Higher Education: Why FG Needs to Step Back

By Bolaji Abdullahi

I have been following with keen interest Olusegun Adeniyi’s columns on the issue of subsidy in critical sectors of our national life, including education and I want to make some quick points. The key issues to consider when discussing the funding of higher education are effectiveness and efficiency. The first has to do with whether the amount being spent is adequate; and the second, with whether the money is being spent in the best way possible. The funding of Nigerian universities is currently not meeting either of the two tests.

A former Vice Chancellor of the University of Lagos, Professor Rahmon Bello identified five key funding sources for a university. These include tuition fees, proprietor’s fund, endowments, research, and innovation grants and, investments and businesses. Now, federal universities draw their funding mostly from the proprietor’s fund alone, while, according to him, 90-95 per cent of the universities’ budgetary receipts go to personnel cost. What this means in essence is that our universities are existing mainly to pay salaries rather than to perform their core duties of teaching and research.

Funding of education needs to reflect the national priority. Today, it does not. Available reports indicate that Nigeria spends up to four times on higher education than it spends on basic education. This conflicts with global and regional pattern on education spending. In almost all the countries of the world, governments invest the bulk of their resources on basic education, which is the only level of education that must be free, compulsory, and universal, as a matter of right.

It is quite ironic that basic education that has been statutorily declared as free and compulsory has become the most expensive level of education in Nigeria. As parents lose confidence in the ability of public schools to educate their children, they now mostly prefer fee-paying private schools. The grand irony also is that even parents who were prepared to pay so much for basic and secondary education have come to expect tertiary education to be free. Therefore, ours is perhaps the only country in the world where it is more expensive to get basic education than to get a university education.

This absurdity has been sustained by government’s fallacious policy of free university education which has mostly served to cover up its failure to develop a needs-based university system. Our post-secondary education system is too narrow and therefore leaves the universities as the only real choice left to our children. Therefore, looking at the long line of children waiting to enter the universities, government instinctively responds by expanding access. Whereas, what we need to do is to provide real options by creating opportunities for post-secondary education that delivers real skills and globally recognised certifications in different sectors that meet the requirements of available jobs, most of which do not even require a university degree.

One continues to wonder why it is difficult for government to see that its pre-occupation with expanding access to university education without corresponding direct investments in teaching and research has not only brought down quality, but is also compounding the youth unemployment situation, which remains a time bomb. The painful truth is that university education has worked better for parents in this country than it is currently working for their children. This is not natural.

To put it plainly, Nigeria is paying so much in the name of subsidy in higher education but getting very little or nothing in return; whether in terms of meeting the national objective of developing high level manpower, or even in terms of economic and social benefits to the individual students and their families. We therefore need to change course. As I have noted earlier, what government has done over the years is to subsidise the personnel cost of the university administration rather than support the students who should benefit from the subsidy. Yes, government must continue to subsidise the universities, but the subsidy needs to be repurposed.

Best practice is to fund the universities based on students’ needs. How much does it cost to give university education to a student in Nigeria per annum? This cost may also vary from locations, course of study and sundry factors. What we need to establish therefore is the basic minimum cost. A 2005 estimate by the National Universities Commission (NUC) projected that it would cost between N345,000 and N680,000 to train a student, depending on the faculty. In 2021, these figures will merely be illustrative. Therefore, if we take N680,000 as the average cost of training a student, it will mean that a university with 10,000 students will receive an allocation of N6.8billion if the government intends to continue with full subsidy. The benefit of tying cost to students is that it would, among others, ensure that students become the centre of universities’ planning and operation. Now, students are hardly part of the plan. What this also means is that the universities are effectively funded as the cost per students is allocated around the core elements of that students’ training, which will include payments to lecturers, teaching facilities and other services, which would have been factored into the cost.

However, should government decide on partial subsidy, which means only a percentage of this cost would be borne by the government, the universities should still expect to get full payments. The difference in this case is that other people are also contributing to the payment besides government. For example, if government decides to pay 60 per cent of the cost, it means the university would still expect to receive N6.8billion for its 10,000 students, but in this case, only N4.080billion will come from Federal Government and the balance of N2.720billion will be paid by the students as tuition at N272,000 per student.

Meanwhile, tuition payment is one of the most politically contentious issues in Nigerian education. However, as shown earlier, if it is clearly defined as a means of improving quality, which in turn will enhance the employability of the students upon graduation, most parents would be willing to pay. Nevertheless, the idea of a federally backed Education Bank needs to be brought back on board to off-set the challenge that students from poor homes are likely to face when they now need to pay tuition by awarding students loans. But this must be part of a broader plan rather than a stand-alone initiative. In addition to student loans, merit-based scholarships and general bursaries are other avenues of funding that would be open to students from governments at all levels.

Nigeria cannot continue to pretend to give free university education, which is quite costly because it has made it difficult for students and their families to demand accountability or improvement even when available evidence suggests that prospective employers no longer have confidence in the system. As things stand, our universities do not need to change anything. After all, how much money they get or how many students come to them each year does not really depend on anything they do in terms of their core functions. This needs to change.

Global trends indicate that less government is better for universities and that institutions of higher learning function best when they are self-governing. It must be noted however that the degree to which universities are autonomous worldwide is also mostly determined by the extent to which they rely on government funding. The Academic Staff Union of Universities (ASUU) has been at the forefront of fighting for university autonomy; but the quest for autonomy would always be undermined by the universities’ corresponding desire and willingness to continue to draw the bulk of their funding from the federal government, especially those related to salaries and other compensations.

What we should aim for is a system of embedded autonomy, which gives the government overall policy formulation, coordination, and monitoring role, while freeing the universities to operate as autonomous units. This relates to what the Harvard Professor, Lant Pritchett has described as the ‘starfish’ system, which allows for a level of control from the centre but grants freedom to each of the limbs to operate with significant autonomy. Compared to a ‘spider’ system, which pulls responsibility for all functions to themselves, especially through financing; a starfish system, he says, creates local operation which “pulls apart all of the many functions and activities and allocate those across the system.”

Essentially, what we require is a system that would foster high level competitions for resources and even for students. This will create the condition for each university to develop at its own pace, based on real accomplishments in research, in teaching and in their contributions or responsiveness to national development goals. We should have done this many decades ago. But we can start now.