FG Bows to Pressure, Cancels Plan to Take 40% of Varsities’ IGR

Bennett Oghifo

The federal government has bowed to pressure and cancelled the controversial plan to deduct 40 per cent of the Internally Generated Revenues (IGR) of federal universities and transfer such to the Federation Account.

The government had in a letter dated October 17, 2023, titled ‘Implementation of 40% automatic deduction from internally generated revenue of partially funded federal government institutions’, said it would begin the deduction with effect from November 2023.

However, the Minister of Education, Tahir Mamman, announced a policy reversal yesterday during the 75th Founder’s Day ceremony of the University of Ibadan and described the 40 per cent IGR policy implementation as “ill-timed”.

Mamman said President Bola Tinubu approved the cancellation following the controversy that trailed it.

He also maintained that it was not the best time for such a policy “since our universities are struggling.”

In his speech as a Visitor to the university, Tinubu pledged his commitment to the reform of the nation’s education sector as the bedrock for national development.

Mamman said, “The 40 percent IGR automatic deduction policy stands cancelled. This is not the best time for such a policy since our universities are struggling.”

The letter for the planned deduction of the IGR of universities, was 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.

It said the auto-deduction policy of gross IGR was in line with the Finance Circular dated December 20, 2021.

Countering, the Committee of Vice Chancellors of Nigerian Universities wrote a protest letter to the government, demanding that it rescind the plan.

The Secretary-General, Committee of Vice-Chancellors of Nigerian Universities, Prof. Yakubu Ochefu, said the government could not be demanding 40 percent of varsities IGR when it had refused to grant them autonomy.

Ochefu explained that the Finance Act 2020 specified that 40 percent could only be sent to the FG if there was a surplus, saying in the case of universities, there was no surplus but a lack of funding “because universities only get user charges from students and not profits or revenues.”

He said, “If you look at the Act, it didn’t say 40% IGR, but a surplus. So, who determines what is surplus? The Finance Act of 2020 is explanatory, and it is the institution that is supposed to decide and send you the surplus if there is any.

“But FG says it now wants to deduct it from the source. We have protested and written to the Ministry of Education. If they insist, it means they want to ground the universities to a halt. Or we will be forced to add the 40 percent to what we are charging the end users and these end users are complaining already. We told the Ministry of Education to write to the Ministry of Finance to halt the development.”

The Academic Staff Union of Universities also kicked against the policy.

Following its National Executive Meeting, ASUU, in a statement signed by its president, Emmanuel Osodeke, said the decision would impoverish the public universities.