HESLB failed to meet its targets in collecting loans from beneficiaries, says CAG report

By | April 11, 2018

The Higher Education Student’s Loans Board (HESLB) failed to meet its targets in collecting loans from beneficiaries, says a report issued by the Controller and Auditor General (CAG) yesterday.
According to the report, “Performance Audit on Management of payment and recovery of Higher Education’s Student’s Loans,” the CAG said that the HESLB failed to meet the targets because of “weaknesses’’ in tracing and billing of loan beneficiaries as well as in monitoring and evaluation by the Ministry of Education, Science and Technology.
“Tracing and billing of loan beneficiaries was not effective,’’ says the report availed to the media yesterday.
“The general conclusion of this audit is that there is limited assurance that HESLB will sustain itself in financing higher education without depending on subsidies from central government,’’ said the report.
“This is because the trend of HESLB’s performance in loans collection for the past five financial years ranging from 2012/2013 to 2016/17 in below 0 per cent of the amount of the loan due,’’ shows the report.
“This was because of the inadequate design, implementation and monitoring of loan collection strategies and limited oversight role played by the Ministry of Education, Science and Technology,’’ the report revealed.
The HESLB, according to the report, had 163,394 loans defaulters but the board’s records provided indicated that there were only 18 individual defaulters.
Only two individual defaulters have been sanctioned to court for the past two years, says the audit report.
“Furthermore, there were 70 employers who were charged with late payment/ non-deduction penalties, it further says.
“The total penalties for all 70 employers amounted to Sh267.5million, however, HESLB managed to collect 21 percent of the penalties from employers that amounted to Sh57million,’’ says the report.
SOURCE : The citizen