Most schools resumed on Monday, amid an inflationary trend that is driving up the cost of goods and services without commensurate increase in parents’ income. Some parents are having to decide in some cases between food or school fees for their children. Others are moving their children/wards from high fee paying schools to lower ones, or from private schools to public ones. School proprietors are likewise formulating creative financial solutions to keep their clients.
Parents, school proprietors and administrators who spoke to BusinessDay alluded to a number of factors that are responsible for these growing challenges. Some parents work or worked for businesses that have scaled down operations, slashed salaries, laid off workers or shut down completely, in response to Nigeria’s economic recession.
To take the textile industry, information from the National Union of Textile, Garment and Tailoring Workers of Nigeria showed that at least, 60 textile companies in Lagos with a total of 66,250 workers had shut down within the period. The ripple effect of these are tangible.
For instance, at Halcyon International School Illupeju, Lagos, known for its expatriate and upper middle class clientele parents’ ability to pay for quality education, that capacity has clearly diminished.
“To put it in perspective, Ilupeju is largely an industrial area. Most of the expatriate workers work for textile firms. Now, some of these textile firms have closed shop. This has taken a toll on some of our parents’ income. In fact, some of the expatriates have left Nigeria and gone back to their various countries” Bada Emmanuel, head of administration, Halcyon said.
Emmanuel added “get this straight; we are not only referring to expatriates here but also to some Nigerian high middle class workers. I figure it is worse among the lower middle class and those we call the masses. It is a terrible situation, if you ask me. Students go to school hungry.”
A parent who insisted on anonymity said she met an unusual scene at the entrance of her children’s school on Monday. “Parents were stopped and children whose parents had not yet paid the schools fees were sent back. This has never happened. I believe the proprietor is weary of parents’ ability or inability to pay at any later date” she said.
She added “the school fees used to be N60, 000 per child per term but now it has risen to N90, 000. These are indeed tough times.”
Some school proprietors are looking for means of accommodating parents who might be going through financial distress and are unable to meet their financial obligations to their children’s schools when due. Some schools have introduced staggered school fees and others monthly payments.
“Our parents are still paying; our fee is low and we charge per month because we know it may be a lot for parents to pay per term. We aligned our fee policy to meet the needs of the parents, bearing in mind that most of the parents are salary earners. The demography here is middle class, which is why we fixed our fee policy to run monthly” said Chinasa Jonathan-Ojei, head of human capital at the Nigeria Inter-Bank Settlement System Plc (NIBSS) and director of Oaknut Children’s Centre, Ikota Villa Estate, Lagos.
With a population estimated at 20 million, Lagos is said to receive about 300,000 immigrants on daily basis and, according to Olufela Bank-Olemoh, the Special Adviser on Education to Governor of Lagos, this influx of people into the state puts much pressure on public facilities such as schools.
The special adviser lamented that there were only 140 public primary schools in the state as against the 8,000 private schools, but assured that the state government was making efforts to bridge this gap by partnering with the private sector to build and equip more modern schools.
To further alleviate the financial burden on parents, Deposit Money Banks (DMB) such as Stanbic IBTC Plc, Fidelity Bank Plc and Sterling Bank among others , have formulated ‘back to school’ financial packages designed to spread the cost of school fee over a 60 to 90 day period.
Some of the features of the loans include the opportunity to access up to N2million unsecured, flexible, monthly repayment from three to 11 months, simple documentation requirement and easy to access.
To qualify for the loan, children/wards must attend a school that banks or is willing to bank with the said bank. Parents/ guardians must have or be willing to open a current account with the bank and they must have a verifiable source of income, either salaried or self-employed, with proof of income.
“These products are actually there, some kind of bridge finance that parents can access to pay school fees, pending when they are able to repay. It is like a salary advance and it is dependent on the parents’ income and credit worthiness.
“Credit worthiness means you need to look at the person’s income, the organisation they work for, you need to look at how sustainable the organisation is and the integrity of the person in question. You see the repayment of such facilities is dependent on the income of the parents,” said a branch manager in one of the banks, who does not want his name mentioned.
“For a parent intent on accessing any of these credit facilities, simply approach the bank to know what they have. It is essentially a salary advance. Banks would basically advance 50 or 60 percent of your salary to you, this is really an overdraft. What the parents must find out is whether the bank would take all 50 percent the following month or spread it out over a period of about 90 days or more” he added.
STEPHEN ONYEKWELU
