Albay Borrows P700-M for College Scholarships

LEGAZPI CITY, June 17 - The Land Bank of the Philippines (LBP) has approved a P700-million loan package to Albay province to finance its technical and tertiary education scholarship program designed to produce "a college graduate for every family."

Albay Governor Joey Salceda signed the loan agreement with LBP president and Chief Executive Officer Gilda Pico to formalize the multi-million loan package that would finance a first-in-the country education strategy.

The program would produce a college graduate in every household through a simplified study now, pay later scheme in the province.

Salceda, a topnotch economist in the country, authored the program, referring to it as an "Education Driven Development"; a development approach for his province anchored on a vigorous, well planned, financed and executed college and vocational education, a system that practically invites more scholars, up enrollment and produce more graduates.

The program is estimated to trigger a growth in college enrollment in Albay by 40 percent, Salceda said.

The ceremonial signing at the LBP Board Room on Tuesday was witnessed by LBP ranking officers and Albay provincial officials, among them members of the provincial board, and members of the media at Land Bank main office in Malate, Manila.

The loan will be used to finance government scholars in the tertiary level, under the Albay Higher Education Contribution Scheme (AHECS), enrolled at the Bicol University and other community colleges in the province which, this year alone will pay for over 12,000 college freshmen until they graduate.

The loan agreement carries an eight percent interest per annum payable in 10 years with a two year grace period on the loan.

Under the loan agreement, the funds would be released in tranche to the provincial government, meaning the money would be released depending on the number of government scholars the province would approve in a given period.

Pico, at the signing program commended Salceda for the innovative program he introduced with the involvement of LBP.

She said "we appreciate the involvement of LBP in this noble project and we look forward for a successful implementation of this first of its kind project."

Salceda, for his part, said, "I would have placed this amount in infrastructures. But I believe diplomas give better economic returns than roads and bridges."

He told LBP officials that a National Statistics Office (NSO) study indicates that 34,000 students finish college in Albay and this represents only 2.95 percent of the province's population.

NSO Education participation indicator showed that of the 197,413 enrollees at the elementary level, 80 percent finishes elementary or nine out of 100 students don't finish elementary; while at the secondary level, of the 87,876 enrollees, 43 percent graduate from high school or 13 out of 100 drop-out ratio.

For this reason, Salceda said his education program was developed. "A well-educated constituency has a lot of social payback and economic benefits. It expands their labor mobility. They will seek better jobs," he said.

"The difference in economic return between an elementary graduate and a secondary graduate is about 7 percent. But the differential between a college graduate and a high school graduate is about 21 percent. With diplomas, they can seek jobs elsewhere and not cramp the limited jobs market of Albay. Diplomas are like visas," he added.

Considered a first of its kind in the country, Albay's education program in all levels, has lately been gaining grounds, among others raising students' learning standard as was proven in the 2009 National Achievement Test (NAT) where the province garnered the 106th place out of 202 divisions, a distant leaped of 69 places from a poor 175th in 2007.

Salceda said the province's present goal is to get to the top 40 schools in NAT within the next three years, and the top 10 within the next six years. The education agenda is backed up by a portfolio of interventions, among others, an institutional capacity-building program.

Albay is presently the only province in the country with a Provincial Education Department (PED) - best known earlier as Education Quality for Albayanos (EQUAL) - created by an ordinance, with plantilla staff approved by the Civil Service Commission and the Department of Budget and Management, overseen by a special advisory group - the Albay Council of Educators.

Salceda said Albay's education program is producing the social impact; the number of college population has grown by 15 percent in three years from 34,000 to 38,000 due to provincial scholarships; and college graduates grew by 31 percent per year from 6,300 to 8,300, more or less. (PNA)