ERC – Reject the Student Loan Act and the plan to introduce tuition fee
* Students loan should be turned into a grant to support the living expenses of undergraduates
* ERC calls on all Nigerian students, parents, civil society organisations, education workers’ unions and the Nigeria Labour Congress (NLC) and the Trade Union Congress (TUC) to oppose the Student Loan Act and the introduction of tuition fee.
Below is the text of a press conference addressed by the Education Rights Campaign (ERC) on Wednesday 21st June 2023 in Lagos presenting our arguments against Student Loans and our alternative.
PRESIDENT TINUBU’S “STUDENTS LOANS (ACCESS TO HIGHER EDUCATION) ACT, 2023”: A SMOKESCREEN TO TAKE HIGHER EDUCATION OUT OF THE REACH OF THE POOR
We are here before you today to respond to the Students Loans (Access to Higher Education) Act 2023 signed into law by President Tinubu on Monday 12 June 2023.
As you all know, the piece of legislation is the brain-child of the immediate past Speaker of the House of Representatives, Hon. Femi Gbajabiamila, who is now the Chief of Staff to the President. Since it was signed, the Act has been described by both its proponents and supporters as a timely piece of legislation that would facilitate equal access to higher education. In fact, the leadership of the National Association of Nigerian Students (NANS), which is supposed to be the voice of students, at a recent meeting with the President, poured encomium on President Tinubu for signing the bill. It would appear from all these that the new legislation can solve the age-long problem of lack of access to education that has plagued Nigeria from times immemorial. On the contrary, we in the ERC think it will not. We think those who have applauded the Act are either ignorant of the real consequences or they are anti-poor and pro-capitalist elements who do not believe that education ought to be an inalienable right and not a privilege. Hence, we are here this morning to prove the following:
- That the Students Loans (Access to Higher Education) Act 2023 is the work of con-artists whose aim is to hoodwink the mass of Nigerian people, including students, youth, parents and workers into thinking that it expands access to higher education whereas what it does is to shut the door more firmly against the majority of Nigerians seeking higher education. Indeed it is a smokescreen to take higher education out of the reach of the poor.
- That the Students Loans (Access to Higher Education) Act 2023 is a fraudulent piece of legislation that on the one hand claims to open access to higher education through students loans but on the other hand puts up innumerable restrictions and hurdles to ensure that only a fraction of poor and indigent students who need support actually gets this loan.
- That the Students Loans (Access to Higher Education) Act 2023 is a market fundamentalist and anti-poor piece of legislation aimed at full commercialization of public education while legitimizing the Tinubu government’s shameful abdication of its role in funding public education. Its ultimate goal is to turn tertiary education into a commodity to be bought on a willing buyer, willing seller principle. If truly the Tinubu government wants to help poor and indigent students who are in millions, then it would recover trillions of naira being stolen legally and illegally from public coffers by big businesses and politicians in order to ensure that there is adequate government funding for public education.
- That the Students Loans (Access to Higher Education) Act 2023 is a fraudulent contrivance by elements who have no interest of the poor and indigent at heart and whose only real achievements would be increase in the cost of education through introduction of tuition fee and subjection of loan beneficiaries to lifelong indebtedness and misery.
The Act has defined for itself the following aim and objective which is “to provide easy access to higher education for indigent Nigerians through Interest free loans from the Nigerian Education Loan Fund established in this Act with a view to providing education for all Nigerians; and for related matters”. However, a clause-by-clause examination of the fine details of the Act shows the following:
(1) THE STUDENTS LOAN ACT ONLY TAKES CARE OF TUITION FEES WHICH ARE A FRACTION OF TOTAL PAYABLE FEES BY STUDENTS IN TERTIARY INSTITUTIONS
According to section 13 of the Act, the aims and objectives of the Fund shall be to “facilitate the mobilization of funds to provide interest free loans to students of institutions of higher learning in Nigeria for the payment of TUITION FEES”. Tuition fee can be defined as the charge or fee for instruction or teaching. Basically, it covers costs like salaries of lecturers and stationeries. There are two broad types of fees payable in universities across the world namely, tuition fee and sundry fees. Sundry fees include admission fees, acceptance charges, library fees, ICT fees, development levy, accommodation fees, matriculation fees, convocation fees etc. Nigeria currently runs a tuition-free public University system owing to the historical struggles of Nigerian students and over decades. Despite this, you are all aware that authorities of various public tertiary institutions have made attempts to undermine this no tuition fee policy by charging students exorbitant sundry charges, including crazy fee called acceptance fees that goes for as much as tens of thousands of naira in many institutions.
