22nd February 2024 12:49 pm
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NSFAS CEO investigated over direct payments, dodgy tenders

  • The CEO of NSFAS Andile Nongogo has been placed on “special leave” pending an investigation launched by the scheme itself.
  • Nongogo’s tenure at the Services Sector Education and Training Authority (Services SETA) will be the crux of the investigation, relating to tender processes and allegedly spoiled millions.
  • NSFAS says that the investigation will focus on the controversial direct payments project.

The debacle of direct student payments from the National Student Financial Aid Scheme (NSFAS) has had a new spanner thrown into the works. The CEO of NSFAS, Andile Nongogo has been put on “special leave” and now the scheme’s board of directors have announced that a series of allegations made against Nongogo will be investigated.

As per The Citizen, Nongongo was asked to go home on Wednesday following weeks of student uproar relating to the new direct payment system that the scheme started using in July to fund its beneficiaries.

“In the past week weeks, several allegations were levelled against the Chief Executive Officer of the National Student Financial Aid Scheme. The allegations relate to his work with the Services SETA and how this may relate to unacceptable conduct in awarding of bids at NSFAS,” reads a statement from the scheme, posted to its official X account.

Students, as well as entities such as the Organisation Undoing Tax Abuse (OUTA) have decried the new student bank accounts, and have criticised the way NSFAS handed out tenders for partners to launch the new payment system.

Four payment partners won bids, none of which were widely known companies which have had their licenses to dole out funds and operate as banking organisations called into question. However the matter the board is investigating relates the Nongogo tenure as the CEO of the Services Sector Education and Training Authority (Services SETA).

The organisation revealed that it saw R37 million wasted due to highly overinflated prices, a dodgy tender award process and flouting of the Public Finance Management Act (PFMA). NSFAS says that it has embarked on this investigation because “public trust is of paramount importance.”

“In the interest of the image of NSFAS, the Board has resolved to investigate the allegations with a particular focus on the Direct Payment project,” it said, adding that chief financial officer Masile Ramorwesi will be acting CEO while Nongogo is on leave.

“The Board wishes to reiterate that this investigation is no pronouncement of guilt against the CEO, but an objective effort to determine the veracity of the allegations.”

On Wednesday, student leadership of the Stellenbosch student representative council (SRC) launched a petition to bring issues they have with the direct payment system to light, and to call for the entire project to be scrapped.

“The Minister of Higher Education Dr Blade Nzimande last year announced this new payment method, suggesting that it would be a more student-centered approach and one that would be more safe and secure to use,” it reads.

“The experience of students however shows otherwise, with many students suspecting fraudulent withdrawals from their accounts,” they said, adding that “What is more worrying is the fact that the companies appointed by NSFAS does not have the necessary paperwork such as banking licenses to operate as Financial Service Providers.”

The petition, which was supposedly taken to Parlaiment on Wednesday now has over 2 000 signatorees.

Despite sustained public outcry, protests that have turned violent and several lawsuits made against NSFAS over direct student payments, the scheme says that the system is working as intended and will continue to be implemented.

Luis Monzon

Luis Monzon

Journalist. Covering education, AAA gaming and consumer tech. Reach me at Luis@htxt.co.za.

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