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Nigeria’s Education Underfunding: World Bank’s $1.08bn Loan Highlights a Deeper Crisis

Folaranmi Ajayi by Folaranmi Ajayi
April 3, 2025
in Africa
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Nigeria’s Education Underfunding: World Bank’s $1.08bn Loan Highlights a Deeper Crisis

Coins and banknote in a glass jar placed on the textbook. Concept money saving for education.

The World Bank’s approval of a $1.08 billion loan to enhance education, nutrition, and economic resilience in Nigeria validates a critical issue: the persistent underfunding of education in the country.

A model that is transforming learning across the globe A model that is transforming learning across the globe A model that is transforming learning across the globe

Despite this international support, Nigeria’s investment in education remains significantly below global standards, which continues to hinder the nation’s development.

In the proposed 2024 budget, Nigeria allocated ₦1.54 trillion to the education sector, representing only 6.39% of the total budget. This figure falls short of the United Nations Educational, Scientific and Cultural Organisation’s (UNESCO) recommendation that developing countries should dedicate 15-20% of their national budgets to education.
Over the past six years (2016-2021), Nigeria allocated approximately ₦3.6 trillion to education out of a total budget of ₦55.3 trillion, averaging just 6% annually.

The World Bank reports that Nigeria spends about $200 per student annually. This amount is considerably lower than countries like Mexico, which spends $800 per student, and Peru, which invests $1,000 per student each year.

GrannyMurray School GrannyMurray School GrannyMurray School

When compared to other African countries, Nigeria’s education funding is also lacking. Ghana, for instance, allocated 23.81% of its national budget to education in 2015, while South Africa dedicated 16.7% in 2018. These figures highlight Nigeria’s lag in prioritising education funding relative to its regional counterparts.

Insufficient investment in education leads to overcrowded classrooms, inadequate teaching materials, and poorly motivated teachers. These factors contribute to subpar educational outcomes, limiting the potential of Nigerian students and, by extension, the nation’s future development.

Finally, While the World Bank’s loan provides temporary relief, it does not address the root issue of chronic underfunding in Nigeria’s education sector.

For sustainable progress, the Nigerian government must significantly increase its investment in education, aligning with international benchmarks and regional practices. This commitment is essential to equip the nation’s youth with the skills and knowledge necessary for personal and national advancement.

What It Takes To Fund Education

Funding education requires a comprehensive approach that involves both governmental and non-governmental efforts. Here are key aspects that contribute to effectively funding education:

1. Government Budget Allocation

Prioritisation: Governments must allocate a significant portion of their national budgets to education. As mentioned earlier, UNESCO recommends that 15-20% of national budgets be directed towards education in developing countries.

Stable and Consistent Funding: Education funding should be stable and consistent year after year to allow for long-term planning and development. This prevents disruptions in programs, teacher salaries, and infrastructure projects.

2. Domestic Resource Mobilisation

Tax Revenues: A strong tax collection system allows governments to generate revenue that can be allocated towards education. Effective tax policies can ensure that education receives the resources it needs.

Public-Private Partnerships (PPP): Governments can collaborate with the private sector to fund educational infrastructure, technology, and resource development. These partnerships may also help in training and mentoring teachers.

3. International Aid and Loans

Development Assistance: Countries, especially those with limited resources, can seek funding from international organisations such as the World Bank, the United Nations, and bilateral aid from other governments. These funds often come in the form of loans or grants.

Debt Relief: Some countries may seek debt relief to free up resources for education, especially if a large portion of the budget is consumed by servicing external debt.

4. Donations and Grants

Non-Governmental Organisations (NGOs): Several international and local NGOs provide funds for educational programs, especially in underserved communities.

Philanthropic Foundations: Donations from philanthropic foundations such as the Bill and Melinda Gates Foundation, the Rockefeller Foundation, and others can support educational initiatives, particularly in the areas of health and education.

5. Investment in Infrastructure

School Buildings and Facilities: A key component of funding education is ensuring that the physical infrastructure is adequate. This includes building new schools, maintaining existing ones, and providing necessary amenities like sanitation, electricity, and internet access.

Technological Investment: Investment in technology is essential for modernising education systems. This includes providing digital learning tools, internet access, and teacher training for the use of technology in classrooms.

6. Teacher Training and Salaries

Attracting and Retaining Teachers: Funding education also involves investing in teachers, as they are the backbone of the education system. Competitive salaries, ongoing professional development, and support systems are necessary to retain skilled teachers.

Teacher Education: Governments and organisations should invest in teacher training institutions to ensure educators are well-equipped to teach effectively.

7. Curriculum Development

Quality of Education: Funding is needed to ensure that the curriculum is updated regularly to meet the evolving needs of students, including critical thinking, STEM education, and skills relevant to the job market.

Inclusive Education: Investments should also be made in creating accessible education for all, including marginalized groups like girls, students with disabilities, and those in rural areas.

8. Monitoring and Evaluation

Accountability: Effective funding also means having strong systems in place to monitor how funds are being spent. Transparency, accountability, and rigorous auditing mechanisms are critical to prevent misuse of funds.

Research and Feedback: Governments and organisations should invest in research to assess the effectiveness of their educational policies and adjust them based on evidence.

9. Community and Parental Support

Local Contributions: In many countries, local communities contribute to the funding of education, whether through fundraising, volunteer work, or providing local resources.

Parental Involvement: Encouraging parents to invest in their children’s education by paying for school fees, uniforms, or supplies can complement government efforts.

10. Reallocation of Resources

Pragmatic Use of Existing Funds: Governments can also find ways to optimise the use of existing resources. This includes eliminating inefficiencies, tackling corruption, and ensuring that funds are distributed equitably across regions and school systems.

Funding education requires a multi-pronged approach that involves significant financial commitment, collaboration between various sectors (government, private sector, and international bodies), and a focus on both short-term and long-term goals. A well-funded education system is an investment in human capital, which can lead to economic growth, social mobility, and improved quality of life for individuals and communities.

Tags: EducationFundingWorld Bank
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Folaranmi Ajayi

Folaranmi Ajayi

Folaranmi Ajayi, is an educator and journalist covering education,as an educator he has over a decade of experience in teaching and helping students pass exams with above-average grades. He is an education journalist with a special interest in local education,policy writing, solutions journalism, mentoring students, public speaking, and online training.

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