Now here is where the profound absurdity of the Students Loan Act rears its ugly head. By virtue of the Act, an indigent student is encouraged to obtain a loan from the Education Bank to pay tuition fees. Now since the prospective loan beneficiaries are indigent, how will they pay the sundry fees which in many higher institutions run into tens of thousands of Naira? If an indigent student pays tuition fee through loan but has no money to pay for acceptance fee or library fee or development levy, will they be admitted? Will they be able to attend lectures, sit for test, examinations and graduate? In that sense, how are beneficiaries’ access to higher education enhanced by this loan which may only take care of not more than 25 percent of the total cost of education while leaving them to scrounge for the rest? Let us consider another scenario: Let us assume an indigent student is lucky enough to obtain the students loan but they have no money to pay for accommodation levy, how exactly would they be able to attend lectures and graduate over the next four years?
Meanwhile, statistics show that at least 40 percent of students are forced to stay at off-campus residences in public institutions that are residential while there are now several new-generation public universities, polytechnics and colleges of education that do not even have any hostel policy which means that the bulk of their students always have to struggle to raise hundreds of thousands of naira to pay for accommodation off-campus after paying their school fees. In fact, in some cases, the cost of off-campus accommodation can be equal to or greater than even the school fees in some of these institutions. So what exactly does this Act resolve for indigent students if they obtain a loan to pay tuition but still have to struggle to raise money to pay sundry charges which may be twice the amount of loan they have obtained and for which they would be indebted for life? This for us is why we think this Students Loan Act is a fraudulent piece of legislation which claims to open access to higher education for indigent students but does nothing of the sort.
(2) THE STUDENTS LOAN’S UNREASONABLY HIGH QUALIFICATION CRITERIA MEANS ONLY A TINY FRACTION OF INDIGENT STUDENTS CAN QUALIFY FOR IT:
Section 14, subsection (b) of the Students Loan Act states that students applying for the loan under this Act must satisfy the following condition: “applicant income or family income must be less than N500, 000 per annum”. This is another provision of the Act which shows the students loan scheme as an unreasonable, unrealistic and absurd contrivance. It is as if the drafters of this legislation are living on the moon! This is not surprising! Members of the corrupt capitalist ruling elite are so cut off from the society and those they lead.
To understand the profound absurdity of this provision, let us examine the minimum wage law in Nigeria. By virtue of the Minimum Wage Act 2019, the lowest paid worker in Nigeria is meant to take home nothing less than N30,000 per month. Now if you divide N500,000 by 12 calendar months, it will give you N42,000 as the maximum income the family of a beneficiary must have. By saying family, it is logically inferable that the Act means the salary of not one but both parents. Therefore by virtue of the Minimum Wage Act, the lowest family income of two parents should be nothing less than N60,000 on a monthly basis which would be N720,000 per annum – an amount that is far above the threshold contemplated in the Act. What this means is that the children of the lowest paid worker will not be able to access this loan. If low-paid workers do not qualify as poor in the wisdom of the drafters of this legislation then who exactly is poor in this country? What rationale did the drafters of this legislation use in determining the criteria for qualification?
According to the National Bureau of Statistics (NBS), 133 million Nigerians are living in multidimensional poverty. Going by the current unified exchange rate which has further devalued the naira, the N30,000 minimum wage is about 42 dollars per month which means workers who earn it actually survive on less than $2 per day. If the Students Loan is truly meant to help indigent students, why are workers considered in the opinion of the drafters of this legislation not poor enough to receive the Students Loan? We all know that even a N100,000 monthly family income is a poverty wage considering the rate of inflation in Nigeria today occasioned by the series of neo-liberal policies launched by the present administration which have further raised prices of goods and services while worsening living standards. An evidence of this is how thousands of workers now trek to work since the removal of fuel subsidy and the consequential increase in fuel price and transport fare. If children of factory workers, civil servants, teachers, lecturers, journalists and vast sections of the working people cannot qualify for the loan, then who exactly is this loan meant for? Mind you, by virtue of the automatic introduction of tuition which the Student Loan Act implies, it now means that large sections of the working people who are disqualified from the loan will still have to pay even more than before for tertiary education.
Even if for purpose of argument, we go below the level of the lowest paid civil servant into the vast informal sector where the bulk of the country’s poor exist, we are likely to find many poor and indigent families where the income of both parents exceed N42, 000 per month yet they are too poor to afford the cost of higher education. For instance, let us assume a typical family consisting of the father who rides commercial motorcycle and the mother who sells fried akara. You will agree with us that the combined income of these two parents from these socio economic activities is likely to exceed N42, 000 per month yet they may be too poor to guarantee three meals per day for their children let alone being able to train them in school. Unfortunately, by virtue of the profound economic wisdom of the proponents of the Students loan Act, these poor Nigerians are rich enough to afford the cost of higher education which is now set to go higher when tuition fee is introduced.
