NSFAS Investigation Clears Allegations Made After Leaked Recordings

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An investigation into the damning allegations made against key personell at NSFAS has found no evidence to substantiate corruption claims. However, the former NSFAS official accused of wrongdoing is set to be reprimanded. 

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The National Student Financial Aid Scheme (NSFAS) has finally received the report from Tshisevhe Attorneys Incorporated (TGR), following allegations from the Organisation Undoing Tax Abuse (OUTA) investigation. 

NSFAS says the investigation found no evidence to substantiate allegations made in the OUTA report against former NSFAS board chair Ernest Khosa. OUTA claimed that voice recordings in its possession showed that the scheme's former CEO was leaking board decisions and actions to two individuals linked to Coinvest.

NSFAS Administrator Freeman Nomvalo welcomed the report and is set to announce measures to implement the recommendations contained in the report. 

The NSFAS Administrator welcomed the report and the subsequent legal opinion from TGR. The Administrator will in due course announce measures to implement the recommendations.

The report recommended that NSFAS be guided by legal opinions from experts in administrative law to minimise NSFAS' exposure to potentially damaging claims. 

They should also expedite the implementation of the remaining recommendations of the Werksman report which includes terminating the contracts of service provided for the NSFAS direct payment system. 

[The board should] decide on how it would implement the termination of the contracts of service providers without prejudice to the beneficiaries of the student’s allowances.

It also recommends that NSFAS should reprimand Khosa for his actions, including discussing NSFAS matters and failing to inform the board about these discussions. 

What Were The OUTA Allegations?

Earlier this year, OUTA released an investigation alleging that former NSFAS Board chair Ernest Khosa, along with Higher Education Minister Blade Nzimande and the South African Communist Party (SACP) received kickbacks related to a lucrative NSFAS tender contract.

The organisations released leaked audio recordings to support their allegations.  In exchange for these alleged payments, service providers would be awarded lucrative tenders to facilitate NSFAS Allowance payments using the Direct Payment System.

Nzimande and Khosa both denied any suggestions that they received money for the awarding of the contract.

Khosa then took a leave of absence to allow an investigation into the matter. At the time, NSFAS’ Board described Khosa’s decision to take leave as an honourable and responsible step toward promoting corporate governance, transparency, and accountability at NSFAS. 

Khosa then returned to work following the conclusion of his leave, but resigned in April 2024, just hours before the entire NSFAS board was sacked by Minister Nzimande.

What Students Care About

South African Union of Students (SAUS) President, Asive Dlanjwa expressed confusion regarding the report. 

They explain that the report clears Khosa of wrongdoing, however, one of the report's recommendations called for the reprimanding of Khosa for discussing NSFAS matters with two individuals linked to companies that were awarded the lucrative contract. 

The investigation did not find any evidence to support the claims made by OUTA although we note however that the recommendations indicated that the chair [Khosa]... would have acted or that he should have informed the board about his conversation with service providers and which were a product of the OUTA allegations.

Dlanjwa says while this may not have a direct impact on students, anything that affects the stability of NSFAS will filter through to students. 

What students want is assurance and certainty that they will receive the allowances on time every month and that there will not be issues regarding their funding, that's what they need more than anything, a sense of stability and that the scheme would not crash in any way

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nsfas banner at nsfas office

NSFAS provides funding to students who attend either one of the 50 TVET Colleges or 26 public Universities. One question has however been raised: can TVET graduates get NSFAS for university fees?

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