The Namibia Students Financial Assistance Fund has proposed an alignment of the academic and financial years as a lasting solution that will enable timely payments to students.
Speaking at an NSFAF media engagement held in Windhoek yesterday morning, acting chief executive officer Kennedy Kandume said the institution is still experiencing delays in honouring its mandate on time due to a misalignment of the academic and financial years.
“Institutions of higher learning in Namibia start an academic year from January to December, while the Namibian government’s fiscal year starts from April to March of the following year, making it difficult to award and pay students on time,” he explained.
About 52 000 beneficiaries owe the institution more than N$2.6 billion, believed to be matured loans given to beneficiaries from 1997 up to 2017.
The NSFAF recently threatened to name and shame defaulters in the local print media if they do not come forth to pay back the money.
Kandume said the Fund is busy engaging relevant stakeholders in exploring a lasting solution that will also help prevent unnecessary delays with regards to payments for students at institutions of higher education.
Although the funding institution has a budget of N$1.2 billion yearly, it does not get its finances at once. Hence, there is a delay in the payment of both tuition and non-tuition fees.
As a result, the institution had this year prioritised the payment of non-tuition fees, but universities will be paid what is due to them once funds become available from Treasury.
Kandume noted that the NSFAF entered into a memorandum of understanding with institutions of higher learning for students to write examinations and access their results while the ministry releases the recently allocated money, which was announced during the 2021/22 mid-year budget review recently.
“For example, other institutions in the world’s academic year starts in August. We are thinking that Namibia should also change its academic year to August, or the government to change its fiscal year to align with the academic year,” he suggested. Another suggestion is that the fund should function as a revolving fund.
“If it becomes a revolving fund, recovery money will be deposited straight into the fund’s account. As soon as the money is deposited, we will be able to pay students timely with no delay,” he observed.
Kandume said the institution’s loan book currently stands at N$5.8 billion, of which matured loans are at N$4,2 billion that is qualified to be recovered and paid into its account.
Another challenge he mentioned is that the NSFAF is troubled by the past haunting the present, which has been characterised by negativities, ranging from a lack of policies and procedures, no clear business processes and systems, the questionable awarding of financial assistance, irregular procurement activities, to conflicts of interest.
“As from 2018 to date, policies and
procedures have been put in place, business processes and systems have been established, the awarding of financial assistance has been transparent, there has been compliance with the Public Procurement Act, and there has been no conflict of interest incident noted,” he added.
The Fund thus decided that going forward, the prevailing governance culture will be maintained, with a compliance obligation upon everyone.
The institution has also implemented a loan management system that is based on generally accepted accounting standards this financial
year (2021/2022).
According to Kandume, the system enables the processing of students’ payments and the management of loan repayments.
“Moving forward, the system will be the foundation of the Fund’s best practices as far as financial management is concerned,” he stated.