The new repayment scheme for National Higher Education Fund Corporation (PTPTN) borrowers seems to smack of robbing the rich to give to the poor. The scheme heavily penalises higher earning borrowers but lets off the lower earning borrowers.
Under the new repayment scheme, the monthly salary deductions range from 2% to 15%. Those who earn less than RM2000 don’t pay back. The deductions are applicable to those earning RM2000 and more. Those earning RM2000 a month will have to pay RM40 when compared to those earning RM8000 and above who will have to pay RM1,200 or more.
The deductions would be a major adjustment to those in the higher income brackets. A deduction of RM1,200 or more is a large cut in disposable income, especially in the urban areas where the high cost of living would result in a significant drop in the standard of living.
For those who worked hard to reach comfortable income brackets, such a high deduction is understandably frustrating, especially when they have been consistently paying back.
The latest report is that the scheme has been postponed for review. However, I believe the underlying principle of the scheme is laudable as it ensures repayment and those eligible to pay won’t get off not paying!
However, a rethink is necessary to ensure that all borrowers pay. I think even those who earn less than RM2000 should also be expected to repay their loans. It inculcates the mental discipline of always paying or giving back what you borrow or take out as a loan. Otherwise, it is just as good as stealing!
And, Malaysians need to learn that you can’t justify stealing — or whatever other names you call it — just because as a borrower you can’t afford it or as a lender you are helping the poor. We should develop a mentality that whenever we take something on loan, we must always give back. When that quality is ingrained in our mental make-up, we will always honour our word to pay back.
As we determine to pay back, we will probably become resourceful in generating more income so that we can honour our commitment to pay back. In the process, we learn how to manage our resources and prove we can be trusted with the resources put in our hands. That’s a mentality that needs to become part of the national consciousness.
So, I fully support PTPTN chairman Wan Saiful Wan Jan’s repayment scheme for PTPTN borrowers. But, I agree, a review is necessary so that everyone who borrows pays back and at a rate that they can afford.
The same scheme may be used but including those earning less than RM2000, reducing the percentage of deductions for the higher income earners and extending the repayment period. Perhaps a flat rate of a 5% monthly deduction may be better for the higher income earners. For someone earning RM8000, that would still be a loss of RM400 monthly, but maybe more acceptable.
It is a good scheme; the rates, perhaps, need to be adjusted so that it is not a painful loss for the higher earning borrowers.