The loan scheme has been a life-saver to many students with tuition challenges since its inception in 2014.
However, not everything has gone according to plan with at least 1,200 graduates who studied on the government loan scheme expected to find difficulty searching for jobs, or pursuing higher degrees, after universities withheld their transcripts over arrears.
This was disclosed in a report filed by Daily Monitor stating that; highly-placed sources said the Shs12.7 billion debt is owed to the institutions by the government through the Higher Education Students Financing Board (HESFB), which administers the loan scheme instituted in 2014.
The government rolled out the programme to enable talented students without means to bankroll degree and diploma qualifications, and repay on finding a job upon graduation.
Some 13,405 applicants have benefitted, with 4,500 of them graduating over the past. These are expected to reimburse up to Shs1 billion. However, limited employment opportunities coupled with ineffective tracking mechanism has meant jobless beneficiaries are unable to pay while hundreds are untraceable.
The result is that the government has received much less from beneficiaries than planned, yet the refunded cash is to be used as a revolving loan for other needy students.
The situation has been worsened by the government’sfailure to remit money to universities that have trained the students studying on the loan scheme, according to HESFB officials who asked not to be named in order not to appear as disgracing their employer.
According to one of the officials, the defaults worsened from 2019, piling the scheme’s debt portfolio to the current Shs12.7 billion.
This has prompted participating universities to target the beneficiaries, and not the government, by withholding their degree and diploma transcripts pending clearance of the arrears.
The government has been defaulting on the releases, the official said, leading to the huge debt. As a result, institutions are withholding the transcripts of students who graduated until we clear their tuition to zero balance.
The institutions named in retaining papers of the affected graduates are, among others, Makerere University, Kampala International University (KIU), Kyambogo University, Busitema University, and Kabale University.
According to sources, the government owes KIU the highest in the arrears, of Shs6.8 billion, followed by Makerere University at Shs5.5 billion.
Makerere University Secretary, Mr Yusuf Kiranda, yesterday confirmed that they were retaining academic documents of the loan scheme beneficiaries to compel the government to pay up.
