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House examines payment woes faced by students

BY BALFORD HENRY Observer senior reporter balfordh@jamaicaobserver.com

Sunday, March 30, 2014    

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THE University of the West Indies (UWI) has recommended that the Government allows tertiary institutions to play a "more important direct role within the economy", in order to address their financial problems which are fuelled by the inability of students to pay the fees.

"There should be a recognition that the UWI Mona, and other publicly-funded higher education institutions in Jamaica, play an important role within the economy and have the capacity to do much more," the university said in a paper presented to the House of Representatives' Human Resource and Social Development Committee, chaired by Opposition Member of Parliament, Rudyard Spencer.

"The current incentives for economic growth, aimed at the private sector, should be modified and adapted to encourage business and income-generating activities within the publicly funded higher education institutions," the paper, prepared and submitted by Professor of Linguistics at the Mona, Hubert Devonish, stated.

According to Professor Devonish, economic growth initiatives such as the Employment Tax Credit, designed for private sector stimulus, could be creatively modified and adapted by publicly funded higher education institutions in Jamaica, such as the UWI.

He said that the proposal is to craft economic stimulus measures specific to the structure and functions of these institutions.

"Such an approach would produce a double benefit. It would help to expand the economy, particularly through the export of high quality, high value educational services. Simultaneously, these institutions would be provided with the opportunity to generate income. This income would be ploughed back into these very institutions to bridge the gap," he expanded.

Devonish explained that the gap that needed to be filled is the one that currently exists between the modest quality of education that the Government of Jamaica and the Jamaican student can afford, and the highest quality education needed by the students and the country to be competitive in the international market.

The UWI was one of three major tertiary institutions which presented papers to the committee on Thursday, on financing tertiary education in Jamaica, primarily, through the cash-strapped Students Loan Bureau. The others were the University of Technology (UTech) and the Northern Caribbean University (NCU).

The committee has been given the task of examining ways to fund tertiary education, since the passage of a private member's motion in the House of Representatives brought by Dr Dayton Campbell (Government, North West St Ann) primarily seeking an amnesty for indebted students.

The financial problems facing the cash-strapped SLB has since deteriorated further, following the Government's failure to collect approximately $1 billion of a $2.8 billion projected injection into the Bureau's funds from the increase in the education tax imposed last year.

Opposition spokesman on finance and planning, Audley Shaw, proposed in the recent debate on the Supplementary Estimates that the Government uses resources from the PetroCaribe Fund to shore up the SLB, but that has been ignored.

In its presentation, UTech informed the committee that, based on its treasurer's report to the institution's annual general meeting in January, tuition fees had risen to 50 per cent of the university's income, its largest source of income.

"The share of student fees to total income has progressively increased from 36 per cent in 2009 to the present level, while Government subvention has moved in the opposite direction, declining from 40 per cent in 2009, to 30 per cent in 2013," the UTech submission stated.

"The import of the ability of students to pay fees, and to do so in a timely way in keeping with the university's cash flow needs, is evident from this fact: without a reliable flow of income from fees, the university's sustainability and thereby its capacity to contribute to the educational qualification of young people, a sine qua non for national development, is at risk," the submission added.

The NCU said that financing tertiary education is such a "tremendous fiscal undertaking" that no single agency or entity, like the SLB, can successfully undertake the task.

"The only viable and sustainable solution is to employ a systemic approach which would allow us to collectively mitigate this challenge," it noted.

Among the proposals from the NCU were: to create an education fund, where parents or guardians who contribute are given tax incentives similar to those of retirement schemes; extend fiscal support from the SLB to students in specialised programmes requiring a longer time to complete; and to tap into specialised funds, like the Tourism Enhancement Fund (TEF) and the Universal Service Fund (USF), to finance programmes in specific areas needed to mobilise the national agenda.

The NCU also felt that the Government should undertake the initiative to reduce interest rates on loans for students who enrol in areas of national importance; and that the SLB reopens the application process for new applicants, and provide a window for those who are willing to take up study options geared towards the national growth agenda by switching courses.

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