OPPOSITION leader Andrew Holness proposed yesterday that the Government redirect a portion of its annual subvention to tertiary institutions to the Students’ Loan Bureau (SLB) to enable it to provide more loans to borrowers.

He said this stream of funds could be used for special low interest rate loans, of not more than two per cent, which students would be allowed up to 30 years to repay.

“In other words, the allocation that the Government makes on an annual basis to the universities, it could take a percentage of that, put it into the SLB pool and relend and expand the (repayment) term… and that will have negligible impact upon the monthly repayment,” Holness said in his contribution to the 2015/16 budget debate in the House of Representatives.

The Opposition leader argued that the Government needs to make up its mind on the funding of tertiary education.

“We keep tinkering and skirting around the problem of financing tertiary education on a sustainable basis,” he said, pointing out that borrowing to fill the loan pool gap is not working because if the Government cannot absorb the interest costs, then the SLB is constrained in its terms to borrowers.

“The net effect is that tertiary institutions will have to find ways to pass on costs to the students as fee increase, which eventually have to be recovered by Student Loan funds, through student borrowing, thereby increasing the demand in the pool,” he stated.

According to Holness, between 2006 and 2012, loan applications doubled while the value of loans tripled, indicating that fees have increased much more rapidly than applications.

He further declared that there should be a second phase of education transformation, with a focus on more inclusive stakeholder participation, but said there was no need for a special implementation team or entity.

“I believe that the organisational structure of the Ministry of Education is sufficient to deliver what is required,” Holness noted, adding that Parliament would need to play a bipartisan role in the process to ensure accountability and commitment.

At the same time, he also proposed a government-supported saving measure, which would push parents to save for their children’s tertiary education. “We have to develop a culture in Jamaica where parents start to pay for tertiary education, and the Government must establish a savings programme to try and match what parents save to encourage them to put funds away from early. What this does is to create an additional revenue stream for the students,” he told the House.