The impact of NSFAS mismanagement on South African universities
The dysfunction at the heart of the National Student Financial Aid Scheme (NSFAS) and various Sector Education and Training Authorities (SETAs) has been the topic of many recent media articles. This focus is needed, as it directly affects the academic journey and future of South Africa's most vulnerable students. However, the burden these failures place on the institutions tasked with delivering quality higher education—namely, the public universities—continues to receive little or no acknowledgment.
For years, universities have had to carry the brunt of NSFAS mismanagement, often without any meaningful prior consultation or support. While Minister Nkabane and her department continue to promise reforms, universities remain on the receiving end of a crumbling system that is fast becoming unsustainable – not just for students, but for the institutions themselves.
The NSFAS was designed to ensure that no student is denied access to higher education due to financial barriers. Yet, despite meticulous planning from universities, every academic year begins with chaos: delayed funding, defunding of students mid-year, and tens of thousands of students left in accommodation limbo. These issues do not affect only the students – they cripple university operations.
Universities are not profit-driven institutions but operate as financially accountable public entities. The payment of municipal bills, maintenance of infrastructure, licences for an IT infrastructure to enable digital innovation, and the payment of salaries are but a few of the basic things that are expected of any well-managed institution. South Africa has no shortage of examples showing how years of limited maintenance have left once-functional infrastructure and office spaces unfit for use.
When the NSFAS fails to disburse funds on time, what is then expected of a public university? Universities are forced into the untenable position of either blocking registrations or carrying the cost of registration and tuition, effectively becoming creditors in a relationship they never agreed to. When landlords stop accommodating students due to unpaid rent, the backlash is directed at universities. Institutions have had to extend registration deadlines, negotiate short-term payment terms with landlords, and manage rising legitimate student frustration and unrest. They have to manage a crisis not created by them.
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Funding challenges affect the core existence of universities and disrupt teaching and learning. While the public sees burning tyres and angry slogans, what remains hidden is the massive operational toll this takes on institutions. Academic calendars are adjusted repeatedly, and these changes often come with additional cost implications. Although the budget allocation for higher education is increasing, most of the growth is directed towards funding the NSFAS, rather than expanding universities or advancing research and innovation.
The situation within the SETAs adds another layer of strain. SETAs are tasked with facilitating skills development, and the potential impact of these bodies is enormous. However, political appointments and poor governance have rendered many of them ineffective. The recent allegations regarding the appointment of politically connected individuals are yet another example of how politics can be prioritised over merit and accountability in the higher-education and training sector. Universities depend on SETA partnerships for work-integrated learning placements, funding of graduate internships and industry collaboration. When SETAs fail, universities are again forced to fill the gap.
The notion that universities are 'denying graduates access to the job market' because of student debt reflects a simple interpretation of a complex issue. Public universities would like to see all graduates making a contribution, either as employees or entrepreneurs, in various sectors of the economy.
However, the universities cannot continue functioning if they are expected to provide a free service without financial planning, especially when government departments responsible for that funding are in disarray. Public universities are not just service providers, they are national assets tasked with transforming lives, producing research, driving innovation and shaping the future workforce of South Africa. It is therefore important to focus on the impact of funding challenges on institutions and the dysfunction it creates too.
Reform will require more than cosmetic changes and promises. It requires a fundamental rethink of how to establish a sustainable financial aid model for students. It requires sound and accountable management. The financial stability, operational effectiveness and reputation of public universities are at stake. Sustaining excellence within a failing system is difficult.'
Prof. Linda du Plessis is Senior Deputy Vice-Chancellor: Teaching and Learning at the North-West University (NWU).
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