Public Protector: NSFAS Must Address ICT Deficiencies in 30 Days

The National Student Financial Aid Scheme’s board must urgently develop a digital modernisation and systems integration plan. The National Student Financial Aid Scheme’s (NSFAS’s) lagging ICT systems have come under the spotlight once again, with the Public Protector calling for urgent action. Public Protector advocate Kholeka Gcalekayesterday released findings of an investigation into allegations of administrative, governance and oversight deficiencies relating to funding and coordination of student financial aid within the higher education sector by the NSFAS. The report depicts the NSFAS’s deficiencies, which it notes have impaired its ability to discharge its statutory mandate effectively, efficiently and consistent with the standards expected of a public entity. The determination also draws on the findings of the 2023 Special Investigating Unit (SIU) investigation, which uncovered that the scheme incorrectly funded some 40 000 non-qualifying students to the tune of more than R5.1 billion. The Public Protector says NSFAS’s inadequate systems and administrative weaknesses contributed to inefficiency, delays and poor service to students. It highlights that the entity’s systems are not sufficiently integrated with key state data sources, such as the Department of Home Affairs, South African Social Security Agency and South African Revenue Service. As a result, the Public Protector has instructed the board to develop a digital modernisation and systems integration plan, within 30 calendar days of receiving the final report. The plan should cover full integration between NSFAS and other institutions’ systems; improved verification interfaces with key state data sources; strengthened fraud controls and cyber security; elimination of duplicate applications and manual workarounds; improved student-facing communication and case tracking; and specific milestones and funding requirements. On technology governance, the report notes NSFAS systems were not strong enough to support accurate, efficient and accountable student funding administration. Public Protector advocate Kholeka Gcaleka. (Image source: GovernmentZA) According to the Public Protector, evidence obtained through the investigation also shows “severe” inaccessibility of the entity to beneficiaries it is intended to service. The financial aid scheme reported an inability to resolve 80% of the queries received through its contact centre due to the need to escalate these queries through its internal units for resolution. “NSFAS’s limited accessibility, particularly its centralised Cape Town-based walk-in service and ineffective query-resolution arrangements at institutional level, contravenes the Batho Pele principle three on access. “It further undermines section 29(1)(b) of the Constitution, as NSFAS funding is one of the principal mechanisms through which the state is required to make further education progressively accessible.” As part of the Department of Higher Education and Training, NSFAS runs a close to R50 billion annual budget, providing financial aid to eligible students at public TVET colleges and public universities. NSFAS has, over the years, faced systemic governance issues, including IT system failures and mismanagement within the scheme. In May, higher education and training minister Buti Manamela placed the entity under its third administration round in as many years, citing ICT modernisation delays among the reasons for his decision. Earlier this month, NSFAS administrator professor Hlengani Mathebula, whose appointment has since been suspended, revealed that ICT was the biggest operational risk facing the financial aid scheme. Mathebulawarned that outdated and fragmented technology systems were undermining funding administration, payments and student services. Following the debacle with the direct-payment fintech providers, the NSFAS board was booted in 2024, leading to the entity being placed under administration by science, technology and innovation min