In what has been described as an “attack on the university system,” the Academic Staff Union of Universities (ASUU) and the Committee of Vice Chancellors of Nigerian Universities have expressed their discontent over the Federal Government’s recent plan to automatically deduct 40% from the Internally Generated Revenue (IGR) of universities across the country.
The controversial move was disclosed in a letter dated October 17, 2023, titled ‘Implementation of 40% automatic deduction from internally generated revenue of partially-funded Federal Government institutions.’
The letter, signed by the Accountant-General of the Federation, Mrs. Oluwatoyin Madein, and Director of Revenue and Investment, Office of the Accountant-General of the Federation, Felix Ore-ofe Ogundairo, referenced the Finance Circular with number FMFBNP/OTHERS/IGR/CRF/12/2021, dated December 20, 2021, to justify the policy.
However, ASUU’s National President, Prof. Emmanuel Osodeke, has firmly criticized the government’s decision, emphasizing that universities do not profit from the various user chargers or service fees they collect from students. Prof. Osodeke further expressed surprise at the government’s intention to levy charges on subsidized items such as ID cards, hostel accommodations, lab coats, and other student essentials.
“This is what we saw when we were fighting that the government should fund universities and Nigerians think ASUU is the problem.
“Universities are not revenue-generating agencies, so the 40 per cent of the subsidised money students pay for a hostel, medicals, ID cards, lab coat, chemicals in the laboratory should still be shared with the government?
“This is an extreme, that such is happening in Nigeria.. Will the Presidency ask the NASS, NNPC, to give a return of 40 per cent?”
Osodeke urged parents, students, and the Nigerian populace at large to stand up against what he termed an assault on the universities. He further stated that ASUU plans to engage with the relevant Federal Government agencies overseeing the policy to determine the subsequent course of action.
He said,
“Parents, students, Nigerians need to rise up to this. This is an attack on universities. Universities are already paying taxes. They pay withholding taxes and it goes to government. There is nothing like IGR in universities. What we have are charges.
“We need to know the 40 per cent of what they want to collect from universities. They are even saying lecturers should pay them accommodation fees too.
“They want 100 per cent of what they pay as accommodation. It is sad. Give us some time to interact with the government,” Osodeke said.
In his statement, the Secretary-General of the Committee of Vice-Chancellors of Nigerian Universities, Prof. Yakubu Ochefu, disclosed that the deduction made by the Federal Government from universities was initially 25%, but was recently raised to 40%.
Prof. Ochefu urged the Accountant General of the Federation (AGF) to clarify the definition of Internally Generated Revenue (IGR), emphasizing that universities solely collect user charges from students rather than profits or revenues. He emphasized that universities were already operating at a deficit, contending that a 40% deduction would result in the complete deterioration of the university system.
Ochefu said,
“The Federal Government, through the Accountant General of the Federation, is citing the Finance Act of 2021 as the basis for the decision.
“We also have to look at the provision of the law. It says that it is when you have surplus in terms of your Internally Generated Revenue, that is when you can make the return to the government. But many universities don’t have IGR, because most universities charge students’ fees as user charges. Paying N2,000 for an ID card, which has already been subsidised by the university; they pay health insurance, sports, ICT, accommodation, these are all the charges that come together and universities must provide all these for their students.
“If a user charge is considered as IGR, then we have a problem with the nomenclature. The accountant general should clearly specify what he was referring to as IGR.
“If it is all these subsidised charges that the government wants to collect 40 per cent, then the universities will lead towards financial catastrophe.
“We will open our books to the world to let them know that this is how much we get in terms of user charges. Universities are being run in deficit and FG still wants to collect 40 per cent; that means you want the universities to run down.
Meanwhile, he maintained that if the Federal Government intended to collect 40% of the universities’ generated funds, it should ensure full funding of the universities.
“If this happens, the financial challenges of the universities will get worse because the university is not a profit-making institution, it is not a revenue-generating entity. It is a service-providing entity.”
<span;>He also mentioned that the Committee of Vice-Chancellors would hold consultations with the Ministry of Education, the Accountant General, and other relevant parties.
