Cape Town - A few hours after hundreds of students from across universities in the Western Cape peacefully protested against the National Student Financial Aid Scheme (NSFAS) and the newly introduced Direct Payment Method, NSFAS announced an investigation levelled against its CEO.
Students from Stellenbosch University, Cape Peninsula University of Technology (CPUT), University of Cape Town, and University of the Western Cape joined in the protest from CPUT’s District Six Campus to Parliament, on Wednesday.
ActionSA Western Cape Students chairperson and National Youth Forum spokesperson Matthew George said the protest was about the defunding of students and the dispersion of student allowances through third parties – Coinvest Africa, eZaga Holdings, Noracco Corporation, and Tenet Technology.
George said the service providers were ill-equipped to do the job, and that the awarding of the contracts to these service providers were “fraudulently dubious”.
Following an investigation into NSFAS contracts last year, The Organisation Undoing Tax Abuse (Outa) found that NSFAS hired service providers without them having the required banking licences to pay out student allowances, at excessive rates relative to the market.
Outa said the appointed service providers were awarded a tender without being registered financial service providers.
George said students had indicated that there had been deductions from their accounts that could not be accounted for.
Many students had also not been issued their allowances, even those who had been boarded on to the system. There were also students who had been short paid, and service fees/ transaction fees were exorbitant.
“It's ridiculous and inhumane to defund a student in the middle of their academic career as well, especially those students who are staying in accommodations off campus in different provinces,” he said.
Okuhle Kulati, Economic Freedom Fighters Student Command (EFFSC) at UWC, said: “We just heard about these service providers. We are not sure whether they are trustworthy or not. And the bank charges are crazy.
“When you are trying to transfer money from your Norraco account to Capitec, or whichever you use, it's probably like R36 to transfer R1 000, for example, or more than that.
“So we are just trying to say to NSFAS that you could find another way to provide for these students, instead of service providers that we do not know.”
Meanwhile, the NSFAS Board said it would investigate allegations against CEO Andile Nongogo related to his work with the Services SETA and how this might relate to unacceptable conduct in the awarding of bids at NSFAS.
The investigation will focus on the Direct Payment project. During the course of the investigation, the CEO will be on a leave of absence. Chief financial officer Masile Ramorwesi will act as CEO until further notice.
Board chairperson Ernest Khosa said: “The Board commits itself to transformation and clean governance at NSFAS, and will ensure that any activities that defeat the purpose of serving students from poor and working-class backgrounds are addressed decisively.”