(3) THE STUDENTS LOAN OUTRAGEOUS REQUIREMENTS MEANS THAT IT WILL BE EASIER FOR A CAMEL TO PASS THROUGH THE EYE OF A NEEDLE THAN FOR A POOR STUDENT TO BENEFIT FROM THE LOAN
To add insult to injury, subsection (C) of the same Act says “applicants must provide at least two guarantors, and each of the guarantors shall be (i) civil servants of at least level 12 in service (ii) lawyer with at least 10 years post-call experience (iii) judicial officer, or (iv)justice of peace. The guarantors are meant to accompany the application with their particulars showing their employers details, banking details, copy of CAC registration and a letter stating they “accept liability in the event of default”. This is another outrageous requirement which demonstrates that this student loan scheme is nothing but a scam. Poor and indigent people are the least likely to know a top civil servant, lawyer or judicial officer who can stand for them to obtain a loan. To ask people who are poor to produce all these before they can go to school is an absurdity.
Unfortunately, there is however no guarantee that even if an applicant succeeds at satisfying all these onerous requirements, they would get the loan. Section 16, subsection 4 of the Act clearly states that “disbursement will only be on availability of funds”. This means many indigent students may have to wait endlessly for months and years with the likely consequence that they lose their admission or are forced to drop out. As is usual with the highly corrupt bureaucracies in ministries and parastatals in Nigeria, it will not be surprising if a students’ loan cartel soon develops to further milk desperate applicants. Also, it will not be surprising when we begin to see children of rich people and politicians who can easily get top civil servants and judicial officers to stand for them benefit for the loan while the poor who deserve it gets nothing at all. It is for all these reasons that we are forced to conclude that it would be easier for a camel to pass through the eye of a needle than for a poor and indigent Nigerian to benefit from President Tinubu’s students loan programme.
(4) STUDENTS LOAN ONEROUS REPAYMENT PLAN WILL SUBJECT BENEFICIARIES TO DEPRESSION AND SUICIDE
While the government has been going about saying it is a non-interest loan, the repayment plan is onerous and meant to subject beneficiaries to a miserable existence. Section 18 (1) of the Act says that “Any beneficiary of the loan to which this Act refers shall commence repayment two years after completion of the National Youth Service Corps programme”. This means that it does not matter whether or not the beneficiaries have succeeded in getting a job or not, they must start paying. This is in a country where the unemployment rate is at least 40% for the general population and at least 53.6% among young people! It is a fact that a majority of graduates seldom get any job at all within the first 2 years after they leave school. Infact, many can still be unemployed 5 years after National Youth Service. So how does the government expect unemployed beneficiaries to begin repayment? Meanwhile, according to the Act, if beneficiaries default on the loan, subsection (6) says they shall be “liable on conviction to a fine of N500,000 or imprisonment for a term of two years or both”. This could easily become another source of oppression and extortion by the police and security services.
Meanwhile, subsections (2) and (4) respectively states that “repayment shall be by direct deduction of 10% of the beneficiaries salary at source” and “where the beneficiary is self-employed, he shall remit 10% of his total monthly profit to the Fund”. There is no indication in any of these provisions what should be the level of income earned before a beneficiary should start repayment. It is a known fact that even where graduates get a job, it is usually low paid casualised labour. Graduates form the bulk of casual workers in banks, hospitality, entertainment, logistics, app-based transport and the teaching profession today where they work for less than the minimum wage. To ask these low-paid workers who are the bulk of Nigeria’s workforce today to begin to pay 10% of their monthly income for a students’ loan is akin to drawing blood from a hemorrhaging patient. It means such a beneficiary will be unable to settle down and start a family just because they obtained a loan. This is why we think this students’ loan is likely to plunge its beneficiaries into depression, misery and suicide as they have to constantly struggle to pay the loan either while being unemployed or while earning low pay. This is not the kind of bleak future Nigeria’s youth deserve!
STUDENTS LOAN: A SMOKESCREEN FOR INTROUCTION OF TUITION FEE AND COMMERCIALISATION OF HIGHER EDUCATION
Last, but not the least, we in the ERC believe that the Students Loan Act is a smokescreen to legislate into existence tuition fee in Nigeria’s public universities, polytechnics and colleges of education, thereby fully commercializing higher education to the detriment of poor working people. Ironically, most of these so-called leaders pushing this policy of education commercialization benefitted from free education in the 1970s and 1980s. As we have earlier opined, Nigeria operates a tuition-fee higher education system. But by virtue of this Act which predicates the disbursement of the students’ loan on the payment of tuition fee, it is only a matter of time before tuition fee is officially introduced and the government fully absolves itself of any responsibility towards the funding of public higher education. Tinubu in his manifesto actually reveals that the objective of students’ loan is to “give institutions the ability to charge more cost reflective tuition fees”. This means that we will likely see a further reduction of budgetary allocation to public higher institutions and granting a so-called financial autonomy to the management of higher institutions to seek new revenue sources, including tuition fees, to pay staff salary and allowances.
When this is done, the total fees payable by students of government-owned tertiary institutions will increase astronomically. At the moment, sundry fees payable in some public Universities are already as high as N150, 000, aside cost of hostel accommodation and living costs. By the time tuition fee is added, this will take cost of education beyond the reach of the working people and poor Nigerians.
WHERE DO WE GO FROM HERE?
Gentlemen and ladies of the press, we went at length to undertake a clause by clause examination of the Act for the benefit of those who applaud the loan out of ignorance because they do not have full understanding of the details and what they mean. Even if the Student Loan Act is reviewed such that all the absurdities we noted above are removed or amended, the scheme will still not in any way solve the problem of access to higher education. This is because the solution to the problems of public education in Nigeria is proper funding and democratic management of schools. This is the only way to ensure that children of working people and the poor masses are able to go to school.
We believe that the leaders of the National Association of Nigerian Students (NANS) and the students’ bodies who have rushed to applaud the loan scheme have done a disservice to Nigerian students. Did they even read the documents before their infamous meeting with President Tinubu where they were singing solidarity songs for a President who had just signed into law a piece of legislation which allows government to abdicate its responsibilities to the funding of public education? Did they realize they have just signed off on a policy that will raise the cost of education astronomically for the mass majority who will not be eligible for the loan while those eligible would be subjected to lifelong indebtedness?
In the past, students’ leaders would call Senate meetings, congresses and symposia to assess the view of their members and entertain democratic debates and deliberation before taking a position on national issues. Today, many so-called students’ leaders are professional students – that is individuals who register in a university not for education but so they can qualify to continue to lead the students’ body. It is sad. However as Spinoza says, ours is not to lament but to understand. The students’ movement needs an ideological rebirth. Only the mass of students can save their organization. In the meantime however, we demand a NANS Congress to allow genuine students representatives from the campuses to deliberate on what position the students’ movement should take on this policy. This should not be too much to ask if truly these so-called NANS leaders are truly representative of their members. We also encourage students unions and students organisations on the campuses to organize congresses and public meetings of their own and begin to campaign against the students loan and the attempt to introduce tuition fee.
On our part, we in the ERC, both independently and in collaboration with other groups, shall from this day on embark on national sensitization and awareness campaign across Nigerian campuses to expose the Students Loan Act and plan to introduce tuition fee for what they are: a smokescreen to take public education out of the reach of the poor. Given the ideological capitulation of the official leadership of the students’ movement to the side of the government, we believe that it is necessary to build a mass struggle from below.
This is not the first time students’ loan has been introduced in Nigeria. In the 1970s, the federal military government promulgated the Nigerian Students’ Loans Board decree to provide funding to Nigerian students based on loans repayable in 20 years after graduation but this soon collapsed after a while due to massive indebtedness and corruption. In addition, practical examples from across the world show that students’ debt schemes do not work, instead they subject people to lifelong indebtedness. Presently the USA, which is popular for such schemes, is coming to the end of a student loan repayment freeze since early 2020, which was introduced because a lot of people could not afford to get gainfully employed or pay their debts. In Britain, graduating students legally face 40 years of debt repayments. If this this what happens in some of the world’s richest countries what is the future in Nigeria?
For us in the ERC, we believe that Nigeria is rich enough not only to fund public education but to provide free, functional and democratically-managed public education at all levels. The only obstacle is corruption and capitalism. This is why the ERC is committed to play a part in building support for the public ownership of the commanding heights of Nigeria’s economy and their democratic control and management in order to ensure that Nigeria’s wealth is secured from the tiny rich dominating it and made available to be used for the benefit of the mass majority.
(1) We demand that the Students loan should be turned into a grant to support the living expenses of undergraduates in public tertiary institutions whose cost of living has risen astronomically due to the fuel subsidy removal and other anti-poor economic measures.
(2) We hereby call on all Nigerian students, parents, civil society organisations, education workers unions and the Nigeria Labour Congress (NLC) and the Trade Union Congress (TUC) to reject the Student Loan Act and the plan to introduce tuition fee.
(4) We call on the government to fund public education adequately, ensure democratic management of allocation and finance of institutions and meet the demands of unions.
(5) For the nationalization of the commanding heights of Nigeria’s economy under democratic workers control and management in order to secure the resources needed to fund public education and other social services adequately.
Deputy National Coordinator.
Adaramoye Michael Lenin,
National Mobilization Officer.