Economy fuels debate over fund’s exclusion of private HE
Nigeria is battling galloping inflation, according to the records from the National Bureau of Statistics (NBS). The local currency has also plunged against the greenback, resulting in a high naira to US dollar exchange rate which, in turn, leads to a steady rise in the cost of goods, including building materials.
The Nigerian government established the TETFund in 2011 to manage and disburse education tax – a 2.5% tax imposed on the annual profit of private companies – to fund public tertiary institutions in Nigeria. The agency provides intervention for public tertiary institutions regarding infrastructure, research grants and scholarships for academics aspiring to higher degrees.
Over the years, several private tertiary school administrators have demanded inclusion in the TETFund infrastructural intervention, arguing that they pay high taxes to the government. But the fund management and academics in government-run higher institutions have strongly kicked against the demand.
Private schools need urgent intervention
Private universities have since renewed their clamour as Nigeria’s weak economy bites harder.
“The current [economic] challenges and escalating costs confronting tertiary institutions, particularly private-owned universities, call for urgent government intervention,” said Dr Ikechi Ezeh, the founder of Christopher University, a private institution in Ogun State.
Ezeh, who spoke on 25 March 2023 during the school’s convocation, contended that privately owned institutions have helped significantly in bridging the gaps created by the inadequate capacity of government-run schools to accommodate a high percentage of candidates seeking admission yearly.
“The only way to encourage private institutions is for the federal government to extend the TETFund grants to them, and to not restrict funding to public universities,” he added.
The Vice-Chancellor of Chrisland University in Abeokuta, Professor Chinedum Babalola, said private institutions should be treated as charity organisations and not profit-making establishments, THISDAY reported.
“When you go to the public universities, you will see the TETFund buildings. The major financial drain in a university is capital projects. Budget allocation for capital projects in private universities runs into several billions of naira. You can imagine if the TETFund should construct two or three buildings at a private university such as ours; that would be a big relief,” she said.
Private school income is limited
Professor Mahfouz Adedimeji, the vice-chancellor of Ahman Pategi University in Kwara State, told University World News that private universities are adversely impacted by the harsh economic climate. He noted that the major source of revenue for these universities is tuition fees, but in a distressed economy “like ours, to pay the fees, even where they are subsidised considerably like at my university, is difficult for many parents”.
“I believe that the TETFund Act of 2011 should be amended to cater to private universities, too, because they are contributing to the human capital development of the country. These universities are not training Siberians or some aliens from distant planets. They are training Nigerians, and the current interventionist apartheid should be discarded for a more inclusive development,” he added.
But, several academics in government-run institutions and the TETFund have expressed reservations about the call to extend the fund to privately owned schools.
Professor Samuel Edoumiekumo, the chairman of the Committee of Vice-Chancellors of Nigerian Universities, told University World News that privately owned higher institutions are still viewed as profit-oriented, adding that taxation is not enough of a reason for them to seek inclusion in the TETFund.
“Every business pays taxes, so, that they are paying taxes should not be an argument,” he said.
Time to amend the TETFund Act?
Edoumiekumo, however, admitted that the high cost of building infrastructure in tertiary schools is a concern that may necessitate a review of the TETFund, provided that the private schools can prove that they are not out to make a profit.
Abdulmumin Oniyangi, the spokesperson for the TETFund, insists that private tertiary institutions cannot benefit from the fund’s infrastructural interventions – at least for now.
He said: “The law says that the fund is meant for the public higher institutions. It is not the fault of the agency that private higher institutions are not benefiting from it. If the law is amended to include private tertiary institutions tomorrow, so be it. We will comply.
“This is not a question of the TETFund trying to sideline private institutions; it is a matter of law. However, in the area of research that contributes to national development, private institutions can access the fund if they meet the requirements. Regarding other areas such as infrastructure, the TETFund only intervenes in public higher institutions.”