Gov’t pets private varsities to absorb free SHS graduates

Demand for tertiary education is expected to explode by the year 2020, from the first batch of Free Senior High School beneficiaries, and the government has said its waiver of corporate income tax on private universities is meant to enable them invest in infrastructure and admit more students.

Speaking at a graduation ceremony of Datalink University College in Tema, the Minister in-charge of Tertiary Education, Prof Kwasi Yankah, said the private universities need to rise to the occasion.

“We are aware of the implications of the free SHS for admission to universities as from the year 2020. The demand for higher education will be greater, and as happened in the late 1980s after the educational sector underwent considerable reforms, there was an explosion of qualified students, whom the public sector could not absorb.

Nearly 30 years after, a similar situation has arisen, and the private sector would be expected to intervene and help cope with the situation. Universities in general need to expand, and diversify their programmes to accommodate the avalanche expected, he said.

By the year 2020, over 400,000 Free Senior High School (SHS) students would be expected to be seeking entry to tertiary schools.

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The reality, however, is that this single batch of free SHS beneficiaries are more in number than the entire student population of the 138 tertiary institutions in the country at the moment.

Prof. Yankah said the tax waiver is expected to give private universities a measure of relief, and help them utilise the savings made to expand their facilities and absorb the large throng of Free SHS beneficiaries.

“But the private universities would have served the national purpose even better, if expansion contemplated by private universities is in the area of STEM disciplines: science, technology, engineering and mathematics.

It is, indeed, the intention of government to introduce supplementary policies that would move us faster towards the 60:40 science-to-humanities ratio, which the nation is still struggling to attain.”

Private universities are responsible for over 20percent of all university admissions every year, and also employ thousands of staff.

2018 budget

Presenting the 2018 budget statement to Parliament, Finance Minister, Ken Ofori-Atta, said private institutions will no longer be required to pay corporate income tax.

“Income tax [25percent] will be waived on privately-owned universities, to the extent that profit is ploughed back to maintain the facilities. We will work to achieve the same for privately-owned SHSs in the future,” he said.

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“The education sector represents a high growth potential, with multiplier effects on the economy, as confirmed by a recent ‘Country Private Sector Diagnostic’ study by the World Bank Group. This is borne out by the rapid growth in privately-owned and managed universities, as well as in the inward flow of students from the West Africa sub-region.”

 

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