DHET & NSFAS 2022/23 Annual Performance Plan; with Minister

NCOP Education and Technology, Sports, Arts and Culture

18 May 2022
Chairperson: Mr E Nchabeleng (ANC, Limpopo)
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Meeting Summary

Higher Education           

The Committee met virtually to be briefed on the Annual Performance Plans and budgets of the Department of Higher Education and Training (DHET) and the National Student Financial Aid Scheme (NSFAS) for the 2022/23 financial year. The Minister was in attendance.

The Department first took the Committee through the six key programmes and their expected outputs for 2022/23.

The Department's baseline increased over the 2022 medium-term expenditure framework amount by R7.546 billion in 2022/23; it will increase by R10.551 billion in 2023/24 and by R12.150 billion in 2024/25. The Department's budget is dominated by Programme three (University Education), representing 80.9 percent of the budget in 2022/23. The compensation of employees amounts to R10.776 billion, 93.9% of Departmental operations. The operational budget for 2022/23 is R701.360 million, and it will increase to about R728.42 million in 2024/25. Included in this budget are provisions for office accommodation and examination services.

The National Student Financial Aid Scheme's mission is to transform into an efficient and effective provider of financial aid to students from poor and working-class families in a sustainable manner that promotes access to, and success in, higher and further education and training, in pursuit of South Africa's national and human resource development goals. The Scheme considered various key factors when they considered their situational analysis, such as the impact of COVID-19, the current context of the organisation, and the remediation strategies for improving overall organisational performance.

The Scheme’s revenue for 2022/23 is expected to be around R48.968 billion. Its expenditure is expected to reach about R50.869 billion, with programme one accounting for R309.408 million, programme two taking up R49.252 million and capital assets only taking up R1.461 million.

The Committee asked the Department questions about the infrastructure of educational buildings, asking if the Department is planning on building permanent premises where programmes at community colleges can be hosted, as most of these programmes are held after hours in school classrooms.

The Committee wanted clarity on a wide range of issues. Firstly, Members raised their concerns about the incident at Stellenbosch University and urged the Department to give them an update on the matter. Members also wanted an update on the students stuck in Ukraine and asked how the Department's international agreements with other universities have aided this process.


The Committee asked how the Financial Aid Scheme will monitor the funds paid out to educational institutions and if the Scheme will strengthen its systems to provide more efficient services. Members also asked whether the Scheme would engage with other departments to develop an integrated system. Various other questions were raised on student accommodation placements, the process, and how the Scheme planned on monitoring this process. Other matters related to the distribution of the devices to eligible TVET colleges and university students.

Meeting report

Chairperson’s Opening Remarks

The Chairperson welcomed the Minister of the Department of Higher Education and Training (DHET) and delegates from the Department, the National Student Financial Aid Scheme (NSFAS) and Members of the Committee. He thanked the Members for all their support, love, and solidarity for him and his family through their period of loss.

He said that they were dealing with two matters today: the Annual Performance Plan (APP) and the budget of NSFAS and the DHET for the 2022/23 financial year. He mentioned the incident at Stellenbosch, saying that it was a matter of racism and that it needed to be addressed urgently. He added other incidents at other universities that have affected the students and the DHET.

The floods that have happened recently have also affected the infrastructure of educational buildings. The Chairperson asked the DHET to provide the Committee with an update on the students still stranded in Ukraine.

He went through the agenda of the meeting. 

He expressed his greatest sympathies to Ms S Luthuli (EFF, KZN), who lost her brother over the weekend.

Minister’s Opening Remarks
Dr Blade Nzimande, Minister of Higher Education, Science, and Technology, expressed his sympathies to the Chairperson for his loss and asked to pass on his condolences to his family and to Ms Luthuli and her family.

On the incident at Stellenbosch University, he said that he was disgusted at what happened, and he was awaiting a full report of the matter. He assured everyone that the Ministry would be addressing the matter with utmost importance.

He mentioned that the Director-General might have more information on the students who are in Ukraine.

