NSFAS faces mounting pressure as the Private Student Housing Association reveals a R44 million debt, risking the academic year for thousands of students. Urgent action is needed to ensure students can return to their accommodations without disruption.
THE National Students Financial Aid Scheme (NSFAS) financial troubles continue as it fails to pay accommodations for students.
The Private Student Housing Association (PSHA) has warned that students may not be able to return to the rooms if the financial scheme fails to pay the outstanding debt within the next 14 days.
The association, which provides accommodation to more than 80,000 students, said NSFAS owes a sum of R44 million to its members, from 2024.
The association warned this could potentially disrupt the academic year’s resumption for 2025 and create a nightmare scenario for both students and their parents.
In a statement issued on Monday, the PSHA board said the non-payment compromises the sustainability of running private accommodation businesses.
Chief Executive Officer Kagisho Mamabolo said the PSHA members regret having to adopt this tough position, but it is something they are unable to avoid.
Mamabolo said the association previously advocated for direct rental payments from universities rather than from NSFAS itself.
However, this did not happen.
“NSFAS appears to be exploiting accommodation providers at the expense of students. We are deeply concerned for the well-being of our student tenants and the potential disruption that unpaid fees could cause to their academic pursuits,” said Mamabolo.
“NSFAS recently informed all accommodation providers to consider housing students at their own cost for January, which is unfair to the accommodation providers since NSFAS does not pay student accommodation in December and January.”
He added that student accommodation providers could ill afford to offer free services for beds, water and sanitation, electricity, transport, internet connection, safety, and security for students without the funds to pay cash-strapped municipalities, service providers, staff, and the banks that fund the operations and developments.
Mamabolo said the failure to pay tertiary education landlords also risks disrupting the provision of higher education.
The association said communication with NSFAS has become impossible due to unanswered calls and emails. Promises made have not been kept, despite the welcome dissolution of the NSFAS board in April last year and the appointment of a new administrator to make the organisation more efficient.
NSFAS spokesperson Anele Ntswayi said she would only be able to comment when she is back at work.
A spokesperson for the Minister of Higher Education and Training, Camagwini Mavovana, said she would talk to the administrator and send a response.
In an interview with the SABC, the financial scheme administrator Freeman Nomvalo, said the money was paid directly to most of the students because the pilot project has not been rolled to everyone and not all landlords were in the system to be paid directly from the scheme.
Nomvalo added that there are students who did not pay the money to the landlords.
He was responding to a protest by landlords offering accommodation to students from uMbumbulu College in southern Durban, over unpaid rental fees.
It was reported that landlords received only partial payments from NSFAS, with the rest given directly to students. The landlords have not received full payments from student accommodation from February to November, which has caused problems in maintaining buildings and covering expenses.
In recent years, NSFAS faced many challenges, including unpaid loans from graduates, reduced funding for current students, and an ongoing corruption crisis.
The pilot project was launched following allegations of corruption and bribery between accrediting agents and landlords.
This also saw the exit of chief executive officer, Andile Nongogo, who was accused of corruption involving the appointment of service providers.
Institutions selected for the pilot project including private accommodation landlords, were expected to register on the NSFAS portal for accreditation.
Mamabolo stated that while PSHA has collaborated closely with NSFAS to assist students from disadvantaged backgrounds in attaining higher education, every year accommodation providers struggle with delayed payments from the scheme, hampering their business operations.
“For this reason, PSHA members cannot be expected to allow students back to their residences while NSFAS has outstanding rental payments – it simply does not make business sense to do so.
“This crisis has been created by NSFAS. In a time when access to high-quality higher education is more crucial than ever, the PSHA urges NSFAS to set a good example and exhibit steadfast dedication to the students it serves.’’
“These students’ needs must be met urgently, with empathy and a thorough awareness of their circumstances. A more communicative and accountable NSFAS will benefit students and South Africa’s entire higher education system,” said Mamabolo.
The association said there is still confusion between tertiary institutions, NSFAS, and landlords about the implementation of the grading and accreditation process for the 2025 academic year.
This, said PSHA, means students are assured of the quality of the lodgings and also means that landlords are guaranteed an agreed rental rate and payment since they comply with NSFAS criteria.
