ensure that any activities that defeat the purpose of serving students from poor and working-class backgrounds are addressed decisively.
Minister Disputes OUTA’s Claims
Nzimande also rejected the allegations made by OUTA, labelling them as malicious and views them as an attempt to undermine a smooth start to the 2024 academic year.
The Minister views the allegations contained in this leaked report as reckless and largely based on gossip and are intended to undermine a smooth start to the 2024 academic year.
The minister said he has never used money from any of the Department's entities to fund the SACP. In addition to his role as minister of higher education, Nzimande is a general secretary of the SACP.
Nzimande says that he reserves the right to take legal action against OUTA for publishing their investigation.
"Given the damaging allegations continued in this report the Minister reserves his right to take the necessary legal action."
