Aquino’s 2013 education budget pushing schools toward commercialization – youth party-list


MANILA — A lawmaker has charged that the Benigno Aquino III administration’s proposed budget allocation for education is so meager that it will drive state schools to implement more commercialization schemes, tuition and other increases, and other income-generating activities.

During a recent congressional budget deliberation for the proposed allocation for the Commission on Higher Education (CHED) and state universities and colleges (SUCs) Kabataan party-list Raymond Palatino said the Aquino government’s P37.1 billion ($880 million) budget for education is “grossly insufficient.” He said that despite President Benigno Aquino III’s pronouncement that the country’s 110 SUCs will will receive a hefty increase in their budget next year, there are many “cover-ups” and “deceptions” in the proposed budget as put together by the Department of Budget and Management (DBM).

In his 2013 budget message, Aquino said that his government was not neglecting public schools and universities, or the country’s “iskolar ng bayan” or scholars. Aquino then went on to explain that the DBM increased the allocation for SUCs by almost 44 percent or P11.3 billion, to P37.1 billion ($880 million) from the current P25.8 billion ($619 million).

“At first glance, it appears that the government is changing its earlier pronouncement that it will gradually reduce state funding for SUCs to force them to utilize their internal income. Such a move is a direct response to the clamor of students who have arduously fought for greater state subsidy in the past years. However, instead of being all praises for the Aquino administration, we remain unimpressed and dismayed, as the 2013 budget is a cover-up budget full of potholes and deceptions,” Palatino said.

Nominal increases, real cutbacks

The lawmaker said not the entire sum of P37.1 billion ($880 million) will go to SUCs. He said that if the automatic appropriations for employees’ pension and the funds that are actually part of the Miscellaneous Personnel Benefits Fund (MPBF) will be removed, SUCs will actually get only P32.7 billion ($785 million) Some P2.1 billion ($47.6 million) are also earmarked for retirement and life insurance premiums (RLIP), the fund for pension and other benefits of retired employees.

“This is an automatic obligation of the government and is actually not part of the operating budget for SUCs,” Palatino said.

Meanwhile, P2.2 billion ($47.6 million) is set aside and is part of the MPBF, which is the fund for unfilled positions in SUCs. The DBM withholds this budget unless SUCs request for its utilization. SUCs, however, are required to provide proper documentation.

“As we pointed out before, this fund is like DBM’s own pork barrel, which it can dispense at its whim,” the youth solon explained. The actual increase in the SUC budget, he went on, is actually only 37 percent.

“There might be a nominal increase, but if we consider how much SUCs actually need, it is still grossly insufficient,” Palatino said.

According to DBM, SUCs requested a total of P54.6 billion ($1.3 billion) for 2013. Only P37.1 billion,however, or almost 68 percent was approved by DBM for inclusion in the National Expenditure Program (NEP). Without the fund for RLIP, the fund for salaries and benefits of teachers and employees of SUCs, which falls under the personal services (PS) component, there is a P2.35 billion ($56.4 million) or an 11 percent increase to P22.97 billion ($547.6 million) from the current P20.62 billion ($500 million) budget. The last, Palatino hastened to explain, is not even a real increase in salaries for government employees.

“This increase only corresponds to the implementation of the fourth tranche of the Salary Standardization Law III next year,” he said.

In the meantime, the fund for maintenance and other operating expenses (MOOE) is set to increase by P3.42 billion ($81.4 million) or over 88 percent, to P6.43 billion ($153 million) from the current P3 billion ($ 71.4 million) budget. Majority share of the increase or P1.3 billion ($30.95 million,) will go to the University of the Philippines, while the remaining P2.1 billion ($50 million) increase will be shared by over 100 SUCs.

Not all SUCs, however, will be getting increases. Three SUCs are set to receive hefty cuts in the MOOE component, due to CHED’s Normative Funding Formula, which rationalizes the MOOE budget allocation for SUCs based on performance indicators, including enrolment and passing rates.

Three schools will be getting cuts in the 2013 MOOE: Aurora State College of Technology will be getting 59.50 percent less from its P28,369,000 ($675 thousand) in 2011; the Cebu Technological University (Cebu State College of Science and Technology) from P209,457,000 to P93,421,000 ($4.987 million to S2.24 million) or 55.40 percent less; and Adiong Memorial Polytechnic State College will get 52.41 percent less in the MOOE from P3,085,000 to P 1,468,000 ($73 thousand to $34.9 thousand).

A large portion of the increase in the budget of SUCs in the meantime is primarily because the fund will be allocated for capital outlay (CO), the budget for building infrastructure, for all SUCs next year. This year, only UP received funding for CO worth P190 million $4.5 million). Next year, the budget for CO ballooned to P3.17 billion ($75.4 million).

It may all look like a lot of money is going to education, but Palatino pointed out that the P3.17 billion ($75.4 million) DBM-proposed budget for CO is only 23 percent of the total P14.95 billion ($355.9 million) requested by SUCs. “If one considers the fact that the national government has not given any CO for the past two years, the P3.17 billion ($75.5 million) only attempts to cover up the cuts in the past in a very poor manner,” he said. “In fact, the Philippine General Hospital under UP, will not receive any CO for next year. Clearly, this is a cover-up budget meant to appease the growing dissent of students and administrators.”

Tuition increases and other misplaced priorities

According to DBM’s Budget of Expenditures and Sources of Financing, the budget agency expects an almost P1-billion ($23.8 million) increase in the internal income of SUCs. Part of the projected increase in income, or P500 million ($11.9 million) will come from tuition payments, which is expected to increase to P6.76 billion ($ 160.9 million) from the current P6.26 billion ($149 million). Also, DBM projects that income from other fees would increase by P200 million ($4.7 million) to P3.2 billion ($76 million) from the current P3 billion ($71.4 million).

“This is a clear indication that behind the supposed increase in the budget of SUCs, spiralling tuition rates will remain and would even intensify. DBM’s projections are already telling,” Palatino said.

He explained that the proposed budget for SUCs is only 0.31 percent of the country’s gross domestic product (GDP) for 2013, a far cry from the P16.8 billion ($ 400 million) budget allotted for debt servicing.

The P275.9 billion ($6.57 million) total budget allotted for the Department of Education and SUCs, meanwhile, is only 2.3 percent of the country’s GDP, far from the United Nation’s six-percent recommendation for education.

According to the Congressional Policy and Budget Research Department, the Philippines remains to be one of the countries with the smallest per capita spending for higher education. The said study revealed that the government spends only $625 per college student per year, less than the budget allotted by neighbouring countries like China ($2,728), Malaysia ($11,790) and Indonesia ($666).

“It is clear that the nominal increase for SUCs does not change the government’s policy on higher education. Access remains a challenge, and funding remains inadequate,” Palatino said. “In this light, the youth will continue and even intensify the fight for sufficient government funding for an education sector that truly serves the nation,” Palatino concluded.(

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  1. Please correct this part of the article:

    He explained that the proposed budget for SUCs is only 0.31 percent of the country’s gross domestic product (GDP) for 2013, a far cry from the P16.8 billion ($ 400 million) budget allotted for debt servicing.

    We mistakenly put P16.8 billion in our press release, when it should have been “16.8 percent of the GDP.” The revised press release now reads:

    The P37.1 billion proposed budget for SUCs is only 0.31 percent of the country’s gross domestic product (GDP) for 2013, a far cry from the 16.8 percent of the GDP allotted for debt servicing, Palatino said.

    We apologize for the error. Thanks.

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