FG Proposes TETFUND to Allocate 30% of Its Funds for Student Loans

The Federal Government of Nigeria has announced proposed amendments to the Tertiary Education Trust Fund (TETFUND) Act, which includes a significant plan to allocate 30% of its funds from the Federation Account to the newly established Nigerian Education Loan Fund (NELFUND). This initiative aims to enhance access to higher education for Nigerian students by providing a reliable source of financial support.

During a recent state house briefing, Bayo Onanuga, the Special Adviser to the President on Information and Strategy, confirmed the proposed amendments, highlighting their role in strengthening funding for student loans. He emphasized that this adjustment is part of the government’s broader strategy to ensure sustainable financial support for students pursuing higher education.

Onanuga stated, “Some people may have been wondering, how are we going to fund the loans we are giving to Nigerian students? Well, I think the government has provided an answer. Most of the funding will also come from the money going to the Tertiary Education Trust Fund.”

Under the proposed changes, 30% of TETFUND’s revenue will be redirected to NELFUND, created under the Students Loans (Access to Higher Education) Act. This move is aimed at addressing concerns regarding the sustainability of the government’s loan initiative.

In addition to the funding allocations, the proposal introduces a cap on NELFUND’s annual administrative costs. The bill stipulates that the fund will not spend more than 5% of its annual income on operational expenses, including salaries and capital projects. This measure is intended to prioritize educational funding and ensure that a substantial portion of the funds is directed toward supporting students.

Onanuga further explained, “NELFUND has been pegged to spending only 5% of its income on its administration. Whether it wants to do capital projects in its office or pay salaries, it cannot spend more than five percent of whatever accrues to it from the Federation Account.”

If approved by the National Assembly, this amendment is expected to ease the financial burden on students by increasing the availability of educational loans. The proposal reflects the government's commitment to prioritizing education funding as part of its economic stabilization and development efforts.

As the government works to enhance funding mechanisms for education in Nigeria, this proposed allocation of TETFUND resources to NELFUND marks a significant step toward improving access to higher education for countless students across the nation.