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NSFAF saves N$100M from failing students

Mon, 28 September 2015 22:46
by Charmaine Ngatjiheue
Education

The Namibia Students’ Financial Assistance Fund (NSFAF) is saving about N$100 million from not paying tuition and assistance grants to failing students.

Chief Executive Officer of NSFAF Hilya Nghiwete told the Villager that her organisation has adopted a policy where they do not pay for failing students as the money can be used to assist other students in need.

Nghiwete added that the failure rate of students is worrisome, mainly because it delays the students from the opportunity to contribute to the local economy.

“The failure rate is also delaying the disbursement of funds to other students. We want to conduct a study investigating the failure, although failure may also be attributed to social factors. We will conduct the study, which will be able to give us possible reasons why. We have an aggressive student sensitisation programme,” she explained.

In the current financial year, the fund budgeted N$1.4 billion for students who need loans, with the bulk of that amount - which is N$1,150 000 000 - being given to continuing students.

Nghiwete added that on average the fund spends NSFAF saves N$100M from failing students N$250m on new students whose loan applications were approved. In addition, in the last financial year, the fund provided financial assistance to roughly 10 327 students. Nghiwete added that NSFAF meets with loan- holders to dialogue with them.

However, contact with students abroad is very minimal, although the fund is trying to create ways whereby it can communicate with them.

“Hopefully, the new information management system would be able to address these issues. In terms of creating contact with students, continuing students are quite covered, while new intakes are engaged at high- school level. We want to create as much awareness and accessibility of funds as possible,” she said.

Nghiwete admitted that there is a need for funds to be increased as the funds given to students does not match the rate at which tuition fees keep on increasing.

In terms of the delays in payments, there is also a mismatch between how the funds are disbursed and the institutions’ financial year ending. She noted that institutions’ academic years start in January, whereas the government’s financial year begins in April.

“There is indeed a need for student funding to be increased, especially with the framework of tuition, which is accommodation and meals, transport and book allowances. Currently, the fund does not cover 100% of the students’ fees. It only covers 80% for accommodation and meals, 50% for book allowances and 20% for transport. The budget is not adjusted at the rate of the increasing tuition fees. We will soon cover 100%, especially now that the Ministry of Higher Education, Training and Innovation is listening to us. Last year, the ministry added N$10 000 on each student’s loan,” Nghiwete said.

Meanwhile, the operations of the fund have been decentralised to all regions, except the Kavango West region, and the fund thus has fullyfunctioning offices in 13 regions.

She added that, “We also reach out to potential employers. When the fund was put up at the ministry, there were limitations in the structure as many things were not catered for, such as the repayment department,” the official continued.

She reiterated that every child with 25 points in five subjects last year who was eligible to get a loan, was awarded such a loan. The fund has requirements for students, as there are two categories, which are the new intakes and continuing students.

“Once the selection is completed, the child will sign a contract, and the funds will be disbursed. We do not pay for students who are failing, as we do not cater for them. The criteria for funds to be disbursed is a student progressing to the next year,” she stressed.

Most of the functions and rules set up by the NSFAF are in line with the Fourth National Development Plan (NDP4), Nghiwete said, adding that all the funds spent are to educate the nation.

“We have a priority to focus on the development of the country, and apart from the education and health sectors, we focus on tourism, agriculture, information technology, manufacturing and chartered accountancy,” she stated.

Repayment of loans Nghiwete noted that there was no proper repayment monitoring structure in place, and the repayment rate is not exactly how they want it to be. She, however, said the repayment of funds is not entirely the fund’s biggest priority, as assisting with providing an education is their main priority.

“When the fund was run from the Ministry of Education, there were only three departments expected to run everything. Thus, there was a limitation to the structure. We then delinked from the Ministry and created a responsive structure dedicated to ensuring things are run accordingly. We can also not impose repayment because we try to understand the living conditions of the students, and the dynamics of the economy do not also cater for prompt repayments. It is a small economy. We want to make sure people pay back what is collectible, but the repayment rate is not at the level we want it to be. There is a complete database of all students who have completed their studies and they are responding well to our call, while others come voluntarily. Even though the repayment rate is not where we want it to be, we are working on it, although there is room for improvement for the recovery of funds. For now, the main priority is the rate of studying, and not the rate at which these funds are collected,” she added.