14"' CONGRESS OF THE REPUBLIC 
) 
OF THE PHILIPPINES 
1 
7 JUL -3 m i  :17 
First Regular Session 
) 
SENATE 
S.B. NO. 722 
Introduced by Senator Ramon Bong Revilla, Jr. 
EXPLANATORY NOTE 
This bill seeks to create a National Student Loan Board to implement a National 
Student Loan Program for the poor, define its power and functions and appropriate the 
necessary funds. 
The importance of providing access to higher education for the poor cannot be 
overemphasized, In the Philippines, only a little over 11% of our work force has a college 
education. Of the college age population, les than 50% are enrolled in tertiary educational 
institutions and about 70% are living below the poverty line. 
Under this proposed measure, he cross-subsidy program implemented by the 
University of the Philippines (UP) will be replicated on a nationwide scale. As such, 
under this proposed measure, a mandatory monthly contribution shall be made by persons 
within specific income brackets and that such fund collected shall go into the national 
student loan fund. These contributions will be graduated according to income bracket. 
Using the 1995 data from the Philippine Statistical Yearbook and the targeted 
contribution rates, annual contributions that will be collected under this proposed 
measure will amount to about Php 6 billion pesos a year. 
Indubitably, there is a great need to provide a national student loan program to 
assist the Asia by educating the less fortunate of our Filipino people. 
In view of the foregoing, the pas 


14“’ CONGRESS OF THE REPUBLIC 
) 
OF THE PHILIPPINE 
) 
First Regular Session 
1 
SENATE 
S.B. NO. 722 
Introduced by Senator Ramon Bong Revilla, Jr. 
AN ACT 
CREATING A NATIONAL STUDENT LOAN BOARD TO IMPLEMENT A 
NATIONAL STUDENT LOAN PROGRAM FOR THE POOR, DEFINING ITS 
IMPLEMENTING 
GUIDELINES, 
RULES 
AND 
REGULATIONS 
AND 
APPROPRIATING FUNDS THEREFOR 
Be it enacted by the Senate and the Hozrse of Representative of ihe Philippines in 
Congress assembled: 
SECTION 1. Short Title. - This Act shall be known as the “National Student 
Loan Program for the Poor Act of 2004.” 
SECTION 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. 
SECTION 3. Definition qf Terms. - For the purpose of this Act, the following 
terms shall have the corresponding meaning: 
(a) Iskolar ng Bayan - hereinafter called “iskolar” shall referred 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; 
(c) National Student Loan Board - hereinafter called the “Student Loan Board” 
refer to a governing body under the Office of the President tasked to 
implement the provisions of this Act; 
(d) Board of Directors - hereinafter called the “Board” shall refer to the 
governing body of the Student Loan Board and shall exercise the power and 
duties hereinafter defined; 
(e) Monthly Contributions - hereinaeer called “contributions” shall refer to the 
contribution of designated income earners to the Fund, based on the National 
Economic Development Administration (NEDA) income brackets; 


(9 Iskolar Brackets - hereinafter called the “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 a immediately 
previous school term. 
SECTION 4. Composition of the 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 hidher duly designated representative who should be an 
Undersecretary, shall be the Chairperson of the National Student Loan 
Board. The Secretary of the DECS shall receive per diems to be paid 
for attendance in regular and emergency meeting called by the board. 
2. Vice Chairperson - The Secretary of the Department of Social 
Welfare 
and 
Development 
@SWD), 
or hidher 
designated 
representative who should be an Undersecretary, shall be the Vice 
Chairman of the National Student Loan Board. The Secretary of 
DSWD shall receive per diems to be paid for attendance in regular and 
emergency meetings called by the Board. 
3. Executive Director of the Stndent Loan Board - There shall be an 
Executive Director of the Student Loan Board to be appointed by the 
President of the Philippines. The Executive Director must be a natural- 
born citizen f the country, and must have passed the Career Executive 
Service Oficers (CESO) examination. The Executive Director shall 
receive a monthly compensation equivalent to a salary grade of 28. 
The Executive Director shall serve a term of three (3) years and can be 
re-appointed for another one (1) term. 
4. 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, a1 of 
whom shall be appointed by the President of the Philippines. Each 
Working Board member shall receive a monthly compensation 
equivalent to salary grade of 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 coterminus with the term of the Executive Director. 
5. Ex-Officio Board Members - The Chairpersons of the Government 
Service Insurance System (GSIS), the Social Security System (SSS), 
the Philippine Overseas Employment Administration (POEA) and the 
Executive Director of the Student Loan Board shall be ex-officio 
members of the Board. They shall receive per diems to be paid for 
attendance in regular and emergency meetings called by the Board. 
The ex officio members of the Board shall have no power to vote. 
SECTION 5. Powers and Functions of the National Student Loan Board - The 
powers and functions of the Board shall be as follows: 
a) To closely coordinate with NEDA in determining the income brackets and 
monthly contributions to the Fund; 


