Student Loans: What Is The Benefit For Masses?

By Ali Abubakar Sadiq

President Bola Ahmed Tinubu, recently signed into law the Student Loans bill. The Bill was conceived way back in 2016 after I submitted proposal to the then Senior Special Assistant to President Buhari on Student Matters.

Being a friend, I suggested to him to allow me draft a proposal on student loans, which he readily accepted.

The reason why I made that suggestion was knowing that most countries in the world have in place a student loans scheme which supplements scholarships and targeted talented students from poor families to enable them have University Education.

When I started the research, I found out that since the early 1970’s, Nigerian Government under the military had a decree that allows for the establishment of Education Bank.

The reason I focused my attention on the issue was considering we had a new government in 2016 that carries tremendous goodwill from the people and Buhari is expected to turn around the country, and also the United Nation’s projection of Nigeria’s population to become the third largest after India and China with 400 million people come 2050, is enough to excite ones concern about the future of education in a country where many are so poor.

Nigeria had over the decades failed to even reach the UN threshold of 15% commitment of National Income to the educational sector, for developing countries. Education statistics in Northern Nigeria are the worse in the world, as millions of our children couldn’t even go to school let alone have a vision of University education.

The North is more populous than any other region in West Africa, yet it has the highest number of poverty and illiteracy. That is why I thought a student loan could mitigate the shortfall of University graduants in the country, moreso as cutting Federal Funding for Universities is just a matter of when not if.

In my original proposal I suggest the resuscitation and expansion of the Education Bank to be funded by the Federal Government, to enable it offer an interest-free loan to students in tertiary institutions.

The Bank should have branches in all the 36 states of the Federation and Abuja and targets at least 500 students from each local government to be offered the loan for the four years of University Education.

The proposal also mentioned offering Grants to Authors and Artists to publish their works as well as to the category of youths with special talent and special skills.

The loan should not only cover tuition but also vocational skills loans to University students to enable them learn entrepreneur skills based on their area of studies. For example those undergoing Agriculture courses should be able to have loan to invest in fishery, poultry, animal husbandry etc.

so that on graduation they have businesses to depend on not wait for Government jobs that are not available. In my proposal, based on how other countries make the repayment regime very favorable to graduands, I suggested 1-10 year period and for those incapacitated or dead should have automatic cancellation of repayments, because the idea for the loan is to enable youth get education and learn vocational skills to contribute towards the development of the country.

Besides we have seen in recent times how individual politicians and civil servants steal billions that could be worth a whole year’s budget of an institution like the Education Bank and are roaming freely.

In the Bill signed into law by the President, it includes the creation of the Nigeria Education Bank and it will be funded from 1% of the total revenue of the Federal Government accrued to FIRS, Immigration and Customs (that is tens of billions per annum).

The law also included ASUU to be represented on the Bank’s board, offer interest-free loans, including vocational training school as beneficiaries, but restricts the repayment period to mere 2 years. Finally it also pegged the family income of beneficiaries not to be higher than 500,000 per annum.

After studying the act, my position is, there is a need for further amendment of the law. Foremost reasons are: The two year repayment period doesn’t consider the rate of our current unemployment rate and how some graduates spent years without job.

The exclusion of vocational training for university students should also be revisited because it has more potential of enabling students repay the loans and create jobs. There is also the need for the family income ceiling to be raised and the referees criteria amended.

The family income should be raised higher considering there may be even middle-income families with many children to support thus their wards should also have opportunity to seek the loan. The bar for referees could elude many of the poor families targeted, instead I think ward heads, district heads, local leaders and even university lecturers should be more appropriate to stand as guarantors being closer to the beneficiaries.

I want to draw the attention of people, especially Northerners, seeing how many of our people misunderstood the student loan thus making all kinds of negative comments on the media and sharing propaganda from the detractors of the program.

Northerners, as the law stands today, stand more chance of benefitting from it than any of our counterpart regions, for the simple fact that we have the highest population of youth that couldn’t attend universities for financial reasons.

I also believe 60-70% of parents that could fall within the threshold of earning no more than 500,000 in the country would be northerners due to our social set up. In most Islamic household in the north, the father is the sole bread winner and none of his wives or children contributes significantly to the running cost of the family.

Soon, I believe, government will totally withdraw its subsidy on education and few families could afford the new range of tuition fees that is bound to follow. The student loan stands to benefit more northerners if only the communities understand the system and enlightened their people to quickly grasp the opportunity.

I think NGO’s, traditional institutions, local authorities, media, politicians and opinion leaders should embark on a vigorous campaign for our youth to access the facility that is going to be online this September and only God knows how much will be injected to the bank.

ASUU, as stakeholder in the Education Bank, should stop blaming the policy as if it is the one responsible for government withdrawal of its funding. The Student Loan idea began in 2016 from my proposal, long before the Buhari government ignored ASUU’s call for funding despite the longest industrial strike in our history.

The writing on the wall was apparent to all discerning minds that the way government allows private universities to operate in the country is a clear indication of its surreptitious withdrawal of its funding.

It had been a matter of when not if, of finding ourselves in this situation where government is withdrawing its support. The introduction of the student loan came at the right time to enable poor families see their children in universities.

Finally, I would appeal to our lawmakers in the National Assembly to undertake the responsibility of seeing the amendment of the student loan act as among its first priority in putting it back to its original proposal and repel the constrains as enumerated above to enable wider and smoother application of the law for the benefit of improving education across the country, especially in the North that have deficit.

The North should understand that even if the law continue to exist as it is, they are going to be the biggest beneficiaries, if only its people are sensitize enough and in time to access its full benefit.

We should also realize there are people whom access to the student loan were restricted by the criteria, the reason why some are spreading all kinds of propaganda to disparage and paint it black for those who can, in the meantime, access it.

We should realize everything has its pros and cons and there is nothing that is perfect, but we should always exploit the imperfect and strive towards making it perfect.

Ali Abubakar Sadiq writes from Kano,
aleesadeeq1@yahoo.com
08039702951