DHET Briefing: Annual Performance Plan and Budget for 2022/23
Dr Nkosinathi Sishi, Director-General, DHET, and Ms Pretty Makukule, Chief Financial Officer, DHET, took the Committee through the Annual Performance Plan and Budget for 2022/23

Dr Sishi highlighted what the DHET's mission and vision are for this financial year and mentioned their legislative mandate. He said that certain policies and strategies informed the planning of the APP of 2022/23. He also mentioned what the Department aims to achieve by 2024/25: to provide a diverse student population with access to a comprehensive and multifaceted range of PSET (Post-School Education and Training) opportunities. The Department wishes to improve social and economic development through the PSET system. It has set out five key measures of performance, being:
Enrolments in PSET institutions (by sector)
Students' completions (by sector)
Funding support is given to students (by sector)
Learners in SETA supported skills programmes
Infrastructure Development.

He took the Committee through the six key programmes and their expected outputs for 2022/23.
Programme one has to do with the administration and it provides strategic leadership, management, and support services for the Department. The key outputs of the programmes are to:
Ensure that all valid invoices from creditors are paid within 30 days
Ensure that 40% of public procurement is spent on women-owned business
Ensure that the vacancy rate is below 10%
Resolve 80% of disciplinary cases within 90 days per annum
Obtain a clean audit opinion from the Auditor-General of South Africa
Ensure at least 98% network connectivity uptime
Ensure that all (100%) determination tests on irregular, fruitless and wasteful expenditure are concluded within 12 months.

Programme two deals with planning, policy, and strategy. It provides strategic direction in developing, implementing, and monitoring departmental policies and the Human Resource Development Strategy for South Africa. There are various key outputs on the quality of provisioning, infrastructure, research to support strategic decision-making, international relations, social inclusion and equity.

Programme three is on University Education, and it is aimed at developing and coordinating policy and regulatory frameworks for an effective and efficient university education system. Its aim is also to provide financial and other support to universities, the National Student Financial Aid Scheme, and National Higher Education Institute. Some of the key outputs of this programme were to:
Submit to the Minister updated guidelines for the implementation of the DHET bursary scheme for poor and working-class students at public universities for approval;
Support six universities to develop Technical and Vocational Education and Training (TVET) College articulation implementation plans;
Develop a report on compliance of Public-Private Higher Institutions;
Develop a report on compliance of Public-Private Higher Institutions.

Programme four is on technical and vocational education and training, and it plans to develop, implement, monitor, maintain and evaluate national policy, programme assessment practices, and systems for TVET Colleges. It also plans to provide financial and other support to TVET Colleges and regional offices.

Programme five centers around Skills Development and promotes and monitors the National Skills Development Strategy. It aims to develop skills development policies and regulatory frameworks for an effective skills development system.

Programme six focuses on Community Education and Training. This programme aims to plan, develop, implement, monitor, maintain, and evaluate national policy, programme assessment practices, and community education and training systems. It will also provide financial and other forms of support to Community Education and Training (CET) Colleges. One of the key outputs is to develop a report on compliance of Public-Private Higher Institutions.

Ms Pretty Makukule took the Committee through the budget of the DHET for 2022/23. She said that the budget is distributed among the six programmes that Dr Nkosinathi Sishi discussed.

Some of the budget trends are:
That the post-school education and training budget has an increase of more than 7.0% over the MTEF
The Department's baseline increased over the 2022 MTEF amount by R7.546 billion in 2022/23; it will increase by R10.551 billion in 2023/24 and by R12.150 billion in 2024/25.
University funding contributes to the most significant percentage of funding in the vote at an average rate of 65.4%, compared to 14.3% for TVET Colleges.
The Department’s budget is dominated by Programme three (University Education), representing 80.9 percent of the budget in 2022/23.

She indicated that, for 2022/23, compensation of employees amounts to R10.776 billion, 93.9% of Departmental operations. A more detailed:
Departmental: R1.043 billion
TVET Colleges: R7.288 billion
CET Colleges: R2.162 billion
Examiners and Moderators: R283.252 million.

She added that the operational budget for 2022/23 is R701.360 million, and it will increase to about R728.42 million in 2024/25. Included in this budget are provisions for office accommodation and examination services.

Overall, the Department continues to be innovative and efficient and ensures that the required processes, monitoring, and evaluation of the whole system are being improved.

