The Standing Committee on Public Accounts (Scopa) yesterday held a hearing with the National Student Financial Aid Scheme (NSFAS) on its annual report and financial statements for the 2019/20 financial year.

NSFAS has received a qualified audit opinion and the committee notes that there are deeper issues that primarily stem from the lack of systems and controls. The Chairperson of Scopa, Mr Mkhuleko Hlengwa, said Scopa takes seriously issues that affect NSFAS as they impact poor students who have to suffer due to the chaos that is created when there is a lack of proper systems.

“NSFAS is an institution that is supposed to address inequality and inch the previously disadvantaged and presently disadvantaged poor closer and closer to the haves. What we are hearing is a history of an organisation that has inched further away from its core mandate in terms of its systems and controls,” Hlengwa said.

NSFAS’s Chief Executive Officer (CEO), Mr Andile Nongogo, said many of the problems they face as NSFAS emanate from the scheme having legacy systems that are not fit for purpose. “We have initiated a process to acquire a new system. We have also changed our ICT operating model to a core sourcing model because we realised that we are not going to have all the requisite skills in-house to be able to monitor all our systems,” he said.

Scopa Member, Ms Benedicta van Minnen, asked NSFAS why has there been no adequate support, as part of the contract for the system that the scheme bought from Jamaica. NSFAS informed the committee that it pays an annual licence fee of R3 million for this obsolete system. “The system is an open-ended contract. To terminate this contract requires a year’s notice. We have already made the notice to terminate the contract,” Mr Nongogo said. 

The Minister of Higher Education, Science and Technology, Mr Blade Nzimade, informed Scopa that one of the difficulties facing NSFAS is the announcement of the new bursaries that was made on 16 December 2017, that said NSFAS is moving onto a new scheme. “That announcement to say we are moving onto a new scheme, 14 days before it had to start to be implemented, messed up NSFAS big time and exposed the extent to which NSFAS didn’t have systems and increased the number of beneficiaries,” he said.

Minister Nzimande says late last year, he appointed a ministerial task team that he gave six months to review the system and functionality of NSFAS. “They have already given me a preliminary report which identifies a lot of what you as Members of Scopa and the Auditor-General have identified. The team will be finalising this report hopefully before the end of March,” he said.   

Scopa believes it is important for the scheme to restore its systems so that it can be in a position to administer with integrity any funding they will receive from the public purse. The committee has told the new board and executive team that it is important that it deals urgently with the issues that have crippled the scheme. “We are dealing here with a qualified report, with a new management. The CEO will appreciate that they are successors in law and we hope there is an appreciation of the seriousness of the issues we are raising that we want dealt with speedily,” Hlengwa said.