ActionSA, a political party, has announced its plan to take legal action against the National Student Financial Aid Scheme (NSFAS) in order to challenge the awarding of the NSFAS Direct Payment of Allowance contract.
They argue that the contractors chosen are not qualified for the job.
ActionSA Launches Legal Action Against NSFAS Regarding the Direct Payment Allowance System
Under the new system, NSFAS implemented a direct payment system for student allowances through their bank card at TVET colleges and universities. Previously, student allowances were paid through the financial divisions of all universities.
Four allegedly inexperienced and unlicensed contractors were awarded the contract by NSFAS. In response, ActionSA will approach the high court to not only declare the decision irrational but also to ask the court to set aside the contract award.
Alistair Shaw, the legal director of ActionSA, stated that the party believes it is in the best interest of taxpayers and students to challenge the decision.
Matthew George, the Chairperson of ActionSA Western Cape Students, emphasized the party’s goal to prevent NSFAS from becoming a breeding ground for corrupt contractors.
Matthew George, ActionSA Western Cape Students Chairperson
The party has identified several key concerns that drive their challenge. These include the financial burden on students due to higher transaction fees from the new service providers compared to commercial banks, lack of thorough consultations with stakeholders, disorganised registration portals, delays in receiving allowances, and the overall impact on students’ well-being.
ActionSA is committed to addressing the root causes of problems within the higher education system and holding those responsible accountable for compromising student interests.
They express gratitude towards OUTA (Organisation Undoing Tax Abuse) for bringing attention to the questionable contract award and supporting their legal intervention.
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