THIRTEENTH CONGRESS OF THE 
REPUBLIC OF THE PHILIPPINES } 
Second Regular Session 
EXPLANATORY NOTE 
The Islamic educational institution known as Madrasah has undergone a process 
of evolution commencing from the traditional family-based education of the Holy Qur'an 
to the community-organized and more sophisticated institution that it is today. 
As proof of the growing awareness of the significance of Islamic philosophy as an 
essential component of the larger Philippine educational system, Islamic Studies have 
been included in both the undergraduate and graduate programs at the Institute of 
Islamic Studies of the University of the Philippines and at the King Faisal Center for 
Islamic and Arabic Studies of the Mindanao State University. The study of the Arabic 
language has also been integrated in the curricula of higher education of both 
institutions as well as in the Foreign Service Institute of the Department of Foreign 
Affairs. Private schools have also started to offer courses in Arabic and Islamic Studies. 
Despite the above-mentioned developments, the Madrasah has yet to fulfill the 
educational needs of the majority of the Muslim population of the Philippines. There are 
presently about 2,000 Madaris serving the needs of the Muslims and the other 
indigenous cultural minorities. But there is no standard in the facilities and the quality of 
education offered by these Madaris. This is compounded by the problem of the lack of 
funds to finance the acquisition of additional facilities and instructional materials, the 
construction of additional classrooms, and the training of Madrasah teachers and 
administrators. 
To overcome these problems this bill seeks to establish a permanent trust fund to 
be known as the Fund for Madrasah Education (FAME). As a safeguard to ensure the 
non-impairment of the Fund, this bill also provides for the corresponding guidelines and 
criteria for its use and allocation. The Board of Trustees will also be required to submit 
copies of the annual financial statement of the FAME within sixty days from the close of 
each calendar year to Congress as well as to the Office of the President. 
The approval of this bill will be in consonance with the policy of the State as 
embodied in BP No. 232 "to promote the right of the nation's cultural communities in the 
exercise of their rights to develop themselves within the context of their cultures, 
customs, traditions, interests and beliefs." 
Approval of this bill is earnestly sought. 
MANNYVI LAR 
f 


R ,, . 
.. 
6 
JU$j -7 
r t': ., 
THIRTEENTH CONGRESS OF THE 
REPUBLIC OF THE PHlLfPPlNES } 
Second Regular Session 
6 .* ~~~~~~~~ 
BY : 
* ,.i. 
7 
SENATE 
.. 
INTRODUCED BY HON. MANNY VILLAR 
AN ACT STRENGTHENING THE MADRASAH EDUCATION SYSTEM AND 
PROVIDING GOVERNMENT ASSISTANCE TO MADRASAH EDUCATION 
THROUGH THE ESTABLISHMENT OF THE FUND FOR ASSISTANCE TO 
MADRASAH EDUCATION, APPROPRIATING FUNDS THEREFOR, AND FOR 
OTHER PURPOSES 
Be it enacted by the Senate and the House of Representatives of tbe Philippines in 
Congress assembled: 
SECTION 1. Title. This Act shall be known as the "Fund Assistance for 
Madrasah Education Act of 2005." 
SEC 2. Declaration of Policy. It is a declared policy of the State to promote and 
ensure that quality education is accessible to all Filipino citizens, regardless of cultural 
origin, conviction, creed, or belief. The State recognizes the jnvaluable role of private 
educational institutions, including Madaris, in educating the citizenry, and in preparing 
them for responsible roles in nation-building. 
The development of the Islamic philosophy of education along with the national 
goals of education and the development of a national heritage are desirable goals of the 
State. For this purpose, the State shall ensure a sound and stable management of the 
Madrasah as an Islamic institution forming an essential component of the Philippine 
Educational System, by providing for a perpetual source of funding for its operations 
and expansion. 
SEC 3. Madrasah Curriculum. The Madrasah curriculum shall be enriched and 
harmonized in order to make it compatible with the formal educational system. 
Equivalency learning accreditation, experience-based learning, and other innovative 
education approaches shall be utilized in order to make possible the smooth transition 
of the recipients of Madrasah education system to the formal educational system and 
vice-versa. 
SEC. 4. The Fund for Assistance to Madrasah Education: Its Creation and 
Purpose. There shall be created the Fund Assistance for Madrasah Education 
(hereinafter FAME or the Fund), which shall serve as a foundation to continually finance 
and support the operation of Madaris throughout the Philippines. For its seed capital, 
the amount of One Hundred Million Pesos (P 100,000,000.00) Philippine Currency is 
hereby appropriated from the funds of the National Treasury. 


