Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

FIFTEENTH CONGRESS
First Regular Session

H.B.No. © =

Introduced by HONORABLE JUAN EDGARDO “SONNY” M. ANGARA

EXPLANATORY NOTE
Quality education is a fundamental right to which the nation’s citizenry is entitled to, as

provided in the fundamental law, thus:

“EDUCATION”

Section 1. The State shall protect and promote the right of all
citizens _to quality education _at_all levels, and shall take
appropriate steps to make such education accessible to all.’

It is also a fundamental requirement to develop productive and functional members of
society. The ideals of social justice, economic prosperity and sustain peace, order, freedom and
equality in our country could never be attained so long as majority of the population, the poor in
particular, remain benighted under the darkness of ignorance.

To level the playing field between the haves and the have-nots, democratizing access to
quality education to all Filipinos must be made a national policy. Opportunities to pursue higher
education and relevant training in fields of study vital to the national economy, including the
nation’s collective national psyche, must be provided to every citizen who wish to avail thereof.

It is a known fact that countless capable and deserving students are prevented from
pursuing higher studies due to their dire financial conditions. The government is trying to
address this problem. But with the limited scope and coverage of existing state scholarship
programs available to students, the results are far from encouraging. Strengthening the
Commission on Higher Educatign’s educational assistance program, better known as the
“Study-Now-Pay-Later Plan,” with substantial funding is perceived to be the key solution that
would provide headway and revitalize the program. An enhanced assistance program that shall

article XIV, Section- 1 of the 1987 Philippine Constitution


increase the prospects of poor but deserving students of acquiring quality education and training
needed to uplifi not only their own lot but that of their family and communities as well

This bill is intended to fulfil the commitment and resolve of the State, as enshrined in the
Constitution, to pursue the democratization of educational opportunities for every deserving
citizen and promote social and economic development for every Filipino family

In view of the foregoing considerations, passage of this bill is earnestly encouraged.

JUAN EDG: 10 “SONN’
Representajive

Lone District, Province of Aurora

M. ANGARA,


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

a 242
H. B. No,

Introduced by Honorable JUAN EDGARDO “SONNY” M. ANGARA

* AN ACT
PROVIDING FOR A COMPREHENSIVE STUDY-NOW-PAY-LATER PLAN
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 “Comprehensive Study-
Now-Pay-Later Program of 2010.”

SEC. 2, Declaration of Policy. It is the policy of the State to promote and ensure
quality education for all Filipino citizens. Towards this end, the State shall provide mechanisms
to facilitate access to higher education to all deserving Filipinos, recognizing on the process the
government's responsibility to put education as a priority over among its many programs

‘SEC. 3. Definition of Term. For purposes of this Act, the following terms shall mean:

1) “Scholar” refers to a qualified beneficiary who draws from the Study-Now-Pay-Later
Loan Fund to support his tertiary education;

2) “Fund’ refers to the special fund which shall be used to finance the Comprehensive
Study-Now-Pay-Later Plan;

3) “Authority” refers to the Educational Loan Fund Authority which is authorized by this
Act to develop and implement the Comprehensive Study-Now-Pay-Later Plan;

4) ‘Board’ refers to the Educational Loan Fund Board which is the governing body
through which the Authority exercises its powers and functions, to implement the
provisions of this Act;

SEC. 4. Study-Now-Pay-Later Loan Fund. There is hereby created a special fund to
be administered by the. Educational Loan Fund Authority created under this Act. Said funds
shall be used to finance educational loans to cover matriculation, school fees and other
expenses needed for quality education.

SEC. 5. Educational Loan Fund Authority. To carry out the aforementioned policy,
there is hereby created an Educational Loan Fund Authority under the Commission on Higher
Education (CHED) which shall be organized within sixty (60) days after the approval of this Act.


SEC. 6. Powers and Functions. The Authority shall have the following powers and
functions

a) Establish, develop and implement a comprehensive program for the effective
disposition of the Study-Now-Pay-Later Loan funds for loans to qualified loan
applicants;

5) Develop a system of collecting payments of loans granted under this Act:

©) Issue rules and regulations necessary for the proper implementation of this Act; and

d) Exercise such other functions and duties as will promote and expand educational

opporiunities for needy and deserving Filipinos to carry into effect the provision of
this Act.

SEC. 7. Educational Loan Fund Board. The Powers of the Authority shall be
exercised and its hnctions and duties performed by the Educational Loan Fund Board which
shall be composed of the Secretary of Education as ex-officio Chairman, the Chairman of the
Commission on Higher Education (CHED) as ex-officio Vice Chairman and the heads of the
following government agencies or their representatives as ex-officio members:

a) Government Service Insurance System (GSIS);
b) Social Security System (SSS);
¢) National Anti-Poverty Commission (NAPC)

The President of the Philippines shall appoint six (6) other members of the Board,
chosen from nominees of non-governmental organizations involved in education.