[See presentation document for more details]

NSFAS Briefing: Annual Performance Plan and Budget for 2022/23
Mr Ernest Khosa, Chairperson, NSFAS, and Mr Andile Nongogo, Chief Financial Officer, NSFAS, took the Committee through the Annual Performance Plan and Budget for 2022/23

Mr Andile Nongogo stated that NSFAS was established to:
Provide loans and bursaries to eligible students who need financial support
Develop criteria and conditions for the granting of loans and bursaries to eligible students in consultation with the Minister of Higher Education and Training
Raise funds and recover loans
Maintain and analyse a database and undertake research for the better utilisation of financial resources
Advise the Minister on matters relating to student financial aid
Undertake other functions assigned to it by the NSFAS Act or the Minister.

He said that NSFAS's mission is to transform into an efficient and effective provider of financial aid to students from poor and working-class families in a sustainable manner that promotes access to, and success in, higher and further education and training, in pursuit of South Africa's national and human resource development goals.

He highlighted that they considered various key factors when they considered their situational analysis, such as the impact of COVID-19, the current context of the organisation, and the remediation strategies for improving overall organisational performance. He mentioned the outcomes that they are aimed at achieving:
Having an alternative pool of funding available for eligible students
Introducing sustainable and improved systems for recoveries
Funding the right student, the correct amount at the right time
Engaging and informing stakeholders.

He went through the budget expenditure, explaining where all their funds were being allocated.

[See the presentation document for all the details]

The Chairperson was interested in knowing how many international agreements for international scholarships the Department had in place and how many countries they would sign agreements with.

On the students stuck in Ukraine and Russia, he asked how the international agreements that the Department has signed with other universities have assisted the students in returning home to South Africa. He asked how the International Relations Office’s mandate has facilitated this process. What does the mandate of the International Relations Office entail? Who benefits from the international scholarships, and what values do the beneficiaries of the international scholarships bring back to the institutions?

For NSFAS, he mentioned the matter of the budget cut in funding. He asked NSFAS to provide the Committee with details of the budget cut and to provide them with details as to how the budget cuts will affect eligible students. He mentioned that the Committee received various letters from students who did not receive their grants and their devices. He said that they forwarded all the letters to NSFAS. He was interested in knowing whether there were any possible increases in the budget – for example, whether National Treasury would be willing to provide them with the extra funds they needed.

Ms M Gillion (ANC, Western Cape) mentioned that the Minster had already answered and raised many of her concerns when he gave his input. She thanked the Minister for reassuring the Committee that the Department was busy addressing the incident that occurred at Stellenbosch University. However, she pointed out that it was a serious concern. She said that she was shocked at the whole incident, adding that it was not the first time that such a racial discrimination incident had occurred, especially at Stellenbosch University. Racial issues are something that needs to be addressed seriously by the Department.

She raised the matter of university policies, saying that there is an issue with the accommodation policies of universities. They received many complaints at the start of the first semester from first-year university students who had no accommodation at student residences. She highlighted that traditional residences also only allocate accommodation rights to certain racial groups, especially at Stellenbosch University. How will the department address this issue? She mentioned an incident that occurred at CPUT and UWC. She questioned how NSFAS would monitor the money allocated to the institutions to ensure that the beneficiaries receive ac accommodation.

She noted that the Minister stated that a high percentage of the budget is allocated to universities compared to TVET Colleges. She said that the Department is funding Stellenbosch University, yet there has been little to no transformation at the institution.

The Chairperson raised a question from Ms S Lehihi (EFF, North West) posted on the Zoom chatbox. The Department has made little progress in ensuring that students have access to tertiary education institutions. Many institutions lack the necessary infrastructural development, such as Agricultural Colleges in the North West – Taung and Potchefstroom. How much of the budget has been set aside for those universities? She asked when NSFAS will be establishing a national centre to deal with applications and the dispersal of students' allowances.

Ms D Christians (DA, Northern Cape) agreed with the Minister on the problem of the high unemployment rates in South Africa that it is a crisis and a big concern in the country. She pointed out that there has been a slight increase in the budget for the CET programme in community colleges, from R2.3 billion in 2021/2022 to R2.4 billion. She commended this effort, as she said that one of how the country’s youth unemployment can be tackled is through community colleges.

