Massive R1.7 Billion Recovered by SIU Amid NSFAS Corruption Probe

The Special Investigating Unit (SIU) has achieved a significant milestone, recovering R1.7 billion from South African universities as part of its ongoing investigation into the National Student Financial Aid Scheme (NSFAS).

Launched in September 2022, the investigation aims to address unallocated funds, corruption, and maladministration within NSFAS. These funds, meant for student financial aid, were left unreconciled between 2016 and 2021, causing financial discrepancies across multiple institutions.

Universities Pay Back Unallocated Funds
On December 6, the SIU announced major repayments from two universities: the University of Witwatersrand (Wits) contributed R450 million, and the University of the Free State (UFS) paid R438 million. These sums, alongside previous payments from institutions like the University of Pretoria (R400 million) and the University of Johannesburg (R312 million), bring the total recovery to R1.7 billion.

“The SIU’s investigation revealed that NSFAS failed to implement controls to ensure annual reconciliation of funds disbursed to institutions,” said SIU spokesperson Kaizer Kganyago.

Unallocated funds were generated by various factors, including students receiving multiple funding sources or changes in tuition costs during the academic year.

Accountability and Reform
The investigation also uncovered systemic challenges within NSFAS, such as unpaid loans from graduates and ongoing corruption. To address these issues, NSFAS has enlisted a service provider for reconciliation processes, referred to as “close-out reporting.”

In addition, 421 students who received funding they were not eligible for have signed Acknowledgment of Debt agreements, committing to repay a total of R112.17 million.

Government and Public Collaboration
President Cyril Ramaphosa authorized the SIU investigation in August 2022 to address corruption and recover financial losses. The SIU has expressed gratitude to universities and NSFAS for their cooperation, emphasizing the importance of restoring trust in the financial aid system.

“The SIU is committed to ensuring that all parties receive what is owed to them so that student accounts can accurately reflect the correct balances,” Kganyago added.

The SIU has the authority to pursue civil action in cases of fraud or maladministration and will refer any evidence of criminal activity to the National Prosecuting Authority for further action.

A Step Towards Integrity
With an annual budget of R46 billion, NSFAS plays a vital role in enabling access to higher education for South African students. However, as the SIU’s findings reveal, structural reforms and accountability are critical to its sustainability.

The recovery of R1.7 billion marks a positive step in addressing these challenges and ensuring that resources are used as intended—to empower students and strengthen South Africa’s education system.

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