Rethinking the funding of tertiary education in Nigeria, By Mujib Dada-Qadri

I will suggest the following solutions as bargaining tools for the disputing parties and as a sustainable economic model for funding public tertiary education in Nigeria: (a) introduce a 2% education tax on personal income tax if state governments will allow shared funding of all tertiary institutions in Nigeria or a 2% education tax on company income taxes, to fund federal government owned tertiary institutions only…

It is necessary to give historical and sociological perspectives to the evolution of free tertiary education and emergence of academic unionists globally. The wake of Marxist revolutions in the early 20th century, commencing from the defunct USSR and spreading to other parts of the world, inspired the biggest rise of unionists on the premise of “workers of the world uniting”. Socialist thinkers before Karl Marx had advocated for free education. The wave of radical labour unionism, coupled with radical Intellectualism, spread to Africa, especially with the support of Soviet-backed Marxist literatures and Marxist movements. Unavoidably, Nigeria  caught the unionist flu/Marxist influences long before 1970s, but it is my opinion that the 1970s ushered in Nigeria’s most vibrant years of unionism, involving labour unions, trade unions (the Trade Union Congress [TUC] was created as a rival to the Nigeria Labour Congress [NLC]), university unions, students’ unions, etc. This introduction is necessary to allow readers understand the Marxist/socialist foundational orientations of academic unions in Nigeria.

Moreover, there are economic debates on whether education should be for profit or not-for-profit, leading to different economic perspectives on why education at all levels must be totally free. While the capitalists/neoliberals disagree with such perspective, the leftist/socialist leaning thinkers support the notion that education is a public good and should be totally free. However, we have a resolved dilemma, considering how different countries have addressed the demands of education. For example, USA has an educational system which provides free basic education (totally subsidised) and “tuition based” tertiary education, which could also be “loan aided” for those who qualify. Countries in the Americas, Europe, Asia and Africa have borrowed models similar to that of the USA, while some have chosen the socialist model of running subsidised educational systems at all levels, and Nigeria is one of such countries.

Nigeria’s choice of adopting a socialist inclined educational funding model is not as naive as we might be tempted to think it is. Prior to the 1950s, basic education was not affordable in the country and was only accessible to the privileged class, while tertiary education was largely open to only those who could afford to travel to study outside the country. Chief Obafemi Awolowo, the first Premier of the Western Region, was a victim of such a system and he pioneered the free education model to right the wrong. The model was nationally adopted to encourage an impressive literacy rate, and was inclusive of enviable tertiary education. Awolowo actually ran the free education model based on a creative fiscal policy, which included taxes. Subsequently, the free education system was overgrown and overfed with large populations of students, leading to an overburdened public finance, and hence lean funding and a very discouraging condition of basic education, which is being fairly rescued by private schools. The lean funding approach is currently threatening our tertiary educational system, which academic unions are agitating to save but through “member-oriented bargains” and dogmatic approaches.

Examining the economic dimension of funding public education, especially tertiary education, will reveal to us that educational funding is an investment, whether as a socialist or capitalist goal. The proponents of free tertiary education, citing Germany, Norway etc. as examples, should understand how such systems work. Countries such as Norway, Italy, Spain, Germany, Sweden, Lithuania, etc., have free or affordable tertiary education because they have fiscal systems that ensures the payment of fat taxes.

Furthermore, it is important to resolve the dilemma and frequent altercations between academic unions and the Nigerian government by examining the economic perspectives of educational funding, especially tertiary education. ASUU, which represents the university academic union is freshly requesting for over N1 trillion from the Federal Government of Nigeria, while other academic unions have their own demands too. The Federal Government of Nigeria has failed in its bargains with these academic unions, but not without the cry of “a helpless father with many demands”. Academic Unions seem not to care about such cries, as they cite the fat allowances and emoluments that political office holders enjoy in Nigeria. It is true that Nigeria’s public education is underfunded, and most especially tertiary education, but the need for Nigeria’s public finance and fiscal policy regarding tertiary education must be critically reviewed and separated from “populist biases”. Infact, socialism is not the same as populism. The goal of socialism is to create an egalitarian society through strategic public investments/financing tools like taxes, revenues, etc., while populism is just satisfying public appeal without a sustainable plan. Academic unions must see the need for this renewed perspective, beyond outdated dogma.

