Tag: Students Loan

JUST IN: New student loan bill scales 2nd reading in Senate

The Senate at plenary on Thursday passed for second reading, a bill to repeal and enact the Students Loan Access to Higher Education Act, 2024.

The bill was sponsored by Sen. Opeyemi Bamidele (APC-Ekiti).

Senate President Godswill Akpabio, had read a letter from President Bola Tinubu, transmitting the bill to the Senate for consideration and passage.

Following this, the bill was read and passed first reading, and consequently second reading after debate.

Leading debate on the bill, Bamidele said it sought to enhance the implementation of the higher education loan scheme, by addressing challenges relating to management structure of the Nigerian Education Loan Fund (NELF).

He said the bill would also address applicant’s eligibility requirements, purpose of loan, funding sources and disbursement.

Bamidele said the bill also had the objectives to provide loans to qualified Nigerians to pay tuition, charges and upkeep during their course of study in approved tertiary education institutions, vocational and skills acquisition institutions in Nigeria.

According to him, the bill will help to build, operate and maintain a diversified pool of funds to provide loans to qualified applicants and ensure access to higher education, vocational training and skills acquisition.

He said the bill would help to ensure the recovery of all debts due to the fund from loans granted to qualified applicants, except where the board is of the opinion that a loanee should be exempted from repayment.

He said this would be in the event of death, considerations of hardship and impossibility or undue difficulty to repay the loan.

He appealed to the lawmakers to give the bill expeditious passage because of its strategic importance to manpower development, in line with the policy thrust of the Tinubu’s administration.

Deputy President of the Senate, Sen. Barau Jibrin (APC-Kano) said President Tinubu had signed the bill when he assumed office, adding that the president brought the principal act back for amendment.

This, he said, was to ensure easy execution and give opportunity to indigent students who wanted to be educated but did not have the wherewithal.

Barau said the bill would provide finance and allow them access to finance for their education and be educated.

“No other president has shown a passion to help advance our tertiary educational system like President Tinubu.

“Let us give him all the necessary encouragement to make sure that this bill succeeds and he implements it.

“We commend him for continuing on this trajectory until he takes our tertiary educational system to the next stage,” Barau said.

The bill, after it passed second reading, was referred to Committee on Tertiary Education Trust Fund (TETFund) for further legislative inputs and report back to plenary on the next legislative date.

March 14, 2024
BREAKING: Tinubu revokes Students Loan Act

President Bola Tinubu has sent a letter to the Nigerian Senate and the House of Representatives, requesting the revocation of the Access to Higher Education Act, 2023, also referred to as the Student Loan Act.

President Tinubu in the letter addressed to Senate President Godswill Akpabio and Speaker of the House, Tajudeen Abbas, dated 14th March, requested the revocation of the current legislation and put forth a new bill for consideration and passage.

A copy of the letter addressed to the Senate reads:

“Pursuant to Section 58(2) of the Constitution of The Federal Republic of Nigeria, 1999 (as amended), I forward, herewith, The Student Loan (Access to Higher Education) (Repeal and Re-Enactment) Bill, 2024 for the kind consideration of the Senate.

“The Student Loan (Access to Higher Education) (Repeal and Re- Enactment) Bill, 2024 seeks to enhance the implementation of the Higher Education Student Loan Scheme by addressing challenges related to the management structure of the Nigerian Education Loan Fund (NELF), applicant eligibility requirements, loan purpose, funding sources and disbursement and repayment procedures.

“While hoping that this submission will receive the usual expeditious consideration of the Senate , please accept, Distinguished Senate President and Distinguished Senators, the assurances of my highest consideration.”

Recall that on June 12, 2023, Tinubu had signed the Access to Higher Education Act, 2023 into law to enable indigent students to access interest-free loans for their educational pursuits in any Nigerian tertiary institution.

The Act also established the Nigerian Education Loan Fund, which is expected to handle all loan requests, grants, disbursement, and recovery.

The student loan bill was sponsored by Femi Gbajabiamila, the immediate-past Speaker of the House of Representatives, who is now Chief of Staff to the President.

Tinubu’s response follows the recent postponement of the introduction of the student loan program.

