Universities South Africa Notes the Minister’s decision to place NSFAS under Administration

Universities South Africa (USAf) notes the decision by the Minister of Higher Education and Training, Honourable Minister Buti Manamela, to place the National Student Financial Aid Scheme (NSFAS) under administration, as announced on 4 May 2026. USAf further takes note of the Minister’s stated rationale for this intervention, namely, persistent governance failures, financial irregularities, and significant operational challenges that have undermined the effective functioning of the scheme.

USAf welcomes the Minister’s assurance that the disbursement of student funding and allowances, the processing of appeals, and ongoing engagement with institutions will continue without disruption during the period of administration. USAf further notes and acknowledges the appointment and credentials of Professor Mathebula as Administrator and gives its commitment to working collaboratively with the Administrator and all relevant stakeholders to support efforts to stabilise NSFAS in the immediate term. At the same time, USAf looks forward to contributing constructively to the broader national dialogue on the long-term sustainability, governance, and effectiveness of the student financial aid system, recognising that meaningful reform will be essential to ensuring that NSFAS can fulfil its transformative mandate in a coherent, accountable, and enduring manner.

While USAf recognises that this measure may be necessary as an immediate intervention to stabilise the Scheme, it is of the view that placing NSFAS under administration does not address the deeper, systemic weaknesses within the Scheme. The challenges confronting NSFAS are indicative of serious structural deficiencies in the design, governance, and implementation of the country’s student financial aid system.

The USAf Board cautions that successive administrative interventions, and board changes have not resolved the underlying root causes of the NSFAS dysfunctionality. The Scheme has, for many years, oscillated between periods of instability and crisis, including multiple instances of being placed under administration, without achieving sustainable institutional recovery or long-term effectiveness. This pattern points to the need for a more comprehensive and far-reaching response. In this regard, USAf advocates for a comprehensive and systemic review of the student funding model in South Africa.

This should include a thorough reconsideration of the policy framework, governance architecture, operational systems, and institutional arrangements required to deliver student financial aid efficiently, transparently, and equitably. Without such a fundamental overhaul, the higher education sector risks remaining locked in a reactive cycle of crisis management, which ultimately undermines institutional stability and, most critically, disadvantages the very students whom NSFAS is intended to support, as well as the universities that depend on its effective functioning

The recurring pattern is as follows:

• A crisis occurs at NSFAS, whether governance, financial, or operational.
• An intervention is launched, such as a new board, an administrator, and a task team.
• Temporary stabilisation occurs.
• The underlying structural problems reappear, if they had subsided at all.
• Students and universities bear the consequences.

This cycle demonstrates that the current model of student funding is not sustainable. Unless the processes and systems underpinning NSFAS are fundamentally restructured, the institution will continue to move from one Administrator to another, without ever achieving lasting stability. USAf advocates for strategic engagement with policymakers to support the commitment needed and emphasises the long-term benefits of comprehensive funding reform. NSFAS, in its current state, rests on a foundation that has repeatedly failed, at great cost, to support the scale, complexity, and constitutional imperatives of student funding in post-school education and training.

USAf has, over the years, participated in numerous Ministerial task teams, policy review processes, and governance reform initiatives aimed at addressing the NSFAS dysfunctionality. Various studies were carried out where these structural deficiencies in the design of the scheme were pointed out and the sustainability issues related to it. Recommendations and proposals were advanced as alternatives to bring about sustainability in student funding in the higher education landscape. In each instance, our universities have contributed sound, evidence-based recommendations for transforming the student funding framework. USAf stands ready to again work with all stakeholders towards a sustainable funding model for higher education in South Africa.

The sector and the country must seize this moment to reconsider the funding model itself, to build a system that is sustainable, accountable, and fit for purpose.

Gcina Nhleko is Universities South Africa’s Manager: Corporate Communications.