Go back

New student aid rules ‘could threaten university finances’


Funding shortfalls and unrest set to worsen sector’s woes, warn South African universities

South Africa’s main universities body has warned that new financial aid rules for students, which sparked protests around the country, are causing instability in the sector and pose a threat to university finances.

The warning from Universities South Africa on 5 August comes as universities across the country continue to experience student unrest over new rules introduced by the country’s National Student Financial Aid Scheme regarding eligibility and payment methods.

The scheme is supposed to support poorer students in South Africa, but an investigation has revealed that 5 billion rand’s worth of grants were awarded to 40,000 recipients who did not qualify for the support between 2018 and 2021. NSFAS bursaries cover tuition fees, registration and accommodation costs, as well as transport, a living allowance, books and personal care.

New funding rules

This year, the NSFAS embarked on a process to defund students found to have been granted support based on incorrect information. To date it has defunded nearly 46,000 recipients.

The scheme also stopped paying out support as lump sums to universities in favour of funding students directly and capped accommodation allowances.

But this week Usaf said these decisions have destabilised the university sector. 

“Several institutions in the sector affected by the new NSFAS allowance system, defunding and accommodation capping, face violent protests,” the group said. 

“Some of them have been forced to either halt planned face to face academic activity or resort to online learning in order to save the semester.”

Criticism of policy changes

According to Usaf, students who have been defunded in the middle of the academic year have struggled to reach the NSFAS. It added that the direct funding method risks paying students who are no longer registered, since universities’ registration databases are not integrated with that of the funding scheme.

The group criticised the cost cap on accommodation, which it said has meant universities with multi-year landlord contracts carrying a 700 million rand funding deficit for 2023. 

Usaf also said students that have yet to be onboarded onto the NSFAS’s direct payment system are struggling to pay their rent and face eviction.

Meetings ‘don’t materialise’

Usaf said it has attempted to engage the country’s higher education minister Blade Nzimande repeatedly about these issues since the end of June, but that meetings have not taken place. 

The group said that “even though meetings have been agreed to by the ministry and the department, they are yet to materialise. It is our view that the minister should intervene with urgency in this situation”.

Research Professional News reached out to the Department of Higher Education for a comment on Usaf’s complaint, but received no response in time for publication.

NSFAS chair Ernest Khosa told a media briefing on 7 August that it was aware of complaints about its defunding decisions. Khosa acknowledged that critics have labelled the NSFAS insensitive. However, he said, those who were unsuccessful were given an opportunity to appeal and 6,000 appeals have so far been rejected.

On the problems reported with the accommodation caps, Khosa urged students not yet onboarded with the new system to authenticate themselves, and asked affected institutions to make submissions to the scheme. “There is no need for the university community to talk to us through statements,” he said.