Policy and declared national objective
- The decree declares a national policy to democratize access to education by providing opportunities to deserving citizens to pursue higher education and training in fields vital to the development of the national economy.
- The decree directs supplementation of limited existing state scholarship programs through schemes that expand state financial assistance to deserving students.
- The decree enunciates the establishment of an educational assistance program known as the “study now pay later plan.”
Study-now-pay-later structure and funds
- Section 2 authorizes assistance from loanable funds for poor but deserving students under guidelines issued by the Educational Assistance Policy Council.
- Section 2 creates an Educational Loan Funds (ELF) scheme as a loan fund initially constituted at fifty million (P50,000,000.00) pesos.
- The ELF is set up and administered independently at the SSS and GSIS.
- Section 2 provides that SSS and GSIS each allocate twenty five million (P25,000,000.00) pesos from their investible funds, spread in yearly contributions of five million (P5,000,000.00) pesos starting calendar year 1976-77.
- Section 2 provides that the ELF services the financial needs of eligible students regardless of whether or not their parents or any of them are members of the SSS and GSIS.
- Section 2 states that the ELF is in addition to the current educational loan program of the SSS and the scholarship program of the GSIS.
- Section 2 requires PNB, DEP, and Land Bank to set aside five million (P5,000,000.00) pesos each of their annual investment portfolio for the purpose and to submit procedural guidelines to the Council for their participation consistent with their charter objectives.
- Section 2 requires that all private banking institutions and the Amanah Bank earmark a certain percentage of their investible funds for the purpose.
- Section 2 provides that the Council determines the amount of loan per student based on the number of years to complete studies and the amount needed for expenditures including tuition and other school fees, board and lodging, pocket money, books and supplies, and other miscellaneous expenses.
- Section 2 provides that all loans under the scheme are covered by a guaranty fund created under conditions the Council imposes.
Educational Loan Guarantee Fund creation
- Section 2 authorizes appropriation of one million (P1,000,000.00) pesos from the National Treasury out of funds not otherwise appropriated to constitute the initial Educational Loan Guarantee Fund.
- Section 2 provides that earnings guarantee charges and other credits arising from operations of the loan fund accrue to the Educational Guarantee Fund.
- Section 2 provides that the guarantee fund is administered by the Council.
Donations and contributions
- Section 3 authorizes the Council to accept donations, legacies, grants-in-aid, and other contributions to form part of the loan and/or Guarantee Funds.
Loan payment and employment payroll check-off
- Section 4 requires payment of all loans granted to student-borrowers to be made immediately upon employment.
- Section 4 directs that repayment is made under a payroll check-off system established by the Council.
Governance: Educational Assistance Policy Council
- Section 5 creates a policy making council to oversee the program.
- Section 5 provides that the Council is composed of:
- the Secretary of Education and Culture as Chairman;
- the Secretary of Labor as Vice-Chairman;
- the Director-General of the NEDA, Secretary of Finance, Secretary of Social Welfare, Budget Commissioner, Presidential Assistant on Youth and Sports Development, Governor of the Central Bank, and the Administrator of the SSS and General Manager of the GSIS (each may act through alternates).
- Section 5 empowers the Council to:
- determine and issue policies, measures, rules and regulations necessary to implement, maintain, and enhance the program;
- issue guidelines governing existing and future educational assistance programs of other government agencies and the private sector;
- enlist cooperation of schools and other relevant institutions for effective implementation and enhancement; and
- perform other duties assigned to it by the President of the Philippines.
Implementation support: inter-agency secretariat
- Section 6 creates an inter-agency secretariat to assist the Council in implementation.
- Section 6 provides that the composition and function of the secretariat are determined by the Council.
- Section 6 appropriates two hundred thousand (P200,000.00) pesos annually to be included in the budget of the Department of Education and Culture to finance the secretariat’s operations.
Eligibility and applicant qualification
- Section 7 allows any Filipino citizen who graduates from a duly authorized secondary school, whether public or private, and who desires further studies, to avail of assistance under any scheme.
- Section 7 provides that the basic consideration for eligibility is that the applicant is poor but deserving.
- Section 7 grants the Council authority to determine such other qualifications as it deems proper for the purpose.
Effectivity, abolition, and repeal
- Section 8 provides that the decree takes effect immediately upon publication of its implementing rules and regulations in two (2) newspapers of general circulation in the Philippines.
- Section 9 abolishes the Student Loan Fund Authority created under RA 6014.
- Section 9 repeals or modifies all acts or parts of acts inconsistent with Presidential Decree No. 932.