In order to augment the said seed capital, the FAME shall solicit and receive 
grants, loans, donations, and any other forms of assistance from domestic or foreign 
sources. 
The assistance received by the FAME shall be held in trust, and only the 
earnings thereof in the form of dividends, interest, and profit of similar nature shall be 
utilized to support and maintain the programs and operations of the FAME. 
SEC. 5. The FAME Board of Trustees: Its Composition. There is hereby created 
the FAME Board of Trustees (hereinafter the Board), which shall serve as the trustee of 
the FAME as well as serve as its policy-making body. The Board shall be composed of 
ten (IO) members as follows: 
(a) The Secretary of the Department of Education as Chairperson; 
(b) The Regional Governor of the Autonomous Region in Muslim Mindanao as Co- 
Chairperson; 
(c) The Executive Director of the Office on Muslim Affairs as Vice-Chairperson; 
(d) Representative from Region 9; 
(e) Representative from Region 10; 
(1) Representative from Region 11; 
(9) Representative from Region 12; 
(h) Representative from Northern Luzon; 
(i) Representative from Metro Manila; and 
G) Representative from the Visayas as Members. 
The Chairperson, Co-Chairperson, Vice Chairperson, and Members of the 
Board shall be appointed by the President of the Philippines within sixty (60) days from 
the approval of this Act. 
The Members of the Board from Regions 9, I O ,  11, 12, Northern Luzon, Metro 
Manila, and the Visayas shall be appointed by the President of the Philippines from 
among those nominated by the administrators of the Madaris of their respective 
geographical units for a term of three (3) years and shall hold office until their 
successors shall have been appointed and qualified. 
They shall be of proven 
educational capability and possess the appropriate qualifications and expertise in the 
Islamic culture, customs, traditions and philosophy. 
The Members of the Board shall serve without compensation but they shall 
receive a reasonable per diem not exceeding two thousand pesos (P 2,000.00) per 
month, and reasonable travel allowances. 
, 
SEC. 6. Powers and Function in order to carry out the effective implementation of 
this Act, the Board shall exercise the following powers and functions: 
(a) Formulate and lay down the policies on developmental programs and projects of the 
FAME as well as the solicitation of funds and the expenditures thereof; 
(b) Establish priorities, which shall be reviewed periodically and revised in accordance 
with existing conditions, among the various possible project areas defined in the 
guidelines hereinafter set forth in Section 13 hereof; 
(c) Determine the proper use and application of the income, capital gains, and other 
profits of the FAME, including final action on the individual application for grants andlor 
loans; 
(d) Avail of professional and technical assistance and expertise to enhance the 
capabilities of FAME; 
(e) Ensure the non-impairment of the Fund by engaging the services of an independent 
certified public accountant who shall prepare an independent financial report, which 
report shall be subject to review by the Commission on Audit. 


SEC. 7. The Secretariat and the Executive Director. There is hereby created 
the Secretariat, which is the implementing arm of the Board. The Secretariat shall be 
headed by an Executive Director, who shall be a Muslim of known probity and integrity, 
with extensive experience in educational management He shall be appointed by the 
Board upon majority vote of its members, and shall serve for a period of three (3) years, 
subject to renewal, and may be removed for cause after due notice and hearing by the 
Board. 
Other personnel as may be necessary to carry out the objectives of the FAME 
shall be appointed by the Executive Director with the approval of the Board, provided 
that in no case shall more than twenty-five percent (25%) of the personnel belong to 
one tribe. These personnel shall receive such compensation and benefits as provided 
for under existing laws. 
SEC.. 8. Functions and Responsibilities of the Secretariat. The Secretariat under 
the stewardship of the Executive Director shall take charge of the day-to-day operations 
of the FAME and shall exercise the following duties and responsibilities: 
(a) To execute the policies formulated by the Board; 
(b) To manage and administer the activities of the F AMB. and coordinate and follow-up 
the implementation of the same; 
(c) To conduct research and studies relevant to the goals of the FAME and to submit 
recommendations thereon to the Board; 
(d) To prepare and submit to the Board its annual budget and the quarterly and annual 
reports on the activities of the F AME together with its proposed development plans; 
(e) To act as the Secretariat of the Board during its meetings and to keep a record of 
the proceedings of the said meetings; 
(f) To perform such other duties as may be assigned to it by the Board. 
SEC. 9. Non-Impairment of the Trust Fund. To ensure the permanent character 
of the Fund it shall be maintained strictly as a capital fund for investment and 
reinvestment. It shall be maintained infact with only the net earnings thereof to be 
utilized for financing programs of assistance to Madrasah education. 
SEC. I O ,  Rules for Determining Impairment or Non-Impairment of the Trust 
Fund. For the purpose of determining whether or not the trust fund herein constituted is 
being maintained intact and unimpaired, a determination must be made on April 30. 
August 31, and December 31 of each year hereinafter known as the determination 
dates in accordance with the following rules: 
(a) If as of a determination date the total of the cash on hand and in the bank. The 
market value of the investment then held after adjusting for all accrued expenses as of 
the date be at least equal to the dollar equivalent of the Fund as provided fur in Section 
4 hereof, or as such trust fund as may have been augmented in accordance with the 
provisions of Section 12 hereof then in that event the trust fund shall be deemed to have 
been maintained intact and unimpaired; Provided that if any part, or all, of the Fund 
shall be converted into Philippine pesos, or invested in the Philippines in assets the 
value of which is normally denominated in Philippine pesos then the value of the Fund 
which is not to be impaired will be determined in Philippine pesos for whatever portion 
of the fund is so converted said value to be calculated by multiplying the actual number 
of dollars converted times the rate of exchange prevailing at the time the conversion or 
conversions are actually made. 
(b) If as of a determination date the total of the cash on hand and in the bank the market 
value of the investments then held be less than the dollar value of its peso equivalent or 
the trust fund as provided in Section 3 hereof or as such trust fund may have been 


