Student Loan Alone Not A Remedy

There is a new dawn in tertiary education after the Nigeria Education Loan Fund (NELFUND) stated that over sixty thousand students applied for its interest-free student loan. Furthermore, over thirty thousand student loan applications succeeded. In the Fourth Republic, it is a landmark. Sustenance will determine the long-term impact of the student loan initiative.

Despite the 50% success rate, the Managing Director of the Nigeria Education Loan Fund (NELFUND), Dr. Akintunde Sawyerr, said that applicants for the student loan would be cleared subject to enough verifications.

President Bola Ahmed Tinubu signed the Students Loans (Access to Higher Education) Bill, 2024, into law in April. The Act is an improvement on an earlier initiative, which was withdrawn because it was restrictive. The Act covers tuition and other aspects of student welfare. It accommodates a wider coverage of students in public federal and state institutions that do not charge fees and those in vocational training.

This should ordinarily be cheering news, given the poverty ravaging the land and the attendant hardship on students from poor homes. The National Association of Nigerian Students has welcomed it as the “way forward,” as have President Bola Ahmed Tinubu’s cheerleaders.

But others have rejected the return of a policy scrapped four decades ago. Some, seek clarity and a seamless, well-structured, and effective student funding policy, learning from the country’s past experiences and other countries.

The Academic Staff Union of Universities rejected the student loan.

Moreover, the move is perceived as a precursor to charging tuition fees in federal universities and other higher institutions. President Bola Ahmed Tinubu has once unambiguously declared that tuition-free higher education “is no longer realistic.”

A contentious provision is that a beneficiary will commence repayment two years after the National Youth Service Corps programme. It is unrealistic. The Nigerian Graduate Report 2022 found that 58.9% of Higher National Diploma (HND) graduates, 49.55% of Ordinary National Diploma (OND) graduates, and 39.75% of bachelor’s degree holders, are unemployed.

The National Directorate of Employment says most Nigerian graduates remain jobless five years after NYSC. Multinational consultancy, KPMG, said Nigeria’s unemployment rate grew from 37.7% in 2022 to 40.6% in 2023 due to the high influx of job seekers – 4,400,000 annually – into the market. The repayment plan for the student loan is therefore doubtful.

Corruption, mismanagement, and non-repayment kill intervention credit schemes in Nigeria. A student loan scheme introduced in 1974 with advances repayable twenty years after graduation crashed.

In the United States, Forbes reported that Americans owed up to $1,700,000,000,000 in student loan debt as of May 2023. President Bola Ahmed Tinubu should embrace the culture of meticulous planning. President Bola Ahmed Tinubu needs to rationalise the federal universities, polytechnics, and colleges of education that the government has been recklessly establishing with no thought given to their funding.

Nigeria must reach into its past to recover its success in tertiary education. Then, the defunct regions and successor states awarded scholarships, bursaries, and grants. These were awarded for study at higher institutions at home and abroad. The Federal Government and the Local Governments also awarded scholarships and bursaries. This is a better system.

The way forward is to mobilise all tiers of government to return to that template. They should harmonise and build joint data banks so students can choose a scholarship, bursary, or student loan. Technology-supported infrastructure should be deployed to ensure that no beneficiary gets from more than one funding stream. This will ensure that no qualified Nigerian youth desirous of higher education is denied because of lack of funds.

The government should encourage charities, faith-based organisations, and Non-Governmental Organisations (NGOs) to offer scholarships and bursaries. Corporate organisations should be incentivised with tax breaks to offer grants, scholarships, and bursaries.

The student loan is a good idea, but not as a standalone panacea or remedy. Its implementation and execution should be preceded by thorough planning, with realistic conditions, targets, and reliable funding sources.

Source: https://punchng.com/students-loan-alone-not-a-panacea/