SPECIAL REPORT

College Education: High in Profits, Low in Quality

Among the stockholders of the country’s higher education institutions are big names in the local business community.  While the quality of education in tertiary education is declining, the Education Act of 1982 allows them to arbitrarily increase tuition to guarantee huge profits for their owners. 

BY RONALYN OLEA
Bulatlat.com

In 2003, nine private higher education institutions (HEIs) were listed in the Philippines’ Top 1,000 corporations.  These HEIs have a combined profit amounting to P1.13 billion (US$20,178,571).

The National Teachers College (NTC), a small college in Manila, is ranked No. 66 among the Top 1,000 corporations in the Philippines in 2003.  It earned a profit of P297 million (US$ 5,303,571), a staggering 5,214 percent increase from its earnings two years ago.

The Centro Escolar University (CEU), also in Manila, ranked No.198 and had the biggest equity (meaning assets minus liabilities) amounting to P1. 941billion (US$ 34,669,250). The CEU ranked No. 1 among HEIs in 1999 and 2000.  The Manila Central University (MCU) in Caloocan, Manila registered the biggest increase in profit by more than 8,000 percent from 2001.

Another consistent member of the Top 1,000 corporations in the country is the University of the East (UE) which has campuses in Manila and Caloocan cities.  It ranked 517th in 2003, rising from 867th in 2000 and 935th in 1999.The Mapua Institute of Technology (MIT) and the Far Eastern University (FEU) also managed to remain in the list of top earning corporations.

Below is the list of HEIs among the Top 1,000 corporations in 2003.

Well-known stockholders

Among the stockholders of the country’s higher education institutions are big names in the local business community.  Emilio Yap, chair of the Philippine Trust Co., publisher of Manila Bulletin and owner of Manila Hotel controls 55 percent of CEU’s stocks. 

Lucio Tan started investing in the UE in 1999.  Tan is considered as the country’s richest businessman with a personal net worth of $1.5 billion.  He owns Fortune Tobacco, Asia Breweries, Allied Bank and Philippine Airlines.

The Yuchengco Group of Companies bought the MIT in 1999 from the family of Don Tomas Mapua.  The Yuchengco Group of Companies owns the Malayan Insurance, Great Pacific Assurance Life Corp. and Rizal Commercial Banking Corporation.

Another business tycoon with investments in private tertiary education is Henry Sy.  Sy is a partner of the IBM in the Asia Pacific College.  He is the chairman of the SM Group of Companies with revenues amounting to $1.7 billion. Sy is considered one of Asia’s wealthiest persons. 

John Gokongwei donated P200 million to Ateneo de Manila’s School of Management.  The family also gave financial support to the University of San Carlos in Cebu, Xavier University in Cagayan de Oro City, De La Salle University, Sacred Heart School and Immaculate Conception Academy.

Exorbitant fees

MIT increased its tuition this year by 5.99 percent from PhP1, 183.79 (US$21.13) to PhP1, 254.64 (US$22.40) per academic unit.  The school implements a four-semester system thereby enabling it to collect tuition fees four times a year while shortening the months allotted per semester.

The FEU raised tuition by 10.54 percent, from PhP750.07 (US$13.39) to PhP829.16 (US$14.80) per unit.  Feati University imposed a 20-percent increase from PhP 416.95 (US$7.44) to PhP466.83 (US$8.33) per unit.  The MCU increased its tuition by 11.49 percent from PhP787.74 (US$14) to PhP878.23 (US$15.68) per unit. The UE administration hiked its tuition by 15 percent despite a deadlock in the consultations with students.  

Data by the Commission on Higher Education (CHED) show that from AY 1999-2000 to AY 2003-2004, tuition increased by 64.14 percent per unit.  This year, 370 or 28.01 percent of private HEIs increased tuition equivalent to an average of P32.74 (US$.58) per unit.

Private HEIs in the National Capital Region have the biggest average tuition rate per unit, amounting to P614.54 (US$10.97).  For a 21-unit load, a student pays an average of P12, 905.34 (US$230.45) in tuition alone. On the other hand, the Region IV-B has the lowest with P216.78 (US$3.87) per unit or P4, 552.38 (US$81.29) for a 21-unit load. 

Aside from tuition, students also have to pay other fees.  Private HEIs also imposed increases in miscellaneous and other fees.

Based on CHED’s partial report this June, nine common items of the miscellaneous fees increased by 139.88 percent.  Reports from regions III, IV, VII, NCR, CAR, CARAGA and ARMM are still excluded.

In the same report, eight schools collect internet fee for an average of P331.28 (US$5.91). Thirty-four schools also collect development fees for an average of P318.91 (US$5.69). St. Scholastica’s College in Manila collects P600 for building/capital development fee. There are 37 private HEIs collecting insurance fees amounting to P49.70 (US$.88).  Eight schools from ten regions impose energy fees at an average of P349.04 (US$6.23).  The UST charges P800 (US$14.28) as energy fee.  With its 30,000-student population, the UST administration amasses P24 million (US$428,571) annually from energy fees alone.  The UE administration also collects installment fee worth P500 (US$8.92).  St. Scholastica’s College’s fine for late enrolment is P500 (US$8.92).

