FG Students’ Loan: Students, Parents, Lecturers express mixed reactions
…We are not in support if loan will increase school fees — PTA, ASUU
…Requirements too much, not suitable for common person – Students retort
…Loan requirements, attempt to send students of poor into generational indebtedness —CSOs
By David Awoyemi
The newly signed Student Loan Act by the President Bola Ahmed Tinubu recently to usher in new development in the nation’s education sector has been greeted with mixed reactions by stakeholders in the education sector.
The Permanent Secretary, Federal Ministry of Education, Andrew Adejo, at a press conference in Abuja, had disclosed that higher institutions cannot introduce tuition fees because of the introduction of the loan scheme.
He said, the institutions are not autonomous, stressing that the President has approved the constitution of an inter-ministerial committee on student loans made up of the various Ministries and Agencies, which the Inaugural meeting will come up on Tuesday, June 20, 2023.
Adejo said the President has also directed that by September/October 2023/2024 academic session, he wants to see recipients of the loan. So, it’s a serious business.
“Between now and then, we have to fine-tune the processes. The loan purpose is for the beneficiary to finish an education programme. The recovery doesn’t start until you get employed. The committee has been given specific terms of reference,” he said.
…..We are not in support if loan will increase school fees — PTA, ASUU
However, the Parent-Teachers Association of tertiary institutions have appealed to the Federal Government not to make the signing and introduction of student loans a reason to increase tertiary tuition.
While lauding the efforts of the Federal Government for signing the student loan bill, during an interview with our correspondent, the National President, of PTA, Mr. Haruna Danjuma, said parents were not in support of school fee hike, adding that the student loan bill was a great development.
“The association appreciates the FG for signing the bill. It is a welcome development. We appreciate the government for deciding to give loans to students because there are several parents and students who do not have the financial strength to pay school fees.”
“The loan will help a lot of them to go to their choice of tertiary institution and we will have more educated Nigerians. We are very happy. However, we want to believe that the school fees will remain as it is without any increment.
“If the fee will be increased, we are not in support of that. It will be a greater burden on the parents and students. Government should come together and meditate very well on this, so it does become a major challenge.”
On his part, the National President of the Academic Staff Union of Universities (ASUU), Prof. Emmanuel Osodeke, reiterated that the Union was not in support of the student loan as it might likely jerk up school fees.
He added that a lot of students may not be able to afford the cost of school fees if they were increased because of the student loan.
He, however, added that “if the parents and students are satisfied with any increment that might happen due to the student loan, then, ASUU does not have anything to do with that.”
The Committee of Pro-Chancellors of Federal Government-owned universities has hailed the President, over the student loan act which he assented to on an auspicious day, democracy day.
The committee during its 99th regular meeting at its secretariat also constituted a committee to look into the thematic area of university autonomy. It was gathered that the meeting brought together pro-chancellors from 50 federal universities.
…requirements too much, not suitable for common person — students frown
Meanwhile, students have frowned at the stringent requirements layed down to obtain the loan, expressing worries over difficulties that may make it unavailable for the reach of the common people.
A student of Obafemi Awolowo University, Ile-Ife, Garuba Benedict, who spoke with our correspondent said, “personally, I don’t like it. It is a no welcome development for me because the requirements are too much and it is not suitable for common person.
“If Federal Government wants to assist the poor like it said, it won’t be an outrageous requirements that will not be accessible for students.”
She stressed that, “it is just too high and not a welcome development personally, because how will the students pay back? Though, some people believe that Government loan they don’t get to pay back, but I’m certain that these government currently will get every of their pay, and will be different from all the loans that had been forgotten.”
Benedict questioned if the Federal Government can no longer fund university education or is aiming to increase the tuition fees, mentioning that the loan is small but the requirement is stringent for anyone that wants to go for it.
“They should be able to meet up with the requirements or better still not start what they could not meet up by not paying back the loan because if you are unable to pay back after two years of graduation, there is a penalty and if along the line something came up or they didn’t meet up with the payment after graduating, how will they go about it,” she asked rhetorically.
“So, I will advise student that wants to take the loan to think very well because if such student cannot pay back, it might be an hindrance to travel or get any position in the country.
“If any student fails to repay the loan, it might have consequence on such student. Government will make sure students pay back the loan they obtain. I’m not satisfied with the loan if only the requirements can be reduced,” she concluded.
Also, David Agboola, a final year student of Computer Science, Moshood Abiola Polytechnic, Ogun State, said, “The student loan bill is good in the sense that it will reduce to the barest minimum the number of defaulters, as we all know generally that Nigerians have bad loan habit. With the loan bill being passed, it will make any student who aims to default on the loan think twice.”
Esther Okeleye, a student of Moshood Abiola Polytechnic, noted that the student loan bill is a perfect agenda to assist students, who sometimes find themselves in financial crisis. She pleaded for a milder penalty.
A parent, Mrs. Atinuke Ajiboye, stated that the loan requirements is worrisome and heavy to meet up with, as she questioned the issue of securing a job after graduating. “How about free or subsidized education?”she queried.
“And with the parameters of how the economy is, how will the loan be payed if the income is not enough or after graduation it is not met and even before my child graduates, how will I get to meet up with the requirements?
