Education is our only hope
AS we start the new school semester I am compelled to resurrect the discussion about the effective funding of tertiary-level education.
This is in fact a clarion call to action. No longer should poverty be allowed to be a bandit of our young people's dreams operating with impunity. Daily I am confronted with other Jamaicans who are cerebral and who have been fighting to free themselves of the shackles of poverty by hopping onto this vehicle called education which, even with the fare increases, remains the only legitimate modality for upward social mobility.
It is accepted that education is the ultimate redemptive tool for families that suffer from abject poverty. Education is responsible for the triumphs of many successful businessmen, nation-builders, and leaders.
No longer can we continue to enjoy the comfort of opinion without the discomfort of thought, thus I have cerebrated long about the matter and I have placed some recommendations before the Parliament.
This semester has caused me to revisit the discussion at once because of the shattered dreams that I have had to share with some of my own constituents who, despite beating the odds and achieving excellence at CSEC and CAPE examinations and a promised contribution from the Constituency Development Fund (CDF), will not be able to continue to occupy that coveted spot in one of our illustrious tertiary institutions.
The motion brought to the Parliament reads: "Whereas the country's development is directly linked to the educational qualification of its citizens; and whereas the cost of tertiary education has a direct bearing on national development:
"Be it resolved that, given the perilous trajectory on which the Students' Loan Bureau (SLB) finds itself, which is one that raises the question of viability, the Human Resource and Social Development Committee be mandated to urgently examine the adequacy and affordability of funding tertiary education in Jamaica and report to this Honourable House on its findings and recommendations."
The time has long come for the country to confront the many challenges of effectively funding tertiary education. Far be it removed from me to suggest that there is any entitlement for the people of Jamaica to pay for everyone's tertiary education.
Those who receive financial assistance for education must be, first of all, those who need it and secondly, those who are going to contribute to the upliftment of the nation and be able to fit with workforce needs.
My focus is on the following areas:
The challenge of funding tertiary education did not come upon us like Nicodemus overnight, and neither do I share the thought that there is a panacea available. Hence, I would suggest that we take practical steps in ensuring that our children receive the best education possible. I strongly embrace the idea that responsible parenting through primary socialisation must be the genesis of this.
Parents should make greater efforts in strategically planning for their children's future. In addition, more emphasis must be placed on family planning. Every parent should start saving for his or her child's education from birth, I dare say even before birth.
It is irresponsible for parents to bring children into this world and leave their future to either chance or the generosity of the State, or some philanthropist. What we as politicians should do is to augment their efforts as opposed to be footing the entire bill.
For persons who are estranged from wealth, the Students' Loan Bureau has assisted with granting them loans so that they can access tertiary education. Over the past five years, there has been an increase in the number of matriculants to universities and colleges, a reason for celebration, one might say.
The SLB provides assistance to roughly 30 per cent of students pursuing tertiary level studies in Jamaica. That number was estimated to reach 20,000 this academic year. We must celebrate the fact that more young people are matriculating to universities and colleges and not allow this achievement to yield to the fiscal struggle that is ahead of us where this matter is concerned.
I used the inclusive pronoun 'we' deliberately, because this is a national struggle which we must overcome; it transcends political allegiances and social classes.
(A) Priority areas
The SLB must stop concerning itself with trying to give loans to all students who have applied for tertiary education. Instead, I believe the SLB should first concern itself with making loans available to persons pursuing tertiary studies in areas critical to national development such as mathematics, pharmacology and engineering, etc.
Far be it removed from me to suggest that persons doing history, archeology, sociology, psychology and the other oversubscribed degrees should be denied tertiary education. I am merely suggesting that the limited funds be directed to those areas which are of strategic importance to the country, and at lower interest rates.
(B) Interest rate calculation for SLB
Regarding SLB interest rates: I know of a student who borrowed $394,000 while studying, incurred interest of $194,000, repaid $850,000 and still owed $450,000. I once again posit that education ought not to be a debt sentence. I am steadfast in my advocacy that the interest rate should be calculated based on simple interest and on the reducing balance.
(C) I also recommend that students who receive government assistance be bonded to reduce the instances of brain drain where we export our experts. It was recently revealed that the country loses four out of every five university graduates through migration to the UK, US, and Canada, and that depletes our human capital potential. That means we have to fix the problem of wage uncertainty and restore confidence in the Jamaican labour market to offer competitive salaries.
(D) The Government should be prepared to stand as guarantor for students who have been beneficiaries of PATH. PATH must be a means to an end, an end where people will be liberated from poverty and move from welfare to well-being and on to wealth creation.
(E) We have to find a long-term solution, including fostering a culture of repayment of debt. There is too high a delinquency ratio in relation to some of these funds and loans on the portfolio. The rate of SLB collections is just under 50 per cent.
It is designed as a revolving fund, but for it to function as a revolving fund you will actually have to be able to reduce sharply that delinquency ratio. The very least that one would expect from people who have benefited from the creative and empowering arrangement that the SLB represents is that if there are problems associated with either unemployment, under-employment or low salary, that a genuine effort be made to inform the SLB, and a remedial plan be discussed.
