CONGRESS OF THE PHILIPPINES
FIFTEENTH CONGRESS
First Regular Session

HOUSE OF REPRESENTATIVES
.__ 1820

INTRODUCED BY REPRESENTATIVE IMELDA CALIXTO-RUBIANO-

EXPLANATORY NOTE

This bill seeks to create a National Student Loan Board that will implement a National
Student Loan Program for the poor, also defining the functions and powers of the Board and
appropriating funds thereof.

The significance of access to higher learning and education for the unfortunate and the
underprivileged poor cannot be subject to debate. Statistics show that for those who are in
college age population, less than 50% are enrolled in tertiary educational institutions and
approximately 70% are living below the poverty line.

‘The University of the Philippines (UP System) has implemented a cross-subsidy program
that will be simulated and replicated under this proposal. This particular measure will mandate a
monthly contribution by persons of a specific income bracket and said contributions will be
remitted to the national student loan fund. Thereafter the funds generated from the collections
will be graduated in accordance to income bracket.

Unguestionably, the need to provide for this national student loan program will assist the
deprived and poor by providing them access to tertiary education.

In view of the foregoing, the passage of this measure is earnestly requested.

Re

IMELDA CALIXTO-RUBIANO
Representatives
Lone District of Pasay City


Republic of the Philippines
HOUSE OF REPRESENTATIVES

Quezon City

FIFTEENTH CONGRESS
First Regular Session

HOUSE BILL No. _ 1820

Introduced by Representative Imelda Calixto-Rubiano

AN ACT
CREATING A NATIONAL STUDENT LOAN BOARD TO
IMPLEMENT A NATIONAL STUDENT LOAN PROGRAM FOR
THE POOR, DEFINING ITS POWERS AND FUNCTIONS, AND
APPROPRIATING FUNDS THEREFOR

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

SECTION 1. Short Title. - This Act shall be known as the “ National Student Loan
Program for the Poor Act of 2010”.

SEC. 2. Creation — There shall be created, under the Office of the President of the
Philippines, in close coordination with the Department of Education (DepEd) and the
Department of Social Welfare and Development (DSWD), a National Student Loan Board to
implement a National Student Loan Program for the Poor.

SEC. 3. Definition of Terms. — For the purpose of this Act, the following terms shall

have the corresponding meaning:


a)

Iskolar ng Bayan — hereinafter called “Iskolar” shall refer to a qualified beneficiary
who draws from the National Student Loan Fund to support his or her tertiary
education;

b) National Student Loan Fund — hereinafter called the “Fund” shall refer to a cross-

subsidy benefit fund to be collected by the National Government and lent to qualified
Iskolars as hereinafter defined;

¢

National Student Loan Board — hereinafter called the “Student Loan Board” shall

refer to a governing body under the Office of the President tasked to implement the

provisions of this Act;

4) Board of Directors ~ hereinafter called the “Board” shall refer to the governing body
of the Student Loan Board and shall have the powers and duties hereinafter defined;

e

Monthly Contributions ~ hereinafter called “contributions” shall refer to the
contributions of designated income earners to the Fund, based on the National
Economic Development Administration (NEDA) income brackets;

1) Iskolar Brackets — hereinafter called “brackets” shall refer to a beneficiary
classification system wherein Iskolar ng Bayan shall be ranked according to the
annual family income and/or academic performance in an immediately previous
school term,

SEC. 4. Composition of Board, ~ The National Student Loan Board created under this
Act shall be composed of the following members.

1) Chairperson ~ The Secretary of the Department of Education (DepEd), or his/her
duly designated representative who should be an Undersecretary, shall be the
Chairperson of the National Student Loan Board. The Secretary of the DepEd shall
receive per diems to be paid for attendance in meetings called by the Board.

2

Vice Chairman - The Secretary of the Department of Social Welfare and
Development (DSWD), or his/her duly designated representative who should be an
Undersecretary, shall be the Vice Chairman of the Loan Board. The Secretary of the
DSWD shall also receive per diems to be paid for attendance in meetings called by
the Board.


£) To be the trustees for the Investment Portfolio of the Fund, which shall be created out
of its excess over semestral operating and lending requirements;

g) To appoint an investment manager for the investment Portfolio, should it be deemed
necessary: Provided, That such appointment should not exceed three (3) years, and
subject to performance review prior to renewal;

h) To report to the Office of the President on a monthly basis; and

i) To perform such other powers and functions as may be deemed necessary by the

president of the Philippines, pursuant to the provisions of this Act.

SEC. 6. Meetings of the Board. ~ The National Student Loan Bard shall hold twelve (12)
regular board meetings every year to be held every first Tuesday of the month, The Chairperson
of the Board shall be the Presiding Officer and in case of his / her absence, the Vice Chair shall
automatically preside and take over the proceedings.

SEC. 7. Quorum for National Student Loan Board Meetings. — All meetings shall only be
convened with a quorum of at least fifty percentum (50%) plus one (1) of the regular Board
Members. All meetings convened without quorum shall be deemed null and void, and
transactions or rulings made therein shall have no effect.

SEC. 8. Executive Committee of the Loan Board. ~ There shall be created an Executive
Committee of the National Student Loan Board composed of the Executive Director and the ten
(10) Working Board Members.

