Higher Education Minister Blade Nzimande has dissolved the National Student Financial Aid Scheme (NSFAS) board with immediate effect and will place the institution under administration.
The decision comes amid the non-payment of student allowances, which has left thousands of them stranded without accommodation, among other needs.
In a statement on Thursday, the department of higher education and training said Nzimande had made the move “given the magnitude of the problem and its negative impact on the well-being of students and the continued functioning of our post school education and training system”.
“In the next few days, the minister will be taking a series of additional and decisive steps, all of which are intended to have the problem of non-payment of allowances resolved as a matter of priority,” it added.
It said the legal effect of the decision to dissolve the board would be gazetted on Friday.
The dissolution follows the resignation of NSFAS board chairperson Ernest Khosa on Thursday.
In January, Khosa took leave of absence citing security concerns after the Organisation Undoing Tax Abuse released a report and leaked audio implicating him and Nzimande in alleged fraudulent activity.
In February, the Special Investigating Unit said it had recovered nearly R738 million from higher education institutions after it found that NSFAS had failed to design and implement measures to ensure a settlement between the funds paid to the institutions and the allocation of those funds to the students.
On Friday, the ANC Youth League said it welcomed Nzimande’s decision to dissolve the NSFAS board, saying that it “demonstrates a commitment to accountability and effective governance within the crucial realm of higher education”.
In a statement, the youth league said it was evident that the board had failed millions of students, adding: “Today many students are suffering as allowances are not being paid. This failure is unacceptable and underscores the urgent need for reform within the institution.”
The Democratic Alliance’s spokesperson for higher education, Chantal Kings, said the party was calling for Nzimande to also resign.
“Minister Nzimande cannot be absolved from actions of the board since he has defended the decisions of the board on numerous occasions,” Kings said.
The troubled student financial aid scheme will be placed under administration
