Rethinking The Financing of Public Universities in Nigeria

The current Academic Staff Union of Universities ( ASUU ) strike in the last several months, has again d to the fore the need to examine the financing strategies for our public universities.

The role of Eductation is so crucial to all development, that neglecting it, is out of the question.

This approach of treating universities as parastatals of Governments contributes to the inefficiencies in the running of our universities. Click To Tweet

It is one of the social investments that is the number one priority for all Governments.

The first problem for our federal Government is the assumption that the government must be dominant in every aspect of providing Education, from appointing Vice Chancellors, to naming Governing Boards. State Governments are also in the same place now.

This approach of treating universities as parastatals of Governments contributes to the inefficiencies in the running of our universities.

Government need to cut back on its involvement in University Administration, restrict its role to Regulating the universities for standards… Click To Tweet

Government’s major role is to ensure that the Nigerian Universities Commission, is a strong Regulator that will ensure standards, as its first duty.

The next aspect, that should preoccupy the Government, should be affordability of University education , for all who qualify.

Providing for this opportunity should take several forms.

The current logjam where ASUU and the FGN has succeeded in grounding Public universities, can never produce a winner. Click To Tweet

The best models in the world, for funding public universities , combine, Government funding, Tuition, Research grants and Donor support in the form of Alumni foundations etc. The Nigerian Universities funding model seems lob-sided, with the Government taking the lion share. There are many things wrong with this model, first, the Government is biting more than it can chew. This is coming from its desire to dominate every aspect of university administration. Government need to cut back on its involvement in University Administration, restrict its role to Regulating the universities for standards , and contribute to ensuring affordable university education.

The presumption, that paying any tuition at all, is unacceptable, is wrong headed. Making it low enough to be affordable should be the goal.

Creating a system that provides scholarships for brilliant students unable to pay tuition, and low interest loans for needy students are better ways to make university education affordable.

The presumption, that paying any tuition at all, is unacceptable, is wrong headed. Making it low enough to be affordable should be the goal. Click To Tweet

In the USA for instance, the Basic Educational Opportunity Grant (BEOG) has ensured that those who want university Education but can not afford it, get support through this program. Its administration is even more fascinating. The Government has approved every kind of financial institution, Banks, Insurance companies, Credit Unions etc .. the opportunity to participate, by allowing them to receive applications that have been vetted for Income level, and made eligible, by the Financial Aid offices of Universities.

This discentralized participation, removes bottle necks.

This grants’ program and several other student loans programs , allows students to invest in themselves, and repay loans, after graduation and employment, into the workforce. This makes university education affordable for almost everyone who wants a university education in the USA.

We can adopt many of these same strategies to make university education affordable here.

The current logjam where ASUU and the FGN has succeeded in grounding Public universities, can never produce a winner. The damage that has been done to date will never be remedied for several years to come. Government melding, in University Administration and biting more than it can chew, is one thing, ASUU too, has become the other side of the problem.

Institutions like TETFUND are not optimizing the monies they receive and their current model for funding projects is defective. Click To Tweet

ASUU has emerged as not knowing what they want. They may be winning the short term battles now, they will surely lose the war. Federating ASUU, into another Federal Government, is not the answer. ASUU in each university should be able to speak for its members. The needs of each university are different. Let the unions in those universities determine what their needs are , and fight for it, within their individual universities.

ASUU in each university, should ensure that they are represented in their Governing Boards, so they are part of decision making in those governing Boards and can see what is available and how money is spent.

The modern German unions, for instance, are represented on the Boards of their companies and not only do they take part in decision making, they also see the Company from the top. They discuss productivity and available resources. They know when the companies can raise wages and when they can not. They are partners in running the companies. University Unions are even in a better place to take part in running their affairs.

Collective bargaining is a good thing, for its members and for moderating the excesses of authorities, there is always a limit. Ask all the large Unions that in the past, went beyond its usefulness, NITEL, NEPA, Bank Unions …all eventually unionized itself out of relevance.

All large Unions, generate more check-offs as dues, and become powerful enough to significantly disrupt activities, and get everyone to listen. There is also a price to pay, in loss of goodwill and sympathy for their cause.

The two things ASUU should fight for, are it’s autonomy, for Universities to run their affairs and a commitment from the Government to provide a certain level of support that can be written into law, with the instrumentality to enforce it.

For instance, the Federal Government should commit to contributing 15%-20% of its annual Budget to Education. This will ensure funding adjusts automatically , when the Government Budget increases. The allocation should be paid directly into the Education Trust Fund every month, at the Federal Allocation Committee meetings, just like the State Governments. This way, they get their allocation directly from the Federation Account, and avoid all the disbursement drama that sometimes accompany releases from the ministry of Education.

The other issue is how the Fund is managed. Institutions like TETFUND are not optimizing the monies they receive and their current model for funding projects is defective. There should be a proper FUND management institution to manage the various monies meant for the Universities. They should have a structure like sovereign wealth Funds.They should be autonomous, managed like any Fund, ….free to invest, issue Bonds …and … Fund projects. There should be a clear criteria for managing the Fund.

There are also other innovative ways that will ensure a better funding model for our public Universities. Click To Tweet

The Fund can raise Bonds, like a municipality, and because of the recurring monthly receipts from the Federation Account, it makes it possible to structure Bonds, to meet its obligations, and can repay, from the FGN inflows and the returns on their investments.

This twin objectives of autonomy and a clear cut commitment from the Government, will provide public universities adequate funding, and will create a more effective ASUU, that is dis-centralized.

These measures will make for a more competitive environment for universities to compete for good students, teachers and Research grants.

Our huge population makes university education, a growth market. There is no doubt about its viability, we can see that in the growth of private universities and the money spent yearly to train students abroad. A more competitive university market here will ensure quality and rapid growth.

There are also other innovative ways that will ensure a better funding model for our public Universities. The housing of students, for instance, can be better done, with public/ private partnerships with universities, providing land and the private sector, building and charging affordable rent, that the university controls, because of their involvement. Even Facilities like Laboratories, can be provided by institutions and companies that trade in these facilities. They build and provide operating leases that the university can pay for gradually. This way, even the maintenance and modernization burden is taken off the universities. There are countless other facilities that can be put in place, to take off the burden of capital outlays from the university.

This way, they can focus on the more important job of educating students and producing quality output for the economy.

Finally, our university lecturers can do more. When they claim that their children and former students earn more, when they go to work in Banks for instance, they discount the fact that time is money. University lecturers have plenty of time, they fail to compute this huge available time into their remuneration.

A good university lecturer can teach in more than one university at a time, they are offering the same lectures and using the same lecture notes. They can involve themselves more in doing research in their field and write Books, not the hand-outs they force on students now.

A first hand experience a few years ago, was very illuminating for me. I attended a 3 year, yearly 6-weeks Semester program (Owner and President’s management program ) at the Harvard Business school, specifically OPM47. This is different from the one semester (Advanced Management program ) that is popular with our top Executives in Nigeria.

I was pleasantly surprised that every year of the 3-year program, almost all the teachers wrote new books that were distributed to students free, because the cost of the books have been built into the course fees. Essentially, they wrote those books and the university buys them, and charges the cost to students. So there was a ready market for the books. I don’t see why our lecturers can not have such arrangements in our universities. This will greatly improve their remuneration and focus them more on Academics. This is a win-win for all.

These are the things they need to do to increase their incomes, not selling diesel, as some of them do now, on the excuse that they are not well paid. They have to choose to be academic and focus on academic things.

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Ogiemwonyi, a retired Investment Banker writes from Ikoyi, Lagos.

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