”If maybe any other things is being concerned as a single mother whose minimum wage is N30,000 naira and part of the requirements is the parent or child should not earn less than N500,000. This is not just favourable to help the poor as it is stated for the purpose,” she said.
Another parent, Mrs. Bola Edun whose ward attends the University of Lagos, stated that the development of what the President has brought is a welcome development to ease off the stress of looking for money or borrowing around to meet up “or not seeing anyone to loan you and at the end of the day making my child to drop out of school.”
“This may be due to lack of income or funds. There was a time, I was not financially bouyant to fund the eldest one some years back, but with this development, this will help us grow and concentrate on other bills which will make her finish in the school.
“I am a trader and things doesn’t go as required all the time. So, if the loan is available for use, that will help my child to graduate and I pray she gets a better job that will make her income robust to pay back the loan before the due date given as agreement of the debt,” she said.
Also, a parent who is a commercial driver, in Lagos, who simply identified himself as Kayode Bilewade, said it is a good development.
“Personally, President Tinubu has been doing well since he became the president.
“This development will make my child who is writing WAEC at the moment to get the loan and gain admission into any Federal University of his choice through the loan. I will try to meet up with all agreed requirements and before graduation, would have been working on the process of repaying or before the two years or due time given,” he said.
But in an interview with the Chairman, Obafemi Awolowo University, Ile-Ife, Professor Anthony Ifechukwude, declined to comment on the student loan.
He said, he has nothing much to say, but simply said, “let everyone fight for his/her rights.”
“The Federal Government should take of our welfare. As a professor, I know what is my take home which is not even equivalent to what some of these highly placed individuals are earning in the ministry. If that is what they want, they should do it,” he said.
….loan requirements, attempt to send students of poor into generational indebtedness — CSOs’
According to the Osun State Secretary of Democratic Socialist Movement and Education Right Campaign, Comrade Ibrahim Raheem, “this development is nothing but an attempt to send students of poor background into generational indebtedness while transferring the responsibility of funding public education to students.
“There is need for Nigerian students, education workers’ unions, the labour movement, and the generality of Nigerians to reject the Students’ loan act.
“It should be recalled that the Federal Government has declared its intention to introduce tuition fees across tertiary institutions, which is a planned increase in payable school fees.
“So, the loan scheme is to create an impression that it has taken care of students who cannot afford the obnoxious school fees. Students and working people should not fall for this deceit.
“The fact is that the vast majority of students will not be eligible for the loan or not able to fulfill the condition for it. This is because by the act, only students whose parents income is N500,000 or less annually are qualified for the loan.
“This means that any student whose parent monthly income is N42,000 or above is not eligible for the loan. By the current high cost of living, high inflation and devaluation of Naira, the national minimum wage must be much higher than N42,000 at the moment.
“This means that children of workers on what should be the minimum wage are not eligible for the loan. In any case, by the prevailing economic reality, how is a family surviving on less than even N100,000 not within the poverty line? Yet they are not qualified for the loan!
“The fact is that there is no guarantee that even the students who collect the loan will be able to get employment after graduation to be able to repay the loan. This means that it will be difficult for even the eligible students to get a lawyer or civil servant to serve as a guarantor for the loan and thereby not being able to meet requirements for the loan.
“Even, if the students loan act is reviewed such that the encumbrance to eligibility noted to is removed, the scheme should still be rejected. The present unemployment rate for university graduates in Nigeria is at 25 per cent, according to the World Bank. This is as a result of the failure of the successive capitalist governments with their structural adjustment programme or neo-liberal capitalist agenda of the last three decades.
“Without any guarantee of employment after graduation, majority of students that take the loan may find themselves burdened by a massive debt without a good-paying job to easily pay back, thereby leading to a situation where every little income that comes to them goes into servicing a usurious loan whose interest will continue to increase, thereby locking people in a permanent debt-trap.
“Practical examples from all over the world show the failure of such students’ debt schemes. Presently, the USA which is popular for such schemes is in the middle of a student loan repayment freeze because a lot of people could not afford to get gainfully employed or pay their debts. This means that, for the Nigerian government, the only gain from this bill is the increment of school fees, while students and workers stand to gain nothing.
“Therefore, the fact that the government is planning to use the revenue from the fees to run public schools means that the school fees will not be affordable for students from the working class families,” he said.
On the repayment plan, the bill recommended that any beneficiary of the loan to whichsoever to this Act refers shall commence repayment two years after completion of the National Youth Service Corps (NYSC) programme. It also recommended that repayment shall be by direct deduction of 10 per cent of the beneficiaries’ salary at source by the employer and credited to the students’ loan account to be prescribed by the bank.
However, the bill also recommended two years’ imprisonment, N500,000 or both for students who default in repayment or anyone found aiding defaulters.This has elicited mixed reactions from many students.
Chairman, National Association of University Students (NAUS), Campus Monitoring Committee, Osun axis, Ayobami Eruobami, said students’ loan was not advisable as it would cause problems later.
He said, “Unemployment rate in the country is increasing daily. We have graduates who are yet to get a job. So, students who are given loan to study in higher institutions may not be able to refund the loan even when they graduate because it’s more than evident that there are no jobs for them.”
