ACHEA Conference July 2002‘The Challenge Of Quality for the Higher Education Administrative Professional.’

Financing TertiaryEducation

Unlocking the potentialof Nations

ACHEA Conference July 2002‘The Challenge Of Quality for the Higher Education Administrative Professional.’

Traditionally financial assistance had been centered around merit and need, awards were generally:• For those who achieved excellence

scholarships were made available

• For those who demonstrated financial need, there were loans and grants.

• There were instances where assistance was made available by request regardless of category (excellence or need).

ACHEA Conference July 2002‘The Challenge Of Quality for the Higher Education Administrative Professional.’

Problems Encountered• If only those who achieved excellence were

allowed to continue, the opportunities for social mobility created by education would be limited to only a few.

• The demands of any growing society cannot be met by only a few qualified persons. Growth and development depends on the availability of new skills in various sectors. It is unlikely that it could be met only by those who could afford their education and those who achieved excellence.

ACHEA Conference July 2002‘The Challenge Of Quality for the Higher Education Administrative Professional.’

Problems Encountered• Nonetheless scholarships can provide the

necessary incentives for studies in specific areas, and indeed opportunities have been provided time and again to bring technical and intellectual support to areas targeted for growth and development, for example CIT programmes undertaken by HEART NTA in Jamaica

ACHEA Conference July 2002‘The Challenge Of Quality for the Higher Education Administrative Professional.’

Demonstration ofFinancial Need

• The measurement of need is always a difficult one and can be highly subjective. In Jamaica the decision was taken to measure need by living conditions.

ACHEA Conference July 2002‘The Challenge Of Quality for the Higher Education Administrative Professional.’

Demonstration ofFinancial Need

• Through the survey of living conditions published by the Planning Institute of Jamaica annually, quintiles are established dividing the society into groups ranging from those at the poverty line and upwards. Assisted by this we were able to arrive at an acceptable measurement of need.

ACHEA Conference July 2002‘The Challenge Of Quality for the Higher Education Administrative Professional.’

The Jamaican Experience

• From the records available since 1972, it is clear that Jamaica has combined all three. Although it is apparent that at different times there was a strong leaning to one or the other direction.

ACHEA Conference July 2002‘The Challenge Of Quality for the Higher Education Administrative Professional.’

Jamaican Experience• For Jamaica there was often no

difference between those who achieved excellence and those who demonstrated financial need. The poor are often among the brightest and indeed there are degrees of financial need within this group.

ACHEA Conference July 2002‘The Challenge Of Quality for the Higher Education Administrative Professional.’

Scholarships

• Scholarships continue to be sourced by private sector bodies, the government, individuals, and educational institutions.

ACHEA Conference July 2002‘The Challenge Of Quality for the Higher Education Administrative Professional.’

Scholarships Cont’d• The Government through the Ministry

of Education awards scholarships annually based on excellence – only to the top performers.

• Scholarships invariably cover tuition and books and (at least) assists with maintenance costs.

ACHEA Conference July 2002‘The Challenge Of Quality for the Higher Education Administrative Professional.’

Private Sector Scholarships:

• Are available either to employees, children of employees, or persons pursuing programmes directly relevant to the entities core business. Again these are made available to top performers. The number of applicants for these invariably exceed the available awards.

ACHEA Conference July 2002‘The Challenge Of Quality for the Higher Education Administrative Professional.’

Private Sector Scholarships:• Increasingly therefore we observe awards

that do not cover tuition; as scholarships are perceived to do.

• There are now therefore a number of ways of assisting bright students. These are usually donated by private entities or individuals. They do not cover all their costs but they help.

ACHEA Conference July 2002‘The Challenge Of Quality for the Higher Education Administrative Professional.’

Educational Institutions TEI’s often give awards based on

achievement. Increasingly however, financial assistance is being made available by institutions for students who are in need. There is quite an extensive programme at U.W.I. Mona and to varying levels at other institutions through the island.

