NOV 20 — The recent announcement that PTPTN (National Higher Education Fund Corporation in English) may suspend funding for university courses with student repayment rates below 50 per cent clearly raises many questions.

The PTPTN has, over the years, approved 3,951,404 loans totalling RM71 billion. However, more than 2.7 million loans, amounting to RM32 billion, remain unpaid.

I don’t know what others are asking, but my questions are: When was it first discovered that non-repayments were getting severe and why didn’t PTPTN tighten up its requirements and monitoring? Why is this agency still giving out loans knowing that substantial non-repayment is going to happen?

For while it’s great that RM39 billion has been repaid, to be RM32 billion in the red is surely something to be concerned about.

Isn’t it also ironic there was a recent uproar over FashionValet’s RM43.9 million loss, yet it’s been crickets despite PTPTN’s negative surplus being more than 700 times bigger?

Will suspending funding for selected university courses work?

My two sen is that even if it helps, it wouldn’t be fair to students who are willing and able to repay their loans. It’d be like punishing the innocent together with the guilty.

And what about courses whose repayment is more than 50 per cent but, say, less than 60? Do the defaulters involved get to escape repayment?

A culture of entitlement?

I have a theory about why the PTPTN problem has ballooned so much. It’s because there’s this national "cultural policy” that students are (informally? Unofficially?) entitled to a free education, and that no matter who bears the cost, it shouldn’t be them.

The fundamental injustice about this entire arrangement is hard to overstate.

A huge portion of PTPTN funds come from tax-payers I.e. society as a whole is giving these students a free ride.

There are many other students who do pay back their loans, thus this huge non-paying group effectively creates a segregated system whereby some families meet their loan obligations while others get off scot-free.

Two ideas

One very obvious solution is for PTPTN (or maybe even the Ministry of Higher Education) to declare that students are NOT to be given their academic qualifications unless their loans are repaid.

At present, from my understanding, PTPTN loans are already conditionally disbursed anyway (eg, if a student scores a CGPA less than 2.0 the monies won’t be released, etc.). So why not some conditional graduation?

Here’s another irony. There are academic requirements for loan disbursals but no financial repayment requirements for academic completion.

How convenient!

The second solution is to mobilise hiring managers to help rectify the situation: Ensure that all your fresh graduates can and will repay their loan in full, failing which hiring, promotions and bonuses will be affected.

Let their new hires know that if they want to get far in the organisation, they have to complete their loan repayments.

Not only would companies be instilling discipline into their employees, they’d be doing the nation a favour too.

* This is the personal opinion of the columnist.