How to punish a recalcitrant state? | Selangor Times
Issue 118


How to punish a recalcitrant state?
Writer: Wong Chin Huat
Published: Fri, 22 Jun 2012

I can understand why Higher Education Minister Khaled Nordin wanted to freeze loans for students of Universiti Selangor (Unisel) and why Deputy Prime Minister Muhyiddin Yassin could not wait to back this decision.

They must be annoyed that PKR has echoed the student activists’ call to abolish the PTPTN loan and provide free university education instead.

Set up in 1997, PTPTN was in many ways a smart design for the BN government in coping with a changing society and economy. It serves at least three purposes.

As a start, theoretically, the loans have allowed the expansion of higher education without the government bearing the financial burden.

Liberalisation of the higher education sector became a must after the 1990 elections in which the BN survived a near-miss, partly due to frustration of non-Bumiputera middle class parents over their children’s restricted educational opportunities and social upward mobility.

From 2006 onwards, the qualified applicants of the PTPTN loans were expanded beyond students of public institutions to cover those enrolled in private institutions. In practice, the new beneficiaries are many private institutions with dubious quality, whose licenses are unsurprisingly held by some well-connected persons.

Finally, the commodification of education pushes students and parents to be more atomic, counting their own benefit and cost. This removes the fuel for student activism. For the less critical mind, the Government can even emerge gracefully like a generous philanthropist who charges low interest and waive your loan if you perform well.

The problem is of course bad debts. Many debtors don’t pay back and their education is essentially funded by the Employees Providence Fund (EPF).   

Even though the amount to be paid back ranges from RM150 to RM400, it can be burdensome considering the stagnation in graduates’ initial pay and high cost in transportation, housing and telecommunication.  From a sympathetic perspective, the PTPTN loan lands young graduates in tens of thousands ringgits of debt before they even start to work.

Who stands to gain? Undoubtedly one of them are those private institutions which provide sub-standard education. Abolish PTPTN and many crony-run colleges will have to close shop.

The free education solution basically changes the equation by the government funding more cost-effective education via public institutions, freeing the students from debts and exploiting economic gains by killing the rent-seeking diploma mills.

Is this viable? Many European countries have free education. Other countries find that free university education may be unnecessary and wasteful. I believe there is plenty of room for a healthy policy debate.

But policy debate is exactly what we lack in Malaysia. You need not agree with the students and their supporters who occupied Dataran Merdeka, but thanks to them, we have now a policy debate.

What Khaled and Muhyiddin did was trying to prove their point in practice. If Anwar told students not to pay back their loans, then Selangor should provide for free education. After all, proof of the pudding is in the eating.

Put your money where your mouth is - what’s wrong with this way to punish a recalcitrant state? Nothing wrong if the state already has the money.

The fact is education falls under the federal jurisdiction and majority of the taxes we pay from income tax to service tax to import/export duty are collected by the Federal government.

Freezing the loan for Unisel students is therefore robbing money from Selangor, which pays its due share of federal taxes.

Selangor responded very smartly by preparing to liquidify Unisel’s assets to absorb the students’ burden. With greatly reduced corruption, Selangor has enough money to fight Putrajaya on this money.

Khaled and Muhyiddin lost flatly. They do not only look like school children who bully others when they can’t win an argument. They can’t even win the fight after losing the arguments.

A gentleman would have done the honourable thing to save his boss the embarrassment. Khaled must have possessed superhuman courage to claim victory in this battle.

But I would like to thank him for sacrificing his dignity and credibility to put forward a point for us to ponder: why shouldn’t higher education be controlled by the state?

If the states are allowed to control more taxes so that they can fund their universities, then different states can choose different systems.

In that case, Johor where Khaled and Muhyiddin hail from, can use PTPTN to fund their universities while Selangor can provide free education.

And students who prefer PTPTN – say, because they fancy private colleges – can move to Johor and students who don’t mind “boring” public institutions can move to Selangor.

Then, everyone can have their own way. Why not?

Over time, we can judge which system is superior. Why must we put all eggs in the same basket?

It’s time for us to end this hang over of centralisation and uniformity.



 Selangor Times



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