ACHEA Conference July 2002‘The Challenge Of Quality for the Higher Education Administrative Professional.’

Government• Government assistant has never been

limited to top achievers. In 1970 the S.L.B. was established. One must remember that although top achievers were likely to get scholarships there were many bright students for whom scholarships were not available as there were never enough.

ACHEA Conference July 2002‘The Challenge Of Quality for the Higher Education Administrative Professional.’

The initial objective1970-1993

• During these years funding was made available to assist persons in completing a tertiary education anywhere and was generally provided upon request. Loans were offered to persons studying anywhere in the world.

ACHEA Conference July 2002‘The Challenge Of Quality for the Higher Education Administrative Professional.’

The initial objective1970-1993

• The funds were provided by the Government of Jamaica and the World Bank.

• Repayment was “pathetic,” a large number of borrowers did not return to Jamaica, and many did not acknowledge the responsibility for their debt.

ACHEA Conference July 2002‘The Challenge Of Quality for the Higher Education Administrative Professional.’

March 1993 - 1996• Between 1993 and 1996 a new scheme

emerged which is still referred to as the GOJ/JBA scheme. This scheme was guaranteed by the government and funded by the banks.

• It allowed student borrowers to enter into loan agreements with the bank of their choice.

ACHEA Conference July 2002‘The Challenge Of Quality for the Higher Education Administrative Professional.’

HistoryThis scheme was marked by:

• High Interest Rates• Poor or no record keeping by the

banks• Limited Communication between

the school, the student and the banks

ACHEA Conference July 2002‘The Challenge Of Quality for the Higher Education Administrative Professional.’

The Consequence

• Poor Repayment

• Abandonment of the scheme

N.B. Student behaviour during this period “drove” the transition to a new and fairly tight scheme.

ACHEA Conference July 2002‘The Challenge Of Quality for the Higher Education Administrative Professional.’

New World Bank LoanJuly - 1996

The New Mandate:

“To ensure that no needy Jamaican student is denied a tertiary education by reason of finance.”

ACHEA Conference July 2002‘The Challenge Of Quality for the Higher Education Administrative Professional.’

Challenges

• The measurement of need; who is a needy Jamaican?

• New limitation – only students attending Jamaican Institutions were able to borrow, the only exception being the foreign campuses of the University of the West Indies as well as some institutions in Cuba.

ACHEA Conference July 2002‘The Challenge Of Quality for the Higher Education Administrative Professional.’

Challenges cont’d

• Ensuring that funds were used to assist those who truly wanted an education – hence – no assistance to repeaters or for purchases of consumer items.

ACHEA Conference July 2002‘The Challenge Of Quality for the Higher Education Administrative Professional.’

Challenges cont’d

• Creating improved communication between the Tertiary Educational (TEI’s) Institutions, the SLB and the Approved Financial Institutions (AFI’s); where and when they were involved.

ACHEA Conference July 2002‘The Challenge Of Quality for the Higher Education Administrative Professional.’

Today’s SLB

OUR MISSION

To provide efficient and friendly student financial services to ensure the sustainability of a student loan revolving fund, while maintaining acceptable charges for needed facilities.

ACHEA Conference July 2002‘The Challenge Of Quality for the Higher Education Administrative Professional.’

Today’s SLB

OUR VISIONTo be the financial institution of choice for tertiary students, offering efficient and friendly services at affordable rates.

ACHEA Conference July 2002‘The Challenge Of Quality for the Higher Education Administrative Professional.’

Today’s SLB

Undergraduates

• There is no distinction between the bright and the need.

• Assistance is provided for the needy who perform satisfactorily.

ACHEA Conference July 2002‘The Challenge Of Quality for the Higher Education Administrative Professional.’

There are two types of assistance:

The Grant-in-aid – for the neediest of the needy. A non-repayable award.

