Kenyan Varsities in crisis as freshers report without Helb loans

Kenyan Varsities in crisis as freshers report without Helb loans

  Kenyan Varsities in crisis as freshers report without Helb loans

  

helb loan delay 2016/2017 - The Higher Education Loans Board (Helb) says it will delay funds for newly enrolled university students until November this year, dashing the hopes of thousands of freshmen who began reporting for admission last month.

This comes as continuing students allege drastic cuts of as much as 50 per cent in the amounts of Helb funding they have each received this year.

The latest announcement means that many of the 56,938 government-sponsored first year students will have to meet their own tuition, accommodation and living expenses for about two months. Continuing students, meanwhile, have been promised disbursements from the revolving fund by the end of the week.

Student leaders have already threatened a “nationwide strike” on Friday over the delays, and further action within two weeks if the amounts disbursed are not retained at last year’s levels. University administrations anticipating a crisis have already put out stern notices directing students to pay fees in full before registering for courses, attending lectures or taking up accommodation in campus hostels.

The State agency says the delays are due to cash-flow problems as well as challenges arising from dozens of universities having varying opening dates. The students asked to wait until November sat their Kenya Certificate of Secondary Education (KCSE) exams last year and have been admitted to universities a year early under the State’s accelerated intake programme, severely straining Helb’s resources.

Treasury secretary Henry Rotich allocated Helb Sh4 billion in this year’s budget and the agency recovered Sh3.3 billion last year, ending up Sh7 billion short of the Sh14.3 billion it says it needs to meet total demand.

“The board wishes to inform you that the results of your first time loan applications for 2014/2015 are expected to be out in November,” Helb said in a notice to first year loan applicants.“We highly regret the inconvenience caused. Please bear with us.”

This year’s admission to public universities under the Kenya Universities and Colleges Central Placement Service (KUCCPS) saw a 7.4 per cent growth in enrolment from the 53,010 students offered places last year.

Helb said it expects to offer loans to 62,500 freshmen and 15,000 new students admitted to technical and vocational education and training (TVET) institutions. This higher number of ‘freshers’ includes first year students in self-sponsored programmes (commonly known as ‘parallel degrees’) in public universities, as well as those attending private chartered universities.

Thousands of freshmen yesterday jammed Helb’s head offices, located at Anniversary Towers in Nairobi, along University Way, making enquiries on when the loans will be credited to their bank accounts. The University of Nairobi admitted its cohort of ‘freshers’ yesterday.

The funding crisis may see poor but bright students who depend on State loans and bursaries miss lectures and accommodation. Many may be forced to defer their studies.

Freshmen at State-owned universities pay about Sh30,000 in the first year for tuition, medical, registration, activity and computer lab fees. However, the amount does not include meals, housing and personal upkeep.

University hostel charges average Sh3,000 per semester while private hostels charge as much as Sh7,000 per month. Most learners depend on university hostels for accommodation because they are safe, cheaper and conveniently located close to lecture halls. But lack of cash may see them locked out of the hostels, which are given out on a first-come, first-served basis.

Helb said it had extended the application period for first year students to end of October to allow all needy students put in requests for funding.

“If we close the applications by September 30, we will lock out many students who do not have the requisite documents like admission letters, (Kenya Revenue Authority) PIN certificates, identity cards and so on, hence the need to lengthen the application period to October,” said Helb chief executive Charles Ringera in an interview with the Business Daily.

Mr Ringera also blamed the delay on institutions’ ‘varying opening dates’, which made it difficult to plan ahead as recoveries flow monthly and government funding is periodic. He said there was need to align the semester dates.

“The challenge now is 68 universities and 49 TVET that we fund having varying opening dates. How do you plan cash flow around over 100 institutions yet recoveries flow monthly?” Mr Ringera asked.

Helb said it was making arrangements to wire funds to continuing students. “Helb is pleased to inform the second and subsequent successful applicants in session that their respective loan awards will be credited to their bank accounts as from Wednesday, September 17, 2014,” the agency said in a notice.

Helb, which finances more than 80 per cent of university students, says the accelerated intake plan had disrupted and overstretched its budget. The agency disbursed more than Sh5.1 billion last year. It estimates that student financing needs will triple to Sh14.8 billion this year, forcing it to step up its loan recovery effort with hefty fines on defaulters.

Undergraduates get between Sh35,000 and Sh60,000 annually from Helb alongside a bursary of up to Sh8,000. This translates to a minimum of Sh140,000 and maximum of Sh240,000 for a four-year course.

Of the total loan disbursed, Sh8,000 is sent directly to the university as tuition fees and the balance sent to the beneficiary’s bank account in two equal tranches in the first and second semesters. Helb has recently turned to accessing the databases of government agencies such as the Kenya Revenue Authority (KRA), the National Hospital Insurance Fund (NHIF), and the National Social Security Fund (NSSF) to trace defaulters.

There are about 68,647 loan defaulters who owe the agency Sh7.4 billion as at July this year, despite a two-month amnesty window granting them a chance to pay up without penalties and interest.


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