Examining the economic dimension of funding public education, especially tertiary education, will reveal to us that educational funding is an investment, whether as a socialist or capitalist goal. The proponents of free tertiary education, citing Germany, Norway etc. as examples, should understand how such systems work. Countries such as Norway, Italy, Spain, Germany, Sweden, Lithuania, etc., have free or affordable tertiary education because they have fiscal systems that ensures the payment of fat taxes. For example, the personal income tax-to-GDP in the following countries are: UK – 45%, Sweden – 52%, Netherlands – 49.5%, Norway – 30.9%, Germany – 47.5%, Denmark – 55.9%, France – 55.4% and Austria – 55% (according to PwC world tax summaries for 2022). Many of these countries are known for tax-to-GDPs above 20%, in comparison to Nigeria whose tax-to-GDP is not even up to 15%.

It is also important to note that the best universities in Africa are largely found in South Africa and Egypt, such as the University of Western Cape, Ain Shams University, University of Johannesburg, American University of Egypt, etc., according to the statistics of web ranking, but it is important to consider the following: the tuition fees of universities in South Africa, which is $10,000 on the average; government funding of universities in South Africa; public funding of universities in Egypt, where the government has earmarked 4% of it’s gross domestic product, at about $11 billion, on education. This is not up to public funding of education by OECD countries, which spend $10,000 (on average) on each student. USA, which is one of the OECD countries, spends over $500 billion on education. Interestingly, the average tuition fees (annually) for private universities in Nigeria is $3,000. This analysis is pertinent, so as to establish that education is not cheap, there has to be a payment plan, yet education is a public investment.

… the alternative solutions mentioned above will enable government to renew it’s fiscal policy regarding the funding of tertiary education through a sustainable model, against the current “populist model” which has overburdened the government without maximum economic gains. This new model must ensure that the Federal Government of Nigeria boosts it’s funding of tertiary education by 50% over the next 10 years above the current fundings…

Importantly, considering the bogus financial demands of public tertiary education in Nigeria and it’s urgency: how should we resolve the dilemma, which symbolises a mosquito landing on a scrotal sac? I am offering this perspective as an alternative solution. Personally, I will not support the USA loan model or the commercialised university model, which some Nigerian elites fixated only on USA/UK realities have advocated. People sharing such opinion have failed to realise that the global university administration and funding model surpasses those of the USA/UK models alone. Also, USA’s loan funding model might have worked for the system but a loan trap of $1.7 trillion, according to US federal reserve bank, is not a model I will encourage for any developing economy. Albeit, Nigeria cannot afford to run a market-led tertiary education model, where an average student will be forced to pay the market price of $3,000 annually, when the GDP per capita is $2200, making Nigeria one of the poorest countries in the world.

I will suggest the following solutions as bargaining tools for the disputing parties and as a sustainable economic model for funding public tertiary education in Nigeria: (a) introduce a 2% education tax on personal income tax if state governments will allow shared funding of all tertiary institutions in Nigeria or a 2% education tax on company income taxes, to fund federal government owned tertiary institutions only. (B) create a special scheme/bilateral agreements that will tax the income of graduates of Nigerian institutions working in the diaspora. The case of Nigerian doctors and professionals is the most peculiar, considering the economic migrations of these professionals who will always see need to relocate to developed countries. Alternatively, introduce a policy that will mandate professionals trained in Nigeria’s tertiary institutions to work for a certain number of years before migrating (the least preferred alternative). (C) introduce 70% tertiary education subsidy in all Federal Government owned tertiary institutions against the current subsidy scheme, which is almost 100% but with a condition of “government aid”, which will allow students from less privileged backgrounds, through financial records of their parents/guardians, to pay existing or adjusted tuition fees and those from privileged backgrounds will be mandated to pay the “market price” of tertiary education. This model of government aid/exclusion is being practiced in South Africa called National Student Financial Aid Scheme (NSFAS). This policy will grant automatic free education to extraordinary students from any of the social backgrounds.

In conclusion, the alternative solutions mentioned above will enable government to renew it’s fiscal policy regarding the funding of tertiary education through a sustainable model, against the current “populist model” which has overburdened the government without maximum economic gains. This new model must ensure that the Federal Government of Nigeria boosts it’s funding of tertiary education by 50% over the next 10 years above the current fundings, subject to renewed consensus with state governments where applicable, to avoid state chapters of academic unions joining in strike actions against the Federal Government. This should be coupled with the introduction of a Tertiary Education Funding Appraisal Tribunal (TEFAT), which will see to the annual auditing of disbursed funds for tertiary institutions, investigating/punishing university administrators culpable in financial malpractices and appraising/supervising project executions independent of the Ministry of Education. This body should either be subjected to the authority of the Presidency or Ministry of Justice.

Mujib Dada-Qadri is a lawyer and policy analyst. He writes from Abuja.

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