UWI foreign campuses - $40,000

Jamaican Universities - $35,000

UWI, Mona, UTECH, NCU

All other institutions - $12,000

ACHEA Conference July 2002‘The Challenge Of Quality for the Higher Education Administrative Professional.’

Grant-in-aid

• There is no specific application for the Grant-in-aid, upon applying the means test to each application, those persons falling at a designated level are automatically awarded the Grant-in-aid.

ACHEA Conference July 2002‘The Challenge Of Quality for the Higher Education Administrative Professional.’

Tuition LoansThese are awarded to applicants who:

• Have been accepted to an approved institution, i.e. approved by the Ministry of Education for SLB funding

• Have been determined to be needy as a result of the means test.

ACHEA Conference July 2002‘The Challenge Of Quality for the Higher Education Administrative Professional.’

The Means Test• Measures – The family size vis-à-vis

family income to arrive at the PCAR per family.

N.B.: The details for the actual test are submitted by applicants, we use the information applicants provide in the application forms.

ACHEA Conference July 2002‘The Challenge Of Quality for the Higher Education Administrative Professional.’

The Means Test• Over the years we have observed

several attempts to manipulate what is perceived as the formula. This is dangerous. Some applicants have actually worked their way out of a loan and grant by doing so.

ACHEA Conference July 2002‘The Challenge Of Quality for the Higher Education Administrative Professional.’

Additional Assistance• The Boarding Grant – This is funded by the

Ministry of Education but administered by SLB.

• Criteria for approval – The students must be accepted or enrolled at a foreign campus of UWI for a programme not offered at UWI Mona.

• Boarding grants are available for the prescribed period of study for the particular course.

ACHEA Conference July 2002‘The Challenge Of Quality for the Higher Education Administrative Professional.’

Alternatives to SLB• Credit Unions• Building Societies• Commercial Banks

N.B.: Repayment with these institutions begin immediately after disbursement (while the applicant is studying)

ACHEA Conference July 2002‘The Challenge Of Quality for the Higher Education Administrative Professional.’

Alternatives to SLB cont’d

• Collateral is required

• Higher interest rates

• Loan Charges are higher

• No Moratorium on loans

ACHEA Conference July 2002‘The Challenge Of Quality for the Higher Education Administrative Professional.’

Benefits at SLB• Moratorium for the course of

study and six months thereafter.

• No Collateral required – 2 guarantors to cosign.

• Lower Interest rates.

ACHEA Conference July 2002‘The Challenge Of Quality for the Higher Education Administrative Professional.’

Benefits at SLB• Very competitive loan charges.

• Direct contact with the Tertiary Educational Institutions on behalf of the applicant.

• Highly competitive life insurance with added benefits for permanent incapacity, mental or physical.

ACHEA Conference July 2002‘The Challenge Of Quality for the Higher Education Administrative Professional.’

Benefits at SLB• It is possible to qualify for a gift of

a grant-in-aid.

• The life of the loan is ten years.

• Full financing is offered for all major Jamaican Universities.

ACHEA Conference July 2002‘The Challenge Of Quality for the Higher Education Administrative Professional.’

Benefits at SLB

• Customer friendly loan process.

(still a work in progress)

• Tuition is sent directly to the tertiary institution.

• Variety of loan payment options.

ACHEA Conference July 2002‘The Challenge Of Quality for the Higher Education Administrative Professional.’

Benefits at SLB

• Loan Management System dedicated to Student Loan Management.

• Applicants are able to appeal if not approved.

ACHEA Conference July 2002‘The Challenge Of Quality for the Higher Education Administrative Professional.’

New products offered at SLB• Post Graduate loans – Funded by a commercial

bank on the recommendation of SLB for each applicant.

• For those who apply and are not considered needy, a commercial bank loan to cover tuition costs.

• In both cases conditions apply. However the interest rates are the same as those at the SLB and the facility has been structured with the student borrower in mind.