Student loans suggested as alternative to subsidies

JAKARTA (JP): Education experts suggested on Thursday the adoption of a loan scheme to help students cope with tuition fees and help alleviate the burden of subsidies the government has to bare.

"By giving out such loans, as it is well-known in several countries, we can help students stay in university. The students can pay the loan back maybe a few years after they graduate," Winarno Surachman told The Jakarta Post.

Winarno said the loan scheme would be a very good idea as it would motivate students to study and accomplish their educational requirements.

He expressed hope that the system would also help improve the quality of graduates.

"Of course, the government should continue to give scholarships for students with excellent achievement," he added.

"This way (by stopping the subsidies) we can really produce scientists and not just plain university graduates," he added.

The government is on the verge of cutting subsidies for tuition in state universities to reduce state expenditures.

Subsidies for each state university student amounts to some Rp 3 million each year.

There were some 500,000 state-university students registered in 1998.

The government also provides additional operational funds for state universities.

Winarno supports the government's decision to cut subsidies for higher education and to focus its spending on students in primary level schools.

"Basic level education from elementary to high school is crucial. It would be better to concentrate more on that," he said.

Gadjah Mada University, the country's oldest university, is well-prepared to face the cut in subsidies for students, saying that they had long established a fund to help cash-strapped students.

"My financially strapped students will receive a coupon for a special reduction and of course other forms of help," Rector Ichlasul Amal told Antara.

Gadjah Mada University has established a fund of about Rp 8 billion, in which it can tap into.

"Universities should be creative in finding and using new sources of funds. It will also enhance the creativity of students," he added.

However, protests came from the rector of the State University of Yogyakarta, Suyanto, who contended that stopping subsidies for tuition could increase the number of student dropouts.

He said the cut in subsidies would force universities to raise tuition fees.

"The current tuition paid by students contributes no more than 10 percent compared to the overall operational expenses," he explained. (44/edt/dja)