The National Student Financial Aid Scheme (NSFAS) Board has fired its embattled CEO, Andile Nongogo following a damning investigation conducted by Werksmans Attorneys and advocate Tembeka Ngcukaitobi.
The decision to axe Nongogo was confirmed by officials of NSFAS who went before the Standing Committee on Public Accounts (Scopa) in Parliament on Tuesday.
NSFAS board chairperson Ernest Khoza told Scopa that the decision was taken late on Monday night.
This decision has been hailed by the Organisation Undoing Tax Abuse (Outa), a prominent civil society watchdog in South Africa.
Rudie Heyneke, Outa's Investigations Manager said it was delighted with the NSFAS board’s decision to terminate the employment of Nongogo as CEO.
The report by Werkmans Attorneys confirmed Nongogo had a relationship with one of the companies that had been appointed for the new NSFAS direct payment system.
Nongogo was placed on special leave after students from various universities protested against the new direct banking system outside the Department of Higher Education offices and Parliament.
The special leave was also to allow investigations against him to be carried out without interference.
Outa's concerns about Nongogo's management came to light earlier this year when they warned against his involvement with public finances, based on their investigation into his tenure as CEO at the Services SETA (SSETA).
The investigation revealed that Nongogo approved payments totalling R37 million for an overpriced rebranding campaign.
Outa also reported Nongogo's conduct to the South African Institute of Chartered Accountants (SAICA) and lodged a criminal complaint with the South African Police Service (SAPS) related to a tender at SSETA.
Werksmans' investigation followed Outa's initial findings and focused on irregularities in the NSFAS direct payment scheme implemented under Nongogo's leadership.
According to Outa, these irregularities which first emerged in September 2022, was a warning that the scheme was destined to fail and would cost taxpayers millions, while negatively affecting underprivileged students.
Initially, Outa's warnings were disregarded by NSFAS and the Minister of Higher Education, Blade Nzimande, who even threatened legal action against Outa and denied them access to relevant documentation regarding the tender process.
The direct payment scheme's implementation in June 2023 resulted in thousands of students not receiving their allowances.
According to Outa, the Werksmans report vindicates them.
The report recommended Nongogo's dismissal, immediate termination of contracts with four fintech companies, and the initiation of disciplinary actions against all involved in pushing through the direct payment system.
Nongogo's actions extended beyond the direct payment system, including the appointment of Futgenx Technologies as an ICT specialist for NSFAS, Outa said.
Despite failing to deliver the required services, Futgenx was paid over R3 million.
Additionally, Nongogo signed a five-year lease for NSFAS's head office, instead of the initially agreed-upon two years, costing R166.906 million over the rental period.
Outa said it was worth noting that NSFAS reduced its subsidies for student accommodation to R45,000 per student per year “while operating in lavish surroundings”.
Nongogo's tenure also oversaw a new accommodation accreditation tender, with 39 companies appointed to inspect student accommodation.
However, only approximately 25,000 units have been accredited, with a need for over 400,000 units in 2024.
Some appointed service providers had close ties to Nongogo's previous role at SSETA, raising concerns of a conflict of interest.
Rudie Heyneke, Outa's head of investigations said: "The SIU findings presented to Scopa earlier today also confirmed the failures of NSFAS since 2017. Nongogo was appointed in December 2020 and did nothing to turn the situation around. As a matter of fact, NSFAS now finds itself in a worse position than before. He is a seasoned public official who should have protected the assets of the State, but he chose to do otherwise."
Outa said that Nongogo's actions and irregular decisions caused significant damage to NSFAS and a major upheaval for thousands of students.
"The damage cannot be measured in rands and cents when it comes to students who went without allowances for weeks, were kicked out of their accommodation, went hungry, and could not complete their studies," Heyneke said.
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