There has been a sharp decline in funding to needy students by the Students Loan Trust Fund, with disbursements decreasing by 9.6 percent from 2010 to 2011 and a further 28 percent from 2011 to 2012,” the Auditor General’s Report for 2014 has revealed.
In 2010 loans were disbursed to 26,955 students, a number which decreased to 18,605 in 2011, and decreased further to 13,833 in 2012.
According to the report, the purpose for the establishment of the Fund will be defeated if the loan disbursement continues to decline indefinitely.
Appearing before the Public Accounts Committee of parliament, CEO of the fund Sheila Narh-Boamah, said the decline in disbursement experienced in 2010 and 2011 resulted from the Fund’s attempt to migrate the process from a full paper-based application to a partial online application system.
“This change in business processes accounted for the decline in applications at the time because IT penetration and ease of use was not as widespread as it is today.
The issue has since been reversed by the aggressive implementation of the AG’s recommendations. Currently, every academic year the Fund in collaboration with tertiary institutions, SRCs and NUGS carry out schools’ orientation activities, lecture hall sales and loan clinics to take the loan application process to the doorsteps of tertiary students,” she said.
“There may also be the need to review the scheme in total to enable it become more attractive and easier to access,” the Auditor General advised.
The Fund which was set up in 2006 aims at financing students in tertiary institutions who are in need of financial assistance to complete their education.
The Fund is stifled with lack of funding, which the parliamentarians advised, must change
Currently the only source of funding is the allocation from GETFund representing 10 percent of the inflow into the Fund. The allocation does not even come in full some times.
In 2014, the Fund received GH?13million out of the total allocation of GH?15million.
Accroding to the Auditor General, in order not to stifle the objectives of the Fund, its management must take advantage of other sources of funding such as voluntary contributions which are tax deductible as well as mobilization of resources from local and international partners interested in the advancement of tertiary education.
Currently, students are entitled to benefit from GHC600, GHC630 and GHC1,600 per annum, depending on the students’ financial needs.
It is estimated that about 380,000 students from both private and public tertiary institutions have benefitted from the Fund.
As a social intervention package by government, students are entitled to take the loan for a maximum of 6 years in their education life-cycle; and a 2-year grace period after completion and a repayment period of between 2 and 10 years to repay, depending on the number of years one enjoys the loan.
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