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Please Ensure That Investment BY The Revolving National Higher Education Fund Would Not Be Scandalous Part of the speech by Dr Tan Seng Giaw, DAP National Vice-Chairman and MP for Kepong during the debate on the Bill to amend the National Higher Education Fund Corporation Act (1997) on 24 April 2000 | |||||||
| Malaysia needs many more qualified people. We require at least 30 internationally recognised universities. Now, we have 11 public universities and hundreds of private colleges. Apart from limited scholarships, the Government has set up Perbadanan Tabung Pendidikan Tinggi Nasional, the National Higher Education Fund Corporation, PTPTN, under the Act of the same name that was passed in Parliament in 1997. Under the Act, the Government gives a grant such as RM221.5 million for loans and RM6.2 million for operating expenditure in 1998. The unused fund is invested in fixed deposits and sale and purchase agreement, REPO, in the banks. In 1998, the interests from these investments amounted to RM20.6 million. This year, the Cabinet approves a further allocation of RM1.1 billion to PTPTN, making a total of RM2.5 billion. There will be more students getting loans, hoping that this country will become a centre of excellence for education. To achieve this, the standard of public and private universitities as well as institutes must be raised. There is no royal road to learning. Today's Bill is to amend the above-stated Act, so that students in polytechnics and private institutes can also obtain loans. This is a good thing, as long as all students pay back these loans after they have graduated. During the debate on the Act on 14 May 1997, I suggested that the Government has a pilot study to see if giving only 70 or 80% of the loans would spur the students to do better. Alas, the Government has not done this. In Australia, Ausstudies, the scheme on which PTPTN has been based, only gives 70% of the loans and repayment is through deduction of incomes just like incomes tax. In public | |
universities, each student can borrow RM6,500 for arts and RM7,000 for science. In private institutes, the amount is RM12,000 for arts and RM12,500 for science. Every borrower is required to pay administrative cost, equivalent to 4% of the balance of the main loan. The unused fund in PTPTN should be invested wisely--strictly according to the provisions in the Act. We do not want to see reckless investments. For example, there is a report of the paper losses of RM1.15 million incurred by the Malaysian Examinations Council. The Cabinet is said to have known it. The Council's task is certainly not investing in the equity market. It is to prepare national examinations. Therefore, the Government should present a white paper on the matter if it is found to be true. We would like to know the number of borrowers and the total amount given out. Meanwhile, we would like to see the shortening further of the period to process an application. Now, it is said to be two months compared to nine months in 1998. Six months after graduation or after getting a job (whichever is earlier), the borrowers start to pay back. The Inland Revenues Board has been appointed as an agent to collect back the loans. From experience of other orgainizations such as Mara University, some students have not or have been very slow in paying back their loans. It is in the nature of some people to be unwilling to pay back loans. Shame fades in the morning, but debts remain from day to day. Hence, it is imperative that PTPTN has an effective mechanism to make sure that all borrowers pay back what they owe. The revolving fund can then be used to help more students to complete their higher education.
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