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NSFAS follows Zuma’s new plan – but with caution

The National Student Financial Aid Scheme (NSFAS) will reopen applications for next year following the announcement by President Jacob Zuma on Saturday of free education for poor and working-class first-year students in 2018.

This comes after Zuma announced in a statement that the new definition for poor and working-class students is now a combined annual income of up to R350 000.

The current NSFAS threshold is R122 000 but this is expected to change as from next year.

The chief executive of NSFAS, Steven Zwane, told the Mail & Guardian yesterday that, following Zuma’s announcement, those students who had missed the August deadline for applications will be allowed to apply for funding through their universities.

“Our responsibility is to articulate to the universities what information we require for us to capture the information and make a decision. So universities and TVET [Technical, Vocational, Education and Training] colleges will be receiving the applications and communicating with us about the new applicants and we will process the information.

“The speed of processing might be impacted in terms of making a decision to award, but the pronouncement is there and we are saying universities must take students in terms of the capacity they have,” said Zwane.

The presidency also announced that loans given to students funded by NSFAS in their further years of study would be converted to 100% grants “effective immediately”.

Zwane said NSFAS was ready to implement this because it was an opportunity to fund more students.

This year, NSFAS funded more than 460 000 students.

“We knew from the [Judge Jonathan] Heher report … that some action had to be taken around this. So we were able to write our perspective … and shared with the minister [Hlengiwe Mkhize] through the board chair [Sizwe Nxasana] in terms of what we perceived as the implications.

“So when we got the pronouncement by the president we had already started working on a couple of scenarios in terms of what it means for NSFAS. I think for us the biggest thing out of this is that we move from providing loans and bursaries to purely providing bursaries in the form of grants,” he said.

Zwane said the scheme would be busy over the festive season analysing, defining and finding ways to make sure that, whatever had been pronounced, “we can deliver on it”.

“More importantly is the fact that we always believed that free education for the poor and working class was our mandate and we believe NSFAS has always played that part. If you look at the money that we are owed, we have been providing free education over the years,” said Zwane.

The scheme is currently owed R29-billion as per its 2016-2017 annual report. He said the announcement by Zuma now means that, for everybody who is currently funded by NSFAS, their loan gets “wiped out”.

Currently 40% of NSFAS loans are converted to grants if a university student passes their first and second year of study, and the loan in final year is converted into a grant if the student passes their final year.

Students currently pay back their loans when they earn R30 000 or more a year. The repayment is 3% of their annual salary increasing to a maximum of 8% when their salary reaches R59 300 or more a year.

Zwane said the scheme would seek clarity from the department of higher education and training on what is going to happen to those who are no longer students and whether their debt would be wiped clean or continue.

He said the NSFAS board, executives of the scheme and the department would meet on Monday, where the issue will be raised.

But even those who will be part of implementing Zuma’s plans are not optimistic.

A senior executive at the department of higher education and training, who asked to remain anonymous, said the plans announced by Zuma where “populist” and would not work.

“What’s going to happen is that all of this can work for 2018 but by 2019 it would have collapsed. It’s populism, he does not care how the next person is going to do this,” said the insider.

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Bongekile Macupe
Bongekile Macupe is an education reporter at the Mail & Guardian.

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