NSFAS huge debt crippling universities' programmes

Unpaid fees by student funding scheme NSFAS have forced some universities to delay maintenance, halt refurbishment of residences and reprioritise research projects ahead of the start of the new academic year.

Several universities have detailed to Sowetan how escalating debt by NSFAS is directly impacting on their operations, quality of teaching, learning and research.

The University of Pretoria (UP), which says it is owed R182m by NSFAS, had to freeze building maintenance, while Rhodes University (RU) had to reprioritise its budget as a result of unpaid debt.

UP spokesperson Sashlin Girraj said the lack of payment from the scheme had resulted in the delay of the refurbishment of student residences.

“To compensate for the shortfall in NSFAS payments, the UP has to cut operating and infrastructure costs.

“Because NSFAS has not confirmed that these amounts, outstanding from 2017 to 2022, will be settled, interim solutions have to be made at registration,” Girraj said.

The university said in 2023, there were 10,361 NSFAS-funded students.

“The numbers have been steadily growing since 2017. The opportunity cost for the 2023 year amounts to approximately R14.3m.

“At this point, the university’s infrastructure is in reasonably good condition.

“But delaying maintenance will result in deterioration and possibly more expensive work in the future. We have postponed all significant building work and major upgrades,” Girraj said.

University of Cape Town spokesperson Elijah Moholola said any outstanding funds from NSFAS make it difficult for the university to offer quality teaching and learning.

“Generally, 40% of the income is derived from student fees, which makes this an important source of revenue for ensuring financial sustainability,” Moholola said.

“UCT has implemented some cost-cutting measures on noncore activities, including deferring maintenance on non-essential infrastructure.

“Further, engagements are currently ongoing with key stakeholders including the unions on how the university can respond to the challenges of budget cuts from NSFAS and government subsidy,” Moholola said.

Rhodes University spokesperson Luzuko Jacobs said the debt has an adverse effect on the overall operations.

He did not want to share the precise debt, saying that this might jeopardise the university’s discussions with NSFAS.

“Revenue from all income streams is consolidated into the central budget which is the basis for institutional sustainability.

“This budget supports, among others, the academic project, residence operations, research, infrastructure development and maintenance.

“The cashflow implications and impact on the budget pose a serious risk to institutional sustainability,” Jacobs said.

Sefako Makgatho Health Sciences University spokesperson Lusani Netshitomboni said they had to come up with alternative ways of filling financial gaps as a result of nonpayment by NSFAS.

This has also compromised their research units.

“You can never have enough money for research because as much as you dig, you find that more money will be required to continue, so it is always good to have extra money and ensure that our books are up to date.

“However, we have a research council that makes sure we have the funds, and some money for research comes from the government research council,” Netshitomboni said. Sefako Makgatho is owed R192m by the funding scheme.

University of Johannesburg said it’s owed R132m while Durban University of Technology is owed R514m for the period 2017 to 2022.

The North West University is owed R108m for the same period and R372m bill with North-West University for the 2023 academic year.

Last week, higher education, science and innovation minister Blade Nzimande committed R4bn for the registration of students.

Nzimande also pleaded with universities to allow owing NSFAS students to register.

“I urge institutions not to deny NSFAS-funded students with outstanding payments to register for the current cycle.

“I have noted with concern the main reason for the outstanding payments was due to reconciliations that NSFAS has been engaged with institutions predominantly because of registration data changes.”