SEC. 8 Term of Ofice. The members of the Board shall hold office until their
successors shall have been appointed or qualified.

SEC. 9. Meetings. The Board shall hold regular meetings to be held every first Monday
of the month. The Chairman of the Board shall be the presiding officer. In the absence of the
Chairman, the Vice Chairman of the Board shall automatically take over. Minutes of all
meetings shall be recorded and attested to by a simple majority of all regular Board members.

At least one meeting per year shall be devoted to a review of the Study-Now-Pay-Later:

Loan Fund's performance in terms of the following:
a) Total number of current beneficiaries;
b) Number of dropouts, voluntary or revoked;
©) Average academic performance by year of study;

d) Breakdown of scholars by field of study;

2


e) Breakdown of scholars by region of origin;
f) Breakdown of scholars by place of study; and

g) Breakdown of scholars by size of annual family income and family livelihood.

SEC. 10. Quorum. All meetings shall only be convened with a quorum of simple
majority of the regular Board members. All meetings convened without the said quorum shall be
deemed null and void

SEC. 11. Executive Director. There shall be an Executive Director who shall be
appointed by the Board and shall have the rank of a bureau director and shall hold office until
replaced by the Board.

The Executive Director shall have at least seven (7) years experience in school or
educational administration and a holder of at least a Master's degree conferred by a reputable
educational institution.

SEC. 12. Secretariat. The Board shall create a Secretariat which shall be headed by
the Executive Director to cany out the functions of the Board, The Board shall likewise provide
for the qualifications and compensation of employees in the Secretariat in accordance with the
existing Civil Service rules and regulations.

The Secretariat shall exercise the following functions

a) Recommend the approval of educational loan applications by the Board;

b) Review, evaluate and assess programs, plans of action and agenda of the Board;
c) Review, evaluate and assess the academic standing loan borrowers;

d) Recommend the cancellation or revocation of loans; and

) Perform such other powers and knetions as may be determined by the Board.

SEC. 13. Qualifications of Applicants. Any Filipino citizen who graduates from a duly
recognized high school, and passes the college university entrance examination where he or
she intends to enroll on is qualified to avail of the benefits of the Educational Loan Fund. The
applicant must not presently be enjoying any scholarship or study grant.

SEC. 14. Terms of Loan. The loan available to a beneficiary of the Student Loan Fund
shall be subject to the following terms and conditions:

a) Coverage - Loans shall be available only for undergraduate degree courses. This
program shall not cover post graduate courses.


b) Loan Amount - The maximum annual loan amount shall be equivalent to the
prevailing cost per academic unit at the University of the Philippines multiplied by fifty
(0) academic units. Said loan shall be payable directly to the concerned school.

c) Interest - All loans granted shall have an interest rate of not more than ten percent
(10%) but not less than five percent (5%) as determined by the Board

SEC. 15. Repayments. The payment for loans shall start five (5) years after the loan
grantee graduates from the course he or she took Provided, That payments for educational
loans must be paid in five (5) equal annual amortizations from the date the first loan payment
becomes due, The heads of the GSIS, the SSS and the POEA are hereby directed to closely

coordinate with the Board to determine the occupational status of borrowers for purposes of
loan repayments to the fund.

SEC. 16. Implementing Rules and Regulations. The Department of Education and
the Commission on Higher Education shall, within six (6) months from the effectivity of this Act,
issue the necessary rules and regulations to cany out the objectives of this Act.

SEC. 17. Appropriation. There is hereby appropriated the sum of Five Billion Pesos
(P5,000,000,000,00) out funds in the National Treasury not otherwise appropriated to be used
to finance the Comprehensive Study-Now-Pay-Later Program. Ten Million Pesos
(P10,000,000.00) of said appropriation shall be used initially for the operating expenses of the
program, the rest shall form part of the Study-Now:Pay-Later Loan Funds,

‘Thereafter, the amount necessary to carry out the provisions of this Act shall be included
in the annual General Appropriations Act

SEC. 18. Separability Clause. If for any reason any provision of this Act is declared
unconstitutional or invalid, parts or provisions ofthis Act which are not affected shall continue to
be in full force and effect

SEC. 19. Repealing Clause. All laws, executive orders, presidential decrees,
implementing rules and regulations inconsistent with this Act are hereby repealed or modified
accordingly

SEC. 20. Effectivity Clause. This Act shall take effect after fifteen (15) days after its

publication in two (2) newspapers of general circulations.

Approved,