March 14, 2024
Students Loan: Inventing a problem where none exists – By Owei Lakemfa

THE Students Loan scheme, planned to be floated in the next few weeks, is an ingenious creation of a problem that does not exist. I explained this as the Lead Discussant at the Federal University of Technology, FUTA, Branch of the Senior Staff Association of Nigerian Universities, SSANU, Colloquium on Wednesday, March 6, 2024 in Akure. I had begun my submission by enquiring if a citizen has a fundamental right to be an illiterate. I did not think so, but argued that even if he does, the collective rights of society supersedes such an individual right.

I pointed out that it is in realisation of the indispensability of education to society, that Chapter Two of the Constitution directs that: “Government shall strive to eradicate illiteracy and to this end, Government shall as and when practicable provide free, compulsory and universal primary education; free secondary education; free university education; and free adult literacy programme.”

So, if education is so fundamental to human existence, and if societies need an educated citizenry to run, why should it not invest in education? Why should the citizen take a loan to be educated?

I took the audience through the trajectory of the loan and my observations. The Students Loans (Access to Higher Education) Act 2023, was signed by President Bola Ahmed Tinubu on June 12, 2023, exactly 14 days after he came into office. This gives the impression that the bill was signed in a hurry. On the other hand, it might have been signed on trust since it was introduced by former House of Representatives Speaker, Femi Gbajabiamila, the Chief of Staff to the new administration.

The June 12 date was also Democracy Day, marking the commemoration of the June 12, 1993 annulment of the presidential election by the military regime led by General Ibrahim Badamosi Babangida. So, did President Tinubu, who played a role in the de-annulment struggle, see a correlation between democracy and the Students Loan Bill?

The title of the new law, ‘The Students Loans (Access to Higher Education) Act 2023’, gives the impression that it is meant to grant ‘Access to Higher Education’ in the country, which is not the case.

Nigerians access to tertiary education is limited primarily by available admission spaces. This led to the 1978 establishment of the Joint Admission and Matriculation Board, JAMB, to manage the admission process. So, the introduction of the loan scheme would not lead to increased admission slots.

Given the fact that, generally, tuition fees are not paid in public tertiary institutions, coupled with the reality that nearly all those who send their wards to tuition fee-paying private universities can afford to do so, it is curious why the Student Loan Scheme is being introduced. This is more so when Section 3 of the Act states that the loan is “only for payment of tuition fees”.

My conclusion was that the Tinubu administration intends to introduce tuition fees into public tertiary institutions through the backdoor. I also pointed out that the challenge students face in our tertiary institutions is primarily upkeep. More so with hyperinflation. But the Act forbids students from accessing the loan for anything other than payment of tuition fees that do not exist in public schools.

If the loan is for only tuition, how will indigent students feed and accommodate themselves in the campuses? How would they buy books and other materials for their studies? How would they carry out necessary research? So, I submitted that the interests of the students and the government do not coincide. Also, the Act disqualifies a loan applicant if “any of the parents had defaulted in respect of students loan or any loan granted the person”. This is like visiting the sins of the parents on the children.

Another aspect is that the new law grants beneficiaries a two-year post National Youth Service Corps moratorium before the repayment begins. Working beneficiaries who dodge repayment risk a N500, 000 fine or two-year jail or both fine and imprisonment.

I pointed out that given the reality of mass unemployment , many beneficiaries are likely to default as unemployed graduates will be unable to repay the loans. I pointed that in the United States, students loan has become like an albatross. The outstanding debts in 2021 stood at $1.7 trillion. Secondly, some youths are not getting married because of the burden of the students loan. The sociological implications of this include the promotion of depopulation, burden of single motherhood and increase in absentee fathers. Also, some American youths do not go to college because they want to avoid the loan trap. This partly informs why some developed countries are seeking professionals from the underdeveloped countries to run their system.

I concluded that the scheme may endanger the future of the students and, by extension, society. As alternative, I submitted that government should live up to its responsibility of funding education. This I pointed out it can do, amongst other ways, by restoring the scholarship and bursary awards to students which used to be provided by all tiers of government.

Professor Bayo Aborishade while also opposing the scheme, narrated his experience in the scheme in the country before it was abolished in the late 1970s.

