Tinubu’s student loans law: An ill-conceived, half-baked policy

Bola Tinubu, Nigeria’s new president, was determined to hit the ground running from his first day in office. He was haunted by the ghost of his somnolent predecessor, Muhammadu Buhari, who sat desultorily on his hands, doing nothing for the first six months of his administration in 2015. Unlike Buhari, who was called, and relished being called, “Baba Go Slow”, Tinubu has been called, and enjoys being called, “Baba Go Fast”!

But, in governance, while inertia is deadly, going fast can be as bad as, even worse than, going slow. This is because good government depends on good policy making, and good policy making requires thoughtfulness and a comprehensive analysis of the problem.

However, Tinubu has shown a penchant for populist and half-baked policies. Populist, because they’re eye-catching and intended to show he cares about ordinary people; half-baked, because they’re poorly thought through, and defy basic rules of good policymaking: problem definition and options analysis; stakeholder consultation; evidence-based policy design; and dispassionate consideration of the risks and impacts of the proposed policy.

Tinubu, who has long been part of Nigeria’s problem, and whose party has misruled Nigeria since 2015, is now insulting Nigerians with deceptive invocations of populism

Recently I criticised the withdrawal of the fuel subsidy, well, not the policy itself, but the arbitrary way it was unveiled without proper planning, consultation and consideration and remediation of adverse impacts. As we have seen, the subsidy removal has not only affected the so-called “rich”, but, more so, the poor, who bear the brunt of the pass-through costs through sky-rocketing inflation that will further immiserate them. But what did Tinubu do? He announced a N500billion “palliative” measure to give N8,000 to 12million households monthly for six months.

First, how did Tinubu arrive at the 12 million figure when nearly 140 million Nigerians are multidimensionally poor? Second, what would N8,000 per month do for a poor household, with an ever-rising cost of living? And third, why six months? The fuel subsidy removal would save the government $10bn, over N8trillion, per year. But Tinubu wants to give 12million families a measly N8,000 per month for six months!

Now, faced with a backlash, he has ordered a review of the palliative measure. The National Economic Council has also rejected the Buhari government’s Social National Register on which the 12 million households were based, questioning the credibility and integrity of the register. But the muddled policy would have been avoided if the Tinubu government had done its homework before making rash announcements.

Which brings us to the student loans policy. Tinubu signed the Student Loans (Access to Higher Education) Bill into law on June 12, purportedly to support “indigent” students. In a four-part article entitled “Education loan for students by President Tinubu”, the legal icon and renowned educationist Chief Afe Babalola, SAN, founder of Afe Babalola University, extensively examined the new law and gave it the thumbs down! Chief Babalola’s analysis and verdict are unassailable.

For me, the act confirms a pattern of deceptive populism and half-baked policy making. Populists always claim that they are against the elite and care for ordinary people. Thus, Tinubu, who has long been part of Nigeria’s problem, and whose party has misruled Nigeria since 2015, is now insulting Nigerians with deceptive invocations of populism. Recently, he said he would “recover Nigeria from vested interests”, citing the student loans act as evidence of how he’s fighting for the poor!

But if the student loans law is, indeed, intended to support indigent students, then it is, at best, a badly-drafted law and, at worst, an ill-conceived, harebrained policy. Yet, Dele Alake, Tinubu’s special adviser on “special duty, media, communication and strategy”, said: “This is how it is done in other developed climes.” Really? How many student loans laws in other countries did the Tinubu administration study before introducing its own flawed legislation?

First, there’s no evidence of a comprehensive analysis and understanding of the problem. Giving loans to poor students in a tertiary education system that lacks the resources and capacity to produce employable graduates is misguided. With graduate unemployment ranging between 40 and 60 per cent, depending on whether the qualification is a degree or an HND, poor students would be saddled with huge debts with little prospects of getting a proper job after graduation to pay them back.

In the UK, the introduction of the student loans scheme was linked to raising the tuition fee from £3,000 to £9,250 per year, so as to allow universities to generate more income. And as they generated more income, they spent it on enhancing teaching, research and the student experience, all of which resulted in better qualified and employable graduates. There’s evidence that university education in the UK generally leads to well-paid employment.

Sadly, not so in Nigeria, due to the poor quality of graduates being churned out by Nigeria’s public universities. Therefore, giving loans to poor students without significantly resourcing, improving and raising the standards of Nigeria’s tertiary institutions would simply increase student population and graduate unemployment. Furthermore, a student loan that covers only tuition, as the act says, and not maintenance, as in the UK, doesn’t really help indigent students.

Then, there’s the utter deception about the objectives of the loan system. The act says its aim is to “provide easy access to higher education for indigent students”. Yet, it puts major obstacles in their way. First, an applicant’s family annual income must be less than N500,000. One key characteristic of a good policy is that it must be inclusive, that is, excluding no sections of society from its benefit. But Tinubu’s student loans law excludes several millions of poor families: apparently, according to the act, a family is considered rich in Nigeria if its annual income is N500,000 ($650)!

Ridiculously, every applicant must also produce two guarantors. Tell me, in a country where getting anything virtually depends on connections or palm-greasing, why should an indigent parent or student be burdened with looking for a senior civil servant, a senior lawyer, a judicial officer or a justice of peace to act as guarantors? Think about the potential humiliation, and even exploitation and extortion!

What’s more, if an applicant has a parent who has defaulted in respect of a student loan or any other loan, he or she would be disqualified. Thus, Tinubu visits the sins of parents on their children. Furthermore, an applicant would be disqualified if he or she has been convicted of drug offences. That’s utterly ironic, given that Tinubu himself forfeited $650,000 to the US government on a drug-trafficking offence!

Read also:University of Lagos increases obligatory fees for undergraduate students

Here’s the point. The eligibility and disqualification conditions set out in the student loans act negate the so-called aim “to provide easy access to higher education for indigent Nigerians.” So, too, is the exclusion of students in private tertiary institutions from benefitting from the loan. In the UK, tuition fee loans are for students of all tertiary institutions and backgrounds, while maintenance loans and grants are means tested. If the Tinubu government cannot afford a universal student loans system, it shouldn’t create such a discriminatory scheme that excludes large sections of society. That’s bad policy and may even be unconstitutional, as some senior lawyers argue!

Outrageously, the act provides that a student-loan defaulter “shall be liable to imprisonment for two years or a fine of N500,000 or both.” How many of the politically-connected farmers who defaulted in their Anchor Borrowers’ Programme loans are in jail? None! So, why should student-loan defaulters? No civilised society treats student-loan default as a jailable offence. Besides, student loans are not conventional loans, hence many governments make provisions for debt cancellation.

The student loans act is perverse. Yet, Tinubu trumpets it as an achievement. It betrays his deceptive populism and penchant for ill-judged policymaking. Call it bad governance!