One concern that she mentioned was that the CETs in most provinces do not have permanent premises. When will these provinces get permanent premises, as some programmes are still being held in schools after hours? She asked whether the budget that has been allocated from CETs would be adequate to ensure that unemployed youth would have access to the facilities to have the opportunity to be employed.

She asked for the status of the 54 Pilot centres across the country, and she asked for more information on the CET programmes and whether they are doing what they are expected to do.
She observed that there had been articles in the newspapers about protests ongoing at UNISA. She asked the Departments what the cause was of the protests and the progress on the matter. Has the Department tried to determine what was happening and come up with possible solutions?

She noted that the Minister raised the issue of student placements. Coming from the TVET sector, she said that TVET Colleges have struggled for several years to form networks and engage with workplaces where students could be placed after graduating to gain work experience. She commended the Minister, saying that it is a good thing that principles are being held accountable to form the necessary networks and to engage with workplaces because it is essential. Students go out of college and want to apply for jobs, but they do not always have access to the necessary tools to do so. She asked whether or not principals will receive any form of training on how to network and engage with workplaces.

The Minister mentioned that 94% of learners who start grade one end up not going to university, and this remains a concern. This only highlights the systemic problems in basic education. Many learners are not receiving a quality basic education. In turn, they are not equipped with the basic skills and attributes to be able to go to any higher education institutions. How will the DHET collaborate with the Department of Basic Education to find solutions to lower the statistics and get learners from grade 10 up to matric and into higher education institutions and training?

She asked the Department to provide the Committee with feedback on the pass rates at universities and TVET Colleges and if they have any plans to increase the pass rates. She mentioned that they had received complaints from students in TVET Colleges who have completed their NCV courses and have been unable to go and do their trade tests.

She asked for feedback on the distribution process of the devices, whether laptops were sent out, and how many are still pending.

She asked for feedback on the ICT system, asking if they have been engaging with the new system or if they have decided to continue using the current system.

Ms N Ndongeni (ANC, Eastern Cape) raised a question to NSFAS. She pointed out that there were no targets on the number of complaints or queries from the NSFAS-students, asking the rationale behind this decision not to include the complaints and queries as targets for 2022/23.
How is NSFAS dealing with the debt that tertiary institutions owe? Does the entity have any mechanisms in place? She asked whether or not NSFAS has informed the Department about the institutions in debt to them and what the Department's response was on this matter.

NSFAS has indicated that they dispersed upfront payments to institutions at the beginning of the academic year to enable eligible students to register and to be able to receive allowances, as the financial year commenced in April. However, this was done without any registration data from the institutions to confirm the number of eligible students to receive financial aid. It was then possible that some institutions could have received more money than they needed. The Committee has previously raised the delays from the institutions in submitting registration data to NSFAS. She asked whether the delays in submitting registration data and transferring the money back to NSFAS were intentional and used as a strategy for institutions to generate revenue from interest while the money is in their bank accounts.

She mentioned that the students of the Ingwe Colleges protested because they did not have any funds and no funds from NSFAS. She asked the entity for an update on the matter.

The Chairperson asked what happens to the interest accrued on the money that NSFAS pays out to the universities. He said that the funds stayed in their accounts for over three months. He added that it seems as if they are doing it intentionally to accumulate more money to serve other interests where they do not have the available funds. 

Mr Andile Nongogo, Chief Executive Officer, NSFAS, stated that, just like all the other departments, NSFAS received a budget cut, which started in the previous financial year. However, since then, they have been able to deal with the budget cuts with the help of National Treasury and the Department. This has enabled them to cover all student funding for the past two years, and they are adequately covered as far as student funding goes.

The projections of the current trends determined the amount of the budget that National Treasury covered.

