The department of higher education & training is querying the auditor-general’s damning findings on the national funding agency for higher education students.
Higher education & training minister Blade Nzimande told MPs on Wednesday there is a dispute, “whether declared or not”, about the audit outcome between his department and the auditor-general’s office.
Some of the findings against the National Student Financial Aid Scheme (NSFAS) were largely due to a lack of co-operation by tertiary institutions, he said.
In the audit outcomes of NSFAS for the 2019/2020 financial year tabled in parliament last week, the auditor-general said the institution’s accounting records could not be verified.
The auditor-general was unable to verify the amounts owed by institutions due to a lack of reconciliation between the financial records of the NSFAS and higher learning institutions.
The audit was also unable to determine the full extent of irregular expenditure of about R7bn in the financial statements.
The auditor-general slapped NSFAS, which falls under Nzimande’s department, with a qualified audit report for the third time in as many years. The irregular spend regarding student loan agreements has often been highlighted as one of the major concerns.
NSFAS is the government’s conduit for providing financial support to students from poor and working-class families studying at universities and technical and vocational education training (TVET) institutions.
It had a budget of about R35bn in 2020, funding about 700,000 students.
On Wednesday, MPs discussed the auditor-general’s report during which Nzimande said that NSFAS was hamstrung because of a lack of co-operation from universities and colleges.
Data is sometimes not provided on time to NSFAS, and some of the information is sometimes unreliable, he said.
“The situation is worse at Technical Vocational Education & Training (TVET) colleges with weak administrative capacity. But we are dealing with that, not as fast as we want to largely because we have no money to attend to some of the problems facing the college sector,” he said.
A dispute between the department and the auditor-general’s office relates to the new bursary scheme for students from poor and working-class families not being gazetted, Nzimande said. It was introduced in 2018.
In the annual report, the auditor-general found that NSFAS had not consulted with the minister of higher education & training in crafting criteria and conditions for granting loans and bursaries to eligible students, and had not published the revised criteria and conditions in the Government Gazette. This led to a finding of irregular expenditure.
Legal advice received by the department’s director-general suggested there was no need to gazette it, “and in essence there is a dispute between the AG’s [auditor-general’s] office and [the] department”, Nzimande said.
“If the AG’s finding stands [it means] the billions we have spent over the last three years supporting the children of the working class and the poor is irregular expenditure,” he said.
The department and NSFAS will go through the auditor-general’s report to devise solutions to the issues raised, Nzimande said.
Sharonne Adams, a business executive at the auditor-general’s office, told MPs the rules and regulations governing NSFAS state that if there is a revision in the criteria for funding, as in 2018, it has to be gazetted.
“This matter was escalated to [the] National Treasury … and [the] Treasury was in agreement that this is irregular expenditure.”
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