Greenidge sees scaremongering over UG loan fund

The University of Guyana (UG) Student Loan Fund has received close to $9 billion since it was created in 1994 and is a revolving one, as such, the cutting of money intended for it this year should not disturb students’ access to loans, says APNU Shadow Finance Minister Carl Greenidge.

In a letter carried in the June 15th edition of the Sunday Stabroek, Greenidge noted that the fund was started in 1994, and that with the exception of this year’s contribution government has allocated around $450 million to the fund annually since its inception.

These contributions, he went on, will amount to approximately $9 billion (counting this year’s contribution) over a twenty-year period. He also explained that students who borrow loans are mandated to complete repayment of said loans in fifteen years at a very low interest rate.

Greenidge believes that “Since the Fund has been in existence since 1994 it should now be mature or flush with cash…how then can the fund be unable to extend loans to this year’s students? The Fund cannot be exhausted at this point in its lifecycle simply as a result of government’s inability to pay this year’s tranche…the story of the consequential unavailability of funds in 2014 for student loans voiced by government spokesmen … is utterly untrue.”

His letter was in response to a statement and fears that students looking to source loans to attend UG this year will not be able to do so because the amounts were cut by the National Assembly.

During the consideration of the estimates earlier this year the Alliance for Change (AFC) and A Partnership for National Unity (APNU) used their combined superior seating to cut part of the Finance Ministry’s budget. The amounts cut included Guyana’s annual contribution to the Caribbean Development Bank (GDB), and equity contributions for the Amaila Falls Project which amount to $18.56 billion. These amounts were tied to a $450 million allocation intended for the Student Loan Fund.

The opposition parties had requested that the amounts be delinked, but cut the entire amount after government said this could not be done. With the next academic semester less than three months away there are fears that loans will not be available, which therefore means that students will be forced to pay cash or will not be able to attend university from September 2014.

The status of the Loan Fund

It has long been known that many students, after graduating from UG become delinquent with their loan payments. There are many past students still residing in Guyana who are not repaying their loans, while others have migrated without repaying same.

The guarantors of loan recipients are supposed to be held accountable for the loans if the borrower is delinquent, however even this provision is not enforced efficiently.

Stabroek News has attempted to ascertain the status of the Fund, including the current balance; the percentage of students making repayments; and the amount of interest collected so far. This endeavour however, has been unsuccessful.

On Monday this newspaper spoke to the Finance Ministry’s Financial Secretary Neermal Rekha who declined to comment on the topic. Rekha also declined to speak on the management of the fund or the amount of money it holds at this time.

Last Monday, Finance Minister Ashni Singh conceded that the repayment of loans taken is not where he would like it to be, and that the ministry is exploring ways to improve the system for recollection.

Latest in Local News

default placeholder

Brian Tiwarie blasts Ramotar administration over specialty hospital project

Businessman Brian Tiwarie yesterday rejected claims that his company had taken possession of containers belonging to the fired Specialty Hospital contractor and he accused the Donald Ramotar administration of grossly mismanaging the project.

The Kato school

Multimillion-dollar Kato school unsafe for children

The Kato Secondary School, which was constructed at a cost over hundreds of millions of dollars, remains unoccupied because it is not safe for children, Minister of State Joseph Harmon said yesterday.

default placeholder

Repairs underway to shifting Hope Canal bridge

There is a major structural fault with the $350m bridge constructed across the Hope Canal,  East Coast Demerara, according to Minister of State Joseph Harmon, who yesterday said the structure has repeatedly shifted away from the road.

default placeholder

National Assembly approves $800m in supplementary spending

After hours of deliberations, the National Assembly last night approved almost $800 million in extra-budgetary spending including on 6000 solar panels to “green” State House and an army exercise aimed at testing the preparedness of the Guyana Defence Force which was done last year.

default placeholder

Brian Tiwarie planning to establish newspaper

Prominent businessman and owner of BK International, Brian Tiwarie, is planning to open his own newspaper company here and has started the process.

default placeholder

Probe underway into stealth flights from Ogle

An inquiry has been launched into the circumstances surrounding how two planes left Guyana illegally from the Eugene F Correia International Airport (EFCIA) last Saturday, Minister of State Joseph Harmon said yesterday.

default placeholder

Finance Minister says unsure of UG ‘emergency’ funding needs

Minister of Finance Winston Jordan has said that he is unsure of the ‘emergency’ funding the University of Guyana needs to reputedly prevent a collapse of the  institution.

default placeholder

Ministry welcomes removal from US human trafficking watch list

The Ministry of Social Protection yesterday welcomed the latest classification on Trafficking in Persons (TIP), which has seen the country coming off the watch list for TIP, that is, moving from Tier 2 on the Watch List to Tier Two.

Comments

About these comments

The comments section is intended to provide a forum for reasoned and reasonable debate on the newspaper's content and is an extension of the newspaper and what it has become well known for over its history: accuracy, balance and fairness. We reserve the right to edit or delete comments which contain attacks on other users, slander, coarse language and profanity, and gratuitous and incendiary references to race and ethnicity.

Stay updated! Follow Stabroek News on Facebook or Twitter.

Get the day's headlines from SN in your inbox every morning: