How NSFAS Tapes knocked Blade Nzimande Against the Ropes. In South Africa’s higher education sector, the National Student Financial Aid Scheme (NSFAS) has long served as a vital support system, providing financial aid to thousands of underprivileged students across the country. However, recent corruption allegations have shaken the foundation of this institution, implicating prominent figures such as the Minister of Higher Education, Blade Nzimande, and NSFAS Chairperson, Ernest Khosa.
The findings from the Organisation for Undoing Tax Abuse (Outa) have prompted widespread calls for accountability, with student organizations and political parties demanding the resignation of both leaders. The scandal has raised questions about NSFAS’s credibility, sparking an outcry among students and stakeholders who feel betrayed by those entrusted to oversee educational funding.
NSFAS Corruption Allegations
Outa’s investigation into NSFAS corruption began in 2022, targeting the Services Sector Education and Training Authority (SSETA). Initial findings revealed questionable activities involving various contractors and tenders awarded within NSFAS. A preliminary report published in February 2023 flagged three NSFAS tenders tied to SSETA contractors, uncovering maladministration and corruption worth millions of rands. This investigation exposed the R170-million tender granted to the Grayson Reed consortium for an attendance monitoring system, which showed signs of severe contractual non-performance.
In the months that followed, Outa’s probe deepened. By mid-2023, the organization had laid criminal charges of corruption against former NSFAS CEO Andile Nongogo and two service providers, citing irregularities in contract awards and banking requirements. The most shocking revelations, however, were yet to come. Outa’s August 2023 update disclosed that mandatory tender requirements had been adjusted to accommodate selected service providers, allowing contracts to flow to companies like Coinvest Africa, Tenet Technology, Ezaga Holdings, and Norraco Corporation without sufficient oversight.
Findings from Outa’s Report
Outa’s final report in December 2023 detailed an extensive network of corruption, implicating high-ranking officials within NSFAS and service providers. It highlighted several incidents that shed light on how NSFAS funds were mismanaged:
- Lack of Banking Licences – Outa found that NSFAS had hired service providers who did not meet the required banking standards. This omission opened the door for fraudulent activities, compromising student payments.
- Exorbitant Spending – The report documented lavish spending during Nongogo’s tenure at SSETA, including R37-million on a branding campaign that featured overpriced items, such as R4,600 T-shirts, R44,000 umbrellas, and R980 coasters. These figures shocked the public, especially as many students struggled to access even basic necessities.
- Kickbacks and Bribery – Leaked recordings exposed conversations between Khosa and several service providers, where he allegedly promised favorable treatment and vowed to protect the interests of service providers involved in dubious deals with NSFAS. Blade Nzimande and Khosa were accused of receiving millions in kickbacks, amounting to R6-million each, further entrenching the perception of corruption at the highest levels.
Student Organizations Demand Action
For many student organizations, the latest developments around NSFAS have reached a tipping point. The South African Union of Students (SAUS) and the South African Students Congress (Sasco) have been vocal in condemning the alleged misconduct within NSFAS, calling for immediate accountability. SAUS has demanded that Blade Nzimande and Ernest Khosa step down, asserting that their roles have been tainted by scandal and that new leadership is required to restore trust in NSFAS.
The demands from these student groups come amid ongoing issues with NSFAS’s disbursement of funds. Thousands of students still await payments from the previous year, a delay that has left many struggling to afford food, rent, and other essentials. SAUS spokesperson Asive Dlanjwa highlighted the scale of the crisis, noting that around 10% of NSFAS 1.1 million beneficiaries had yet to be fully integrated into the new payment platform. According to Dlanjwa, this amounts to over 100,000 students who may miss out on their financial support due to systemic delays and inefficiencies.
| Student Payment Issues | Description |
|---|---|
| Total NSFAS Beneficiaries | 1.1 million students |
| Estimated Payment Delays | 10% or ~110,000 students |
| Key Issues | Registration on new platform |
Role of Blade Nzimande and Ernest Khosa in the Crisis
Outa’s investigation has placed significant pressure on Blade Nzimande and Ernest Khosa, with both leaders facing mounting calls to resign. Blade Nzimande, a long-standing figure in South African politics, has denied any involvement in NSFAS’s alleged corruption, labeling Outa’s findings as biased and unsubstantiated. However, the audio recordings and additional documentation presented by Outa have fueled public skepticism.
For Ernest Khosa, the fallout has been equally severe. Acknowledging his voice in the recordings, Khosa has since taken a 30-day leave of absence from NSFAS, claiming that the audio was manipulated. His spokesperson, Ishmael Mnisi, suggested that Outa had edited the recordings to enhance ambient sound, making them appear incriminating. Nonetheless, Outa has defended the integrity of its findings, with investigations manager Rudie Heyneke emphasizing that the organization only reduced background noise for clarity.
Political and Public Reactions
The revelations have sparked an uproar among South Africa’s political landscape. The Democratic Alliance (DA) has filed criminal charges against Blade Nzimande, accusing him of undermining NSFAS and exploiting students’ struggles for personal gain. The Economic Freedom Fighters (EFF) have echoed similar sentiments, condemning Khosa as a “leech” who prioritized self-enrichment over the welfare of South Africa’s impoverished students. The EFF has urged Khosa and his associates to resign, stating that they will take action to prevent NSFAS from being further exploited by corrupt officials.
Future Implications for NSFAS and Student Financial Aid
The current scandal has brought NSFAS’s credibility into question and cast a shadow over its ability to fulfill its mandate. As an organization established to uplift financially disadvantaged students, NSFAS has been pivotal in broadening access to higher education. However, the recent allegations have prompted a call for structural reforms to ensure greater transparency, accountability, and efficacy within the institution.
- Reforming NSFAS’s Funding Model – Some experts argue that NSFAS should reconsider its funding approach, implementing stricter regulations and monitoring mechanisms to prevent the recurrence of such corruption.
- Enhancing Oversight and Accountability – The appointment of an independent oversight body to monitor NSFAS operations has been suggested as a means of reducing misconduct.
- Improving Payment Systems – With significant delays in student payments, NSFAS must address technical inefficiencies and ensure that all beneficiaries are properly registered on the payment platform to avoid future crises.
Conclusion
The Outa report on NSFAS corruption has highlighted a dire need for reform in South Africa’s student financial aid system. While political leaders like Blade Nzimande deny involvement, the weight of the allegations has cast a shadow over their leadership. Student organizations and political parties continue to press for action, and public opinion calls for a thorough investigation and an overhaul of NSFAS’s management practices.