In an interview with Bulatlat.com, Rizza Ramirez, national president of the National Union of Students of the Philippines (NUSP), criticized the imposition of exorbitant fee increases. Ramirez said that capital expenditures and operating expenses such as development and energy fees should not be included in the miscellaneous fees. 

Ramirez also said that students who have difficulty paying their full tuition should not be punished by paying extra fees.

Other “exorbitant” fees include:  postal fee, insurance fee, “Smart fee” and copier fee at the AMA Computer College; power charge fee at Trinity College; Power Plant development fee at Miriam College; Land Infrastructure Maintenance and Acquisition Development fee at the Baguio Colleges Foundation; accreditation fee at the Technological Institute of the Philippines; and pre-registration fee at the Aquinas University in Albay, Bicol.

Ramirez revealed that it has been a trend in private HEIs to impose miscellaneous fee hikes.  “It is more convenient for them to increase miscellaneous fees since according to CHED memorandum no. 13,  no consultation is needed to impose such increases,” she said.

Mushrooming of HEIs

Ramirez noted that the increasing participation of the private sector in tertiary education show its profitability.  There are 1,231 private higher education institutions (HEIs) as against 111 state universities and colleges (SUCs).  During the last 14 years alone, 595 private HEIs have been established.

Ramirez said, “Given how private school owners earn huge profits, private HEIs appear like mushrooms.”

These figures include schools operating without government permits. CHED Executive Director Roger Perez himself revealed that 26 schools offer 49 programs without government permits. Among these are 10 schools offering BS Accountancy. 

The ABE International is the most delinquent. Its branches in Las Piñas, Taft and Caloocan offer four programs without the permits.

Declining quality of education

School owners and even CHED officials justify the prohibitive costs of private tertiary education by claiming that quality education is expensive. But their claim of providing quality education is debunked by different surveys and studies.

In the Asiaweek survey of 77 best universities in 2000, the University of the Philippines, the country’s premier state university, ranked No. 48.  Only three private schools managed to make it to the list. De La Salle University was ranked 71st, Ateneo de Manila University, 72nd, and the University of Santo Tomas, 74th. 

The Asian Development Bank (ADB) report entitled “Technical Assistance to the Republic of the Philippines for the Organizational Development of the CHED”, published in October 2002, noted the declining quality of tertiary education in the Philippines.  “As recently as the 1970s, the Philippines was seen as one of the region’s leading education centers.”

Moreover, the Task Force on Higher Education, organized by the CHED in 1995, averred that, “College education in the Philippines is comparable to top science high schools in the country and regular secondary education in Europe and Japan.”

The declining quality of tertiary education is also manifested by the performance of graduates in licensure examinations.  From 1997 – 2001, only 18.4 percent were able to pass the board examinations for Certified Public Accountants (CPA).  The highest average passing percentage is that of Medicine with only 66.4 percent passing the licensure examinations. The Professional Regulatory Commission released the following table of average passing percentages for the different licensure examinations.

For five years, 35 schools got zero-passing rates in BS Accountancy, 28 in BSC/BSBA Accounting, eight in Secondary Education and three in BS Nutrition and Dietetics.

In fact, the CHED has released a phase out order to 115 HEIs.  These schools registered zero to five percent passing rates in licensure exams from 1997 – 2001.  Only 17 of these HEIs have closed their programs.

CHED’s bias

Ramirez lashed out at CHED for “favoring the interests of school owners.” 

“The CHED is as quick as lightning in approving applications for tuition fee increases,” she said.

In an interview over the radio last week, Perez said the real reason behind the uncontrollable increases in tuition and other fees is the Education Act of 1982 or Batas Pambansa 232.  Section 42 of the law states that, “Each private school shall determine its rate of tuition and other school fees or charges.”

The CHED’s proposed revisions to its own Memorandum No. 13 show its bias for school owners. One of the CHED’s proposals is to enforce a 10-percent ceiling in tuition fee increases.  Ramirez claimed that while seemingly limiting tuition fee increases, the proposal is tantamount to allowing private colleges and universities to increase tuition fees without consultations for as long as the increase is below ten percent. 

The CHED also wants to exempt HEIs granted autonomy and deregulated status from the required consultations.  There are 30 HEIs granted autonomy and 22 more were deregulated.

The creation of a Regional Task Force on Tuition and Other School Fees is also being proposed.  This body shall accept, consolidate, intervene and resolve all complaints, debates arising from applications for tuition increases.  However, if the said task force fails to decide on a complaint within 30 days of filing, the decision will be deemed in favor of the proposed tuition fee increases. 

Until now, the CHED has not come up with a “compromised version” of the proposals. Ramirez concluded that it is impossible to reconcile the conflicting interests of school owners and students.  Bulatlat.com

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