“I took a students’ loan scheme in 1974.It was N400 per annum. I paid back to the last Kobo, but most students never paid back a Kobo. Many of them were children of rich Nigerians who had the means, but saw the scheme as free money. On the loans form, they filled fake guarantors, the state never checked, and the loans were never repaid.

“In my days, the loan was for upkeep. There was no tuition fee, nor is there tuition fee today. The intention of the government is quite obvious: that it is going to introduce tuition fees. But there are enough funds in Nigeria to fund education in a country where a single minister could within weeks of being in office, have access to billions of Naira. The politicians know how to take care of themselves. It is a class issue; if you don’t belong, you are finished.”

Dr Olawale Bello, concurred that government is trying to introduce tuition fees, adding that it has commenced the process by pushing the universities to increase sundry fees.

FUTA Vice Chancellor, Professor Adenike Oladiji, said government should not be judged by what people assume are its intentions. She is confident that the Act will be revisited in line with the intentions of government.

The FUTA SSSANU led by Comrade Felix Adunbi conferred ‘Labour Friendly Award’ on Ondo State Governor, Lucky Orimisan Aiyedatiwa, who was represented by Head of Service, Bayo Philip. The union also conferred the Labour Activist Award on me.

March 11, 2024
Tinubu reveals take off date for students loan programme

President Bola Tinubu has declared that the students loan programme would commence full operation in January 2024.

Tinubu made the announcement at the 29th Economic Summit organised by the Nigerian Economic Summit Group (NESG) in partnership with the Federal Ministry of Budget and Economic Planning, in Abuja on Monday.

The president assured Nigerians that government-owned tertiary institutions would no longer go on strike.

He admitted that Nigerians were feeling the short-term negative impact of his reforms but promised that everyone would soon enjoy the benefits.

The president also assured that Nigeria would honour all future foreign exchange contracts.

“All foreign exchange contracts will be honoured by this government, I assure you we have a line of sight to the foreign exchange we need to refloat this economy and we will get it,” he said.

Tinubu said that as the naira continued its free fall at the parallel market, he would clear foreign exchange contracts backlog discouraging investors’ confidence.

The Chairman of the NESG, Mr Niyi Yusuf, said that with more than 133 million multidimensionally poor Nigerians, there were potentially more risks of stagnation and distress if a low-growth and low-investment era persisted.

“The future of the Nigerian child is at stake, across every geopolitical zone, the Nigerian ageing population is also at risk, there is a high prospect that a retiree’s savings and investments will be eroded entirely just a few years into the first or second decade of retirement.

“Our high fertility rate which is driving a much higher population growth than economic growth poses a risk of an unproductive population bulge, with an unmanageable social infrastructure cost and burden for supporting our children’s health, nutrition and education,” Yusuf said.

He said that Nigeria’s Multi- trillion dollar economy would be viable within a decade of serious reform, consistent economic action and deliberate institutional reforms.

Yusuf said, ”Our nation stands at a critical precipice, and our challenges demand immediate, concerted efforts. We need to act now with a shared sense of urgency.

“The Multi-Trillion Dollar Economy growth trajectory will urgently need certain actions including.

“A macroeconomic stabilisation programme supported by an aggressively scaled national security effort to halt all forms of syndicated and organised crime around crude oil and solid minerals.

“A Made-in-Nigeria Agenda. To Make-in-Nigeria, two strategic drivers require urgent investment: a national emergency energisation programme.

”This is to enable access to stable, predictable and affordable electricity supply and a national infrastructure corridor development programme – an efficient and integrated transport and logistics network that links value chains to sea, air and land ports.”

According to him, a national job creation plan that drives the creation of a huge volume of high-quality jobs and a revised national assets optimisation plan that ensures critical national assets are fully utilized and productive.

Yusuf said, ‘This is if we must sell, concession or commercialise some assets to achieve the desired level of productivity.

“A national competitiveness plan that defines the sectors where we have a competitive advantage, export expansion targets to achieve a trade surplus and a positive balance of payment.”

He said that the government needed a new compact with the Nigerian child that guaranteed their promising, secure and safe future.