b) To promulgate the necessary guidelines, rules or regulations for the lending of 
funds for education to the poor; 
c) To appoint the necessary staff and/or employees of the National Student Loan 
Board; 
d) To allocate and disburse funds for the education of the poor; 
e) To cancel, suspend, or revoke loans in cases of deceit, fraud or cheating of 
any kind on the part ofthe borrower; 
To be the trustees for the Investment Portfolio of the Fund, which shall be 
created ant of its excess over semestral operating and lending requirements; 
g) To appoint an investment manager for the investment Portfolio, should it be 
deem necessary: Provided, hat such appointment should not exceed three (3) 
years, and subject to performance review prior o renewal; 
f) 
h) To report to the Office of the President on a monthly basis; 
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. 
SECTION 6. Meeting of the Boards - The National Student Loan Board shall 
hold twelve (12) regular board meetings every year to be held every first Monday of the 
month. The Chairperson of the Board shall be the presiding officer. In the absence of the 
Chairperson, the Vice-Chairperson of the Board shall automatically take over. 
SECTION I. Quorunz for National Student Loan Board Meetings. - All regular 
and emergency meetings shall be convened with a quorum of at least fifty per centum 
(50%) plus one (1) of the Regular Board Members. AI1 meetings convened without the. 
said quorum shall he deem null and void. 
SECTION 8. Executive Coninzittee ofthe 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 andlor agenda o the 
Board; 
c) To review, evaluate and assess the academic standing of loan borrowers; 
d) To implement the orders, rules, regulations and guidelines passed by the 
Board; 
e) To conduct annual spot and random inspections on borrowers; 
f) To conduct studies and researches for the improvement of educational 
services for the poor; 


g) To reprimand, suspend or dismiss erring officials and employees of the 
Student Loan Board based on the existing rules and regulations of the Civil 
Service Commission; 
h) To recommend the cancellation or revocation of loans; and 
i) To perform such other powers and hnctions as may be determined by the 
Board. 
SECTION 9. Student Loan Board Stafl7EmpIoyees. - 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 
the civil servants. 
SECTION 10. PZanning Mudel. - For purposes of developing the relevant 
implementing details of the National Student Loan Program, the Board shall use as a 
principal reference the Socialized Tuition Fe Assistance Program (STFAP) of the 
University of the Philippines. 
SECTION 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. 
SECTION 12. Investntent 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 Iskolurs 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. 
SECTION 13. Contributor Inconre Bracket. - The Director-General of the 
National Economic and Development Authority (NEDA) is hereby directed to assist the 
Board in determining the income bracket of wage earners who shall be required to make 
contributions to the Fund within ninety (90) days after the effectivity of this Act. The 
contributions structure shall be progressive, from a minimum of %% of individual income 
bracket to a maximum of 4% of individual income bracket. 
SECTION 14. Beneficiary Loan Amount. - The loan available to an Iskolur 
shall he semestral, and shall he subject to the following terms and conditions: 
a) 
Availability - Iskolar ng bayan loans shall be available only for 
undergraduate degree courses. This program shall not cover postgraduate 
courses. 
b) 
Loan size - loan amount shall be equivalent to the prevailing cost 
per academic unit at the University of the Philippines multiplied by twenty 
one (21) academic units. 


c) 
Loan repayment - Loan shall carry an annual interest rate of 5%, 
payable over five (5) years commencing the first year after the graduation 
of the Iskolur. Loan amortization computation shall use the Straight-Line 
Method. Amortizations shall he deductible from salary in the case of 
employed graduate Iskolur or paid directly to the Fund in the case of self- 
employed graduate of L~kolurs. 
d) 
AppZzccrtion -the loan shall be applicable to the school of choice of 
the Iskolur, to cover tuition and living allowance. Amounts in excess of 
the loan needed to cover the Iskolar 's needs shall have o be derived from 
the sources. 
e) 
Drawdoivn - Upon approval of a loan, an amount equivalent to the 
tuition of the Iskolur can immediately be drawn upon presentation of proof 
of registration. Balance can be drawn in five (5) equal monthly 
installments starting the first month of the semester in the case of schools 
using the semestral system, or four (4) equal monthly installments starting 
the first month of the trimester in the case of schools using trimestral 
system. 
SECTION 15. Mandatory Contributions - All income earners as determine 
under section 9 above are hereby required to contribute to the Fund. Such mandatory 
contribution shall be based on NEDA income brackets. 
SECTION 16. Loan Payments - The Chairperson of the Government Insurance 
Service System (GSIS), the Social Security System (SSS), 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 of loan repayments to the f k d .  
SECTION 17. Tnx Deductibility - The amount necessary for the effective 
implementation of this Act shall be taken out of the hnds appropriated for the Ofice 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. 
SECTION 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. 
SECTION 20. Separrrbility Clause - If, for any reason, any section or provision 
of this Act shall he held unconstitutional or invalid, the other section or provision not 
otherwise affected shall remain valid. 
SECTION 21. Effectivity CZause - This Act shall take effect fifteen (15) days 
from its publication in the Official Gazette or in at least two (2) newspapers of general 
circulations. 
Approved,