Mismanagement compounding universities funding challenges

While a number of Nigerian universities have raised tuition fees in a purported move to improve quality, stakeholders say the real solution to value delivery in the sector include accountability, transparency and active private sector involvement.

Despite lamentations over the inadequate funding of public universities, the public university system is still a big spender of government resources.

Total receipts from the Federal Government budgetary allocation for federal universities between 1999 and 2016 stood at over N1 trillion, while regular intervention from the Tertiary Education Trust Fund (TETFUND) for these federal universities in the same period was over N300 billion.

“The fundamental challenge of education in Nigeria is the many decades of poor sector governance and entrenched dysfunction with no mechanism of accountability and performance. Evidence supports this because in 2006, the budgetary trend for the education sector was analysed, which showed an incredulous inverse relationship between more budget allocation and performance of pupils and students” said Obiageli Ezekwesili, former minister of education in a statement.

There are currently 153 universities in the country, accredited by the National Universities Commission (NUC). Of these, 40 are federal universities, 44 are state owned and 69 are private universities. The private universities do not benefit from the Tertiary Education Trust Fund.

According to the TETFund Act 2011, the law establishing the Tertiary Education Trust Fund, only public tertiary institutions can benefit from the Fund. Private universities are still pushing for inclusion, arguing that the Fund is drawn from tax contributions from private sector companies in the country.

“Many years ago, when the universities called upon government to properly fund universities and polytechnics, they said they could not afford to do more than what they were doing, which was a fraction of their budget, so the Academic Staff Union of Universities (ASUU) told the government they will teach them how to make the money” said Folorunsho Asaju, vice chancellor Ajayi Crowther University, Oyo, in an interview with BusinessDay.

“The argument went thus: the best products that come from the universities are hired by the private sector, so they are really benefitting from our products, therefore they should contribute to funding the process. We asked that 2 percent of their profit every year be put into the TETFUND to develop the universities and government bought into it” Asaju added.

In response to concerns of corporate governance in Nigeria’s university system, Ogoh Alubo, a professor at the University of Jos, had said to Financial Quest in an earlier report that “It is not correct to say there is no proper corporate governance in the university system. There is a council, senate and several committees and in administration, the bursary has its accounting procedures.

“If there are problems, these must be due to the challenges of accountability and transparency. In some instances (VCs and provosts have been indicted) personal interests outstrip institutional interests. Alubo, however, believes that “more demand and enforcement of transparency and accountability is necessary”.

A new education funding model in Angola and Ghana, involving private equity firms might help improve accountability and increase transparency in resource allocation.

In this model, for instance, AfricInvest, a US$1 billion asset, mid-market private equity firm, recently backed International Community School, a private school in Ghana, in a preferential share deal. The investment is the sixth for AfricInvest’s third private equity fund, which is now 50 percent deployed. The capital will be used to upgrade the school’s facilities and help support its expansion plans within Ghana, as well as the broader West African region. This deal also secured the private equity firm a seat on the board of the school.

The laws establishing federal universities requires that periodically, a visitation panel comprising knowledgeable individuals should to be sent to these universities to assess the quality of management provided by the governing council, vice chancellor and principal officers.

Investigations reveal that these visitations are irregular, and that undue delays by the government in acting on the reports of these visitation panels, and the poor compliance level to the recommendations of the panels render the entire process ineffective.

Isaac Adeyemi, professor, and vice-chancellor of Bells University of Technology, Otta, Ogun state, one of the 69 private universities, shares Alubo’s view on the existence of governance structures in the university system to ensure that the system is properly managed.

Adeyemi is however concerned that “sometimes, especially under certain rulers, contracts for certain projects are awarded at source to ‘political contractors’.

He further observes that “these (contractors) do not owe allegiance to the universities, but to their benefactors. Universities have no control over the costs of such projects.”

Financial Quest investigations reveal that some public universities still find it difficult to release examination results as and when due, leading to situations where students wait till even their final year, to discover they have shortfalls in their cumulative grades.

Furthermore, the case of university graduates seeking post graduate admissions, going through a cumbersome process to secure their transcripts from their universities does not give the impression of an orderly university system.

 

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