“We also need a revitalised national security policy and strategy to protect lives, properties and our national assets,” he said.

Yusuf said that achieving a multi-trillion dollar economy would require a paradigm shift, big, bold actions, tough choices and significant sacrifices by all of us, saying, “We all are witnesses to the outcomes of delayed and deferred action. “

The chairman said that NESG was ready to support the government to model the tough choices required and the associated palliative measures to ameliorate the short-term impact on the populace.

Yusuf said that the new administration had unveiled eight priorities of government which focus on economic growth and job creation, ending poverty, access to capital, inclusivity, food security, national security, fairness and the rule of law and anti-corruption stance.

“This provides a strategic perspective of the Government’s grasp of both the issues and solutions to the national crises and also for the transformation of the Nigerian economy into one that is competitive, sustainable, inclusive and open.

“This is possible only if public and private sector leaders work together towards the same national vision,” he said.

Yusuf said that this year’s summit had been calibrated as a burning platform to answer the question of the essential pillars of economic transformation that would get us to the future envisaged by the government.

“The need for urgent strategic shifts that impact the ease and cost of doing business within a relatively short period is a matter of existential threat to the survival of enterprises and entrepreneurs,” he said.

Also, In the last eight years, the NESG had kept faith with the Government and Nigerians as a dialogue partner, watchdog, connector and intervener.

Yusuf expressed gratitude to the Federal Government, members of the private and public sector partners and the international community for their dedication, participation, and belief in the realisation of a stable, sustainable, secure, inclusive, and economically prosperous Nigeria.

October 23, 2023
President Tinubu: From Renewed Hope to renewed ‘shege’?

Less than a month, Nigerians have already started feeling the impact of President Bola Ahmed Tinubu’s administration which was inaugurated on May 29th.

On inauguration day, Tinubu made the controversial decision to remove fuel subsidy payments, and the price of Premium Motor Spirit (PMS), popularly known as petrol, immediately skyrocketed across the country.

Petrol that hitherto sold between N210 and N220 per litre went as high as N850 per litre in some locations across the country and has remained in the range of N500 and N520 per litre.

While Nigerians were still grappling with the effects of the removal of fuel subsidy payments, the Central Bank of Nigeria (CBN) announced a devaluation of the Naira, aligning with Tinubu’s commitment to a unified exchange rate.

While the intention is to streamline the foreign exchange system, the devaluation has already begun to affect businesses and investors. Industries such as Dangote Group are already feeling the initial repercussions.

These developments have stirred concerns and comparisons to the biblical story of King Rehoboam, raising questions about the future of the Tinubu administration and the welfare of Nigerians.

When Rehoboam was made King, the whole assembly of Israel came to him and said, “your father put a heavy yoke on us but now you should lighten the burden of your father’s service and the heavy yoke he put on us, and we will serve you”.

However, as the popular Bible story goes, Rehoboam answered, “Go away for three days and then return to me”. Then King Rehoboam consulted with the elders who had served his father and the young men who had grown up with him.

While the elders advised Rehoboam to make the yoke of the people lighter, the young men advised him thus: “My little finger is thicker than my father’s waist! Whereas my father burdened you with a heavy yoke, I will add to your yoke. Whereas my father scourged you with whips, I will scourge you with scorpions”.

True to the letters, after three days, when the whole assembly of Israel returned to the King, he answered the people harshly, rejecting the advice of the elders and spoke to the children of Israel as the young men had advised.

When all Israel saw that the King refused to listen to them, they answered the king: “What portion do we have in David, and what inheritance in the son of Jesse? To your tents, O Israel! Look now to your own house, O David!”

When King Rehoboam sent out Adoram, who was in charge of the forced labour imposed on the Israelites, they stoned him to death, leaving the King running for his dear life. Rehoboam’s reign was marked by rebellion against the house of David.

The sudden removal of fuel subsidy payments and the Naira devaluation have already ignited dissatisfaction and unrest among the populace.

The hasty implementation of these measures without adequate consideration for the impact on ordinary citizens raises concerns about the potential consequences and stability of Tinubu’s leadership.

As if these are not enough, there are already indications that the administration will very soon supervise the increment of electricity tariff by the Nigerian Electricity Regulatory Commission.

