HOUSE OF REI

RECEIVED
pave.2 6 JUL 2016
Tine: ‘OD

SEVENTEENTH CONGRESS OF THE )
REPUBLIC OF THE PHILIPPINES )
First Regular Session )

HOUSE OF REPRESENTATIVES

1942

PPOSTRATION UNIT

H.No. ANG ANUEX SERVICE

ENTATIVES:

Introduced by Representative VILMA SANTOS-RECTO
6" District of Batangas

AN ACT
PROVIDING FOR A FULL TUITION SUBSIDY FOR STUDENTS ENROLLED IN
STATE UNIVERSITIES AND COLLEGES (SUCs), AND APPROPRIATING FUNDS
THEREFOR

Explanatory Note

The system of free public basic education has long been in existence in the Philippines.
Free and compulsory elementary education was established by the Malolos Constitution in 1899,
whereas free secondary education was formalized with the enactment of Republic Act No. 6655
in 1988, Tertiary education in State Universities and Colleges (SUCs), however, has never been
free albeit government subsidy.

The budget allocation to basic education has been getting a substantial share in the national
expenditures and has continued to increase over the years. It has gone from 12.3% of the National
budget in 2009 to 13.7% in 2016. Whereas, the subsidy provided to SUCs by the National
Government (NG) has remained at lower levels. Since 2005 to date, the SUCs’ share of the NG
budget has never gone beyond the 2% mark'. For FY 2016, the UP System and the 113 SUCs have
a total appropriations budget of P47.4 Billion, which is only 1.57% of the total FY 2016 budget of
P3.002 Trillion.

According to FY 2014 data, the estimated annual government cost per student in an SUC
is at an average of P21,000. This drives SUCs to internally generate their own income through the
collection of tuition fees and through grants and donations, among others, to sustain the cost of
their operations. In 2014, income collected by 114 SUCs nationwide from tuition fees amounted
to P7.9 Billion while other income collected from students totaled P4.7 Billion’. Tuition fees that
form part of students’ out-of-pocket expenses for their college education range from as low as P12
to as high as P1,000 per unit and are expected to increase further to adjust for inflation. These fees
become one of the compelling reasons that discourage some students to pursue and finish tertiary
education.

Results from the 2013 Functional Literacy, Education and Mass Media Survey (FLEMMS)
show that among the primary reasons for not attending school were insufficient family income and
high cost of education.

Finishing higher education has a significant impact on income and employment. The
average daily wage that a college graduate could receive is 140% more than that of a high school
graduate?. The significant difference in income is a good reason to put sustained investments in
tertiary education.

* Budget Facts and Figures Vol. 2, Jan-Mar 2014, Legislative Budget Research and Monitoring Office
2 Data from CHED
° Results from the 2011 Labor Force Survey


tuition fees and other fees collected from students. The funding requirement shall be sourced from
the annual General Appropriations Act.

‘The goal of this measure is to reduce the out-of-pocket expenses which hinder some
students from completing tertiary education. The government can now afford this reform due to
its more stable macroeconomic position brought about by prudent fiscal policies, an improved tax
collection efficiency, and a remarkable economic performance.

Accordingly, in 2014, government spending fell short of its targets. The underspent funds
of the SUCs which amounted to P4.2 Billion‘ in 2014 could already form a substantial part of the
fund needed for the full tuition subsidy. Around 1.6 million students are enrolled in public tertiary
institutions in SY 2014-2015, and significantly fewer this year due to the full implementation of
the Senior High School of the K to 12 program. The estimated amount to make SUCs tuition-free
would be equivalent to just about P8 billion annually’, which is only 0.3 percent of the 2016
budget. This is a rational and sustainable allocation given its positive impact to economic and
social development.

As expressed in the Philippine Development Plan, the country’s vision of inclusive growth
and development entails sustained investment in human capital, particularly through the provision
of quality basic education, competitive technical vocational skills training, and relevant and
responsive higher education. Significant results can then be realized by making higher education
competitive and responsive to national development goals.

In view of the foregoing, approval of this bill is ¢

VILMA SANTOS-RECTO,

‘ejev

“ Agency Budget Notes, State Universities and Colleges for FY 2016, CPBRD.
5 SUCs Income collected from Tuition fees amounted to P7.9 Billion in 2014.


ON oar on =

"1
12
13
14
15
16
7
18
19

24
22
23

SEVENTEENTH CONGRESS OF THE )
REPUBLIC OF THE PHILIPPINES )
First Regular Session )

HOUSE OF REPRESENTATIVES

H. No. igse

Introduced by Representative Vilma Santos-Recto

AN ACT
PROVIDING FOR A FULL TUITION SUBSIDY FOR STUDENTS ENROLLED IN
STATE UNIVERSITIES AND COLLEGES (SUCs), AND APPROPRIATING FUNDS
THEREFOR

Be it enacted by the Senate and House of Representatives of the Philippines in Congress
assembled:

SECTION 1. Short Title. ~ This Act shall be known as the "Free Public College Tuition Act of
2016."

