South African student bodies are demanding the removal of the National Student Financial Aid Scheme (NSFAS) accommodation funding cap to prevent student homelessness.
The dispute centers on a growing gap between government funding and the actual cost of living. If the cap remains, students from low-income backgrounds may be unable to secure safe housing, potentially forcing them to drop out of tertiary education due to financial instability.
Ten student representative councils, including the University of Cape Town (UCT) Student Representative Council, have called for the cap to be scrapped [2]. The UCT SRC said that rental costs in Cape Town have outpaced the funding provided by NSFAS, which leaves many students accumulating debt just to maintain a roof over their heads [1].
The Private Student Accommodation Association joined the call for reform, saying that the current funding levels put students at a high risk of homelessness [0]. The association said that the cap does not reflect the market reality of urban rental prices.
However, Parliament has defended the NSFAS accommodation cap. Members of Parliament said the cap is a reasonable measure and shifted the blame for the housing crisis onto the universities [2]. This contradiction highlights a divide between the government's budgetary constraints and the lived experience of students in major cities.
The conflict has reached a critical point as the academic year progresses. Higher education officials now face a deadline of mid-August 2026 to table solutions to the accommodation funding challenge [0].
Student leaders continue to push for a funding model that adjusts for regional cost-of-living differences. They said that a flat cap across all provinces fails to account for the extreme price hikes seen in metropolitan hubs like Cape Town.
“Ten student representative councils demanded the NSFAS accommodation cap be scrapped.”
This standoff reflects a systemic failure to align social grant funding with inflation and urban real estate trends. By blaming universities for the crisis, the government is attempting to maintain fiscal discipline, but the pressure from student bodies and private providers suggests that the current funding model is no longer viable for the poorest students.
