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The earlier plan by the federal government to deduct 40 per cent of the Internally Generated Revenue (IGR) of universities was highly criticized by Nigerians, university teachers and other stakeholders in the tertiary education sector. Following public outcry over the bad policy, the federal government some days ago, reversed itself and rescinded the illogical initiative.
Before the policy flip-flop, the government had in a letter dated October 17, 2023 entitled “ Implementation of 40 per cent automatic deduction of internally generated revenue of partially funded federal government institutions” said it would begin the deduction of the 40 per cent varsity IGR with effect from November 2023.
The letter signed by the Accountant General of the Federation, Mrs. Oluwatoyin Madein, and Director of Revenue and Investment, Office of the Accountant General of the federation, Felix Ore-Ofe Ogundairo affirmed that the directive was in line with the finance circular of December 20, 2021.
Consequently, the Committee of Vice Chancellors of Nigerian Universities as well as lecturers of the nation’s colleges of education operating under the aegis of Colleges of Education Academic Staff Union (COEASU) kicked against the inimical policy and urged the federal government to rescind the plan forthwith. They further argued that the Finance Act 2020, which the government relied on in giving the directive, demanded only the surplus of the IGR if there is any.
The VCs and COEASU separately argued that it smacked of double standards for government to deny them autonomy and at the same time demand 40 per cent of their IGR. In apparent unanimity, they threatened that should government go ahead with the plan that parents would bear the brunt. The plan to deduct 40 per cent IGR of universities and other tertiary institutions is ill- conceived. It will worsen the funding inadequacy of federal universities and other tertiary institutions that are poorly equipped and staffed. The plan would have overburdened the parents and sponsors of their students.
The government should not use its universities as revenue-generating agencies. They are established for the purpose of research and the imparting of higher skills and knowledge. Universities are heavily funded to enable them carry out these responsibilities. Government should never demand any money whatsoever from their limited IGR. Those who initiated the policy in the first place must be excoriated for misleading the government. It shows the quality of people serving in this government since its inauguration on May 29, 2023.
The new administration had been characterized by many avoidable policy flip-flops. The removal of fuel subsidy without mapping out palliative measures is one of them. The unification of the foreign exchange markets without much thought is another. With the recent increase in tuition fees in federal universities and its consequences, the government cannot at the same time be asking for 40 per cent of varsity IGR.
During the administration of Muhammadu Buhari, varsity lecturers were on strike for a cumulative 719 days, all because of agitation for better funding of universities and welfare of varsity workers. Let it therefore be reiterated that universities are not established for profit. Moreover, the literacy rate in Nigeria is not outstanding. With 31 per cent illiteracy rate, Nigeria has about 62 million people who are illiterates. The deduction of 40 per cent IGR from the varsities will further promoted illiteracy as it is going to reduce access to higher education.
It is also paradoxical that a government that is praising itself over the establishment of the students’ loan scheme, which is yet to take off, is mooting the idea of collecting 40 per cent IGR from its poorly funded universities and other tertiary institutions of higher learning. The government can increase its revenue base by increasing productivity in the agricultural sector. It can further diversify the economy through the mining sector. Let it stop oil theft and unbridled gas flaring.
Above all, let the cost of governance, the highest in Africa, be drastically reduced. The plan also negates its recently unfolded policy to review its tax rate for affluent persons in order to protect the poor. How can the government protect the poor if they are denied access to education? The federal government controls the nation’s revenues. It controls the oil revenue and other sources of major revenues to the country.
Nevertheless, it is good that the government has reasoned with Nigerians and other stakeholders and rescinded its earlier decision on deduction of 40 per cent of IGR from its universities and other schools. Next time, let the government deliberate fully on any policy before imposing it on the people. In place of the bad policy, government can generate additional revenues through other sources other than the education sector.
Government should grant autonomy to the universities and stop meddling in their affairs. Government needs to reduce its involvement in university administration. Let it begin to devote 15-20 per cent of its annual budget to the education sector.
