BRIEF DESCRIPTION OF THE PHILIPPINES’ HIGHER EDUCATION SYSTEM

Since the creation of the Commission on Higher Education (CHED) and the Technical
Education and Skills Development Authority (TESDA) in 1994, the Department of
Education, Culture and Sport (DECS) has concentrated on elementary and secondary
education. As a result, the CHED, a department-level agency, independent from the DECS,
governs the public and private higher education system (two-year colleges, four-year, and
comprehensive/technical universities) and oversees degree-granting programs in all post-
secondary educational institutions. The TESDA, an agency attached to the Department of Labor,
oversees the post-secondary technical and vocational education.

In 1998, the Philippines had 1,495 higher education institutions including 377 public institutions
(219 state universities/colleges, 102 CHED-supervised institutions, 38 local universities/colleges,
and 18 other government schools) and 1,118 private institutions. The state universities and
colleges (SUCs) are funded by the national government. CHED-supervised Institutions are
directly supervised by the CHED, and their annual budget allocation is integrated in the
government budget appropriation for the CHED. Local universities/colleges are operated,
supported and maintained by local government units. Other government schools such as military
and police academies offer degrees and advanced training programs that are supervised and
regulated by the Department of National Defense and Philippine National Police.

Private institutions are funded from capital investments, contributions, tuition fees and other
school charges, grants, loans, subsidies, and other income sources in accordance with
government legislation. While they are fairly autonomous, they have to apply for permission from
the CHED to open new courses and for authorization to graduate their students.

In 1996, more than 2.2 million students were enrolled in various higher education institutions, and
the enrollment ratio of the students was 29 percent in 2000. Like other Asian countries, the
Philippines has relied on private institutions to increase higher education opportunities and, at the
turn of the century, had a higher proportion of its students in private higher education than any
other country. In 1996, private higher education institutions enrolled approximately three-quarters
of all higher education students.

Each higher education institution adopts a certain admission policy beyond the general
requirement that all candidates have to be graduates of secondary education. Some institutions
require passing an entrance exam and a medical examination; others adopt open admission, but
selective retention.

Though the Philippine Constitution has mandated that the government allocate the highest
proportion of its budget to education, the Philippines still has one of the lowest budget
allocations to education among the Association of Southeast Asian Nations (ASEAN). The
national education budget was 2.7 percent of Gross Domestic Product (GDP) in 1998. In terms of
the higher education budget, as a result of a Congressional initiative in 1997, its share increased
sharply from 2.4 percent in 1987 to 15 percent in 1997. However, following the Asian economic
crisis, its budget (DECS and SUCs) decreased from P17, 166 ($1,415) million in 1998 to P16,759
($1,382) million in 2000.

Most Filipinos regard education as a primary avenue for upward social and economic mobility.
Middle-class parents make many sacrifices to provide secondary and higher education for their
children. Moreover, many of them seem to equate high quality education with high tuition fees.

Tuition fees of private universities in Metro Manila are much higher than those of public
universities. The annual tuition fees of these private universities are nearly half the average
income of Filipino families (P123,168 / $10,154 in 1997).
 Table 1
Tuition Fees of Selected Universities in the Philippines (Pesos)
(PPP $1 = P12.13) is this correct currency rate?!! Bert

Number of
terms to
a Amount/term Amount/year
complete a
degree
University of the
6,500 ($536) 8 13,000 ($1,072)
Philippines (Public)
University of Santo
20,000 ($1,649) 8 40,000 ($3,298)
Tomas (Private)
De La Salle University
30,000 ($2,473) 10 60,000 ($4,946)
(Private)
Ateneo de Manila
40,000 ($3,298) 8 80,000 ($6,595)
University (Private)

Source: Viray, Editha C. (2001). Philippine Business Hiring / Recruiting System. Available at
www.aim.edu.ph/homepage/ABS2001/2001Viray.htm

The Philippine government, universities, individuals, organizations and corporations provide

scholarship programs to students from low-income families. According to a 1999 National
Statistics Office survey, 259.8 thousand college students received scholarships from private
organizations and government programs, which was an increase of 41.2 percent compared to
184.0 thousand in 1998. However, the same statistics show that in 1999, scholarships were
received by only 12.8 percent of the families with children enrolled in higher education institutions
(NSO, 2000).

