The National Student Financial Scheme (NSFAS) has been under fire recently, regarding a range of issues that span across allowance distributions, appeals and the new direct payment system.
Additional criticism has come from the Parliamentary Committee for Higher Education.
Criticism From the Parliamentary Committee
A focal point of the Committee's concern was the appointment of four service providers to distribute funds to universities and technical and vocational education and training (TVET) colleges, as part of the newest direct payment method for NSFAS allowances.
The direct payment system has caused a lot of controversy and frustration, for both NSFAS stakeholders and student beneficiaries, which has lead to an investigation from the Public Protector.
This comes after Stellenbosch SRC Vice Chairperson, William Sezoe, lodged a complaint asking the public protector to look into the awarding of the contract for the new NSFAS direct payment system.
I have last week written to the public protector to investigate the National Student Financial Aid Scheme direct payment system and in particular the involvement of the CEO of NSFAS with the awarding of the specific tender.
According to investigation findings by the Organisation Undoing Tax Abuse (Outa), all four service providers NSFAS partners with are young and unexperienced companies. Outa further revealed that the companies were also not registered as Financial Service Providers at the Financial Sector Conduct Authority (FSCA).
The Parliamentary Committee Group also found grievance with the appointment of the above-mentioned Financial Service Providers, questioning the legitimacy of the bid to appoint these institutions and criticised NSFAS for revising its requirements for the direct payment system tender, and questioned why capable service providers had been overlooked.
NSFAS has been adamant that the new payment system works and is needed, despite the dissatisfaction voiced by many.
The bursary scheme has responded to the Parliamentary Committee, stating that there were no issues regarding the direct payment system, as it was universally accepted, but it had only become an issue when the big banks' bids had not won, after which "media sensationalism had become prevalent."
The Committee resolved that NSFAS should do a comparison of the strengths and weaknesses of the appointed service providers versus the “big banks” or capable service providers.
However, Parliament members has stated that the continuous failing of students "could not be tolerated anymore".
The Poor Handling of NSFAS Appeals
NSFAS was also criticized for the handling of its student appeals.
Of the 170 683 financial and academic eligibility appeals received by NSFAS, 58 924 were funded, 6 337 were rejected, and 28 971 were deemed invalid due to withdrawn, deleted, or duplicated appeals.
Regarding appeals, there were 44 000 appeals that were dependent on external factors from February until now.
Committee members inquired about the timeline for reducing the backlog of student appeals. NSFAS responded that the deadline for internally dependent appeals was 30 September, while those dependent on external factors such as the educational institutions, had until 31 October.
The Committee has been adamant in reminding the scheme that it could not be dealing with appeals in September, as students are nearing their final examinations, meaning majority of the academic year has passed.
Some students were eligible for funding, but were not funded with all the proper documentation, and a significant number of students were wrongfully defunded.
A NSFAS appeal allows you to request NSFAS to evaluate your NSFAS online application again. This NSFAS appeal must be submitted within 30 days of seeing the 'unsuccessful' NSFAS application status.
The bursary scheme has explained that there had been instability in the sector for the whole year. Additionally, the query system was non-responsive, and thus the appeal system took a significant amount of time to conclude.
NSFAS has accused students of trying to cheat the system by submitting documents of their relatives as their legal guardians to qualify for funding.
The Committee has harshly criticized NSFAS' response, saying:
This entity should be one of the best-run entities in this country if it understands what the objective of the country is, if it understands that it must ensure that young people are skilled, are able to contribute to the development of the country and change the livelihoods of their families and communities they come from. Instead, it was an embarrassment.
With all the increased amounts of money poured into NSFAS, the scheme has continued to fail students.
NSFAS' Failures Leave Students Stranded in Dire Situations
During COVID-19, some students came out openly and spoke about how they had resolved to sleep with older men just to get by. The inability of NSFAS to perform was pushing these students further into prostitution, says Mr. T. Letsie, from the ANC, who was in attendance at the Committee meeting.
According to Letsie, NSFAS poor communication is unacceptable.
There is a [NSFAS] contact centre that was not functional. The waiting time on the line could be up to two hours. What is the objective of the contact centre? The employees at the contact centre were mere salary collectors because they are failing the students, and this cannot be accepted.
The NSFAS board must act on the officials who were salary collectors, said Letsie. They must be fired, or Parliament would fire the Board. If the Board could not fix this issue at NSFAS, the Board must resign.
The Committee would find a mechanism with the Department to have people with the correct ethics and right state of mind to work in the public sector.