ASUU Rejects Students Loan Act, Demands Grant for Poor Students
The Academic Staff Union of Universities (ASUU) has kicked against the Access to Higher Education Act, 2023, also known as the Students Loan Act, a law that provides interest-free education loans for Nigerians seeking tertiary education.
The union has urged President Bola Tinubu to convert the loan to a grant for indigent students, arguing that the loan is “impracticable and unsustainable”.
The Students Loan Act, which was signed by President Tinubu last week, was sponsored by the Speaker of the 9th House of Representatives, Femi Gbajabiamila (now the President’s Chief of Staff). The bill was first introduced in 2016 but failed to gain traction. It was reintroduced in 2019 and passed by the National Assembly in November 2022.
The act establishes the Nigerian Education Loan Fund, which will be domiciled with, managed and administered by the Central Bank of Nigeria through the money deposit banks in Nigeria. The fund will enable undergraduates to pay for their tuition fees, living expenses, books and supplies.
The act also stipulates the eligibility criteria and application process for the loan. Applicants must submit an application letter, a copy of their admission letter, and two guarantor letters. The loan will be disbursed directly to the institutions of higher learning on behalf of the beneficiaries.
However, the repayment modality of the loan has generated controversy. According to the act, beneficiaries must start repaying their loans two years after completing their NYSC programme.
They must remit 10 per cent of their income to the fund at the end of every month. Defaulters risk a N500,000 fine, a two-year jail term, or both.
ASUU has faulted this arrangement, saying that it will put undue burden on students whose parents earn low income. The union also said that the loan will not be sufficient to cater for the needs of more than one million students in Nigerian public universities.
Speaking on Channels Television on Sunday, the national president of ASUU, Prof. Emmanuel Osodeke, said: “It would have been better if we were giving it to those students who are very poor; it should be called a grant, not a loan.”
He added that previous attempts to introduce student loans in Nigeria failed due to corruption and mismanagement. He cited examples from other countries where student loans led to debt crisis and suicide among beneficiaries. He called for alternative means of funding education and structural reforms to diversify the economy.
He said: “It is better to look for alternative means of funding education than to encumber students whose parents earn N30,000 a month with a loan.
“It should be called a grant since it is coming from the Federation Account and not that (after) these people have access to it and when they are graduating, they have heavy loads behind them, and within two years, if they don’t pay, they go to jail. That’s why we’re talking about collective bargaining; you have views from all sides.”
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