The University of the Philippines (UP) has developed the Socialized Tuition Fee Assistance
Program (STFAP), under which students from higher income families pay higher fees and
students from the lowest income families are eligible for free tuition plus a living allowance. The
plan was first implemented in the University of the Philippines in 1989 as a major reform designed
to democratize undergraduate student admission and to benefit low-income and disadvantaged
students. The STFAP is also a government policy, having been mandated by the President and
Congress of Philippines through General Appropriations Acts of 1989, 1990, 1991, and 1992

The Commission on Higher Education (CHED) offers students who enter private universities a
similar program, the Private Education Student Financial Assistance (PESFA) Program.
However, unlike the STFAP, the PESFA does not fully cover tuition fees. The CHED also
offers student loans through the Study Now Pay Later (SNPL) Student Loan Program.
Student borrowers have to repay their loans at a simple annual interest rate of six percent starting
thirteen months after graduation.

The Philippines has relied on private institutions to increase higher education opportunities.
However, the equity of expanding private higher education is less clear. Moreover, through the
Education Code of 1982, the government has deregulated tuition fees. The CHED’s liberalizing
policies for private schools and rationalizing policies for SUCs may also make their tuition
fees skyrocket. In SY 2000-2001, about 37 percent of schools raised their tuition fees at an
average increase of 13.11 percent.

In the case of private schools, the PESFA Program offered by the CHED allows students whose
family income is less than P120,000 ($9,893) only P15,000 ($1,237) per year. Therefore, a
student who has an annual family income of P90,000 ($7,420) and who receives the maximum
PESFA would still have to pay more than two-thirds of her family income just in tuition fees.
Though the CHED also provides students with student loans, they will not borrow if they
have little chance of finding a high wage job upon graduation. According to the official
website of the National Statistics Office, the unemployment rate is currently 13.3 percent, and the
underemployment rate is 17.5 percent (as of April 2001). In this situation, it may be hard for even
university/college graduates to find employment.

II. Estimated Expenses of Higher Education in the Philippines

Table 2
Higher Education Expenses Borne by Parents and Students
[National currency Philippine Peso converted to $US
by 1998 PPP estimate $1 = P12.13]

a a Public Private
a a Low High Low High
a Special "One-Time" P200 P350 P400 P500
or "Up Front" Fees ($16) ($29) ($33) ($41)
P8,400 P12,600 P19,300 P50,000
Tuition
($692) ($1,039) ($1,591) ($4,122)
P4,850 P8,000 P12,000 P24,000
Other Fees
($400) ($660) ($989) ($1,979)
Books & Other
P2,000 P3,000 P3,000 P4,000
Educational
($165) ($247) ($247) ($330)
Expenses
Subtotal Expenses P15,450 P23,950 P34,700 P78,500
of Instruction ($1,274) ($1,974) ($2,861) ($6,472)
P7,200 P36,000 P7,200 P36,000
Lodging
($594) ($2,968) ($594) ($2,968)
P8,000 P26,000 P8000 P26,000
Food
($660) ($2,143) ($660) ($2,143)
P7,500 P2,500 P7,500 P2,500
Transportation
($618) ($206) ($618) ($206)
Other Personal P8,800 P13,200 P8,800 P13,200
Expenses ($725) ($1,088) ($725) ($1,088)
Subtotal Expenses P31,500 P77,700 P31,500 P77,700
of Student Living ($2,597) ($6,406) ($2,597) ($6,406)
Total Cost to P46,950 P101,650 P66,200 P156,200
Parent & Student ($3,871) ($8,380) ($5,458) ($12,877)

Public Low: Local Universities/Colleges (LUCs) 38 Institutions, living at home with parents
Public High: State Universities/Colleges (SUCs) 377 Institutions, living as an “independent adult”
Private Low: non-elitist universities/colleges, living at home with parents
Private High: elitist universities/colleges and institutes of technology, living as an “independent
adult”

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