augmented in accordance with Section 12 hereof then the trust fund shall be deemed 
not to have been maintained intact and unimpaired. 
(c) Should the trust fund be determined not to have been maintained intact and 
unimpaired as of a determination date, then in that event no disbursement for programs 
or projects of assistance to Madrasah education shall be authorized until after the 
succeeding determination date at which it shall be shown that the impairment of the 
trust fund has been remedied by the application of stricter control on the programming 
of expenses and other disbursements or through the appreciation of the value of 
investments held or the receipt of additional cash derived from profits, dividends or 
other rights on investments or from the proceeds of sale or investments whose value 
has been appreciated. Nothing in this paragraph shall however, be construed to prevent 
the payment by the Board of reasonable expenses incident to the investment 
exemptions of the Fund as distinguished from expenses or disbursements for programs 
of assistance to Madrasah education. Neither shall the Board be deemed to have been 
temporarily unauthorized from paying the compensation of the administrative staff it had 
previously hired and could not layoff in the meantime either on legal grounds or 
because of the serious disruptive effects any such lay-off may entail on the operations 
of the Fund. 
SEC. 11. Net Earnings from Investment of the Fund. The Fund shall be 
deemed to have net earnings that may be earmarked or disbursed for financing 
programs of assistance to Madrasah education if as of a determination date the total of 
the cash on hand and in the b the market value of the investments then held, after 
adjusting for accrued expenses as of that date, be in excess of the dollar value or its 
peso equivalent of the trust fund provided in Section 4 hereof, or as such fund may be 
augmented in accordance with the provisions of Section 12 hereof The dollar value of 
its peso equivalent of such excess shall be the maximum level of funds that may be 
earmarked or disbursed for financing programs of assistance to Madrasah education for 
the period immediately following a determination date at which earnings have been 
established and until the succeeding determination date. In order to provide a hedge 
against the impairment of the trust fund, the Board shall. as far as practicable, refrain 
from committing funds for programs of assistance to Madrasah education in excess of 
ninety percent (90%) of such net earnings. 
SEC. 12. Additions to Trust Fund. The trust fund herein constituted may be 
augmented from time to time by grants, donations, or other lawful transfers by the 
Government of the Philippines or any other public or private entity, the disposition of the 
principal andlor the income of which shall likewise be governed by the provisions of this 
Act, or by such special terms and conditions as may be imposed in the particular deed, 
bequest, or other instrument or transfer covering such grants, donations, or other 
transfer, and agreed to by the Board. Any unused earnings may be capitalized to 
increase the principal of the Fund. 
SEC. 13. Guidelines for Board Decision In arriving at decisions on individual 
project applications for grants, loans, or other forms of financing from the Fund the 
Board shall be guided by the following: 
(a) The project's contribution to improvement in the quality of Philippine education, and 
Madrasah education in particular, 
(b) The project's relation to a field of study or specialization of high priority for the 
development of human resources in the Filipino Muslim communities; 
(c) The significance of the contribution, and potential contribution through the project, of 
the applying institution or association to educational needs in a specific Filipino Muslim 
community; 
(d) The amount of funds requested for the project as consistent with the Fund 
assistance to as many institutions as possible; and 


(e) An assessment of the applying institutionls or associationls past and current efforts 
to improve the quality of its education and that of its plannirig for the future. 
SEC. 14. Cooperation with the, Board. The Board may call upon any 
department, bureau, office, agency, or instrumentality in the government of the Republic 
of the Philippines, including government-owned or -controlled corporations, for such 
assistance as it may desire and need in the pursuit of the purposes and objectives of 
the Fund and the discharge of its functions and responsibilities. 
SEC. 15. Quorums, Meetings and Annual Reports. A majority of the Board 
shall constitute a quorum to do business. The board shall meet at least once every 
three months or such time as may be determined by the Chairperson or upon the 
written request of at least four Members of the Board and shall render to the President 
of the Philippines, the Senate President, and the Speaker of the House of 
Representatives an annual written report of its activities as well as its financial position 
within sixty days after the close of each calendar year. 
SEC. 16. Implementing Rules and Regulations. Within 90 days from the 
effectivity of this Act, the Secretary of Education, the Governor of the Autonomous 
Region in Muslim Mindanao and the Executive Director of the Office on Muslim Affairs 
shall issue the necessary rules and regulations for the effective implementation of this 
Act. 
SEC. 17. Repealing Clause. All laws, presidential decrees executive orders 
presidential proclamations rules and regulations. or parts thereof contrary to or 
inconsistent with this Act are hereby repealed or modified accordingly. 
SEC. 18. Separability Clause. If any provision of this Act is declared 
unconstitutional the same shall not affect the validity and effectivity of the other 
provisions thereof. 
publication in two newspapers of general circulation. 
SEC. 19. Effectivity. This Act shall take effect fifteen days after its complete 
Approved,