A student housing crisis may be on the horizon as the National Student Financial Aid Scheme (NSFAS) fails to pay R44 million to an accommodation provider.
NSFAS provides comprehensive bursaries and student loans to deserving students enrolled in approved courses at universities and TVET colleges. Funding covers tuition and registration fees, as well as several allowances for food, learning materials, and accommodation.
The accommodation allowance provided by NSFAS is critical as it ensures that students can live close to their institution of higher learning. Without the accommodation allowance, many students would not be able to pursue courses at certain institutions because of where they live.
Earlier this week, the Private Student Housing Association (PSHA) called on NSFAS to pay past-due rental bills to accommodation providers. The association warned that failure to pay outstanding debt may leave students without housing when the 2025 academic year commences.
According to the PSHA, NSFAS owes accommodation providers more than R44 million.
Each year NSFAS fails to settle the full rental bill of students staying in NSFAS- accredited accommodation. The sum owed to PSHA members from 2024 is a staggering R44 million, involving thousands of students with unpaid bills.
The association warned that should NSFAS not settle their debt, students will not be allowed to access the accommodation facilities.
If NSFAS does not pay PSHA members promptly (within the next 14 days), students will be unable to return to the rooms they occupied last year, potentially disrupting the academic year’s resumption and creating a nightmare scenario for both students and their parents.
NSFAS acknowledged the PSHA concerns and called for the association to provide the bursary scheme with information on accommodation providers and students so the situation can be resolved.
NSFAS would like to remind all APs that payments for student accommodation will only be finalised on receipt of legitimate accommodation claims.
The scheme will introduce new measures to ensure certainty and clarity about claims and disbursements of allowances.
As a result, the NSFAS administrator urges all accommodation providers with 2024 outstanding claims to send their claims to the following dedicated email address [email protected] for further engagement.
Exploiting Accommodation Providers
Chief Executive Officer of the PSHA Kagisho Mamabolo says NSFAS is exploiting accommodation providers. However, the pain of this exploitation will be felt most by students funded by the government bursary scheme.
Mamabolo also expressed concern when NSFAS informed accommodation providers that they should consider housing students at their own cost in December and January. This is because NSFAS also pays allowances for accommodation for ten months in the year.
The CEO called for a comprehensive solution to avoid the recurring problems of non-payment of accommodation providers.
Student accommodation providers cannot afford to offer free services for beds, water and sanitation, electricity, transport, internet connection, safety, and security to students without the funds to pay cash-strapped municipalities, service providers, staff, and the banks that fund the operations and developments.
Mamabolo also criticised communication with NSFAS who he says fails to answer calls and emails.
Calls For A Change In Accommodation Administration
The Organisation Undoing Tax Abuse (OUTA) argues that NSFAS should cease management of accommodation to universities and colleges.
This system worked well before NSFAS imposed its irrational processes. Landlords are forced to use the NSFAS student accommodation platform to register beds, while NSFSAS-funded students can only secure accommodation from registered landlords via the NSFAS accommodation platform.
They say NSFAS’ accommodation portal and accreditation processes are flawed and led to a limited supply of student beds and subsequently to student protests.
Landlords were forced to register on this portal despite it not being fully operational. To make matters worse, the demand for NSFAS-accredited housing far exceeded the supply of approved facilities,
OUTA called on Minister Nobuhle Nkabane to end NSFAS’s accommodation programme.
From the outset, the student accommodation portal and accreditation process were flawed. OUTA’s investigation highlighted these issues, but the NSFAS board, other stakeholders, and the Administrator chose to ignore the problem, neglecting their duty to the country’s poorest students.