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Volume IV,  Number 22              July 4 - 10, 2004            Quezon City, Philippines


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Budget Cuts Belie Arroyo’s ‘Education-for-All’ Claim

Amid the commercialization and privatization schemes, the Arroyo presidency only showed lip service to public tertiary education and allowed it to be gobbled up by profit-oriented enterpreneurs. Will it be any different now under a new administration that is run by the same president?


PUP building in Sta. Mesa, Manila

When Gloria Macapagal-Arroyo vowed on June 30 – the day she was sworn into office as the country’s 14th president – to give “education for all,” most of the country’s students would have wondered how she would be able to fulfill such promise. Seen alone from how her own administration – and that of her predecessors - cut budgets for state tertiary education, she may have to do harder in order to bridge the gap between what she preaches and what she does.

Reports show that the state of tertiary education remains pitiful. Ironically, the President remains mum on any increase in the budgetary allocation to education, particularly state universities and colleges (SUCs).

When she assumed presidency in 2001 as a result of the people’s uprising popularly called EDSA Dos, the budget for SUCs amounted to only P13.81 billion ($246.74 million, based on an exchange rate of P55.97 for every US dollar). Not surprisingly, the youth sector at that time presented to Arroyo a four-point agenda which included higher subsidy for SUCs.

In 2002 and 2003, the budget for SUCs was pegged at P15.87 billion ($283.54 million) but this was reduced again to P15.71 billion ($280.69 million) the following year.

Because Congress failed to approve the 2004 budget, the previous year’s national budget is being used this year. As a result, the much-needed increase in the allocation for SUCs was not realized.

The Maintenance and Other Operating Expenditures (MOOE) of SUCs consequently decreased in the past years.  It was slashed by almost half in 1994. (See Chart)

 Rationalization of SUCs

Due to the budget cuts, public tertiary education is even more expensive today since SUCs tend to increase tuition, among others, to – or so they claim - finance their operations. In a survey by the Philippine Education Sector Study in 1998, tuition in SUCs amounted to P3,100 ($55.39) a year.  Besides tuition, yearly expenses besides totaled P6,900 ($123.28).

Part of the government’s cost-cutting measures is the rationalization of the SUCs.  In two separate memoranda by the Commission on Higher Education (CHED) in 1999 and 2000, 86 CHED-supervised institutions (CSI) were set for integration into SUCs. 

In six years, the number of SUCs was reduced by 154 (i.e., from 264 in 1998 to 111 in 2004).

Increases in tuition and other fees

Confronted by the demand to increase subsidy for education, Arroyo has told SUCs to become “self-reliant.” To many SUCs, the presidential directive on financial autonomy meant imposing tuition and other fee hikes, generating income by privatizing services, selling assets and allowing private corporations to invest.

In the country’s premier state university, the University of the Philippines (UP), de facto tuition increases happened even earlier - in 1989 - with the adoption of the Socialized Tuition and Financial Assistance Program (STFAP). The program’s supposed objective is to subsidize the cost of education of poor students in varying degrees according to their income brackets.

However, 13 years later or by 2002, 83.6 percent of the total student population of UP ended up paying full tuition. Only 8.6 percent belonged to brackets 1 to 5 (i.e., those who enjoy full waiver of tuition and other fees). With the STFAP’s implementation, the tuition increased from P17 ($0.30) to P300 ($5.36) per unit. 

Under the STFAP, the students’ rebracketting resulted in increases in one’s tuition.  Many students experienced being reclassified in higher brackets even if there were no increases in their annual family income.

Effective this semester, increases in laboratory fees at UP were imposed in five departments and colleges. The hikes range from P50 ($0.89) to P600 ($10.72).

In 2001, tuition in UP’s graduate schools, initially pegged at P300 ($5.36) per unit, was increased to P500-P700 ($8.93-$12.51) per unit.

Meanwhile, at the Philippine Normal University (PNU), a whopping 400 percent increase in tuition was imposed on the students in 2003.  A 100 percent tuiton hike was also imposed in the Technological University of the Philippines (TUP) and the Kalinga Apayao State College in northern Philippines.

