Government in Opposition to Proposed HELB Changes
The government portrays high opposition to proposed changes to the Higher Education Loans Board Act. The Act intends to reduce the interest that students pay on loans. In addition, it also seeks to increase the duration it takes before loan repayment begins.
According to the Principal Secretary for Higher Education and Research, Beatrice Inyangala, the proposed changes could harm the collection of loans and the future sustainability of the program.
The proposed changes are presented in two Bills seeking to reduce the interest rate for HELB loans from 4% to 3% and increase the duration before students begin to pay their loans. Presently, it takes students up to one year before they start to repay their loans. The new amendments propose a 5-year duration before HELB beneficiaries begin to repay their loans.
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In addition, the changes seek to exempt beneficiaries below the age of 35 from making payments before receiving formal employment.
The Machakos Women Representative, Hon. Joyce Kamene, presented the bill before parliament. According to Julius Melly, the Bills by Hon. Joyce Kamene should not have been presented before parliament before review by the committee.
According to the HELB Chief Executive Officer Charles Ringera, the loan recovery represents close to 37% of the institution’s budget. Extending the repayment grace period would require that the national treasury allocate more funds to HELB. Reduction of loan interest rates would result in 1.8 billion shillings lost in recoveries. He highlights that the board’s reserves are constantly reducing daily thanks to inflation.
Hon. Joyce Kamene stated that many youths fail to be employed due to CRB listing. She urged the government to be a bit lenient with them and consider the financial crisis that young people go through.
The Higher Education Loans Board has not yet disbursed funding to first-year and continuing students.
Government in Opposition to Proposed HELB Changes