Relief in higher education as the National Students Financial Aid Scheme responds positively to persistent issues
Vice-Chancellors of public universities expressed relief at the constructive spirit demonstrated by the National Students Financial Aid Scheme (NSFAS) Administrator, Mr Freeman Nomvalo, during a recent briefing session.
During an (online) briefing within the ordinary meeting of the Universities SA (USAf) Board of Directors on 20 June, the Administrator announced, to the Board’s relief, that the disbursement of student allowances at universities would continue to be entrusted to institutions until the end of 2024. This was a welcome response to USAf’s request in previous engagements, to continue with what universities had started in the first quarter of 2024 – which contributed to the sector’s stable start to the academic year.
As he expressed gratitude to universities’ assistance in this regard, Mr Nomvalo (left) assured the USAf Board that NSFAS was looking to migrate gradually to the direct payment system, to optimise system stability.
In the meantime, 90% of disbursements to technical and vocational education and training (TVET) college students would continue directly – alongside the process of terminating the contracts of the direct payment service providers.
Student Funding decisions for 2024
Nomvalo said the NSFAS planned to finalise the 2024 funding decisions by end of June, at which point the sector would be updated on the outcomes. However, at the time of publishing, an update had not yet been received in this regard.
IT Systems
On the NSFAS Information Technology system that remained misaligned to universities’ systems — causing persistent administrative glitches along the way– the Administrator said the NSFAS top leadership had been engaging with the Scheme’s IT department “to identify challenges so we can resolve them. Though some issues are NSFAS-induced, some do not sit purely with us.” He therefore said they had approached two audit companies to explore a lasting solution with them in this regard. Central to the ongoing investigation was “to understand the connecting points between us and universities – to enable us to re-design a system that will enable us to conduct reconciliations,” the Administrator assured the vice-chancellors.
Student accommodation
Responding to student accommodation woes arising from the NSFAS capping of the annual accommodation allowance to R45,000, Nomvalo said NSFAS had, in response to USAf’s frustrations over this matter, created a task team including USAf, that would engage shortly to resolve outstanding issues before meeting with the entire post-school education and training sector. “We are collaborating with the International Finance Corporation (IFC) to determine more balanced, fairer accommodation costs. We will, in October, advise the sector on whether we’re retaining the cap or overhauling it. To that end, we will move our conference previously planned for September to October – to align it with the completion of this investigation.”
Pilot project on accommodation
The Administrator said they were exploring ways to accredit and administer student accommodation better by designing a system that looks at the current situation and the needs, also drawing from the lessons learnt in 2024. He said NSFAS was envisaging completing all accommodation accreditations by December 2024 and would be consulting universities on the 2025 calendar. “We will engage USAf on the accredited accommodation providers’ portal, to enable students to select their own preferred accommodation in 2025.” He also acknowledged that some private housing offerings did not meet the required standards, and that NSFAS would be acting on those.
Accommodation of students on Work Integrated Learning (WIL)
The Administrator said they were working on a model to support students on work integrated learning (WIL) programmes, in response to a query from Professor Thoko Mayekiso, Vice-Chancellor and Principal of the University of Mpumalanga. This concerned allowances for students currently on WIL. NSFAS does not have accredited accommodation in the remote areas where students are undergoing WIL. The VC wanted to know what arrangements NSFAS had made regarding these students who were being evicted because their landlords had not been paid. As soon as NSFAS had devised a solution in this regard, universities would be advised accordingly, Nomvalo assured.
Communication with institutions
To improve NSFAS communication with institutions, Nomvalo promised to thenceforth use the USAf Board meetings to engage, while maintaining parallel engagements at the officials’ level.
At the time of the USAf Board meeting, NSFAS was planning to undertake road shows to institutions from July – to respond to institution-specific issues while sharing new information, where applicable. He also promised to document all promises he had made during that Board meeting and share them with USAf, shortly thereafter.
Vice-Chancellors’ feedback
Professor Sizwe Mabizela (right), Vice-Chancellor and Principal of Rhodes University, said the sector was desperate for stability, predictability and efficiencies. He however expressed appreciation that universities would continue disbursing student allowances for the rest of 2024.
He raised the issue of the capped accommodation allowance, saying it had plunged many students into debt in the past two years – causing major problems for universities. Professor Mabizela said he hoped such students would be assisted with that debt, adding that at his institution, some students had exited accredited residences for cheaper accommodation options much further from campus, that were inconducive to learning.
“I hope decisions will be made timeously for 2025 to equip students to make housing decisions quite early in the year”, said Professor Mabizela. “The accommodation cap should consider the nuances between urban and rurally based universities.”
From the Tshwane University of Technology, Vice-Chancellor and Principal, Professor Tinyiko Maluleke (left), echoed his peers’ gratitude for the Administrator’s intervention, the change of mood and reassurances for more stability. “What struck me was your offer to reduce all promises made today, to writing. Our oral traditions do not apply to crucial decisions such as those made today.”
He brought up the question of defunded students – which had resulted in funds being owed to universities and therefore expressed hope that funding would be availed to clear up that debt. “’Defunded, as a term, is debatable, but I do not want to be caught in the semantics,” Professor Maluleke said. “We understand that this affects a student who ought not to have been funded in the first place. The problem arises when this happens in the middle of the year – when commitments would have been made and an investment made on the student, including providing them with accommodation.” Professor Maluleke said this causes serious problems for universities. He requested that things be done differently in future.
Professor Bismark Tyobeka (right), Vice-Chancellor and Principal of the North-West University, said the new administration at NSFAS was giving universities hope for a better future. He added however, that even though he was grateful for the upfront disbursement of student allowances to universities at the beginning of 2024 – which allowed seamless distribution of funds — “in some instances, we did not receive sufficient information on what the funds were for, causing some consternation in our accounting processes.”
NSFAS regrets negative impact of their decisions
As a further response to the additional issues raised above, the Administrator said they, at the NSFAS, were worried about the impact of their decisions on various stakeholders. For instance, he was aware that they had squeezed the profit margins of some private student housing providers and left some students with undesirable accommodation alternatives. He thus undertook to ensure that “the team working with the IFC generates decisions that will not have as grave an impact. We are approaching this matter with affordable, not cheap housing – in mind – to create a system that makes sense. I may not have an answer to policy questions now, as I work on correcting the wrongs of the past. But we will ensure that decisions are made by December. Our [IFC] study is taking four clusters into consideration: accommodation in metros; in rural; township communities, as well as for students involved in Work Integrated Learning. Accommodation needs and infrastructure in those areas will differ greatly – and will inform policy adequately.”
Defunding students
Admitting that defunding students does cause challenges, the Administrator said “we would want to minimise that in the 2025 academic year by deciding early — relying on information from institutions. To the extent that our systems work well, we could succeed in making defunding decisions in time. Furthermore, when the loans kick in, alternatives could be to migrate individuals not qualifying for bursaries to the loan scheme — depending on the decisions that informed the defunding.”
Communication ahead of disbursements
He also said the NSFAS would be providing remittance advices to all universities regarding the funds they disburse. “We want to reduce pre-funding as much as possible. We would rather have NSFAS release funds according to the data received — and reconcile monthly.”
All in all, Mr Nomvalo anticipated that rebuilding their systems would take between six months and one year. “We will be reaching out to you,” he concluded, assuredly.
On that note, the USAf Chairperson of the Board expressed his gratitude to the Administrator for having taken time out to brief the sector in this fashion.
Adding to the sector’s feedback, USAf’s Chief Executive Officer, Dr Phethiwe Matutu, says even though the NSFAS has not fully resolved universities’ issues as raised in early engagements with the Administrator, “the positive predisposition to listen, the willingness to act and to communicate their progress along the way, is nothing short of commendable.”
‘Mateboho Green is Universities South Africa’s Manager: Corporate Communication.