Sec. 2. Declaration of Policy. ~ It is hereby declared that accessible and quality education is
an inalienable right of the Filipino. Therefore, the State shall renew its constitutionally mandated
duty to make education its top budgetary priority by providing tuition-free higher education
courses in state universities and colleges (SUCs).

SEC. 3. Eligibility to the Full Tuition Subsidy. — All Filipino citizens who are either currently
enrolled at the time of effectivity of this Act, or shall enroll at any time thereafter, in courses in
pursuance of a bachelor’s degree, certificate degree, or any comparable undergraduate degree in
any state university or college shall be exempt from paying tuition fees: Provided, That they meet
the admission requirements of the SUCs where they intend to enroll in.

SEC. 4. Special Tuition Subsidy Fund. ~ The Special Tuition Subsidy Fund, hereinafter
referred to as the Fund, is hereby established. The Fund shall be used solely for the purpose of
implementing the full tuition subsidy under the provisions of this Act. Tuition fees for units
enrolled by persons eligible for the tuition benefit under the provisions of this Act, payable to
SUCs, shall be paid from this Fund.

Sec. 5. Administration of the Fund. ~ The Fund shall be administered by the Commission on
Higher Education (CHED). For this purpose, the CHED shall have the following powers and
functions:

a) Manage and administer the Fund;

b) Devise a reporting mechanism to be implemented by the state universities and

colleges which will detail the exact amount of tuition fee subsidy availed of by
persons eligible for the full tuition subsidy under this Act;

Page 1 of 3


oNoark wn =

"1
12
13
14
15
16
7
18
19
20
24
22
23
24
25
26
27
28
29
30
31
32
33

35
36
37
38
39

c) Formulate and implement an efficient and transparent mechanism to ensure the
payment of tuition fees, using money from the Fund, to the respective state
universities and colleges, pursuant to the provisions of this Act;

d) Resolve and mediate disputes concerning the ineligibility or disqualification of
persons from the full tuition subsidy under the provisions of this Act or any other
provision of law; and

e) Any other powers or functions necessary for the implementation of the provisions
of this Act.

SEC. 6. Tuition Report. — The President of each state university or college shall submit to the
CHED, within five (5) days after the last day of late registration for each semester, a report
detailing the names of persons eligible for the full tuition subsidy in their institution, as well as the
amount of tuition fee due based on the number of units enrolled.

SEC. 7. Payment from the Fund. ~The CHED shall ensure the full payment of tuition fees due
to the state university or college, as reported under the next preceding section of this Act, no later
than thirty (30) days after the submission of the report to the CHED: Provided, That the CHED
shall reserve the right to withhold or disallow the payment of any reported fees which are perceived
to be anomalous or irregular until further investigation has been conducted.

SEC. 8. Accountability Report. — At the end of each academic semester, the President of each
state university or college shall submit to the CHED a report reconciling the funds received from
the Fund. Any unused or improperly disbursed amount shall be returned immediately to the Fund.

SEC. 9. Midterm Report. — Starting the first school year upon the effectivity of this Act, the
CHED shall conduct a mandatory review and submit a Midterm Report to Congress as to the status
of implementation of this Act.

‘The Midterm Report shall include the following key metrics of access to and quality of public
tertiary education:

a) Enrollment rate;

b) Student demographics;

c) Graduation rate;

d) Gross tuition receipts;

) Disqualification and ineligibility;

f) Teachers’ welfare and training profiles;

2) Adequacy of funding requirements; and

h) Other educational quality indicators, including but not limited to physical learning
infrastructure, teacher-to-student ratio, and student housing.

SEC. 10. Appropriations. — The amounts necessary to effectively carry out the provisions of

this Act shall be included in the annual General Appropriations Act.

SEC. 11. Implementing Rules and Regulations. — Within (60) days from the effectivity of this
Act, the CHED shall promulgate the implementing rules and regulations necessary to ensure the
efficient and effective implementation of this Act.

Page 2 of 3


SEC. 12. Separability Clause. ~ Should any part of this Act be declared unconstitutional or
invalid, other parts or provisions hereof not affected thereby shall continue to be in full force and
effect.

SEC. 13. Repealing Clause. — The provisions of other laws, decrees, executive orders, rules
and regulations inconsistent with this Act are hereby repealed, amended, or modified accordingly.

Sec. 14. Effectivity. — This Act shall take effect fifteen (15) days after its publication in the
Official Gazette and/or in at least two (2) national newspapers of general circulation.

Approved,

Page 3 of 3