WeeklySA_AdminAID: Unspent funds problem due to poor control systems and a lack of reconciliation processes…
By Yolisa Hlatshwayo
The Special Investigating Unit (SIU) has recovered R33 668 138.56 of unallocated funds from the University of Mpumalanga.
This was revealed a week ago when the SIU presented its findings to Parliament’s Standing Committee on Public Accounts (SCOPA).
According to findings it has so far made a recovery totalling to R737 926 351. The figure includes R688 220 611.56 in unallocated funds and signed acknowledgement of debt agreements of R49 705 739.60 as part of an investigation into the affairs of the National Student Financial Aid Scheme (NSFAS).
The unallocated funds are due to poor control systems and a lack of reconciliation processes by NSFAS and were not collected from institutions of higher learning. When approached by the SIU, the institutions cooperated, which led to a quick recovery process.
Funds were also recovered from the following institutions of higher learning:
- West Coast College-R5 057 679.00
- Northlink College-R33 369 404.97
- Walter Sisulu- R19 900 174.00
- Nkangala TVET- R342 672.50
- University of Johannesburg- R311 892 088.94
- University of Zululand-R58 088 144.65
- University of Pretoria- R200 000 000.00
- Majuba TVET College- R25 902 309.31
This investigation has revealed that NSFAS failed to design and implement controls to ensure that there is an annual reconciliation between the funds disbursed to the institutions and the allocation of those funds to the students.
These control weaknesses have led to overpayments and underpayments of funds to the different institutions over the period 2017 to date. NSFAS has recently appointed a service provider to assist them in performing this reconciliation via a process called “close-out reporting”. The reconciliation process is still ongoing.
With regards to NSFAS-funded accommodation, the SIU found that details of the accommodation such as physical addresses and details of the landlord or owner of the accommodation were not captured on the NSFAS system. The physical address of the accommodation and landlord or owner was not vetted by the NSFAS.
The SIU is in terms of Proclamation R88 of 2022 authorised to investigate allegations of corruption and maladministration in the affairs of NSFAS and to recover any financial losses suffered by the State through corruption and negligence.
Meanwhile, as the academic year begins, 36 170 student beds at both universities and Technical Vocational Education and Training (TVET) colleges still required to be accredited by the National Student Financial Aid Scheme (NSFAS).
GroundUp reports that this was revealed by the acting CEO of NSFAS, Masile Ramorwesi, during a briefing to the Parliamentary Portfolio Committee on Higher Education.
“In universities, a total of 77 331 beds have been registered, 49 411 beds have been accredited and are available for the registered NSFAS-funded students and 27 920 are still to be accredited,” Ramorwesi told Parliament.
“In TVETs, out of the total of 40 522 beds registered, 32 272 beds have been accredited and are available for the registered NSFAS-funded students and 8 250 are still to be accredited.”
He said NSFAS has appointed four “solution partners” to assist it with student accommodation.
He said that 39 “accrediting agents” were appointed in May to assist with inspections at properties. He also said an ad hoc committee had been set up to assist the board with student accommodation.
On Monday, GroundUp reported that students at the Cape Peninsula University of Technology have been struggling to find accommodation since 31 January, and have been sleeping in a multipurpose hall without mattresses or other furniture.
DA MP Chantel King raised this with NSFAS and questioned their capacity to accredit beds faster. Ramorwesi responded by admitting there were capacity “challenges”.
He pointed to issues with confirming registration, an influx of accommodation providers requiring immediate inspection and grading, and catching up with the backlog of registered and accredited accommodation providers on the system.
Senior manager in the office of the Auditor-General, Ignatius Fourie, told MPs that NSFAS had regressed from the previous year by receiving an adverse audit opinion for the 2021/22 financial year. NSFAS has received qualified audits for the last four years.
The Auditor-General’s report states that the “overarching root cause” for the adverse finding is that organisational capacity and systems were inadequate to manage and maintain the growth that NSFAS has experienced since 2018.
Fourie told MPs, “An adverse audit means that there were a number of material misstatements in the financial statements and the figures in the financial statements are not reliable.”
Meanwhile, as of February 12, Ramorwesi said NSFAS received 1 904 209 applications. Of these 989,998 have been provisionally funded, 369,320 are awaiting evaluations,72 574 have been withdrawn by the student, 161 492 are in progress, 139 928 applications are on the ‘not started’ status as applicants only created profiles and did not submit applications, 14 198 have been rejected. Applications close today (February 15). –– MP MirrorOnline and GroundUP
