It is not news that Nigeria’s education system is drastically poor. From the frequent strikes by the Academic Staff Union of Universities (ASUU) to high tuition fees by public universities, graduating from a Nigerian university has become as difficult as forcing a horse to drink water.
On rising tuition, APC Presidential aspirant, Bola Ahmed Tinubu (BAT), said he has a solution. But let’s first understand how serious the problem is.
The problem of education financing in Nigeria
Nigeria desperately needs to get more money for education. A 2022 United Nations Educational, Scientific and Cultural Organization (UNESCO) report states that Nigeria now has 20 million children who are out of school, which is largely due to high tuition.
But when it comes to meeting the yardstick for financing that could help pay for these fees, Nigeria is way below the cut-off mark.
In August 2022, United Nations said if Nigeria doesn’t act fast on increasing its education budget to 20%, meeting the global agenda goal for education would prove difficult in 2030.
While President Buhari has allocated ₦1.79 trillion (which is an increase from 8.8% to 7.9%), it is still far off from the 20% ‘cut-off’ mark. Experts have predicted that the future of Nigeria’s education sector is in the hands of our future president now. And that is where BAT comes in.
Bola Ahmed Tinubu [Premium Times]
Bola Tinubu and the Student Loan
BAT has been preaching consistently about his plans for student loans since 2015, when he campaigned for President Buhari.
Fast forward the clock eight years later, and Nigerian citizens are yet to hear anything about student loans. Tinubu has also not revealed any concrete plans to the media on how the student loans will be distributed.
According to Tinubu’s wingman and Federal Minister of State for Labour and Employment, Festus Keyamo, the promise has not been fulfilled due to a lack of revenue.
But if this is true and the country truly wasn’t gaining enough revenue, what happened to miscellaneous money received like Abacha’s loot?
The reality of Tinubu’s student loan
As much as the student loan may sound like a nice plan to avoid high tuition fee billings, this may not be the solution Nigerian students need. Here’s why:
Students may not be able to pay back the loans
The fact still remains that a lot of Nigerian citizens are very broke. In November 2022, the National Bureau of Statistics (NBS) announced that over 130 million Nigerians are suffering from multidimensional poverty.
Just imagine suffering from not just a lack of money, but lack of good hospitals, lack of quality education, and even clean water. That’s what multidimensional poverty looks like.
This is not to talk of the unemployment rate in Nigeria which rose to over 33% in 2022. How would Nigerian students pay their loans if they have no jobs?
It hasn’t worked for other countries
America is a very good example of this. In August 2022, President Joe Biden announced his plans to cancel $10,000 worth of student loans for low to middle-income earners.
This was after America started experiencing loan debt of $1.6 trillion and above for more than 45 million borrowers.
If America could suffer this much student debt with only a 3.7% unemployment rate, who is Nigeria to take the challenge on?
Nigeria already has an education tax
Many corporate companies are already paying for education funding in Nigeria, thanks to the Education Trust Fund (ETF) Act of 2011 and the Education Tax under it.
According to the Act, all corporate companies are required to pay 2.5% of their assessable profit every year to support the funding of Nigerian universities. There are even plans in the new Finance Bill of 2022 to increase the tax up to 10% for these companies. And it’s not just your regular startups. Think of companies like MTN, Dangote Group, Mobil, and many more.
But despite this tax increase, why isn’t this having the desired impact on education financing? These are factors Tinubu should consider before embarking on the implementation of a student loan.