NSFAS CEO Axed Following Allowances Corruption Investigation

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It may be the end of the road for NSFAS CEO Andile Nongogo in his time at the government bursary scheme. This comes after it was revealed that there may have been a relationship between key individuals including the CEO and the Fintech companies appointed to pay allowances directly to students.

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Media reports indicate that Andile Nongogo, the CEO of the National Student Financial Aid Scheme (NSFAS), has had his employment contract terminated. Nongogo is facing corruption allegations linked to a contract valued at R47 billion.

The decision to terminate Nongogo’s time as CEO was officially taken by the NSFAS board on Monday evening. 

NSFAS Board Chairperson Ernest Khosa announced this development during a session in Parliament on Tuesday, as the NSFAS provided updates to the Parliament's public accounts committee regarding ongoing investigations within the organisation.

Khosa explained that the decision to dismiss Nongogo was made by the NSFAS board on Monday night. He cited both a violation of policy and a breach of trust as the reasons for this action.

I should make the committee aware that last night the board of NSFAS took a decision to terminate the contract of the CEO

Earlier this week, Khosa responded to media reports with allegations coming from the Nongogo.

If it is indeed true that it comes from him, I am utterly disappointed. The bottom line is that there are serious findings and recommendations against him which cannot be wished away by involving distant distractions.

What Led To Nongogo’s Termination

Nongogo had been on special leave since August 2023. NSFAS took the decision to place him on special leave as the investigation into allegations of corruption proceeded. 

The Werksman attorney's NSFAS investigation specifically focused on irregularities related to Bid NO. SCMN022/2021, which involved the appointment of service providers for direct payments of NSFAS allowances. 

In 2022, NSFAS Introduced a direct allowance payment system for Technical Vocational Education and Training (TVET) colleges. The direct system was expanded to include universities in 2023. 

The investigation sought to determine whether these service providers are registered financial entities and whether there is a historical business and tender relationship between the CEO and the directors of these companies. 

Findings Of The Investigation 

The investigation found that there may have been possible relationships between key individuals including NSFAS CEO Andile Nongogo and the Fintech companies appointed to pay allowances directly to students. 

It was also revealed that there was active involvement of the CEO in the presentation to the Bid Evaluation Committee and potential conflicts of interest in the appointment of service providers. 

The report also has several other issues including a lack of a feasibility study and amendments to the bid specifications 

Alarm bells were raised regarding Nongogo’s conduct by the Organisation Undoing Tax Abuse (OUTA). These allegations stem from Nongogo’s time at the ServicesSETA (SSETA)

In a press briefing in August 2023, Nongogo declared his innocence amid the allegations levelled against him. However, the CEO was reluctant to go into further detail. 

Nongogo said it was unfortunate that the questions regarding this work were asked during a NSFAS briefing. They added that the SSETA routinely received clean and unqualified audits whilst they were employed at the SETA. 

When I was at the employer, I acted on behalf of the employer, however, the only thing I would like to say is that during my tenure at the services SETA, either as the CFO or CEO, the services SETA continued to get what we call clean and unqualified audits and therefore any assertions that are in the public domain I actually choose not to respond to it  

Following the release of the Werkman’s investigation, Nongogo was given seven days to justify why he should keep his job after an investigation revealed a conflict of interest in the selection of companies contracted to manage the distribution of allowances to students.

It is unclear whether the CEO made representations to the NSFAS board. 

Support For NSFAS Decision Following Investigation 

Universities South Africa (USAf) has expressed its support for key decisions NSFAS. 

The NSFAS board revealed that they would terminate contracts with four direct payment service providers, initiate disciplinary inquiries for staff involved in wrongdoing, and conduct a thorough review of the NSFAS supply chain management policy.

OUTA also welcomed the NSFAS’ decisions. 

Rudie Heyneke, head of investigations at OUTA said that students had suffered the most due to the irregularities that had occurred. They pointed out that the pleas of students to NSFAS had gone unanswered, and likewise, OUTA's requests for access to all the pertinent information had met with no response. 

We repeatedly warned that this scheme would negatively impact on students who can least afford it, while costing the country millions if allowed to continue. Yet all attempts to share what our investigations uncovered with NSFAS or Minister Blade Nzimande were ignored. 

They also welcomed reports that Nongogo will no longer work as the NSFAS CEO 

It's the end of the road for NSFAS CEO Andile Nongogo. NSFAS Board confirmed that he has been fired. OUTA warned months ago that he should not be allowed near the public purse with his delinquent actions, also at #ServiceSETA. 

This is a developing story and will be updated to include relevant information as it becomes available. 

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Thousands of students have had their fears become reality as the National Student Financial Aid Scheme has withdrawn their NSFAS bursaries. Defunding of students and allowance delays are only a few of the issues faced by the scheme.

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