Universities face bankruptcy as state fails to pay

Zimbabwean universities are faced with bankruptcy as the government has failed to settle a US$64 million debt, only managing to pay US$20,000 a month. The unpaid money emanates from a cadetship programme in which government is supposed to pay institutions for the studies of children from underprivileged backgrounds.

Despite failing to settle the debt, the government has ordered universities not to expel any student on its cadetship programme who has not paid fees, exerting considerable strain on the operations of institutions.

Under the terms of the cadetship schemes, students repay the government for their funding through being ‘bonded’ – being in government service – for the same number of years that they study.

The government holds onto the certificates or degrees of beneficiaries until after they have served the bonded period.

Deputy Minister of Higher and Tertiary Education, Science and Technology Development, Dr Godfrey Gandawa, said the government debt was affecting the development of the institutions and this was impacting directly on the quality of learning.

The Minister of Finance and Development was “seized with this matter”, said Gandawa. “We owe US$64 million to all institutions of higher learning in the country. The minister of finance is doing his best to ensure that the debt is reduced. US$20,000 a month is released to all the institutions for the new students.”

The revelations of universities falling on hard times due to government’s failure to pay, came weeks after the National University of Science and Technology told state media that it was owed US$3.7 million by government in unpaid fees for students on the cadetship programme, “and we need this money to buy teaching equipment”.

The university said the lack of money was affecting academic activities. Despite being a science university, it was struggling to buy the necessary chemicals and other equipment.

“We’re aware that there are economic challenges but the government should make efforts to reduce the debt at least by a certain percentage on a quarterly basis,” the institution said in a statement.

Zimbabwe is battling a worsening economic crisis since President Robert Mugabe’s re-election in March last year. The government is also defaulting on its international obligations and the national debt stands at US$10 billion.

Mugabe and nine of his cabinet ministers were recently in China in search of investment and funding. According to government statistics, China has extended US$1 billion in loans to Zimbabwe since 2009 and trade between the two nations rose to US$1 billion last year from US$300 million five years ago.

In recent months there have been widespread company closures and groups loyal to the president have said retrenchments are turning political and may cost the party votes. Only about 500,000 out of a total 13 million people hold formal jobs and many university graduates are failing to get employment, with some resorting to vending.

This article was written by Kudzai Mashininga and was originally published on University World News. Home page photo by Book Aid International/ Flickr Commons.


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