President Ramaphosa âdeeply concernedâ about NSFAS mess

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President Cyril Ramaphosa has expressed deep concern over the ongoing crisis at the National Student Financial Aid Scheme (NSFAS), following Higher Education Minister Buti Manamelaâs decision to place the troubled scheme under administration.

Ramaphosa appointed Manamela as higher education minister after axing disgraced Dr Nobuhle Nkabane, who attempted to appoint ANC politicians as chairpersons of the 21 different Seta boards.

On Friday, 14 August, the high court ordered that Manamela reinstate the NSFAS board and suspend administrator Hlengani Mathebula.

The Presidentâs spokesperson, Vincent Magwenya, said, âThe President is deeply concerned about the situation at NSFAS. The governance and financial stability of this institution is vital in the promotion and enablement of access to higher education by millions of deserving young people who ordinarily would never afford to access higher education. Therefore, NSFAS will be stabilised so that it can deliver on its mandate.

âThe high court decision was delivered this past Friday as the President was commencing with SADC-related activities. The President is yet to receive a full briefing on the judgment and its implications and is yet to discuss the matter with the minister. Therefore, it will be premature to comment at this stage,â said Magwenya.

The Higher Education Portfolio Committee chair, Tebogo Letsie, also addressed Manamelaâs flawed reading of the NSFAS Act, telling Daily Maverick that the department had been given until Friday to produce the legal advice it relied upon.

Letsie explained that the minister claimed to have relied on departmental advice, adding that the committee had instructed the department to submit those advisory documents by Friday. He noted that section 17C of the Act is unambiguous, making it unacceptable to apply the section selectively when referring to administrators versus advisers.

Letsie added that the committee had sought guidance from parliamentary legal experts on how to address unauthorised payments, pointing out that paying individuals who are not legally entitled to funds constitutes a criminal offence. He confirmed that the officials involved are being reported to their respective professional bodies for investigation, emphasising that all misallocated public money must be recovered.

An analysis of three Government Gazettes shows that Manamelaâs notice appointing administrator Mathebula excluded section 17C of the NSFAS Act, departing from the precedents set by his predecessors, Dr Naledi Pandor and Dr Blade Nzimande.

A dive into the crisis

The crisis at NSFAS long predates Manamela and his predecessor, Nkabane. When Nkabane took office, the scheme was under its second administration, led by Freeman Nomvalo. Nkabane subsequently appointed an 18-member board and named Waseem Carrim as acting CEO. In 2025, NSFAS funded approximately 811,011 university and TVET college students â raising university allowances by 4% and boosting TVET allowances by 46%. Despite these financial gains, operational troubles continued to mount.

Accommodation remains one of the biggest failures of the NSFAS, with thousands of students unaccommodated or threatened by landlords due to payment delays caused by NSFAS. In February, protests erupted at the Cape Peninsula University of Technology and Nelson Mandela University, with students demanding urgent intervention over access to housing.

In 2025, NSFAS admitted to owing R44-million to landlords from the Private Student Housing Association, leaving thousands of students in limbo. At the same time, Sector Education and Training Authorities (Setas) were engulfed in leadership disputes and wasteful expenditure scandals.

Manamela appointed

On 21 July, the Presidency announced that Ramaphosa had fired Nkabane and appointed Manamela as the new minister of higher education and training. He had been the deputy minister of higher education and training for more than seven years.

Manamelaâs primary directive was to rebuild trust in the Setas, resolve the ongoing crisis at NSFAS, and ensure South Africaâs post-school education and training sector delivers for young people.

He placed three Setas under administration, appointing Oupa Nkoane as Construction Seta administrator, Lehlogonolo Masoga as Services Seta administrator and Zukile Mvalo as Local Government Seta administrator. He was, however, grilled by MPs for doing so â they argued that the three were not fit for the jobs.

Soon after, Manamela was scrutinised by MPs again over the reappointments of CEO contracts at Setas, which reached their five-year limit (including extensions) on 30 September 2025.

In a bid to improve NSFAS, Manamela took a legal review of the establishment of the NSFAS board. At the same time, the scheme was hit by a series of resignations, including that of former chairperson Dr Karen Stander, interim chairperson Dr Mugwena Maluleke and Karabo Mohale, head of the human resources and organisational development committee, along with other members.

Manamela then placed the scheme under administration, saying, âI was not satisfied that the ordinary governance arrangements were capable of adequately stabilising the institution within the agency and the seriousness of the challenges confronting NSFAS... The administratorâs mandate will ⦠[prepare] the institution for a return to stable, ordinary governance.â

He appointed Professor Hlengani Mathebula as administrator on 4 May 2026, with the NSFAS board taking Manamela to the high court after this move.

So far, the promised return to stable, ordinary governance at NSFAS has failed to materialise. Following Hlengani Mathebulaâs appointment, a Daily Maverick investigation uncovered a trail of invoices exposing lavish spending on hotel accommodations. In one instance, taxpayers footed a R9,200 bill for a double-booked room at Cape Townâs Pepperclub Hotel & Spa â a stay Mathebula skipped because the hotelâs carpets and âdust mites trigger my sinusesâ. The move could constitute fruitless and wasteful expenditure.

Mathebula then appointed four advisers with a combined annual salary of nearly R10-million. Under section 17 of the NSFAS Act, the governance and administration framework is clear:

Section 17A empowers the minister to appoint an administrator to take over the schemeâs management and governance.

Section 17B allows the administrator, with ministerial approval, to hire technical advisers and support staff.

Section 17C mandates that any remuneration or allowances paid to the administrator or technical advisors must be determined by the minister in consultation with the minister of finance.

Daily Maverick reported that the four advisers were paid through private companies and the NSFAS HR roll; Manamela admitted that he did not get approval from the minister of finance to pay the advisers. MPs concluded that Manamela and Mathebula erred in executing the payments.

Court ruling

On Friday, 14 August, the Gauteng High Court in Pretoria delivered a blow to Manamela, suspending his appointment of Mathebula. Judge Etienne Labuschagne ordered the immediate reinstatement of the remaining seven NSFAS board members to govern the R54-billion scheme, pending the final review of the case later this year.

âTo place an administrator in charge of the NSFAS whose response to corruption is questionable, and who has a poor track record in a position of trust at SARS [South African Revenue Service], does not augur well. It cannot be in the interests of NSFAS to be governed by such an administrator,â said the judge.

Daily Maverick reported that in 2019, Mathebula was placed on precautionary suspension by SARS and later parted ways with the tax revenue collector.

Manamela was also taken to court by Dr Innocent Sirovha alongside the South African Youth Economic Council (Sayec). Sirovha and Sayec argue that the authority to appoint the NSF CEO lies exclusively with the director-general, not the minister. They contend that Manamela unlawfully usurped the director-generalâs statutory powers. The matter is now in the Labour Court.

The latest blow to Manamela and NSFAS is the Public Protectorâs report this week revealing that NSFAS had failed to fulfil its mandate, after more than 40,000 students at 76 higher education institutions were improperly funded to the tune of an estimated R5.1-billion. More than R2-billion has been recovered.

âNSFAS exists to enable students who would otherwise not be able to afford higher education to access and participate in the post-school education and training system. The minister remains committed to working with all relevant institutions to address the challenges at NSFAS,â said department spokesperson Matshepoo Seedat. DM

Reporting originally appeared via Daily Maverick. Read the full source for additional context.