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Published On: Mon, Sep 7th, 2020

What is the solution to underfunding in the education sector?

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By Kazeem Shamsudeen

The Coronavirus pandemic has provided further evidentiary ammunition that Nigeria’s education sector has been pigeon-holed by poor funding and lack of administrative management dexterity from University officials. While universities in other countries were shut down at the beginning of the global pandemic in November last year, but later on these universities moved on to e-learning to maintain stability of the academic calendar before finally proceeding to embark on research in developing vaccines to cure the mysterious virus. Russia already announced successful launching of vaccine to cure Coronavirus after the Clinical trials of vaccine against the novel coronavirus were completed on volunteers at Sechenov University and the Gamaleya Federal Research Center for Epidemiology, on the other hand, the UK Government granted a 22 million pounds subvention to the Imperial College and Oxford University to develop research on successful prosecution of vaccine. Other governments in Europe, China, and Japan toe the same line. Even an Island African country like Madagascar made a bold move to develop indigenous pharmaceutical herb to treat the virus before the World Health Organization condemned the indigenous herb to brutal rejection. In the case of Nigeria, university students especially from medical sciences were at home doing nothing up till this moment. Meanwhile, their counterparts overseas were busy scientifically developing vaccines in order to cure the pandemic.
Currently, [University of Ibadan], our best University in Nigeria only ranks 401 in the world according to Times Higher Education World University Rankings of which elevation methodology of Universities is based on Teaching, Research, Citations, Industry Income and International Outlook. The five criteria’s used for ranking elevation are what most Nigerian universities are lacking, hence the low rating. First of all, teaching in Nigeria Higher institutions are highly theoretically driven, instead of been practically driven with emphasis on practical demonstration of knowledge based on national policy planning objective. Research has been a mirage due to low public endowment funding with no world class breaking research ever achieved in Nigeria while only few institutions can boast of significant industry income to complement government subvention. The International outlook is basically out of the university’s hands, but on the government ‘s side. No student from Europe, Asia and America will ever want to come and study in a country portrayed in the Western media as the poverty headquarters of the world, terrorism and child trafficking hub and banditry axis. All these issues must be addressed before our universities can attract International students to make it have a favorable global outlook.
More creative and adaptable financial strategies are needed in order for Nigerian Universities to offset the declining quality, resource use efficiency and learning effectiveness that confront them. And there is a need to develop tactics to curb internal loopholes in higher institutions and increase funding to the education sector in a revenue generating method and reinvest the profits back. Making research and development, exploiting tax laws including growth in medical technology a priority is crucial to achieving this.
For instance, the CBN 2019 report on Personal foreign travels also known as Personal Travel Allowance [PTA] stood at $9.01 billion and further showed that education gulped 50.5 % [$4.5 billion, over #1.7 trillion naira] while Medical tourism representing 21.3% gulped a total sum of [$1.92 billion, close to #760 billion] within that period. The Central Bank of Nigeria report indirectly conjectures that the majority of Nigerians prefer travelling abroad for schooling and medical treatment. This is to show that there is a link between education underfunding and poor health infrastructure in the country.
In a tacit confirmation of these claims, the Minister of State for Health, Dr Osagie Ehanire, earlier this year said Nigeria is spending over $1billion annually on foreign medical treatment; this is over #381 billion and if added with the PTA expenses and the return it will create as direct investment if expended in Nigeria can go a long way in establishing and strengthening a world class university of medical sciences and an industrial academy in each of the six geo political zones of the country to develop high technology in the area of cancer, spinal cord, plastic and neuro-surgery, cardiovascular related diseases such as routine health check, hypertension, heart failure, stroke, arrhythmias, angina, coronary artery disease, valvular heart disease as well as fertility and transplant tourism which are ailments which drive a lot of Nigerians overseas. All these are why heavy investment in research through higher institutions is key to the growth of Nigeria.
Tax laws also need to be tinkered with to open more floodgates of opportunities to raise funds side by side and cut down the cost of governance in Nigeria through reduction of government appointees allowances. One major way to do this is to increase the education tax by three percentage points. Section 1(1) of the Tertiary Education Trust Fund (Establishment Act) imposes a charge called annual Tertiary Education Tax which shall be assessed, collected and administered in accordance with the provisions of the Act. Section 1(2) provides that the tax is at the rate of 2% which is to be charged on the assessable profit of a company registered in Nigeria according to the provisions of Allied Companies Act [CAMA]. To administer this, the Tertiary Education Trust Fund (TETFUND) was established. If the education tax is increased to 5%, the government could get trillions of naira to finance Tertiary education with political will. This will be done side by side incentives and tax allowances to assuage the possible loss of profits for companies paying this tax. Another way is to amend the Petroleum Profit Tax Act to allow companies who win or obtain petroleum entirely under the umbrella of the NNPC account to pay exactly the same percentage that their counterparts are paying as Petroleum Profit Tax. This will also be channeled into education. As it stands now, only companies who win, obtain and engage in petroleum operations on their own account pay petroleum tax. These two steps could raise about #3trillion naira to fund Tertiary education in just five years which will be complemented by other sources of income earlier mentioned.
On their own parts, the Tertiary institutions must explore alternative sources of finance through Public Private Partnership arrangements and be financially prudent and transparent. The current face-off between Dr. Wale Babalakin [SAN] led governing council in UNILAG and the varsity’s Vice Chancellor, Professor Ogundipe Oluwatoyin over counter allegations of autonomous spending running in to hundreds of millions of naira and the construction of a #500 million naira swimming pool which once raises a stir in Obafemi Awolowo University in 2015, prompting workers and students to demand for the removal of the Vice Chancellor are some examples of high-level of mismanagement by university authorities that should be tackled by government through the establishment of independent auditory panels to audit the account of higher institutions in each budgetary year. When all these are implemented to the fullest, education will not only be properly funded in Nigeria, it will also be affordable for the poor people without any depletion in the quality and standard.

Kazeem Shamsudeen is an Associate at MIPAG Policy Think-Tank Group

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