15 / 46
Poverty to Prosperity
Budget Presentation
Gordon House March 19, 2015
15
operating institutions, including diagnostic facilities and special education facilities.
Importantly, we must integrate the private sector into the oversight of education to
ensure that our education output is aligned with our economic needs.
5.
Mr. Speaker, we keep tinkering and skirting around the problem of financing tertiary
education on a sustainable basis. The move to place the full increment of the
increased education tax to the loan pool is something I had planned to do and
therefore supported, resolutions have been brought to this House on the matter
before but we have not taken a consensus position. The approach seems to be to
borrow to fill the gap as the need arises. Once the loan pool is being expanded by
borrowed funds, unless the government absorbs the interest cost, then the flexibility
of the SLB in improving terms to borrowers is limited. Further, as the number of
students enrolling increases, the value of government‟s per capita subsidy to tertiary
institutions will decrease for each student unless the government increases its
contribution yearly. The net effect of this is that tertiary institutions will have to find
ways to pass on costs to the students as fee increase, which eventually have to be
recovered by Student Loan funds through student borrowing thereby increasing the
demand on the pool. Between 2006 and 2012 loan applications have approximately
doubled, but the value of loans have approximately tripled showing that fees have
increased much faster than applications.
If this situation continues many Jamaicans who qualify for tertiary education will be
denied access. The problem requires bold consensus on three things: