FINANCE Minister Dr Ashni Singh yesterday said the Government of Guyana will be providing funding for student loans to be granted to students of the University of Guyana (UG) to meet the cost of the increased tuition fees recently announced by the academic institution, a Finance Ministry release said,

The minister explained that Cabinet concluded its deliberations on the matter on Tuesday, having examined it exhaustively, and decided that student loans will be granted to cover the new tuition fees.
The minister also clarified that, as before, the loans granted to finance tuition fees will not include the facilities fee which has historically been paid by students outside of the student loan arrangement.
As a result of this decision, Dr Singh indicated that he had issued the necessary directive for the Student Loan Agency to begin processing loan applications immediately for the coming academic year.
He emphasised that the decision by Government to grant the increased student loans was made as a result of its commitment to ensure that no Guyanese student is denied access to university education because of affordability.
The minister also emphasised that the increased revenue earned by the university through the new tuition fees provides it with an important opportunity to make the necessary changes to ensure better effectiveness in its operations.
He added that the university needs to make a more concerted effort to streamline its operations to ensure value for money, more prudent management, and a sustained higher quality of teaching and research output. At the same time, the Finance Minister indicated that Cabinet expressed its continuing concern about the poor rate of repayment of loans previously granted, and urged increased voluntary compliance, even as Government considers options for strengthening enforcement to raise repayment rates.
The ideal option, the minister declared, would be for persons to act responsibly and repay previous loans they were granted voluntarily without any stringent enforcement measures having to be applied
The increase in tuition for students of the UG not only places an additional demand on the Government of Guyana’s UG Student Loan Fund, but presents another challenge for the Finance Ministry, given that the budgetary allocation for the monies was reduced to zero by the combined Opposition, A Partnership for National Unity (APNU) and the Alliance for Change (AFC) in a parliamentary vote.
Since then, only half of the monies have been restored by the Finance Minister – a move that has seen him referred to the Parliamentary Privileges Committee.
The combined Opposition contends that spending authorised by Dr. Singh, including the $225M for the UG loan fund, were “unconstitutional” given that the monies restored were not approved by the combined Opposition.
Prior to the restoration of the sums, the Vice-Chancellor, in an interview, had noted that if the loan subvention for the University of Guyana is not restored by the National Assembly then the students would be placed in a dire situation as a result of the severe crisis being ensued at the tertiary institution if the decision to cut the subvention was not reversed.
However, the two parties maintain that the allocation for UG was linked to other provisions for which they were opposed and, given the ruling by Acting Chief Justice Ian Chang that individual line items could not be cut from the Budget, the entire sum, which included the student loan monies was removed.
The Government, in turn, has underscored the fact that the National Budget is presented in the same format it has been for several years now and no allocations are linked, as is being claimed by the Opposition, but listed under the relevant section in the estimates as per normal. The student loan allocation was listed under the Ministry of Finance’s Policy and Administration capital budget.
A significant percentage of the UG students access financial support through the UG Loan Fund, which is a revolving fund that receives an annual injection of from Government, from which disbursements are made, and are refinanced by repayments by students, as well as the continued annual support of Government. Over the years, a vast majority of the student population at the country’s premier tertiary institution has benefited from such loans and a large percentage of prospective and current undergraduates depend on them.