NSFAS Placed Under Administration: Minister Manamela Dissolves Board and Appoints Prof Hlengani Mathebula

In a decisive move to address longstanding governance and operational challenges, South Africa's Minister of Higher Education and Training, Buti Manamela, has placed the National Student Financial Aid Scheme (NSFAS) under administration. This intervention, announced on May 4, 2026, involves the dissolution of the current NSFAS board and the appointment of Professor Hlengani Mathebula as the administrator. NSFAS, the primary funding mechanism for eligible students from low-income households pursuing higher education at public universities and Technical and Vocational Education and Training (TVET) colleges, has been plagued by issues that have disrupted student lives and university operations across the country.

The decision comes amid a cascade of resignations from the board, including its interim chairperson, Dr. Mugwena Maluleke, leaving only seven members from the required 18. Minister Manamela emphasized that this step protects the billions of rands in public funds and the futures of over a million students reliant on NSFAS support each year. With the 2026 academic year underway, featuring approvals for approximately 660,000 to 700,000 students and a budget exceeding R55 billion, the timing underscores the urgency of restoring stability to this critical pillar of South Africa's post-school education system.

Understanding NSFAS and Its Pivotal Role in South African Higher Education

The National Student Financial Aid Scheme, established in 1991 and operating under the NSFAS Act of 1999, provides comprehensive financial assistance to students from poor and working-class backgrounds. This includes tuition fees, accommodation, living allowances, and learning materials for those studying at South Africa's 26 public universities and 50 TVET colleges. In 2026 alone, NSFAS approved funding for over 660,000 students, disbursing R3.6 billion in allowances to universities and projecting total expenditures around R55.4 billion—a significant increase from R27 billion in 2019, reflecting growing demand as more youth qualify for post-school education.

NSFAS support has been transformative, enabling dropout rates to decrease among funded students compared to self-funded peers, according to Department of Higher Education and Training studies. However, its scale—handling millions of applications annually—has exposed vulnerabilities. For instance, first-time approvals reached 626,935 in early 2026, with continuing students adding another 427,144, yet over 132,000 applications were rejected, sparking appeals that now backlog the system.

Universities like the University of Cape Town (UCT), Durban University of Technology (DUT), and Cape Peninsula University of Technology (CPUT) depend heavily on NSFAS payments for timely registrations and operations. Delays have forced institutions to either front costs or block students, exacerbating financial strains amid rising enrollment pressures.

The Escalating Crises Leading to Intervention

NSFAS's troubles have simmered for years but intensified in 2025-2026. Key issues include chronic payment delays, with thousands of students awaiting R5,200 monthly allowances, leading to protests at DUT, CPUT, and UCT. These disruptions halted lectures and damaged property, highlighting how funding shortfalls affect academic calendars and campus safety.

Audits revealed a disclaimer for the 2024/25 financial year—the worst outcome—alongside material irregularities flagged by the Auditor-General. Data integrity problems, such as payments to 822 deceased students and unqualified beneficiaries, prompted Special Investigating Unit (SIU) probes. By early 2026, the SIU recovered over R1.7 billion from universities, TVET colleges, and ineligible recipients, including R33 million from specific fraud cases and investigations into 1,055 parents over R126 million in improper claims.

Operational failures compounded this: delayed ICT modernization caused system glitches, unresolved appeals exceeded 100,000, and student accommodation mismanagement exposed learners to unsafe conditions, undermining dignity. Boardroom battles, like the disputed CEO appointment of Waseem Carrim despite resignations, eroded legitimacy. Minister Manamela's March 2026 directive for direct payments to landlords aimed to curb abuse but couldn't stem the tide.

Board Dissolution: Legal and Governance Breakdown

The board, appointed in February 2025 by former Minister Nobuhle Nkabane, faced a high court review initiated by Manamela over procedural flaws. Resignations accelerated in April 2026, with Maluleke citing personal commitments, reducing functionality. Remaining members were consulted, but alternatives like interim appointments failed to restore order.

Under sections 17A to 17D of the NSFAS Act, Manamela dissolved the board, citing risks to public funds. This mirrors past interventions but signals deeper systemic issues, as noted by organizations like OUTA, which highlighted seven resignations since mid-2025.

Profile of the New Administrator: Prof Hlengani Mathebula

Professor Hlengani Mathebula, a Limpopo native who rose from poverty, brings 30+ years of expertise. Holding a PhD from the University of Pretoria, a Master of Management from Wits Business School, and qualifications from Harvard and Stanford, he has led at the South African Reserve Bank (SARB) and South African Revenue Service (SARS). Currently Director and Head of the Tshwane School for Business & Society at Tshwane University of Technology (TUT), he offers academic insight alongside financial acumen.

Manamela praised his independence and capacity to tackle governance, audits, and ICT reforms. While some question past board roles, his track record in stabilizing institutions positions him to rebuild NSFAS trust. For more on his appointment, see the detailed profile.

Photo by Hennie Stander on Unsplash

Mandate and Priorities for Turnaround

Mathebula's 24-month tenure (or until a new board) focuses on:

• Restoring governance and internal controls.
• Addressing audit failures and consequence management.
• Fast-tracking ICT integration to fix data issues.
• Stabilizing funding disbursements to universities and TVETs.
• Overhauling accommodation to ensure safety.
• Clearing appeals backlogs.

This step-by-step approach aims for institutional renewal without halting services. Official details are in the government statement.

Assurances Amid Concerns: No Disruption to Students

Manamela assured continuity: "Student funding will continue, allowances will continue." Universities like UCT and TVETs can engage operationally. For 2026, with 1.24 million approvals (692k first-time, 551k continuing) and R6.3 billion already disbursed, the focus is protection. Yet, students report ongoing delays, urging swift action.

Institutions face R45 billion debt risks, but direct payments mitigate landlord fraud.

Stakeholder Reactions: Mixed Welcome and Criticism

Parliament's Higher Education Committee called it "troubling instability," urging resolution to avoid long-term harm. The DA labeled it systemic failure, while OUTA welcomed but criticized delays. EFF rejected administration, demanding dissolution; SAUS opposed the process; NEHAWU decried lack of consultation.

Universities express cautious optimism, prioritizing appeals. Students on social media demand faster fixes. For SIU updates, see recovery report.

Historical Context: Lessons from Prior Administrations

This marks NSFAS's third administration:

Past efforts recovered funds but failed to prevent recurrence, pointing to root causes like political interference and capacity gaps.

Implications for Universities, TVET Colleges, and Students

Public universities (e.g., Wits, UKZN) and TVETs bear NSFAS delays, with 106k+ first-time TVET entrants projected. Protests disrupted 2026 starts; administration could ease via better systems. Long-term, it risks enrollment drops if trust erodes, amid 74% graduate poverty rates.

Solutions include NSFAS-university data-sharing and vocational pivots.

Photo by Sibusiso Mbatha on Unsplash

Ongoing Investigations and Anti-Corruption Measures

SIU's R1.7bn recovery targets fraud; 11 arrests in TVET thefts. NPA probes parents. Mathebula must enhance verification, direct payments.

Future Outlook: Reforms for Sustainable Student Funding

Success hinges on ICT upgrades, board reconstitution, stakeholder buy-in. Potential: Hybrid funding models, private partnerships. For SA higher ed, stable NSFAS unlocks equity, boosting 1.2M+ learners toward graduation and employment.

Explore opportunities at higher education jobs amid reforms.