The Higher Education Loans Board (Helb) has been directed to spend the entire Sh900 million it received from the government on loans to college students.
Fred Matiang’i, the Cabinet Secretary for Education, Science and Technology, said disbursing all the money will enable the students who are in Technical and Vocational Education and Training (TVET) institutions to receive funding.
“Helb must do whatever it can, even if it means going to colleges physically and setting a camp there or going to churches so that students can get loans. It must spend the money,” said Dr Matiang’i during the launch of Equity’s Wings to Fly programme for students who are joining TVET institutions on Monday in Nairobi.
It does not make sense, he said, for the government to allocate funds to institutions that do not use it.
In the past, Helb has complained about poor uptake of loans by students in colleges as compared to those in universities. Last year, only 32,954 students in colleges submitted their applications for loans as compared to 98,796, from universities.
This financial year, Helb was allocated Sh9.1 billion by the National Treasury.
In 2016, a majority of students who sat the 2015 Kenya Certificate of Secondary Education examination snubbed diploma courses in government institutions, with the Kenya Universities and Colleges Central Placement Service indicating that only 12,038 candidates applied to join the 57 middle-level colleges.
Dr Matiang’i said the government has put in place the necessary legal and policy framework for the reform of TVET institutions and injected financial support for their facelift.
A World Bank report that was released in December observed that Helb must establish systems to assess the veracity of financial information provided by loan applicants.
“Data suggest that loan applicants underreport income to boost their chances of acquiring loans. At present Helb has no credible verification mechanism for accessing the accuracy of reported family income and financial means,” states the report.
Helb Chief Executive Officer Charles Ringera said there are about 77,000 students who received the loans but are yet to repay and urged them to do so in order to enable others also benefit with a debt of about Sh7.9billion.
The agency currently supports 135,000 students.