Crossroads (Toward Philippine economic and social progress)
Philippine Star, 21 March 2018


Sometime in August last year, Republic Act 10931 or the law on Universal Access to Quality Tertiary Education, otherwise known as the free college tuition law, was signed.

Both houses of Congress passed the new law without much careful roll-out and debate. Almost every legislator had wanted to be counted in support of free collegiate education, a popular bill.

The free college tuition law is too generous and will threaten our budgetary capacity, while possibly weakening the quality of our state collegiate institutions.

A law that demands a large, new subsidy. It is easy to pass a law granting subsidy. In the case of the free college tuition law, the estimates of funding the law were uncertain, but certainly covered a large amount of future expenditure commitments.

Congress had anticipated that new revenue resources would be generated by the TRAIN 1 tax reform package. Expectation of the passage of the tax reform law had emboldened the passage of the free college tuition law ahead of time.

But, of course, the tax reform package was mainly designed to help finance the country’s infrastructure investment program (the Build Build Build program) and to assure the current demands on the maintenance of peace and order.

Estimating cost of college tuition subsidy. The free college tuition subsidy is for all Filipino students who enroll in undergraduate-post-secondary programs of state universities and colleges (SUCs), local universities and colleges (LUCs), private higher educational institutions (HEIs), and other publicly run post-secondary technical vocational institutions (TVIs).

The law covers not only free tuition, but also other miscellaneous fees and school fees dealing with laboratory, libraries, computer, athletics and other minor fees. In addition, it includes ways by which students who are covered by the program could opt out voluntarily from the program. It also contains possibilities for enhancement of a student loan program.

The law requires that estimates of enrollees in each academic year is to be the basis for computing the annual proposed budgets of SUCs for the purpose of estimating free tuition.

This is likely to result in bloating the estimates of enrollment, and of the tuition subsidy, especially if free tuition induces more enrollment by those who cannot afford college education.

The control on enrollment can only happen, if there are strict standards maintained on who can be admitted to go to college. In such quality institutions as the UP, where an entrance examination determines admission, enrollment increases would not happen. The entrance requirements determines who receives the college education.

But in other institutions where the standards of admission is low, the danger of bloated enrolments would arise as tuition fees fall to zero. In our country, much of college education is through demand, often not qualified by entrance requirements.

The Commission on Higher Education (CHED) and the Technical Education and Skills Development Authority (TESDA) are major institutions designed to help implement and oversee the running of the program.

For the first year of implementation of the free college tuition law in the coming schoolyear, 2018-2019, CHED has estimated that around P40 billion would be needed to finance the program.

CHED is in charge of overseeing the free college tuition program directly. The national budget, through the budget department assigns the budget to the CHED, and the institutions receive their budgetary transfers to finance the free tuition.

Although in budgetary practice, the institution would still be paid the proper amount of tuition through the government budget, it is not necessarily the case that the state institutions will still continue to receive a rising budget to improve their physical facilities and their investments in instructional improvements, including even the improvement of pay of faculty.

Free tuition and quality of education. Philippine tertiary education has suffered through the years in the quality of its output. Will free tuition advance the improvement of the quality of college education, especially in the state-supported higher educational field?

In the presence of any constrained government budgetary problem, the free tuition policy might put a squeeze on government support toward the very institutions that render the educational service to their students. In the presence of any budgetary squeeze, teaching standards could fall. When quality falls, the students and the nation as a whole would share in the failure.

This is the danger of the free tuition policy. It is possible the budgets of state universities can improve with better economic development performance. But this cannot be guaranteed, given that there are so many programs that compete with education.

The continued improvement of our state-supported higher educational institutions and their faculty can only happen if substantial cuts can be made in other parts of government expenditures.

During the consideration of the free tuition law, two unlikely possibilities were proposed. One was to cut down the pork barrel program (Sen. Panfilo Lacson). The other was to downsize the government to save around P50 billion (Secretary of Finance Carlos Dominguez).

The state colleges and universities can lose their autonomy to collect or even to adjust tuition fees to their needs. Their dependence on government can make them even more in need of further government support as time moves on. They can lose whatever little fiscal independence they might have had before.

A single, high standard of admission test to college. Recently, Senate President Aquilino Pimental Jr. suggested that the stakeholders in higher education – the colleges and universities – work out a single, standardized entrance examination so that college age applicants do not have to take too many such exams.

He said, “I encourage our educators to work together to come up with something akin to the SAT and ACT in the United States….”

Unfortunately, this will not work if we leave it up to our educators. Many of them fear high standards tests will eliminate institutions of learning that some of them nurture.

To raise standards, the government has to require that a single, standardized test be administered for students to qualify for free college. This will make the budget for free college tuition more manageable.

Such a policy will also lead to the upgrade of our university system. It will improve the quality of our tertiary educational system by leaps and bounds.