The Executive Committee, headed by the Executive Director shall have the following
powers and functions:

a)

To recommend the approval of loan applications by the Board;
b) To review, evaluate and assess programs, plans of action and/or agenda of the Board;
©

d

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To review, evaluate and assess the academic standing of loan borrowers;

To implement the orders, rules, regulations and guidelines passed by the Board;

To conduct annual spot and random inspections on borrowers
£) To conduct studies and researches for the improvement of educational services for the

poor;


3) Executive Director of the Student Loan Board — There shall be an Executive

4

5)

Director of the Student Loan Board to be appointed by the Chairman of the Student
Loan Board in consultation with the Vice Chairman. The Executive Director must be
a natural-born citizen of the country, and must have passed the Career Executive
Service Officers (CESO) examination. He / She shall receive a monthly compensation
equivalent to salary grade 28 and shall serve a term of three (3) years with re-
appointment for another term.

Working Board Members ~

There shall be ten (10) Working Board Members, eight
(8) members of whom shall come from the State Universities and Colleges, and two
(2) from the private sector, all of whom shall be appointed by the Chairman of the
Student Loan Board in consultation with the Vice Chairman, Each Working Board
Member shall receive a monthly compensation equivalent to salary grade 26 and shall
have the organizational designation of “Managing Director” of a specific functional
area of the Student Loan Board. The term of the Working Board members shall be co-
terminus with the term of the Executive Director.

Ex-Officio Board Members — The Chairpersons of the Government Insurance
Service System (GSIS), the Social Security System (SSS), the Philippine Overseas
Employment Agency (POEA) and the Executive Director of the Student Loan Board
shall be the ex-officio members of the Board. They shall receive per diems to be paid
for attendance in meetings called by the Board.

SEC.5. Powers and Functions of the National Student Loan Board. ~ The powers and
functions of the Board shall be as follows:

a)

b

°)

d

e)

To closely coordinate with NEDA in determining the income brackets and monthly
contributions to the Fund;

To promulgate the necessary guidelines, rules or regulations for the lending of funds
for education to the poor;

‘To appoint necessary staff and/or employees of the National Student Loan Board;

To allocate and disburse funds for the tertiary education of the poor;

To cancel, suspend, or revoke loans in cases of fraud, deception, cheating of any kind
on the part of the borrower;


g) To reprimand, suspend or dismiss erring officials and employees of the Student Loan

Board in accordance with existing rules and regulations of the Civil Service

Commission;

h) To appoint the necessary staff and/or employees of the Executive Committee of the
National Student Loan Board;

i) To recommend the cancellation or revocation of loans; and

j) To perform such other functions as may be determined by the Board.

SEC. 9. Student Loan Board Staff / Employees. ~ The National Student Loan Board shall
determine the number of staff / employees needed to carry out the functions of the Student Loan
Board, subject to the rules and regulations of the Civil Service Law and rules. The Commission
shall likewise provide for the qualifications and compensation of applicants based on the existing

rules and regulations on the hiring of civil servants.

SEC. 10. Planning Model. ~ For purposes of developing the relevant implementing
details of the National Loan Program, the Board shall use as a principal reference the Socialized
Tuition Fee Assistance Program (STFAP) currently being implemented by the whole UP System
(University of the Philippines).

SEC. 11. Contributions. — All monthly contributions made to the Fund shall be deposited
by the Board in the Development Bank of the Philippines (DBP) under the name of the National
Student Loan Fund.

SEC, 12, Investment Portfolio. ~ Funds in excess of the annual operating requirements
of the Student Loan Board not covered by its allocation under the General Appropriations Act
shall be transferred to an Investment Portfolio Fund. The interest to be derived out of the
investment Portfolio shall be used to fund full scholarships for qualified /skolars in academic
institutions of their choice: Provided, That such educational institutions are duly accredited by
the DECS and are included in a list of qualified tertiary educational institutions prepared by the
Board for this purpose.

SEC. 13. Contributor Income Bracket. — The Director-General of the National
Economic and Development Authority (NEDA) is hereby directed to assist the Student Loan


the Department of Labor and Employment (DOLE) and the Philippine Overseas
Employment Agency (POEA) are hereby directed to closely coordinate with the Board to
determine the present occupational status of borrowers for purposes of loan repayments
to the fund.

SEC. 17. Tax Deductibility. — All contributions made to the Fund shall be deductible
from taxable personal income. All loan repayments of graduate beneficiaries shall
likewise be deductible from taxable personal income.

SEC. 18. Appropriations. ~ The amount necessary for the effective implementation of
this Act shall be taken out of the funds appropriated for the Office of the President.
Thereafter, such amount as may be necessary for the continued operations of the Board
shall be included in the annual General Appropriations Act.

SEC, 19. Repealing Clause. — All laws, presidential decrees, executive orders,
proclamations, rules and regulations which are inconsistent with the provisions of this
Act are hereby repealed or modified accordingly.

SEC. 20. Separability Clause. — If, for any reason, any section or provision of this Act
shall be held unconstitutional or invalid, the other section or provision not otherwise

affected shall remain valid.

SEC, 21. Effectivity Clause. ~ This Act shall take effect fifteen (15) days from its
publication in the Official Gazette or in at least two (2) newspapers of general circulation,

Approved,