NSFAS ANNUAL REPORT 2013
PRESENTATION TO PORTFOLIO COMMITTEE
ON HIGHER EDUCATION & TRAINING
08 OCTOBER 2013
Agenda
 NSFAS Annual Report 2013
•
Board Chairperson’s Report
•
Executive Officer’s Report
•
Annual Financial Statements
•
Annual Performance Report
 Progress in 2013
 Plans for 2014
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Board Chairperson’s Report
In terms of the NSFAS Act (56 of 1999), NSFAS is a
public entity which has 7 functions:
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To develop criteria and conditions for the granting of loans and
bursaries to eligible students in consultation with the Minister
To raise funds
To allocate funds for loans and bursaries to eligible students
To recover loans
To maintain and analyse a database and undertake research for the
better utilisation of financial resources
To advise the Minister on matters relating to student financial aid
To perform other functions assigned to it by the NSFAS Act or by the
Minister
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Board Chairperson’s Report
NSFAS has made significant progress in the year under review
to carry out this mandate
• All board positions filled and committees fully functional
• Initiated Transformation Programme for new student-centred
model
• Developed comprehensive policies for IT governance, systems
and operations, financial and human resources management
− Prioritised compliance with legislation and regulation,
including the NSFAS Act, Public Finance Management Act
(PFMA)(1 of 1999) and National Credit Act (34 of 2005)
• Appointed executive managers
• Achieved an unqualified audit for third year in succession since
embarking on turnaround
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Board – composition & committees
Board – 18 appointed and co-opted members
5 Board committees were fully functional during 2012
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Executive Committee - 11 meetings
- chairperson Mr Zamayedwa Sogayise
Finance Committee - 6 meetings
- Ms Kirti Menon
Audit and Risk Committee - 6 meetings
- chairperson Mr Stephen Smith
Information and Communications Technology Committee – 2 meetings
- chairperson Dr Tim Brown
Human Resource and Remuneration Committee – 4 meetings
- chairperson Ms Sibongile Masinga
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Executive Officer’s Report
The core business of NSFAS is to allocate funds for
loans and bursaries to eligible students
• In 2012, disbursements increased from R5,9 to R7,7
billion, an increase of R1,8 billion over 2011
• The number of students assisted increased to 382 943, in
line with the funding increase from DHET and other
departments
− This is an increase of 93 771 students over the total
of 289 172 supported in 2011
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Executive Officer’s Report
 The NSFAS Act requires the entity to:
“Develop criteria and conditions for the granting of loans
and bursaries to eligible students in consultation with the
Minister…..”
 This mandate was achieved in 2012 by:
• Laying the foundation for the Transformation Programme
• Procuring a new loans and bursaries management system
to replace the old TEFSA system used since 1991
• Appointing senior managers
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Annual Financial Statements
The Annual Financial Statements (p63) show in detail what
NSFAS does and how it fulfils its mandate. The following are
some highlights from the year under review:
• In 2012, NSFAS distributed financial aid of R7,7 billion to
382 943 students
– an increase of 15% from 2011
• NSFAS provided funding to students at the 23 public
universities and 50 public Further Education and Training
(FET) colleges
– University students 194 504
– FET college students 188 182
– Students at agricultural colleges and the two National
Institutes of Higher Education also received funding
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Annual Financial Statements
Since inception in 1991, NSFAS has provided R32,8 billion in
student financial aid to more than 1 million students.
NSFAS contributes to free education for students from poor and
working class families by providing full bursaries and converting
loans to bursaries to incentivise good academic performance.
Amount provided
Final Year programme
R1 billion
FET College bursaries
R1,8 billion
60/40 Convertible loans
R1 billion
Other bursaries
R2,4 billion
Total
R6,2 Billion
• N
Loan amount
R1,5 billion
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Annual Financial Statements
• The Annual Financial Statements were approved by the
NSFAS Board on 15 August 2013.
• The delay was due to a decision taken by the Auditor-General
on 30 July 2013 to conduct an actuarial review of the loan
book value (Auditor-General’s Report, p66)
– Restatement of corresponding figures
• Note 2 (p92) Prior Period Error
– the loan book value was calculated incorrectly prior to
2012
– the error was corrected after an actuarial review during
the 2013 audit to the satisfaction of the Auditor-General
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AFS- Balance Sheet (p77)
Investments and bank
• Investments
• Cash
Prepayments
Student loans
• Current
• Non current
• Loans
Fixed assets
• PPE
• Intangibles
R620 million
R 186,4 million
R 433,6 million
R 797,3 million
R 7,6 billion
R619,7 million
R 7,0 billion
R 15,8 billion
R23,6 million
R 8,1 million
R 15,5 million
Payables
R 28,4 million
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Expenditure
Operational expenses
R58,4 million
Salaries
R38,9 million
Transformation project
R17,4 million
Audit fees
R 8,9 million
Audit fees
R 8,9 million
Computers
R 2,8 million
Consulting fees
R 4,2 million
Travel and subsistence
R 2,4 million
Printing
R 1,1 million
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Irregular expenditure
Expenditure
R28,1m
R25,6m
*R7,9m
2010
2011
2012
*R4,8m from previous year irregular expenditure
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Irregular expenditure remediation
Remedial steps
• As part of our audit improvement plan, NSFAS put in place the
following measures to enable management to adequately
monitor compliance with laws and regulations relating to supply
chain management.
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Established a Supply Chain Management office
Appointed a Senior Manager: Supply Chain Management
Appointed SCM staff
Trained all staff on SCM compliance
Introduced an automated procurement system
Implemented a supplier rotation system
Conducted quarterly Internal Audit reviews
• The full benefit of these audit improvement measures will be
visible in the next audit period.
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Annual Performance Report (p20)
Strategic Goal 1 - achieved
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Strategic Goal 2 - achieved
2012 - Students assisted increased to 382 943
- Increase of 93 771 over 289 172 students
assisted in 2011
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Strategic Goal 3 - achieved
In 2012, disbursements increased from R5,9 to R7,7
billion, an increase of R1,8 billion over 2011
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Progress in 2013
• Transformation project is nearing completion as promised
• New loan management system developed and in the process
of being implemented in October 2013
• MoUs signed with government departments to share
information to ensure funding reaches intended beneficiaries
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DBE - to identify eligible learners from rural, Q1-3 schools;
Umalusi to obtain school results
DoHA - student and family ID validation
DSD - Access to SASSA database to confirm social grant
recipients
• New organisational structure approved by the Board
– staff to increase from 166 to 299 incrementally as new model
implemented nationally over three years
– Additional operational budget required to effectively administer
and account for public funds of R8,5 billion
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Implementation Plan 2014 -16
• New student-centred model fully implemented
• New core loans and bursaries management system operational
• Pilot Phase in 2014 at 7 universities and 5 FET colleges
Pilot Phase
2014
Phase 2
2015
Phase 3
2016
% University students
30
60
100
% FET college students
10
60
100
Aligned with
introduction of
Central Application
Service (CAS)
The doors of learning and culture shall be opened!
Freedom Charter, 1955
Green Paper for Post School Education and Training, 2012
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