According to reports, electricity tariffs are set to increase by over 40 per cent in the coming days, a development which may eventually end all forms of energy subsidy in the country. The tariff hike is reportedly due by July 1.

More still, President Tinubu recently signed the Student Loan Bill into law, which many have said will make life miserable for Nigerian students and their parents.

As Nigerians brace themselves for the implications of the policies of the Tinubu administration, the cautionary tale of King Rehoboam serves as a reminder of the perils of disregarding the concerns and well-being of the people.

The response to these initial decisions will shape the course of Tinubu’s presidency, as the fate of his leadership hangs in the balance.

Already, Nigerians have changed the renewed hope slogan of President Tinubu to renewed ‘shege’.

Will Nigerians rally behind him or seek refuge in their own tents, questioning their place under the rule of President Tinubu? Only time will tell.

June 20, 2023
President Tinubu’s students’ loan policy – By Hope Eghagha

In partial response to the perennial crises of inadequate funding and ASUU strikes in federal universities, President Bola Ahmed Tinubu has signed the Students’ Loan Bill into law. Under this law, indigent Nigerian students will get interest-free loans to see them through their stay in government-owned higher institutions. Beneficiaries are expected to repay the borrowed sum once they start working, that is, two years after the mandatory national service. Potential beneficiaries will be expected to apply to the Chairman of the Bank through the Chief Executives of their respective institutions having a secured a place in the school. The law states that any student whose parents earn more than 500k per annum will not qualify for the loan. Certainly, this aspect of the law would need to be reviewed.

As is usual with such loan facility, beneficiaries will be expected to provide two guarantors with the requisite qualifications – a civil servant on level 12 and above or a clergy man! Also, a student whose parents had defaulted in loan repayments will not be eligible for the interest-free loan. Furthermore, students who had been convicted of a felony of any offence involving dishonesty or fraud, or who had been convicted of drug offences are ineligible for the loan. Repayment of the loan, as stated earlier, is designed to commence two years after completing the National Youth Service Corps. What is not clear to me is what will happen if after completing a first degree the beneficiary migrates from Nigeria to seek for greener pasture! But that is for the government to worry about!

No doubt, this is a welcome development. And the President should be commended for hitting the ground running because some background work was done even before he was elected to office. Some of the President’s actions suggest he came prepared for the job after many years of waiting. The model of funding tertiary education which we currently operate has failed woefully. We can see this with half an eye! It does not need a patch work. It needs a total overhaul. There is no where in the world where education is free. Somebody pays for it. If the federal government has decided to give loans to students to enable them to pay for tuition, no sensible person, union, or group should join issues with the government. What we should be bothered about are the conditions and how the process should net be hijacked by a cabal in the traditional Nigerian style.

Should there be a bank created for this purpose or we should adopt three to five big banks to warehouse and administer the funds on the condition that they donate a percentage to the funds? What will be the implications of creating a fresh bureaucracy to manage students’ loans? What guarantee is there that the students would repay the loans? What happens if a beneficiary is unemployed two or three years after graduation? In case of default, like if a beneficiary relocates abroad, what will the state do? Will beneficiaries be expected to deposit their certificates with the operators before NYSC? These are questions in the mouths of observers and compatriots. My response is that the government must have ready answers because they operate within the Nigerian geographical space and are familiar with our shenanigans.

The university system needs to be properly overhauled – from teaching methods to curriculum and learning outcomes. The wages of university professors must be reviewed immediately. An Assistant Lecturer, the entry point not academia, goes home with one hundred and ten thousand naira monthly. This salary has been so fixed since 2009. Students live in squalor, a far cry from the relative comfort of the university environment of the 1980s. If the universities charge the appropriate fees added to some grants from the government, academic staff should earn more. Laboratories will have more equipment. The libraries will have more books and journals. The students are more likely to take education seriously. Students will be more comfortable on the campuses. Besides, students will be more interested in their studies because they will be paying for their education.

