SIU finds over R5bn of NSFAS funds may have gone to ineligible students

More than R5 billion in National Student Financial Aid Scheme (NSFAS) funds may have been paid to students who did not meet eligibility rules, the Special Investigating Unit (SIU) told Parliament’s standing committee on public accounts (Scopa). The SIU said the payments related to students whose household income is above R350,000, meaning they would not qualify for NSFAS funding under the scheme’s rules.

How the ineligible payments occurred

The SIU told Scopa many of the affected applicants “did not submit their parents’ details upon application and therefore the means test was not properly conducted.” The unit discussed these findings in 2023.

Separate findings from the Auditor-General

The Auditor-General (AG) reported in its annual regulatory NSFAS audit for the 2024-25 financial year that 14,000 students might not have met the prescribed financial eligibility criteria. The AG said its number is separate from those under investigation by the SIU.

Academic and other irregularities

The AG also presented figures showing 21.6% of students at universities and TVET colleges did not meet required academic standards. It said tens of thousands of students with prior qualifications, or who failed to meet academic progression requirements, continued to be funded. Among its major findings, the AG said 822 students were recorded as deceased and continued to receive funds, and that more than 14,000 ineligible students were funded despite exceeding the income thresholds.

Recoveries and calls for changes

Rudie Heyneke, investigations manager at the Organisation Undoing Tax Abuse, said students who did not qualify for NSFAS funding because their household income exceeded the R350,000 threshold will be required to repay funds they received improperly. He said the SIU is handling recoveries and that NSFAS has appointed debt collectors to recoup funds, including money owed from before 2018, when the scheme operated as a loan system.

Heyneke said it was difficult to determine the exact extent of NSFAS’ financial problems because “various figures are being cited.” He added, “While it is said that NSFAS is R50 billion in the red, I do not believe there is a definitive figure representing the true depth of their financial crisis.” He suggested NSFAS should revise its selection criteria and examine fields of study to ensure it is “funding the right students and focusing on the scarce skills the country needs.”

What happens next

The SIU’s briefing to Scopa and the AG’s audit findings point to ongoing investigations and recovery efforts. The AG’s and SIU’s figures are presented as separate assessments of eligibility and governance within NSFAS.