In the regions of Bicol and Central Luzon, yearly tuition hikes have been imposed in SUCs since 2003.  Early this year, the Cental Luzon State University (CLSU) planned to increase tuition and miscellaneous fees by 298 percent.

Although tuition in the Polytechnic University of the Philippines (PUP) remains P12 ($0.21) per unit, several processing fee hikes were imposed recently, ranging from 67 percent to 900 percent. The fine for late enrolment had the highest increase from P10 ($0.18) to P100 ($1.79).

New fees were also collected at PUP. These included shifting form, verification of grades per subject, re-admission fee, change of subject/curriculum/schedule, among many others.

Collaboration with private corporations

Besides increasing tuition and other fees, SUCs generate income by selling or leasing land and privatizing part of their operations. For instance, maintenance and security services were already privatized in UP and PUP.

The UP administration in Diliman, Quezon City has allotted 163.5 hectare or 33 percent of the land of the campus for Science and Technology Parks (S&T Parks). The project covers 98.5 hectares in the north, from Arboretum to the Iglesia ni Cristo compound. Sixty-five hectares along the university’s CP Garcia Avenue has been allotted in the south.

However, the land area for the building of structures for commercial purposes is larger than that for S&T facilities. These include product manufacturing, hotel, shopping center, supermarkets, gym, swimming pool, theaters, financial institutions, specialty stores, leisure facilities, warehouse, entertainment center, 24-hour helipad, and condominium.

In a memorandum of agreement (MoA) between the UP administration and the Ayala Foundation, UP was relegated to facilitating access to the expertise and skills of university’s faculty and other personnel while allowing the latter to undertake profitable enterprises.

Moreover, the MoA stated, “Any intellectual property rights created by or vested as a result of outputs from joint research and development activities, if any, of the University and the Foundation under this agreement shall be jointly owned by them.”

Another project is the construction of a dormitory called the Diliman Hostel. A tie-up with the private developer New City Builders (NCB), the top-of-the-line dormitory can house about 2,100 students.  In the final terms of agreement, however, the NCB  has the authority to fix the lodging rates. This is consistent with one of the objectives of the project—to turn the Hostel into a viable and profitable enterprise for both parties.

Policies on education

The cuts in the budget of SUCs and the entry of private investors in state tertiary education, various teachers and youth groups say, only indicate government move to abandon public education while earning revenues through privatization and commercialiation. Nowhere is this more evident then in government’s Long-Term Higher Education Development Plan (LTHDP) for 2001-2010.  

The plan prescribes the following targets for 2010: (1) the reduction of the number of SUCs by 20 percent; (2) the conversion of six SUCs to semi-corporations; (3) the generation of income by 20 percent of SUCs through the sale of intellectual property rights and grants; (4) the establishment of active income-generating projects in 50 percent of SUCs; (5) the pegging of tuition rates similar to that of private schools in 70 percent of SUCs; and (6) the collaboration with big businesses of 60 percent of SUCs.

Other programs on education such as the Higher Education Modernization Act (HEMA, 1997) and Philippine Agenda for Education Reforms (PAER) are consistent with the LTHDP.

HEMA authorizes the Boards of Regents of SUCs to fix tuition and other fee increases. SUCs are directed to enter into joint ventures with private corporations and to privatize services such as  health, food, maintenance, security and others.

Recommendations of the PAER, meanwhile, include the reduction of the MOOE; adoption of schemes of cost recovery and maximum utilization of assets; and the seeking of donor support locally, nationally and internationally, from the corporate sector, alumni, institutions and individuals.

These policies on education were formulated based on the recommendations of the International Monetary Fund, World Bank and Asian Development Bank. Even the proposed revisions to the UP Charter, as embodied in Senate Bill No. 2587, are fashioned after the LTHEDP, HEMA and PAER.

Amid the commercialization and privatization schemes, the Arroyo presidency only showed lip service to public tertiary education and allowed it to be gobbled up by profit-oriented enterpreneurs. Will it be any different now under a new administration that is run by the same president? Bulatlat.com

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