Management Of Higher Education Students’ Loans – CAG Report

Higher Education is one of the important sub-sectors within an education system of any country, since it enables its citizens to acquire critical knowledge and skills for social, economic and technological development. Higher Education equips people with the necessary intellectual skills and ability to think critically and decide rationally1. For several years, during pre and post-colonial periods, most of developing and developed economies provided full sponsorship for higher education2 in an effort to raise the average education level of their citizens. This was done for the purpose of improving the resource utilization as well as developing their economies with the intention of raising the income levels of their citizens. In the 1980s, the Tanzanian Government re-established cost sharing within the higher education policy due to financial constraints that faced the Government by then. As well, this intervention was part of the government’s compliance to IMF and World Bank’s social and economic policies in the framework of Structural Adjustment Programs Policies for developing countries.

However, the cost sharing policy proved to be inequitable because it denied a significant number of students from poor and rural families an opportunity to access education. This limitation of cost sharing in the higher education policy necessitated the introduction of alternative models of financing higher education in most developing countries through repayable students’ loans administered through designated loans boards and schemes.

In response to this, in 2004, the Parliament of the United Republic of Tanzania enacted the Higher Education Students’ Loans Board Act No.9 of 2004, which established the Higher Education Students’ Loans Board (HESLB) to manage loan scheme for higher education students. However, the performance of the HESLB in providing loans to higher education students has been facing several challenges, particularly on the identification of loan neediness, loans recovery and an amount of loan to be offered to the respective students.

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