More than R8.3 million in irregular expenditure linked to the Free State Government’s bursary program is being pursued for recovery after the Special Investigations Unit (SIU) uncovered funding awarded to family members, foreign nationals, ineligible civil servants and even a deceased student.
The investigation into the Prime Minister’s bursary program in the Free State revealed widespread mismanagement in a program designed to give needy students access to higher education and address the province’s scarce skills shortages.
The investigation was approved by President Cyril Ramaphosa under Proclamation 123 of 2023 following referrals from the Auditor General (AGSA), whose 2019 and 2020 reports revealed serious irregularities in the handling of stock exchange funds.
Presenting the findings, acting SIU head Leonard Lekgetho said officials negligently approved grants, ignored eligibility criteria and irregularly extended funding agreements.
Among the findings was an official who allegedly awarded grants to family members without following due process.
The SIU also found that an official received a grant for studies beginning in 2017 despite not submitting a qualifying application. In another case, students who failed modules continued to receive financial support, with some scholarship contracts unlawfully extended from three to seven years.
Some recipients were funded for qualifications not included in the province’s 2018/2019 Workplace Skills Plan, while mandatory approval processes were bypassed before grants were awarded.
An official who benefited from an international government-funded grant would continue to receive payments after his term in office.
Investigators have also identified discrepancies in an agreement between the prime minister’s office and an international tertiary institution. Although documents showed that the institution was expected to fund 65% of a scholarship and the province 35%, the SIU found that the Prime Minister’s Office ultimately contributed 65%.
The irregularities contributed to more than R8.3 million in expenditure that must now be recovered by the SIU.
The investigation further revealed funding paid on behalf of a deceased student.
According to the SIU, the student received bursary funding from the Prime Minister’s Office and the National Student Financial Aid Scheme (NSFAS). The provincial office paid R34,891.60 to the University of the Free State, which transferred the money to a suspense account after the student’s death. NSFAS also deposited R13,000 into the student’s bank account, which was used by the student’s parents.
The SIU said recovery was not possible because the student died before completing his studies, the proclamation did not cover NSFAS cases and the parents did not have the means to repay the money.
Seven foreigners were also identified as scholarship beneficiaries, six of whom reportedly received funding as top performers.
However, researchers found no approved deviation from the grant policy, which limits funding to South African citizens living in the Free State. The expenditure related to the foreigners amounted to R576,734.48.
The SIU also found that government officials received full-time grants during the 2019/2020 financial year, despite policies that allowed employees to only apply for part-time grants.
In addition, some grant recipients received excessive stipend payments totaling R1.8 million. The Prime Minister’s Office has started recovering funds from students who studied abroad but failed to meet their scholarship obligations.
The poor financial supervision of universities also came under scrutiny. The SIU found that officials failed to monitor excess scholarship funds held in university suspense accounts, leaving millions of rand unused.
Investigators have traced and recovered R6.3 million from seven universities.
The SIU has also secured 18 guilty pleas totaling R1.9 million from individuals who wrongly benefited from the grant scheme. To date, R283,571 has been repaid in installments.
The fallout has led to 38 disciplinary referrals against affected officials, including human resources officers, administrative clerks, deputy directors, deputy directors and directors for alleged violations of the Public Finance Management Act and the provincial grants policy.
Evidence against seven individuals has also been referred to the National Prosecuting Authority for possible prosecution on charges including fraud, theft and money laundering.
“These references are not symbolic. They represent the SIU’s unwavering commitment to accountability,” Lekgetho said.
He described the findings not only as an administrative failure, but also as “a moral failure, a breakdown of civic duty and ethical leadership.”
“Officials have turned opportunity into exploitation and self-interested service delivery. They have betrayed the people’s trust and the vision of our democracy.”
The SIU’s final report is expected to be submitted to the president in September.
TimesLIVE
Mmatumelo Lebjane
www.timeslive.co.za