Uhuru Saves HELB Beneficiaries in Letter to Parliament

  • President Uhuru Kenyatta speaking at an event at State House Nairobi on June 14, 2022.
    President Uhuru Kenyatta speaking at an event at State House Nairobi on June 14, 2022.
    PSCU
  • President Uhuru Kenyatta came to the rescue of beneficiaries of the Higher Educations Loans Board (HELB) funds after he declined to assent to the Higher Educations Loans Bill (2020).

    Uhuru, who refused to sign the Bill into law at State House, Nairobi on Tuesday, June 21, sent it back to the Parliament with a memoranda over stringent clauses in the Bill that would give Helb power over loanees.

    In the document seen by Kenyans.co.ke, the Bill amended Section 15 of  the Helb Act to allow the board recall the loan earlier than the one year grace period. In line with this, it called for beneficiaries to submit their contact details to the body.

    President Uhuru Kenyatta signs deals at State House
    President Uhuru Kenyatta signs deals at State House.
    File

    "A loanee shall be required, within one year of completion of his studies or within such a period as the Board decides to recall its loan, whichever is earlier, to inform Helb of his contact address," the Bill read in part.

    The proposed law pushed for students with outstanding loans to begin servicing them within one year of completing their studies - including the interests accrued on the disbursements.

    Graduands who secure employment within the same period would further be required to direct their employers to make Helb deductions and remit them to the parastatal. Failure to do so would lead to hefty fines.

    "A loanee who fails or neglects to satisfy the requirements within the stipulated time shall be guilty of an offence and liable to a fine not less than Ksh5,000 in respect of each loan deduction that remains unpaid in accordance with Subsection 1, and such a fine shall be made to the Board," read the Bill.

    The shooting down of the Bill comes as the Board declared that it was underfinanced due to unpaid loans. On May 22, Helb CEO, Charles Ringera, announced that 75,000 students who heavily depend on state financing could miss out on the funds.

    Ringera explained that 107,000 of beneficiaries defaulted on loans totaling nearly Ksh10 billion, including those who left the country for better opportunities abroad. He added that the board would follow the law and impose fines on unserviced accounts.

    "We have also seen a tendency of migration for greener pastures, particularly in Northern America. If you don't repay the loan or come for a discussion with us, the law says we charge your account a penalty of Ksh5,000 for being in default."

    To encourage servicing of the credit, Helb announced a 100 per cent waiver on loans paid in full by June 2022.

    Uhuru further refused to sign into law the ICT Practitioners Bill. The Bill, which had caused uproar over the stringent requirements, including one that required players in the sector to be holders of a Bachelor's degree and be members of a national board.

    File Photo of University Students At the Anniversary Towers in Nairobi
    File Photo of University Students At the Anniversary Towers in Nairobi.
    File