NSFAS Recovers R850 Million from Universities After SIU Probe Exposes Irregular Payments

The National Student Financial Aid Scheme (NSFAS) has recovered more than R850 million following an in-depth investigation by the Special Investigating Unit (SIU) into irregular payments made to public universities and TVET colleges.

This milestone was revealed in a presentation to the Portfolio Committee on Higher Education on Wednesday, where NSFAS reported that a total of R858,978,309.19 has been successfully paid back so far.

The recovery follows years of poor financial controls, procurement failures, and non-compliance with student funding regulations.

“Recoveries paid to date to NSFAS – R858 978 309.19,” the presentation stated.

Billions Still Outstanding

The R850 million is part of a broader R2.06 billion that the SIU identified for recovery. The amounts reflect historical overpayments, duplicate claims, and misallocated funds that fell outside the rules of the NSFAS funding framework.

Significant repayments include:

• R477.6 million recovered on 5 April 2024

• R381.3 million recovered on 27 September 2024

Major Universities Implicated

Several top institutions are involved in the recovery process:

• University of Fort Hare – R277.6 million

• University of Pretoria – R400 million

• University of the Witwatersrand (Wits) – R450 million

• University of the Free State (UFS) – R438.1 million

In addition, the University of Johannesburg (UJ) repaid R311.9 million through a close-out reconciliation process.

Legal Action and Reforms Underway

The SIU investigation—authorised under Proclamation R.88 of 2022—is ongoing and has prompted legal action to nullify irregular contracts, including a controversial lease agreement for NSFAS’s headquarters. NSFAS has formally joined the SIU’s application as a co-applicant at the Special Tribunal.

Importantly, the legal strategy focuses not just on contract law, but on public law, reflecting the broader implications of financial mismanagement in a state-run agency.

A Turnaround Strategy in Motion

NSFAS says it has started implementing all recommendations made by the Auditor-General South Africa (AGSA) and the SIU. This includes:

• Upgrading ICT systems

• Enforcing stricter contract compliance

• Strengthening internal controls

“NSFAS envisions a future where every eligible student, regardless of background, has equitable access to transformative education,” the report concluded.

Restoring Trust in Public Funding

As NSFAS works to restore public trust and accountability, the agency’s renewed focus on internal reform and financial transparency marks a critical step forward in South Africa’s higher education funding landscape.

{Source: The Citizen}

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