On the matter of the laptops and devices that have been distributed to students, he said that NSFAS appointed devices to students, and they followed two methods before the NSFAS tender process was followed. One process was where institutions within themselves were asked to appoint laptops to students, and most of the institutions did so. When the process was completed, NSFAS ordered 175 000 devices, mainly for TVET students and university students, and then distributed them to the colleges and universities. NSFAS followed the process as to how many devices were to be distributed to TVET colleges and universities. It was a once-off intervention for TVET students, responding to the lockdown in 2020 due to the COVID-19 pandemic. Of all the devices that were ordered, 165 000 of them were reserved for TVET College students. Of the 165 000 devices, NFAS has been able to distribute 155 000 of them to eligible students. For university students, they followed a different process. The students could log on onto a portal and indicate whether or not they needed a laptop. NSFAS would then place an order for a laptop, and then the laptop was distributed to the student who applied for a device. NSFAS has delivered approximately 6 000 devices through this method to university students. The portal has been opened again to allow the current cohort of students to access devices again. Therefore, NSFAS is on track with this.

On the issue of student accommodation, he said that NSFAS provided allowances for accommodation and relied on the institutions to accredit the accommodation that was conducive to study. Through engagements they had with students and visits they have had to the institutions, they have realised that they cannot just provide the necessary funds anymore, but rather that they need to be involved with the entire accommodation process. He pointed out that NSFAS had spent approximately R12 billion on student accommodation and therefore needed to be a part of the process to ensure that students have access to accommodation. NSFAS will be involved with the student accommodation processes at institutions from this point onwards. They are already creating a portal that will allow landlords who want to provide accommodation to NSFAS beneficiaries to be accredited. NSFAS will ensure that the accommodation is suitable before assigning a grading and a cost to the accommodations. NSFAS will have some degree of power over the total amount that they will be spent on student accommodation. Thereafter, they will assign students accommodation based on where they are from and where they will be studying.

He said that they would want tertiary institutions to also sign up on the portal to follow the same processes when assigning NSFAS beneficiaries to institution-owned accommodation. He said that some institutions' accommodations are not conducive to NSFAS students. In this way, issues of racism will be eliminated. In doing so, NSFAS will be able to monitor student accommodation placements, and they will be able to assess the impact of student accommodation that is not conducive to students.

On the issue of the NSFAS establishing a central system for dealing with applications, placements and disbursements, he said that NSFAS is already a centralised scheme. The issue is more about the systems that have aged. They are working on developing and updating the systems. They are improving the portal to enhance real-time funding decisions for all students. For example, when students submit their applications to NSFAS, they will be informed immediately if they are eligible for funding or not.

He added that the issue that he addressed could also be resolved when their IT systems are updated. He said that the budget requirement they have to update all their systems was estimated at approximately R322 million, including support systems and student funding systems. The Department funded NSFAS with R65 million at the beginning of this year to improve its systems; the entity has started to improve some of the systems with the money that was allocated to it. The entity is currently busy with the application portal and other systems still require funding, which is why there is a standstill. They are engaging with the public sector to acquire funds outside the state.

On why there were no targets set on complaints from students, he explained that targets are normally set at a strategic level, and it does not necessarily mean that complaints are not a part of NSFAS's operational plans. It may not have been stated as one of their APP targets, but it is part of their operational plan to improve students' call waiting time when they call the NSFAS call centre. They have recently completed a visibility study to see how they operate their call centre, and they are busy with improvements of that.

He mentioned that the main issue that will reduce complaints would be when they can deploy the systems improvements. Many of the students' queries are about being unable to see when they have been funded or when there are delays in processing the funding appeals. All these issues will be dealt with when the system improvements have been implemented.

On the issue of collecting money that institutions owe, he said that there is a project called the Close-Up Project that they have developed to deal with this matter; they have almost concluded the reconciliation. He said that it is quite a process, as there are instances where they owe institutions money and institutions owe them money. The project was created to aid in reconciling the amounts owed between the institutions, and its first phase was completed. Some information is still missing, but they hope to conclude the process in June 2022.

On the upfront payments, he mentioned that NSFAS is no longer able to provide any upfront payments to institutions as they do not have the available funds to do so. The process of using upfront payments was used in the past to manage the time difference in the registration data from institutions, for NSFAS to have a rough estimate of the number of students who required funding, and to allow the students that were in need to have their funds paid to them on time. There will be no need for upfront payments through the systems improvement project. They aim to develop a system that will allow NSFAS to determine the number of students who need funding long before the start of the academic year. They are engaging in integrated systems with other institutions and departments to avoid transferring data from one institution to the next.

