The National Student Financial Aid Scheme (NSFAS) projects it will spend more than R18 billion on student accommodation by the end of 2026, according to a media statement issued by NSFAS and confirmed by SABC News reporting on Thursday, 28 August 2026. The figure emerges as the Department of Higher Education and Training publicly acknowledges a major accommodation crisis affecting university and TVET students across South Africa.
Higher Education Minister Buti Manamela, speaking at a colloquium on 28 August, defended the NSFAS accommodation cap introduced in 2023 to curb escalating costs charged by private providers. “The accommodation cap was introduced because public money could not become an open cheque and because some prices were escalating without a transparent relationship to location, quality or costs,” Manamela said, according to EWN.
NSFAS Chief Financial Officer Waseem Carrim told the same platform that the scheme would not bend on the cap. “If accommodation providers charge more than the accommodation allowance, that is of no concern to NSFAS. NSFAS will simply not pay more towards the accommodation than the accommodation allowance that it offers to its students,” he said, as reported by Mingooland.
The dispute has escalated in recent weeks. On 18 August, Parliament’s Portfolio Committee on Higher Education raised concerns about rising accommodation costs and NSFAS funding pressure, according to a Parliament media statement. Nine days later, on 27 August, UCT students marched to NSFAS offices over the cap, which they say leaves them with debt and locked out of residences that charge above the allowance.
Universities South Africa CEO Dr Phethiwe Matutu told the colloquium that a sector survey found only 9,968 institution-owned beds, with 39% of responding residences assessed as being in poor condition. “It is important that at a national level, we come to an agreement that promises cannot be carried out,” she said.
Manamela acknowledged the crisis runs deeper than the 2023 cap. “The accommodation crisis did not begin with the NSFAS cap in 2023, but it also did not begin just now in 2026. It has been built over decades,” he said, according to EWN. A claim by Manamela that TVET colleges face a shortfall of more than 76,000 bed spaces remains unverified, as no second official source has confirmed the figure.
For students on the Cape Flats and across Cape Town, the standoff has direct consequences. Many NSFAS-funded students at UCT, CPUT, and UWC rely on private accommodation in suburbs from Bellville to Wynberg, where landlords routinely charge above the cap. SRCs from four major universities called for the cap to be scrapped on 21 July, arguing that students are being forced to top up from pockets that simply do not have the money.
What remains unclear is whether NSFAS will refer the pricing practices of accommodation providers to the Competition Commission, as its own media statement has signalled. Cape Flats will check for confirmation of the TVET bed-shortfall figure and any Competition Commission filing by Friday, 5 September.