The Academic Staff Union of Universities (ASUU) has called on the National Assembly to protect the Tertiary Education Trust Fund (TETFund) from being phased out under the proposed Nigeria Tax Bill 2024. The union expressed concerns over the bill’s implications, emphasising that TETFund has been a critical pillar in advancing Tertiary Education across Nigeria. ASUU has long maintained that the creation of TETFund was a direct result of its sustained engagement with the federal government since 1992. The union believes that any attempt to dismantle or weaken the fund would harm Higher Education and pose a risk to national development.
Additionally, the union’s reservations were detailed in a presentation delivered by ASUU’s president, Prof. Emmanuel Osodeke, during the second day of a public hearing on tax reform bills held at the National Assembly. In the presentation titled “Debates on the Nigeria Tax Bill, 2024: Our Case for Tertiary Education Trust Fund, TETFund,” ASUU voiced its objections to the proposed changes, mainly removing education tax as a dedicated Revenue source for TETFund. According to ASUU, the Nigeria Tax Bill 2024 threatens the survival of TETFund by redirecting its primary funding source.
Implications of diverting the agency revenue to NELFUND.
TETFund has been pivotal in financing capital projects, postgraduate training, and research capacity building in Nigerian public tertiary institutions for over 15 years. The union noted that more than 90% of capital projects in federal and state universities, polytechnics, and colleges of education have been funded through the organisation interventions. Many tertiary institutions would struggle to provide adequate Infrastructure and academic development opportunities without this agency. One of the key provisions of the Nigeria Tax Bill 2024 that alarms ASUU is the planned diversion of funds from TETFund to the Nigerian Education Loan Fund (NELFUND).
Under the proposed legislation, only 50% of the education tax, the development levy, would be allocated to the institution in 2025 and 2026. The remaining portion would be distributed among NITDA, NISENI, and NELFUND. By 2030, the agency would receive no allocation, with all funds directed exclusively to NELFUND. The union argues that this move is a veiled attempt to phase out the organisation under the guise of financial reallocation. The union insists that TETFund’s existence hinges on its designated funding stream, and diverting this revenue to another agency effectively dismantles it.
Potential consequences for higher education nationwide.
Therefore, eliminating the agency would severely affect the tertiary education system. Over the years, TETFund’s financial support has been instrumental in mitigating industrial disputes in universities and other higher institutions. The agency’s infrastructure development, staff training, and research investments have improved academic standards and reduced labor-related grievances. ASUU also stressed that its impact extends beyond tertiary institutions, benefiting the entire education sector, including primary and secondary levels. By funding the training of educators and other support staff, it has indirectly enhanced the quality of education nationwide. The agency’s role in strengthening the education system has not gone unnoticed, as countries like Ghana have adopted similar models, while others in Africa have studied its framework for potential replication.
As a result, the union called on the National Assembly to reject any provision in the Nigeria Tax Bill 2024 that undermines the agency. ASUU insists that any reduction in agency funding is illegal and unjustifiable, given its proven contributions to the nation’s educational progress. The argument that NELFUND should replace its role is flawed, as it equates to sacrificing a well-established institution for a newly introduced initiative with uncertain long-term viability. Rather than weakening the organisation, ASUU suggests that the government should focus on strengthening its operations and ensuring its sustainability.
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Established through the Education Tax Act No. 7 of 1993, the organisation was created in response to the chronic underfunding of Nigeria’s public tertiary institutions. Initially operating as the Education Tax Fund (ETF), it has since evolved into a vital mechanism for channelling resources into infrastructure development, research funding, and academic staff training. Currently, the agency is funded through a 2.5% education tax levied on companies’ assessable profits. This model ensures a steady revenue stream that addresses higher education institutions’ infrastructural and developmental needs.