An overhaul of Nigeria’s tax template will subject monies accruable to the Tertiary Education Trust Fund (TETFUND) to graduated cuts for five years, beginning this year, if a legislative seal is given to a proposed plan of the Tinubu administration. This would certainly vitiate its interventionist role in the tertiary education sector. What is more, the agency is now programmed to get zero direct funding in 2030, and thereafter.
As embedded in the Tax Reform Bill 2025 under consideration in the National Assembly, the agency will receive 50 per cent of its funds in 2025 and 2026; and 66 per cent in 2027, 2028 and 2029. Its loss from this arrangement would be gained by the newly created Nigerian Education Loan Fund (NELFund). Others to be gainers are the National Information Technology Development Agency (NITDA) and the National Agency for Science and Engineering Infrastructure (NASENI). These are expressly stated in Section 59 (3) of the tax bill from the executive arm of government.
|
|
Miffed by this, the Academic Staff Union of Universities (ASUU) has called on the President of the Senate, Godswill Akpabio, and his House of Representatives counterpart, Tajudeen Abass, to halt the proposal, drawing their attention to its inherent danger, amid the gross underfunding of higher education in the country. ASUU’s statement on the matter said, it was its “considered view that abrogating the TETFund Act of 2011 by design, or default, will be a great disservice, not just to education but to Nigeria as a nation.” It added that, “…giving zero allocation of Development Levy to TETFund as from 2030 is a technical way of abrogating the agency.” PREMIUM TIMES understands the union’s concern, as virtually all the infrastructural support financing that public universities receive are from TETFund.
But the Special Adviser to the President on Information and Strategy, Bayo Onanuga, in a spirited rebuttal said that, “Government agencies like NASENI, TETFund and NITDA will continue to be funded through budgetary provisions supported by company income tax and other levies paid by businesses, which are currently overburdened by special taxes.” There is an attempt to obfuscate or confuse issues by the presidential spokesman, with his statement underscoring that the tax bills “do not propose that NASENI, TETFund and NITDA will cease to exist in 2029, following the bill’s passage.” This is clearly not the point.
|
|
|
|---|
At issue are the suggested decreased funding of TETFund between 2025 and 2029 and its zero allocation from the development fund in 2030, and thereafter, which he avoided commenting on. Therefore, the denial misaligns with the provisions of the Tax Bill and ASUU’s response to this. Guile such as this signals doubts about the government’s sincerity of purpose.
While our tax system should be progressively reformed in the best interest of the nation, which we had robustly supported in an earlier editorial, “Let the tax reforms bills be,” of 9 December 2024, but the component on dissipating accruals to the TETFund in the next five years, seems to us as ill-advised, and at odds with the progress of tertiary education in the country.
Nigeria’s present fiscal reality does not support annual budgetary provisions as a dependable source of funding tertiary education. TETFund was established precisely because the government was unable to adequately fund the university system in earlier years. Several other sectors have not fared better, as can be seen in the 2024 fiscal cycle. The Minister of Health and Social Welfare, Ali Pate, for instance, recently decried the release of only 15.06 per cent of the ministry’s capital expenditure. This represents just N26.55 billion out of the N233.69 billion outlay in the 2024 budget. Also, the ministry is yet to collect a kobo from its N57.39 billion multilateral and bilateral loans for capital projects in the same budget.
This scenario is suspect. There is a N13 trillion deficit in the 2025 budget, an increase of N4 trillion from the N9 trillion in 2024. A rational deduction to make from this is the likelihood of an annual spike. With the N6.04 trillion used for servicing debts in the first half of the same year, as against N3.58 trillion used for the corresponding period in 2023, government should hold its breath on TETFund’s fiscal alteration.
TETFund was created out of ASUU’s ingenuity and perennial strikes for better funding of tertiary education in Nigeria. Set up in 1993 under the military through a decree as the Education Trust Fund, this fiat law was repealed and re-enacted in 2011 by the National Assembly. From the original 2 per cent as education tax deducted from the profit of companies as its source of funding, this was reviewed to 2.5 per cent in 2021 and then to 3 per cent in 2023. These spikes were not without reasons.
TETFund’s imprints are all over public universities, polytechnics and colleges of education across the country, in their infrastructural projects such as the building of classrooms, students’ hostels, establishment of libraries and furnishing them with books, in addition to the underwriting of academic staff training abroad and research.
Between 2009 and 2013, the agency reportedly spent N300 billion in transforming tertiary institutions, while 800 academics benefitted from its postgraduate training sponsorships. And from 2011 to 2024, it spent N1.838 trillion on funding tertiary education, with universities gulping N918.7 billion, according to the Executive Secretary of TETFund, Sunny Ochono.
Despite all this, the level of decay in our tertiary institutions is most embarrassing, and as a result, they cannot compete or be reckoned with globally. ASUU is routinely on strike, as it keeps up its demand of a better national academic environment. This had climaxed in the Federal Government/ASUU Agreement of 2009, renegotiated in 2012, which required the injection of N1.3 trillion, in N200 billion tranches, into the system over a five-year period. Unfortunately, this was observed in the breach. Consequently, no year has passed since then without three to six months of strike. That of 2020 spanned nine months, with a full academic year ultimately lost.
As far back as 2012, the Federal Government set up a committee to study the “Needs Assessment of Nigeria’s Universities,” which revealed a shocking deficit of 32,000 PhD holders, the minimum qualification to teach at that level. In 2013, the report was presented to the Federal Executive Council (FEC) on 1 November. It highlighted that “Students cannot get accommodation; where they get, they are packed like sardines in a tiny room,” and there is “No light and water in hostels, classrooms and laboratories,” among other challenges.
ALSO READ: TETFUND chief calls for university autonomy
It is tempting to assume that 12 years later, significant improvement would have been made with TETFund’s role. While this has helped, it is not enough still, as the government creates new universities and many universities admit students beyond their carrying capacities, and run courses that are not accredited. In some universities, more than 700 students are enrolled in a course, making lecture halls overcrowded, without seats and a lot of students standing outside and peeping through windows when lectures hold.
This is where ASUU and our tertiary institutions impair the system they seek to salvage. There have been cases of the so-called new universities engaged in sleights of hand, presenting staff from older universities as theirs, in order to scale through accreditation processes. This is unethical and irresponsible.
Yet, for TETFund, the N200 billion reckless disbursements by its past officials, which irked President Muhammadu Buhari and made him halt its 2016 budgetary allocation until further notice, are eye-openers to the many abuses that it could be susceptible to. The then Executive Secretary of the Fund, Abdullahi Baffa, had noted then that only N50 billion was properly released. It was a period “when special intervention fund was turned into something else.” These are issues that need to be forestalled and critically addressed, going forward. The agency certainly needs cleansing, to provide a guardrail to its salient mandate.
New thinking and greater commitment to well-funded education should influence policy directions of government. Ignoring these imperatives is a recipe for worsening an already bad situation. The ugly experience of the University College Hospital (UCH), Ibadan, going for over 100 days without electricity and water, because it could not pay its bills, makes the concerns around the funding of education in the country starker. Its medical students, anguished by this disorder, were on the streets in protests a few weeks ago. Government should actually take the funding of education with all the seriousness it truly deserves in the public interest and not subject it to wiles of policy flip-flopping, indicative in the move towards a gradual undoing of TETFund.
Discover more from Premium Times Nigeria
Subscribe to get the latest posts sent to your email.
