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No debt write offs for N$375m defaulters

by Jeremiah Ndjoze

The Ministry of Education this week maintained that the N$375 million debt owed to the Namibia Student Financial Assistance Scheme (NSFAS) will not be written off amidst calls by some defaulters who spoke to The Villager this week.  
The defaulters made this request parallel to claims that the reason behind them defaulting is due to bad strategies of the Ministry of Education and the lack thereof in the recouping of loans that are granted by the Ministry of Education to previously disadvantaged Namibians.

They pleaded with Government to write the debt off as bad debt and to start the loan granting process with a new system in place.
Others called on Government to put strategies in place through which they can provide jobs to them as repayment even if they are to work as volunteers.  
“For example what Government should have done with Census is to call a required amount of loan defaulters to work at a minimal wage instead of hiring people some of whom are already employed and paying them salaries amounting to over N$10 000,” Steve Karamata one of the defaulters said.  
Karamata graduated at the University of Namibia in 2003 but has made no single repayment towards his loan. Nor did he receive a single communication from Government or anything “to motivate me to act on the debt”.
He completed his BSC Agriculture degree in three years, two of which were paid for by Government running a bill of N$23 000.
So why has he never repaid the loan?
Says Steve; “One often completes university and stays idle for two to three years job hunting. In between the frustrations of being jobless you get side tracked and forget about the loan.”
Worse still the record system on which the defaulters’ files are kept is not computerised.
He maintains that twice during the two years of his unemployment, he went to the Ministry to enquire about his debt but could not receive help from the officials.
“The ladies there could not even retrieve my file. They had to go through the odious task of checking hard copy files which make them tiresome and lazy,” he said.
Another defaulter, Olivia Klein, also concurred with Karamata maintaining that while some students may be reluctant to repay their loans, many have forgotten about them due to a lack of constant sensitisation.
“I haven’t repaid. I haven’t received that push from Government. Apart from one or two letters nothing much has happened. I graduated two years ago,” she said.  
But not all the beneficiaries have defaulted on their loans. Tony Gaseb told The Villager that he repaid his debt in full.
“I completed my accounting degree at Unam in 2004 and I started making my repayments in January 2005 when I started working,” he said.
He attributed his commitment to the repayment to his faith maintaining he repaid the loan because he is a staunch Christian and according to Christianity this is the right thing to do.
“As a Christian and I didn’t want to stand in the way of future loan beneficiaries so I paid N$200 per month since January 2005. The remaining amount I settled last year when I received my bonus,” he added.
The NSFAF provides loans amounting to roughly N$200 m each year. Last year, the budgetary allocation to the NSFAF was N$224 m. This amount supported student studying at local tertiary institutions and abroad and a total of 15 825 students benefited from this amount in 2010 alone.
For the financial year, 2011/2012, a total of N$296 631 000 has been allocated to the NSFAF a 32% increase.
Ministry of Education’s Public Relations Officer, Toivo Mvula confirmed the high default rate on the loan repayments citing unemployment as one of the major contributing factors. But he also pointed out that while there are those who are genuinely unemployed, there some that are simply ignorant and are reluctant to pay back.
“We need to be informed of the unemployment status of former beneficiaries in order to freeze the interest paid on top of the loan during the time of their unemployment,” Mvula said.  
He urged loan beneficiaries to comply with their contractual obligations to the loan in order to avoid legal action and subsequently exorbitant payments.