SIU advances legal action to nullify controversial R2.5 million NSFAS office lease

The Special Investigating Unit (SIU) is pushing ahead with the court application to set aside the R2.5 million a month agreement for the lease of rental offices by the National Student Financial Aid Scheme (NSFAS) in Cape Town.

This takes place as labour unions are taking NSFAS to the Commission for Conciliation, Mediation and Arbitration (CCMA) over its plan to move employees from the headquarters to set up regional offices in the provinces.

This was revealed by Higher Education Deputy Minister Buti Manamela during the question and answer session in the National Assembly on Thursday.

DA MP Desiree van der Walt enquired about the timeframes to end the NSFAS rental lease agreement and the exit negotiations with the landlord.

Late last year, Higher Education Minister Nobuhle Nkabane told the portfolio committee that the lease agreement would be cancelled after lawyers advised on finalisation of their legal opinion in the review of the lease.

Manamela said the lease agreement has been under review and the department has been working to ensure that any financial decisions were aligned with accountability and responsibility.

“NSFAS cannot unilaterally terminate the lease as it has opted to follow the legal process to have the contract set aside,” he said.

Manamela also said that the NSFAS has also formally joined in the application by the SIU to challenge the lease agreement.

“The application will be heard in the Special Tribunal on 18 March,” he said.

The SIU previously announced that subsequent to receipt of the investigation report that pointed to some irregularities, it has prepared and obtained the requisite approvals to bring an urgent application.

It wants to interdict the enforceability of the lease agreement and set aside the decision to award the tender.

This was, however, pending confirmation from NSFAS in terms of finding an alternative accommodation.

Manamela said the discussions regarding NSFAS exiting from the lease have been placed on hold pending the outcome of the legal process.

“As the matter is currently sub judice, the department is limited in what can be disclosed publicly, and any premature engagement could jeopardise the case led by the SIU.”

He also said the review of the lease formed part of initiatives to address financial and governance concerns at NSFAS.

“The department remains committed to ensuring full transparency and accountability while allowing the legal process to take its course.

“Once the tribunal has ruled on the matter, the department and NSFAS will take necessary steps to implement the ruling in ensuring NSFAS‘ resources are directed at student funding rather than excessive administrative costs.”

Van der Walt wanted to know the persons that had given the go-ahead to sign “the scandalous and unacceptable lease” at such an excessive rate of R2.5m a month and 140 parking spaces paid to the tune of R27 650.

“We would really like to know what is happening. Why don’t you bring those accountable to the committee where the minister and the deputy come and explain what is wrong? There is something drastically wrong. If you wait for the SIU, it will take forever,” she said.

But, Manamela said the matter was sub judice.

“We can’t disclose any details relating to the case because it will jeopardise the investigation taking place.”

He confirmed that it was unjustifiable for NSFAS to remain at the premises, but there was a plan to decentralise offices.

“We should allow the SIU to complete its investigations. We have joined in the (court case) as an interest party to deal with some of the issues the member is saying,” Manamela added.

The deputy minister said the decentralisation process has started in earnest.

“The CCMA has instructed the team dealing with decentralization to speak with unions that are resisting to be moved elsewhere throughout the country and want to be placed here (Cape Town).

“There are those negotiations taking place,” he said.

Manamela said that as much as everybody wanted NSFAS to vacate the offices, they have to accept that the previous administration or management of NSFAS entered into the lease agreement.

“NSFAS can’t just walk away and that is where this process is. We have said to NSFAS and the department ‘look at various scenarios in case we lose this case’ to ensure we save costs.”

He stated that there were discussions with universities and TVET colleges to house NSFAS offices at the institutions in order to service the students.

“All are dependent on the case before the CCMA,” Manamela said.

“We have to get out of this lease first. The unions have to agree that their members can be moved from Cape Town to different areas. That is part of the negotiations that are happening,” he added.

mayibongwe.maqhina@inl.co.za