The registration data delays are because there is a lack of capacity in the financial aid offices of TVET Colleges compared to the established financial aid offices of universities. NSFAS has tried to enhance the capacities of the TVET financial aid offices through various interventions to provide some forms of support. They are looking at placing interns in the TVET Colleges to help process registration data. He added that NSFAS contacts the TVET institutions through their service agents when they observe a delay in their registration data. In certain instances, NSFAS will send out teams to help TVET Colleges to submit their registration data on time. Data submitted is not always compliant, which hinders NSFAS from making any payments.

He added that there were delays at the beginning of the year. The incident at Ingwe College happened because there was a delay in paying students' allowances, and NSFAS did not have the necessary funds available at that time. However, he said that they have the money now to be able to pay student allowances, although there are still outstanding payments. The outstanding payments are only because they do not have the necessary compliant data available, but they work closely with the institutions to resolve this problem.

On the interest that is accrued through interest by universities, he said that they have no empirical data to suggest that that is the case, but they are in the process of appointing service providers who will assist them in paying out the allowances to the students directly. This process will be concluded at the end of this month, and then the pilot period will be rolled out for three months.

Ms Thembisa Futshane, Deputy Director-General: Continuing Education and Training, DHET, answered the question posed on the pilot centres' status. She said that the pilot centres have been very useful to the DHET because they have been able to drive the city colleges.

The Chairperson interjected and reminded Ms Futshane that she had limited time to answer the questions.

On the pilot centres, she said that they have 54 pilot centres, and 17 of them have been accredited to offer skills and occupational programmes. She added that they are aiming to have 35 additional centres this year. They have used the pilot centres to establish key partnerships with municipalities and other government departments. They were in contact with Microsoft to form a partnership also targeted the pilot centres. She said that she would provide the rest of the details in writing to the Committee.

Mr Sam Zungu, Deputy Director-General: TVET, DHET, commented on the questions about the work placements of TVET Colleges. They had signed a performance agreement with all the college principles and regional managers. The Department will have a TVET Summit. They will be following up with the training band capacitation of the TVET principles to ensure that they are well equipped to build and strengthen industry partnerships to place as many of their students into workplaces. He added that they would be working closely with SETAs, hoping that they would have access to other industry partners through them.

Around the issue of improving the pass rates of TVET colleges, he said that they have been working with the Department of Basic Education on the input side – entry into the system. He mentioned ongoing engagements with a specific focus on vocational and occupational programmes. The Department provides career guidance through one of its programmes, which provides career guidance to certain students.

The Chairperson interrupted Mr Zungu, saying that the time had run out and that he must answer the remaining questions in writing. He asked the Minister to deliver his closing remarks.

Minister’s Closing Remarks
Minister Nzimande made a few last comments on the issue of the students in Ukraine. He said they had had a meeting with Universities South Africa (USAF), where a programme was set up to deal with this matter. He did not have all the details with him. He confirmed that there are agreements between some South African universities and Ukrainian universities, and DHET will make use of those agreements. He said that they were trying to rescue some of the students. However, it is rather difficult in other cases, as their systems do not align with South African systems.

On the issue of the incident that occurred at Stellenbosch University, he said that they are addressing this matter; they will go through a deeper process if necessary. He said that the issue of racism remains a huge challenge in South Africa as a whole; as a government, they need to re-evaluate the issues surrounding it. Racism is not just an issue in universities but workplaces, and dealing with it requires a societal intervention.

He requested that the report of the Summit be sent to the Committee if they have not received it yet. Thereby, the Committee will receive a lot of information on what DHET did and how much progress was made. He added that they need to look at the entire education system, not just higher education.
DHET need an integrated system with NSFAS, other departments, and relevant institutions to work together to provide the necessary services.

He thanked the Committee Members for their input.

The Chairperson thanked the Department and NSFAS for their presentations and for answering all the questions that the Committee posed.

Committee Minutes

The Committee considered the adopted minutes of a previous meeting without amendments.

The meeting was adjourned.

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