Students Loans Board in K2.3 billion shortfall
The Higher Education Students Loans and Grants Board says it requires about K2.3 billion to implement revised upkeep allowances and loans to needy students in public universities.
The ballooning budget follows President Lazarus Chakwera’s order to increase the upkeep allowances from K350 000 to K560 000 per year.
Chakwera said his directive to adjust the allowances was to cushion the effects of the 44 percent kwacha devaluation.
In a written response yesterday, one of the Loans Board directors, Henry Chingaipe said they held a meeting on Thursday to discuss the matter.
He said: “After discussions between t h e board and our counterparts in government ,the decision is that the increment will apply to all disbursements happening after 1st April 2024.
“Now, for the loan cycle 2023/2024, five public universities had their first semester before April 1 2024. Students eligible for upkeep loans were given upkeep amounts for the first semester at the old rates.”
These are Malawi University of Business and Applied Sciences, Lilongwe University of Agriculture and Natural Resources ,Mzuzu University, Kamuzu University of Health sciences and Malawi University of Science and Technology.
Second semesters for these universities started after April 1 and Chingaipe said the upkeep loans for second semester will be paid at new rates while for University of Malawi (Unima), whose academic calendar for the loan cycle 2023/2024 will start in August, upkeep will be based on new rates.
“Since the loan budget for 2023/2024 was already allocated in full, in order to implement the new rates for one semester for five public universities and two semesters for Unima, the board requires K2 378 985 000,” he said.
Re a c t i n g t o t h e development, Malawi Pub l i c Univer s i t ies S t u d e n t s U n i o n (Mapusu) president Ger shom Nyi r enda expressed frustration that students are still receiving the old rates that do not tally with the high cost of living.
“Government must act fast to resolve this matter,” he said.
Minister of Finance and Economic Affairs Simplex Chithyola Banda announced the 60 percent adjustment in upkeep allowance in Parliament on March 26 2024, saying the decision is part of the government’s initiative to promote inclusion and accessibility of loans. The minister said there was an allocation of K25 billion to student allowances, of which K24 billion is a budget allocation and K1 billion is from student loan recoveries.
