Students and parents are worried over the recent hikes in tuition by some higher institutions amid the delay in the implementation of a loan scheme expected to start this month.
The student loan scheme was initiated by President Tinubu’s administration to provide interest-free education loans for Nigerians willing to acquire tertiary education.
BusinessDay gathered that most of the processes required for implementation as stipulated by the law are not yet in place.
With its enactment earlier in June, the Access to Higher Education Act, 2023, otherwise known as students loan Act, established an Education Loan Fund to help Nigerians fund their higher education, while they pay in installments two years after completing their participation in the National Youth Service Corps (NYSC) programme.
But BusinessDay findings show the implementing ministries and agencies are yet to put together modalities to ensure the smooth take-off of the scheme as set by the law.
Ben Bem Goong, director of press at the federal ministry of education, said the ministry, which is the lead implementing institution, had yet to receive the revised and gazetted copy of the Act to determine the process of implementation.
“There are still some areas the government wants to finetune in the law. I think when school resumes, the picture will become clearer,” Goong told BusinessDay.
Goong did not also give any assurance that students will begin to benefit from the loan scheme soonest, but assured that the ministry will take the needed action when it receives the law establishing the students loan.
BusinessDay also gathered that issues of funding, modalities and guidelines for disbursement of the loan to students were yet to be set and defined by the government. The proposed education bank that will facilitate disbursement as contained in the Act has not been established.
After signing the bill into law, President Tinubu in June approved the constitution of a committee to finetune processes to ensure successful implementation within six weeks ahead of the proposed September take-off. But, the deadline given to the committee has elapsed but no modalities have been set.
As stipulated by the Act, the committee would decide the broad modalities including the process of application for the loan, who is qualified to get the loan and when they should pay back, among other details. The committee is expected to establish regulations and guidelines for the management, administration, disbursement and recoupment of students’ loans which all stakeholders including parents, student applicants, beneficiaries of the students’ loans and deposit banks are mandated to comply with.
The committee would be chaired by the CBN governor with members as the ministers of education and finance, or representatives; the Auditor-General of the Federation; chairman, National Universities Commission; a representative of the forum of university vice-chancellors; a representative of the forum of polytechnic rectors and forum of provosts of all colleges of education in the country.
When summoned by the National Assembly earlier in August, the federal ministry of education could not provide any update on the implementation of the law.
Enonebi Azorbo, director of legal services, ministry of education, told the House Committee on Student Loans and Higher Education that other than the committee being set up, there was no other information on the timeframe, modalities or ideas for amendments to the Act.
The lawmakers were concerned that the proposed funding for the scheme sources were inadequate and had hinted at plans to amend the law to raise funding federal government revenue coffers from one percent to 3 percent.
The Act establishes the Nigerian Education Loan Fund, and sources of the Fund to be domiciled in the CBN and managed the committee shall consist of education bonds; education endowment fund schemes; one percent of all taxes, levels and duties accruing to the Government of the Federation from the Federal Inland Revenue Service, Nigerian Immigration Service and Nigerian Customs Service; one percent of all profits accruing to the Government of the Federation arising from oil and other minerals; all sums accruing to the Fund by way of donations, gifts, grant, endowment or otherwise; and other revenue accruing to the Fund from any other source.
Another concern is that some states and local governments may not permit the deduction, and may require constitutional amendment before that one percent may be drawn.
The implication of this, according to Terseer Ugbor, chairman of the House Committee on Student Loans and Higher Education, is that state universities may be excluded if the state governments fail to participate in funding the loan from their allocation from the Federal Government.
Andrew Adejo, permanent secretary at the ministry of education, had in June informed that the government will establish a new bank which will avoid the pitfalls of the past, including low recovery rates, and perform other operations beyond just the loans.
BusinessDay gathered that nearly all tertiary institutions in the country have announced a hike in school fees due to high operating costs.
“I can’t wait for the loan scheme to start because school fees have increased, so it is not really easy for my parents now,” Ruth Emenike, student of English Education, University of Abuja, said.
Christian Chikeziri, a 200 level student of Michael Okpara University of Agriculture, said tuition has been raised from N56,000 to N90,000 for his course. “The situation has posed a lot of difficulties for students and some are even dropping out, because they can’t cope.”
Education experts say there are still lingering concerns that could affect the effective implementation of the scheme.
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Princewill Anyalaewchi, a retired deputy director, education at the federal ministry of education, expressed concern over the selection process.
He said the government must first ensure that there is no segregation, the process is not politicised, and modalities must be put in place such that only true beneficiaries can access this loan, and not those whose parents are rich.
He added that the Act does not give much clarity on how the government would identify the indigent students.
“Also the criteria should not be too rigorous; it should not operate like the Federal Scholarship Board. The standard was too high,” he said.
He also recommended that the proposed 10 percent repayment can be reduced to a single digit, say 5 percent, to make things easier.