Low wages, unemployment to blame for HELB loans crisis
- Aug
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- Posted in HELB Online Services
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Low wages, unemployment to blame for HELB loans crisis
Low income for helb beneficiary in Kenya
By JEREMIAH WAKAYA, NAIROBI, Kenya, Feb 22 – The announcement by Education Cabinet Secretary Amina Mohamed that the Higher Education Loans Board (HELB) will enlist the services of law enforcement agencies to compel graduates including those working in the informal sector to repay their loans has continued to attract wide condemnation.
Critics have cited low wages and unemployment as the main reasons why over 70,000 beneficiaries have now been listed as defaulters with accruing interests set to compound their debt situation.
“Most of the graduates don’t have jobs. It is not easy to get a job immediately after graduating. Going for people with informal jobs is unfair. If I’m earning Sh5,000 and I am to give Sh3,000 to HELB, I will only be left with Sh2,000 and that is not enough for anything,” she told Capital FM News on Friday.
The one-year period given to graduates to begin repaying their loans, Paintoi said, is insufficient.
“If the money I am paying back is supposed to help other students I don’t understand why then there is a four per cent interest rate per annum. We should not be paying more than they gave us because this money is going back to fund other students,” Paintoi who has a Sh200,000 loan with HELB said.
The Education CS while speaking during the launch of HELB’s 2019-2023 Strategic Plan had said the agency would track down defaulters in partnership with law enforcement agencies.
“We are also going to partner with our law enforcement agencies to track down those holding jobs and yet are reluctant to stand up to be counted as responsible and patriotic citizens who honour their debts,” she said on Wednesday.
Makueni Senator Mutula Kilonzo and his Narok counterpart Ledama Ole Kina slammed the directive by the education ministry recommending the waiver of the Sh7.4 billion owed to the loans board by university graduates.
Drawing comparison to the recent commitment by the government to write-off a Sh2.7 debt owed to sugarcane farmers by government-owned millers, Mutula asked the government to waive the Sh7.4 billion debt owed by HELB beneficiaries now listed as defaulters.
“Sugar debts were waived what are you talking about?” Mutula posed.
“There’re so many young people out there who are educated and unemployed. How do we expect these people to pay,” Ole Kina wondered.
The public outcry over the new directive prompted HELB to issue a statement saying the directive by CS Mohamed had been taken out of context.
“Section 15 (2) of the HELB Act gives mandate and authority for the board to have inspectors who will help HELB to recover and also access premises where ex-loanees are actually residing,” HELB CEO, Charles Ringera, said on Friday.
“We get direct authority by the Office of the Director of Public Prosecutions (ODPP) so that we have prosecutors on board. Those prosecutors are part of the law enforcement agencies that we’re using,” he said.
Ringera said the board had ceded prosecutorial powers given to it by the Attorney General prior to the enactment of the Constitution (2010), the mandate now resting with ODPP.
“All these offences fall under ODPP but the office has delegated prosecution to HELB. ODPP remains the overall owner of the prosecutions,” Ringera stated in a statement on Friday.
The loans board said prosecutors were at liberty to charge defaulters with several offences under the HELB Act including furnishing false information as well as refusal to pay.
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