Understanding the NELFUND Initiative
The Nigerian Education Loan Fund (NELFUND) has emerged as a significant initiative by the Federal Government aimed at providing interest-free loans to students in tertiary institutions. This policy has gained widespread recognition among students and parents who are either current beneficiaries or potential applicants. However, for NELFUND to sustain its impact, it is crucial to address several concerns that could threaten its long-term viability.
Policy vs. Programme: Clarifying the Framework
According to a simplified explanation of policy and programme, a policy is a high-level statement of principles or rules that guide decisions and actions, while a programme is a specific, planned series of activities designed to implement that policy. A policy is typically initiated by an authority such as a government, national or sub-national, and a programme to implement the policy is imperative. While a party or an individual can propose a policy, it must be officially adopted to have any enforceable power.
Whether NELFUND is a national, party, or personal idea, it should be adopted as a policy due to its desirability. However, for a policy like NELFUND to become national and enduring, it must have legislative authorisation. Has NELFUND been adopted as a state policy by the National Assembly? If not, another government, regardless of political affiliation, could assume office and discontinue it due to lack of funds or political reasons. This scenario is similar to what is currently happening with TETFund, which was established through the 2009 ASUU-Federal Government agreement. Although TETFund and NELFUND serve different purposes, they are both essential. If NELFUND is adopted as a national policy, its funding should be included in the annual budget, ensuring some level of stability in its execution.
Threats to the Survival of NELFUND
The survival of NELFUND beyond political challenges is already under threat. One of the most pressing issues is its funding. The available funds are struggling to meet the growing demand, and this problem is becoming increasingly apparent. Additionally, debt recovery will become a significant challenge in the future.
Funding Constraints
Recently, there have been complaints about the ability of the available funds to meet the demand. Federal institutions should be held responsible and called to order. Candidates for admission into tertiary institutions often prioritize school fees over the quality of training or the reputation of the institution. This is why many students apply to federal universities, which used to charge the least school fees, followed by state universities with higher fees, and finally private universities. Research supports this trend.
To benefit from the funds provided by NELFUND, federal universities have introduced high fees for different courses, effectively competing with state universities. State universities have also raised their fees to keep up with rising costs and to secure a larger share of the national resources. There is no consideration for the amount allocated or voted for the fund in their thinking. They assume the funds are inexhaustible. Such actions not only negatively affect the survival of the fund but also shift the responsibility of funding education from the federal and state governments. Over time, the national funds allocated to NELFUND cannot increase indefinitely. The managers of the fund must introduce policies to prevent the project from collapsing due to indiscriminate fee hikes.
Rising Applications and Debt Recovery
Rising applications for NELFUND support are expected to begin in the upcoming academic session. The number of candidates seeking admission into tertiary institutions has started to increase because the financial barrier that previously prevented them from applying is now being addressed by the NELFUND project. Before, siblings had to queue to attend schools because most parents could not afford to fund the education of multiple children. Many potential students will take advantage of the scheme now, especially when they are unsure of its sustainability.
On the topic of debt recovery, there is a big task ahead. Just as the Federal Government sees global credit as largess and seeks debt forgiveness for contracted loans, state governments also view credit from the Federal Government as gifts, resisting deductions from their allocations. The mentality of Nigerians, whether corporate or individual, regarding debt repayment is problematic. Reports indicate that farmers under various schemes have refused to repay credits extended to them for production, and there was no repayment of the intervention funds of 2010. There are numerous billion-naira worth of bad debts hanging in banks across the country.
It is important for NELFUND beneficiaries to understand that only repayment of the credit will provide funds for future beneficiaries. Unfortunately, repayment depends on employment, and unemployment in the country is a major issue. The mobility of labor, which allows workers to be employed abroad, cannot be ignored. Graduates who find employment in Nigeria may not be able to escape repayment, given the information stored on them, but those who are employed abroad may not be as patriotic as to voluntarily inform the country that they are employed and ready to redeem the debts.
Ensuring Long-Term Sustainability
The survival of the NELFUND project beyond Tinubu’s administration and even in perpetuity must be worked out from the beginning and fine-tuned as we move forward. While NELFUND focuses on student sponsorship, TETFund should focus on physical and human capital development in the institutions. Education deserves all the funds and physical efforts that the nation can offer. China’s current position is a testament to the core importance of education and government commitment, as seen in the country’s 1949 revolution.
