Category: Campus Life

The Nigerian Education Loan Fund (NELFUND) has announced plans to kick-start the Student Loan Scheme. As part of efforts to ensure the workability of the Act governing the scheme, three months after the submission of the report on its amendments, the House is yet to consider and adopt it for implementation by the Executive. The only private member bill on the floor of the House tailored towards the amendment of the law is still at its first reading stage. This has raised concern, TONY AKOWE reports.

The Student Loan Scheme is set to take off with the appropriation of about N100 billion in the 2024 budget by the Federal Government.

  Sponsored by the former Speaker of the House of Representatives and now Chief of Staff to the President, Femi Gbajabiamila, the Student Loan Act was signed into law by President Bola  Tinubu, who promised that the law would be reviewed to give it a more friendly approach.

The review was to address areas of concern raised by Nigerians in other to make the loan accessible to a large population of Nigerians. When the issue of the students’ loan first broke following the enabling law by the President, Nigerians quickly went to town to point out the loopholes in the law that needed to be corrected immediately.

Amendment yet to be effected

In view of the opinions expressed by Nigerians, the President put in place a high-powered committee headed by his Chief of Staff to look into the law as well as planned operation of the scheme and make adequate recommendations for the implementation.

The committee went to work and drew up a work plan. The Nation learnt that the legal team of the committee set up by the President drew up a draft amendment to the law. But that draft amendment, which should come to the National Assembly as an Executive Bill, is yet to be presented to the lawmakers.

To ensure the workability of the scheme, the House of Representatives set up an ad hoc committee to interact with stakeholders in the education sector, including the technical committee set up by the President and organise an education summit on the way forward. The committee headed by Terseer Ughor, representing Kwande/Ushungo Federal Constituency of Benue State, submitted a comprehensive report to the House on  October 10, 2023.

But three months after the submission of the report, the House is yet to consider and adopt it for implementation by the Executive. However, The Nation learnt that even though the law requires comprehensive amendment, there is only one private member bill on the floor of the House tailored toward the amendment of the law. It could not be ascertained the content of the bill, which is still at its first reading stage.

NELFUND is born

The government has, however, put in place an agency known as the Nigerian Education Loan Fund (NELFUND) to manage the scheme. The agency is expected to handle all loan requests, grants, disbursement and recovery of the loans provided. Source of funding for the scheme include: one per cent of all profits accruing to the Federal Government from oil and other minerals; one per cent of taxes, levies and duties accruing to the Federal Government from the Federal Inland Revenue Service, Nigeria Immigration Service (NIS) and Nigerian Customs Service (NCS); education bonds and education endowment fund schemes. It will draw funds from donations, gifts, grants, endowment and revenue accruing to the fund from any other source, according to the Act.

ASUU’s opposition

But, the Academic Staff Union of Universities (ASUU) is opposed to the loan scheme, saying poor and indigent students will not benefit from the scheme.The union believes that the conditions attached to the loan were not for the children of the poor, who were supposed to be the target beneficiaries. The union is also concerned about accessibility of the loan. While the government appears to have addressed the issue of accessibility, creating a loan app through which students can  have access, it is  yet to address other concerns such as the issue of guarantor and the qualification for students to apply for the loan as contained in the Act setting up the scheme.

Ugbor told an online newspaper dedicated to legislative reporting that he expects ASUU to be a partner in progress in the implementation of the scheme, but regretted that the union is rather opposed to it. He said: “Change is constant and I think ASUU is used to doing things the same way and they are averse to change because they think that change will not be in their interest as members of ASUU. At the legislative summit we held, ASUU was the only organisation and the only stakeholder that came to that event and proposed that the government should not implement the students loan scheme in the country. ASUU recommended at the summit that the whole idea of students loan should be completely shelved and government should go back to the grants and scholarship system that has not worked over the years. ASUU should be coming up with recommendations and more intelligent strategies for developing the education sector, not taking us back to the years when they, as lecturers, have contributed grossly and greatly to causing the deterioration of the education sector.”

