Leadership mess at R54 billion state-run scheme

The Pretoria High Court has suspended the appointment of Professor Hlengani Mathebula as administrator of the National Student Financial Aid Scheme (NSFAS).

The ruling, delivered on Friday, 14 August 2026, also restored the seven remaining members of the NSFAS board to their positions, pending a final review.

Higher Education Minister Buti Manamela initially dissolved the board in May 2026 after appointing Mathebula as the scheme’s new administrator.

At the time, Manamela cited legal concerns about the board’s structure as the reason for his department’s decision to place NSFAS under administration.

He also claimed that previous attempts to stabilise the board through interim appointments and vacancy fillings had been unsuccessful.

The suspended board members approached the High Court shortly after the board was dissolved, alleging that Manamela had ulterior motives.

The court has now ruled that Manamela’s decision to dissolve the board was irrational and has reinstated its members to continue managing the scheme.

Despite Manamela’s concerns about the board’s composition, the court found the NSFAS board to be still quorate and thus able to carry out its intended functions.

Hundreds of thousands of South African students depend on NSFAS for funding, with the scheme estimated to have approved funding for 660,000 students this year alone.

Despite receiving an annual budget of over R54 billion from the state, NSFAS has faced numerous governance challenges and financial issues in recent years.

The scheme’s latest administration period is its third in less than a decade, following two previous administrator appointments in 2018 and 2024.

Appearing in Parliament last week, Manamela revealed that the funding shortfall at NSFAS had grown from R2.5 billion in 2018 to where it now sits at around R15 billion.

Finance Minister Enoch Godongwana has criticised the scheme’s management and revealed that the government spends R700 million on running NSFAS.

“If we took that money and divided it, we could pay the fees of 9,000 students, just with what we spend on administration,” Godongwana said.

OUTA welcomes court decision

The High Court’s decision to restore the NSFAS board and suspend Mathebula’s appointment as administrator has been welcomed by the Organisation Undoing Tax Abuse (OUTA).

In a statement, the organisation said placing the scheme under administration was unnecessary and could have been avoided.

OUTA said the ruling confirmed concerns they had raised back in April 2026, when NSFAS interim Chairperson Dr Mugwena Maluleke and board member Karabo Mohale both resigned.

When OUTA questioned why this had created a crisis over the board’s ability to function lawfully, it found several other NSFAS board members had resigned during 2025 and had not been replaced.

According to the court judgment, Maluleke had requested that Manamela fill board vacancies, as its composition reportedly no longer met the requirements of the NSFAS Act.

Manamela responded to this request on 23 January, reportedly declining to fill these vacancies pending his own review of the board’s appointment.

“The Minister knew the board was losing members,” OUTA CEO Wayne Duvenage said. “He was asked to fill those vacancies, and he chose not to.”

“When the situation reached a crisis point, his solution was to dissolve the board and appoint an administrator whose suitability for the position should have raised serious red flags.”

OUTA questioned Mathebula’s appointment as NSFAS administrator back in May due to findings from the Nugent Commission about his tenure at the South African Revenue Service (SARS).

The court judgment found that Manamela had not fully considered these findings when he appointed Mathebula as the administrator of NSFAS.

This includes claims made by Mathebula before the court that he had not faced disciplinary proceedings during his time at SARS, which the court found to be untrue.

“This was not an appointment where the Minister could afford to get it wrong,” Duvenage said. “NSFAS had already been through years of instability. The last thing it needed was another questionable leadership decision.”

“When you put someone in charge of R54 billion in public money and the futures of hundreds of thousands of students, there can be no room for questionable appointments or compromised judgment.”