The National Student Financial Aid Scheme (NSFAS) has not yet vacated its Cape Town headquarters, despite previous plans to review and potentially terminate its lease agreement.
In 2024, NSFAS came under scrutiny for its R2.5 million monthly rent payments for its offices in Cape Town’s Foreshore area. Following widespread criticism, the scheme’s Legal Services Unit launched a review of the lease, exploring options to reduce the number of rented floors or cancel the lease entirely.
NSFAS initially expected to complete the review by 25 October 2024. However, progress has been significantly delayed.
When questioned about the delay, Higher Education Minister Nobuhule Nkabana explained that NSFAS has not yet secured alternative premises.
The date for moving premises is unknown at this stage as new premises have not yet been procured. The same applies to the addresses of where these premises will be.
The decentralisation process, which includes establishing new offices, has been delayed following a decision by the Commission for Conciliation, Mediation and Arbitration (CCMA) on 25 February 2025.
The CCMA ruled that the Decentralisation Task Team’s work must be put on hold until consultations with the majority union take place at the Bargaining Forum.
Meanwhile, NSFAS has joined the Special Investigating Unit (SIU) in legal efforts to set aside the lease agreement. The scheme confirmed that it would act as a co-applicant in an application to the Special Tribunal.
Cape Town Lease Criticism
Chairperson of the Portfolio Committee on Higher Education and Training, Tebogo Letsie, welcomed the Higher Education Minister’s plans to terminate the lease in 2024. Letsie said that the committee has long been critical of NSFAS’s decision to relocate from its previous offices in Wynberg to the Foreshore.
While many students suffered from funding delays, getting their allowances on time, and accommodation challenges, the entity enjoyed a building with scenic views at a staggering R2.5 million a month.
The Cape Town headquarters have been a contentious issue, particularly as NSFAS moves forward with its decentralisation strategy. The scheme recently unveiled plans to establish new offices in the Eastern Cape, Gauteng, and KwaZulu-Natal, with the current Cape Town office set to close.
NSFAS budget is bigger than many national departments and we have always maintained that the offices of NSFAS must be in Gauteng where we have the highest concentration of the student population.
Controversy Over NSFAS's Cape Town Move
NSFAS’s relocation to the Foreshore was criticised for its high rental costs and inaccessibility to students.
In early 2023, United Democratic Movement (UDM) leader Bantu Holomisa called for a criminal investigation into NSFAS’s rental arrangements. He alleged that between December 2021 and September 2022, NSFAS paid nearly R20 million for office space it had yet to occupy.
Former NSFAS spokesperson Slumezi Skosana defended the move, stating that the move was motivated by the schemes' intension to be easier to access for students. However, critics argue that the previous offices in Wynberg, located near major transport routes, were more accessible to students.
Skosana also denied allegations that the offices were unoccupied for the first two months of the lease, claiming that a staggered relocation took place. According to him, NSFAS was granted a rental holiday for the first two months and only paid 50% of the rent in the third month.