President Tinubu is preparing the nation therefore for a new approach to education policy formulation and implementation. Our dear ASUU has been virtually emasculated by the courts after the last battle over payment of salaries after a protracted strike. The federal government used the court to deal a blow on the union and killed morale. Even within the university system, there are doubts whether ASUU still has the strategy to lead academics to the Promised Land. This is why the union must reinvent itself and restore confidence in the followership. In my view, ASUU’s objection to a Students Loan Board amounts to being a busybody! Interestingly, NANS officials paid a solidarity visit to the President to thank him for the initiative and requested that ASUU should be removed from the Board! Are these the students ASUU is fighting for? Let the welfare of academics be the primary and only focus of university unions. ASUU, kindly return to the drawing board while listening to your members!

President Tinubu should adopt other measures to reinvent tertiary education. For starters, he should direct that the gentleman’s agreement which then Speaker House of Representatives reached with ASUU be respected and implemented. Academics have been on the same salary provisions since 2009, and indeed, the take home pay of academics cannot take them home! The withheld salaries of ASUU members should be paid to show good faith. The funds which accrue from TETFUND should be given to universities as grants without apron strings from Abuja to meet their needs. That way, he would win over most academics to his side. Furthermore, the universities need full autonomy in managing its affairs. In my view, there should be no central body dictating academic programmes to the universities, thereby usurping senate functions.

The government must remember that school/tuition fees alone will not be sufficient to meet the obligations of the universities. In other words, government must not hand off funding education through grants and other forms of interventions. Education is too important a service to be commercialized.

June 19, 2023
EXPLAINER: Simplified steps to access FG’s interest-free student loans

In a groundbreaking development on Nigeria’s Democracy Day, President Bola Tinubu officially signed the Student Loan Bill into law, marking a significant milestone in the nation’s commitment to providing affordable education opportunities.

The Act which was sponsored by the immediate former Speaker of the House of Representatives Femi Gbajabiamila, aims to revolutionize educational opportunities for Nigerian students and shape the future of the country’s education landscape.

Reacting to the signing of the Bill, Gbajabiamila who is now the Chief of Staff to the President tweeted: “I am excited that President @officialABAT has signed the “Student Loan (Access to Higher Education) Bill” into law. I sponsored this Bill in the House of Representatives, confident it will assist indigent students and families in grasping the opportunities that higher education can provide”.

Under the Act, the Nigerian Education Bank is established to manage and oversee the loan disbursement process.

The Bank assumes the responsibility of collecting contributions and other prescribed funds, holding them in a dedicated fund, and ensuring their efficient distribution to eligible applicants.

Contributions to the fund include interests from deposits, education bonds, education endowment fund schemes, and a percentage of taxes, profits from oil and minerals, as well as other sources of revenue.

By facilitating access to funds for tuition fees, the Bank aims to alleviate financial burdens and enhance educational opportunities for students across the country.

To access the loan, students must fulfill certain requirements, including first securing admission into any public Nigerian university, polytechnic, College of Education (COE), or TVET school. Furthermore, the annual income of the applicant or their family should not exceed N500,000.

In addition, two guarantors are required, who must be civil servants with a minimum of level 12 years in service, a lawyer with at least 10 years of post-call experience, a judicial officer, or a Justice of Peace.

Each guarantor is also required to provide two passport photographs, details of their employment, and evidence of their association with the named organization.

Self-employed guarantors must furnish information about their registered business with the Corporate Affairs Commission or another relevant authority, along with their banking details.

Institutional efficiency is crucial to the loan application process and each institution must ensure that all applications from their respective schools reach the Bank within 30 days after the close of admissions for the academic year.

The Act further outlines that the processing and disbursement of loan applications should occur within 30 days of reaching the Bank.

These applications must also be forwarded to the Minister for approval within the same timeframe, emphasizing the importance of timely processing to expedite loan delivery.

The repayment terms outlined in the law are designed to ensure the sustainability of the loan program and beneficiaries will commence repayment two years after successfully completing the National Youth Service Corps program.

The repayment process entails a direct deduction of 10 per cent from the beneficiary’s salary at the source by their employer, or if self employed, 10 per cent of their total monthly profit to the designated Students loan account prescribed by the Bank.

The new law has been hailed as a progressive initiative and an embodiment of government’s commitment to empowering the younger generation and broadening their educational horizons.

June 13, 2023