(3) TRUST FOR FUNDING TERTIARY EDUCATION
Another avenue that is worth considering is the setting up of a national tertiary education fund similar to the National Housing Trust. The anlage of this proposal is that parents contribute money to this fund and would be able to draw down on it at the time their child reaches the age for university education. This is not a new tax being proposed, but the funding for this should come from the recent increases in the education tax in March of last year.
(4) PRIVATE SECTOR
(A) Encourage the private sector to provide student employment: This will provide two benefits:
(a) Incorporate a practical component to courses.
(b) Augment the income of students.
(B) Indeed, parents must plan their children's education. I would love to see a public-private partnership where, if parents have saved, they are entitled to the saved amount matched in loan at a reduced interest rate.
(5) COST-EFFECTIVENESS IN THE OPERATION OF OUR UNIVERSITIES:
We also need to seriously consider the cost of tertiary education. This will prevent the exponential annual fee increases that we have been seeing more and more frequently. In 2012, the Government spent $11 billion of its $74-billion recurrent budget on recurrent bills in tertiary education. With this subvention from the State, students are required to pay 20 per cent of their tuition fees.
With the establishment of a tertiary commission to manage the allocation of the State's funds to all approved tertiary institutions in a transparent and equitable manner, the universities and colleges must develop a long-term strategy for funding with an investment component. We must require universities and colleges to research funding models that continuously engage the public.
Other cost-effective measures to reduce inefficiencies throughout tertiary education systems include:
* linking funding more closely to graduation rates
* creating incentives to reduce non-completion rates and the length of study time
* reducing public subsidies of students who remain too long in the system
* eliminating duplicated programmes
* rationalising low-enrolment programmes with possible redeployment of academics across programmes
* downsizing faculty to respond to falling student enrolments
* increasing use of shared facilities
* expanding student mobility between institutions
* stopping deregistration. Imagine a situation where a student, having benefitted from this subsidy then goes on to pay 80 per cent of the tuition cost (example $200,000 out of $250,000 which would amount to 96 per cent of the total economic cost), is then deregistered for owing $50,000 or four per cent of the total economic cost which bars him/her from doing exams.
That delays the completion of their course, in some cases for an additional year, and wastes all fees paid before. In essence, this student would have paid $1.2 million to the university for a year of study and would have been barred for owing $50,000.
This is a grave social injustice. I therefore recommend that these students be allowed to sit their examinations and that examination results and or degrees be held until full payment is made.
(B) Energy conservation
A complete review of the operations of our tertiary institutions will either disabuse my mind that monies are being wasted, or will be the basis for the reduction of fees at these institutions. A cursory check revealed that one of our prominent universities is spending $13 million to $23 million per month on electricity. What madness is this?
These institutions must use newer and more conservative technologies which will drastically reduce these bills and thus negate the need to increase tuition fees. The government subsidy given to these institutions must be directed to remedying this problem. Conservative estimates are that the electricity bill could be reduced by 66 per cent if solar panels were to be installed. This is the direction we must move in.
(6) EDUCATION AS A BUSINESS
My humble cry is that we must see education as an investment. In the UK, the rate of return on investment in higher education would be around 11 per cent. If we look at it in a strictly business sense, catering to a return on our investment we will realise the following;
A secondary-level graduate is likely to earn about $40,000/month, which falls below the income tax threshold, versus a tertiary level graduate who is likely to earn $80,000/month with income tax of $20,000/ month or $240,000 annually. If both were to work up to the age of 65 years, the secondary graduate would contribute $0 by way of income tax whilst the tertiary graduate would contribute $240,000/year for 44 years, yielding $10,560,000.00.
My cry is for poor people to escape the limited options poverty provides, exchanging it for prosperity with more options through education.
(7) I believe every child living with a disability that matriculates to a university should receive a full scholarship. This number is less than 100 students.
I certainly cannot sit and watch that door close for what is expected to be 20,000 students, next academic year, who have worked hard to matriculate to universities. Michelle Obama said it best: "When you have walked through that doorway of opportunity, you do not slam it shut behind you. You reach back and give other folks the same chances that helped you to succeed."
Poverty cannot have the deciding vote on who gets tertiary education. The Government will have to get creative and think of ways to fund tertiary education. With a country all too familiar with financial woes, we must explore feasible ways to keep that door open.
We should not hold ourselves out as having all the answers to the funding of tertiary education. As with so many of our problems I am convinced the answer lies in the collective wisdom of the Jamaican people. Somewhere out there are possible answers and we need all the suggestions on the table.
It is for this reason that I urge tertiary students, all student leaders, parent-teacher associations, and youth and community clubs to take the lead in discussing this issue of funding tertiary education.
The motion has been referred to the Human Resource and Social Development Committee of Parliament. The committee is slated to start the review in this month. I know chairman/member Rudyard Spencer will do the right thing and invite submissions from the public, as it would be a travesty if our collective voices remained silent on this issue.
Education is the custodian of the hope of thousands of families. We must not allow education to yield to poverty. Young people, irrespective of social background, must be allowed to empower themselves so that they can realise their potential as nation-builders. We must stand firm and do what is right for the future of our nation.
Dr Dayton Campbell is Member of Parliament for St Ann North West