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UNIVERSITY OF THE PHILIPPINES SYSTEM

INFORMATION OFFICE

17 December 2013

For Immediate Press Release

UP unveils new socialized tuition system

Reference: Dr. Prospero E. de Vera

Vice President for Public Affairs Tel. No. 63-9178074722

The University of the Philippines recently unveiled a new socialized tuition system that will speed-up the processing of tuition bracket applications, adjust income brackets of student applicants, and increase the stipend of poor students in the premier university of the country. The Socialized Tuition System (STS) replaces the old Socialized Tuition and Financial Assistance Program (STFAP) established in 1989 which has been criticized for its long and tedious application process, mismatches between assigned brackets and the actual financial capacity of students, and inadequate benefits for those in the lowest income bracket. UP President Alfredo E. Pascual spearheaded this reform effort when he assumed office believing that the old tuition system is no longer responsive to the needs of UP students. According to Pascual, “the STFAP was established in 1989 as part of UP's effort to democratize access to its academic programs while promoting fairness and social justice in the university. It was a program intended to make UP education affordable, despite tuition increases for students, particularly those from poor families.” However, over the years, implementation problems and conceptual issues have masked the merits of the program. The major changes in the tuition system include simplifying the basis for assignment of tuition brackets, inflation adjustment of income cut-offs for bracketing, increase in monthly stipend of students belonging to low income households, and streamlining of bracket assignment and appeal process. The changes will initially apply to incoming freshmen for academic year 2014-15.

Using a new model developed by the Marketing and Opinion Research Society of the Philippines (MORES) for socioeconomic classification of Philippine households, the STS will reduce the 14-page application form used in the previous STFAP into 2 pages. To make bracket assignment easier, the STS will, as a second major change, reduce the number of indicators used for bracketing the students applying for STS assistance from four to two: the MORES instrument and the student’s declared household income.

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The third major change is the upward adjustment of income cut-offs for brackets A, B, C, and D.

Comparison of Income Cut-offs between STFAP and STS

Tuition Bracket

Socialized Tuition & Financial Assistance

Program (STFAP)

Socialized Tuition System (STS)

A P1,000,000 and above P1,300,001 and above

B P500,001 to P1,000,000 P650,001 to P1,300,000

C P250,001 to P500,000 P325,001 to P650,000

D P135,001 to P250,000 P135,001 to P325,000

E1 P80,001 to 135,000 P80,001 to P135,000

E2 P80,000 and less P80,000 and less

The new income ranges of the tuition brackets is adjusted upward by 30% to address the drift towards upper brackets as income rises due to inflation. The rate reflects the extent of inflation between 2006, when the current cut-offs were established, and the end of 2012. This adjustment will lower the tuition bracket assignment of many students. For example, a student with household income of P1,300,000 per year will now be assigned to bracket B instead of bracket A. The fourth major change is the increase in the monthly allowance for Bracket E2 from P2,400 to P3,500 per month for 10 months a year. The allowance may be in the form of cash, meals, dormitory accommodation, and other benefits and services provided by the University. Finally, the STS will streamline and automate the bracket assignment of students through online application. The automation will solve the very long processing time, sometimes lasting 10 months, in the STFAP that penalizes applicants who are temporarily assigned to higher brackets and discourages others to apply. All the changes are designed to benefit the students. While income cut-offs for bracket assignment is adjusted upward for inflation, the tuition rate remains unchanged.

Tuition Rates under STFAP and STS (no change)

Tuition Bracket

Constituent University / Campus

UP Diliman, UP Los Baños, UP Manila (P per unit)

UP Baguio, UP Cebu, UP Mindanao,

UP San Fernando, UP Visayas (P per unit)

A 1,500 1,000

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B 1,000 600

C 600 400

D 300 200

E1 & E2 0 0

All UP students, including those in Bracket A, are subsidized based on current tuition rates. Based on UP’s annual budget, government subsidy for UP for salaries and operating expenses stands at about P120,000 per student. Bracket A students with a normal academic load pay a total of only P50,000 in tuition and fees annually. The appeal process for cases will also be faster under the STS through decentralization of the decision to the campus or constituent university concerned. This replaces the old system where applicants had to wait for the decision of a UP system-level committee that meets only thrice a year. These revisions, added Pascual, will be supported by proper training of UP personnel, intensified information dissemination, strengthening of control systems through audit or verification, imposing severe penalties for misdeclaration, and improving student financial assistance services (scholarships, grants-in-aid, more and better paying student assistantships). According to Pascual, “we have worked on the STS since the start of my administration in 2011 and it is part of our commitment to make sure that no qualified student will be denied a UP education on account of financial need”. When fully implemented, the new STS will cost UP at least P300 million in reduced tuition income and additional stipend payments. The STS was approved by the UP Board of Regents with no opposing votes in its last meeting and will be implemented starting next semester. It was the product of close to 2 years of research, verification, and consultation with all stakeholders in the various units of the University.