Uncategorized
Phuti Mosomane
IN the past few weeks, several allegations were levelled against Andile Nongogo, the Chief Executive Officer of the National Student Financial Aid Scheme (NSFAS), while he was the head of the Services Sector Education and Training Authority.
Nongogo has been placed on special leaving pending an investigation by NSFAS. He will be replaced by Masile Ramorwesi, who will act as Chief Executive Officer.
But damning new claims over Nongogo’s stewardship, including interference in awarding of tenders, have emerged at the weekend have emerged following a probe launched in 2022 by the civil society movement, Organisation Undoing Tax Abuse (OUTA). OUTA had investigated and found Nongogo had presided over shenanigans while he headed the Services Seta and this practices may have followed him in his role at NSFAS.
His conduct was said to be “unacceptable in awarding bids at NSFAS”.
In a statement, NSFAS said that while the Board recognises that, in the main, the allegations stem from activities in another organisation, it views them in a very serious light.
The statement added that NSFAS runs close to a R50-billion budget, which services young people from poor and working-class backgrounds. This is no small task, as it impacts skill development and, consequently, the economic development of our nation. The Board believes that public trust is paramount in executing this responsibility.
“In the interest of the image of NSFAS, the Board has resolved to investigate the allegations with a particular focus on the Direct Payment project. During the course of the investigation, the Chief Executive Officer will be on leave of absence. The Chief Financial Officer, Mr Masile Ramorwesi, will act as Chief Executive Officer until further notice.”
The Board wishes to reiterate that this investigation in no pronouncement of guilt against the CEO, but an objective effort to determine the veracity of the allegations.
Ernest Khosa, Board Chair said: “The Board commits itself to transformation and clean governance at NSFAS and will ensure that any activities that defeat the purpose of serving students from poor and working-class backgrounds are addressed decisively”.
It all began to unravel in February 2023, when OUTA reported on the findings of its investigation into NSFAS: claiming that NSFAS hired service providers without them having the required banking licences to pay out student allowances at excessive rates relative to the market.
NSFAS also hired a business which provided cloth masks to National Treasury in 2020 to work on an ICT contract and has rented an expensive head office space while slashing the subsidies for student accommodation.
In June 2023, OUTA laid a criminal complaint of corruption against Nongogo, one of his former colleagues at the Services SETA and two Services SETA service providers.
The criminal complaints relate to the over-inflation of a specific tender awarded to Five Star on 22 August 2016. It is alleged that Five Star over-inflated their bid for the branding of a tender box by a whopping 8 000%, or at least R292 000.
On 4 August 2023, OUTA reported that Nongogo had signed off on an overpriced branding campaign that cost taxpayers R37 million while he was Services SETA CEO. This included a branded T-shirt at R4 600, R44 000 for a branded umbrella, R980 for a coaster, and R668 200 to print 100 copies of the SSETA Annual Performance Plan.
On 8 August 2023, OUTA published an updated report on its NSFAS investigation. Despite NSFAS’s refusal to provide OUTA with tender information requested through PAIA during 2022, this information was gathered.
This report details the differences between the current tender that was awarded to Coinvest Africa, Tenet Technology, Ezaga Holdings and Norraco Corporation and the two tenders for a similar service (direct payment of student allowances) which was cancelled.
One of OUTAs findings is that the cancelled tenders had 20 mandatory requirements that had to be met by service providers, while the current tender has only five mandatory requirements. The requirement for a banking licence was changed to having a banking licence OR a sponsor bank OR an affiliation with a bank, opening the backdoor for bidders not registered as financial service providers (FSPs) to submit bids. As such, the appointed service providers were awarded a tender without being FSPs.
INSIDE EDUCATION