Number of students expected to participate

On the number of students expected to participate in the exercise and the amount for each student, he said: “From our last figures, we have at least 10 million students across tertiary institutions in the country. The National Open University of Nigeria (NOUN) is the biggest tertiary institution in the country. I hear that they have over 500,000 students and then all the private universities and public universities combined also have a few millions. Polytechnics, colleges of education, and other institutions of higher learning are also there. By the time we put all those figures together, I am sure we will be getting a number that will rise above 10 million students in the country. So, if we are talking about an average of N1 million per student for a four-year study and you are talking about 10 million students that is about N1 trillion.  So, if we assume that 50 per cent of students may need student loans, based on the level of our development and poverty in the country, then we are looking at five million students requiring students loan.

Read Also: Tinubu directs expansion of student loans programme

Concern over source of funding

One concern that was also raised was the source of funding for the scheme. However, the Federal Government said that part of the funds will come from proceeds from the Education Tax being managed by the Federal Inland Revenue Service.

Chairman of FIRS Zacch Adedeji, who disclosed this, said: “The education tax fund is one of the sources of funding that we will use to execute this programme.” He believed that channeling the education tax into the scheme was the administration’s way of being accountable to Nigerian taxpayers.

Currently, funds from the education tax are used by Tertiary Education Fund for the development of infrastructure in public tertiary institutions across the country. Adedeji said: “This is in fulfillment of Mr. President’s promise that we will make education accessible to all. This is one of the schemes where we will be applying the education tax that we collect. It is a way of being accountable to the taxpayers because the essence of education tax is to consolidate and restore education integrity and quality. In fulfilling that part of the Act, education tax fund is one of the sources of funding that we will use to execute this programme.”

Modalities for accessing the loan

Executive Secretary of NELFUND Akintunde Sawyerr outlined the modalities for accessing the loan. According to him, students wishing to obtain the loan will be expected to route their requests through the loan app or website. He said the app was designed to minimise human involvement in the process. Such students will be required to provide their JAMB registration number, date of birth, National Identification Number and Biometric Verification Number, among others.

He said: “The applicant will go on to a portal, or they will engage with the app. They will have to put in certain pieces of information that make them eligible, such as their JAMB number and, of course, the tie-in to their date of birth. Further pieces of information include their NIN, which confirms that they are Nigerians. This loan scheme is being paid for by Nigerian taxpayers. So, it’s for Nigerians and the NIN to help verify and qualify them as such. Their BVNs is for financial inclusion because this scheme in itself will, at some point, be able to empower students. So, we need to know they have bank accounts. We need to know where their accounts are to be able to access those accounts. It will also have their matric number and admission number so that we can firmly establish which institution they are going to because one of the key elements of this is that once we have received applications and those applications are approved, the fees or the tuition requirements in terms of financials will be transferred directly to the institution. That in itself, has benefits for the institution”.

The executive secretary said the government was keen to ensure that young Nigerians do not fail to acquire tertiary education simply because they lack the funds.

He believed that the loan would help to stem the dangerous journey undertaken  by Nigerian youths across the Sahel to Europe in search of a better life. According to him, “Some of the opportunities provided by the scheme include enrolling intending students in teacher training programmes and vocational skills. The programme provides opportunities for Nigerian students who want to go into the academic and get a university degree or perhaps want the technical side and acquire some vocational skills and also in the teacher training space. This intervention will affect the lives of many Nigerian youths because that’s usually the bracket to further their education. It will enable us to intervene and support families, particularly the needy”.

President Tinubu, who has directed the implementation of the scheme, has also directed that it be expanded to include those who might not want to enter higher institutions, by seeking to acquire some skills. The President’s spokesman, Ajuri Ngelale, said the President has directed the management of the NELFUND to expand its focus area by extending the interest-free loans to Nigerian students interested in skill-development programmes. He said the President believes that it is important for the scheme to accommodate those who may not want to pursue university education, noting that skill acquisition is as important as obtaining undergraduate and graduate academic qualifications.

President Tinubu “emphasised the need for equity and inclusivity in the management of the programme, stating that no matter how economically challenged you are, accredited and qualified students will and must have access to this loan to advance their education in higher institutions. There is no compromise in our commitment to the disadvantaged citizens of this nation”.

But, to achieve the required equity and inclusivity in the management of the programme, stakeholders believe the amendments should be effected urgently.