When a university up north became very ambitious and decided to run 5 medical programs ( the first in the world), I cautioned many students that it is not viable and not to fall into a trap. IN 2012 , I wrote THIS and THIS. However, students being students, they will take whatever offer as long as they do not need to pay anything. Thus, the so-called ” scholarship” that was offered by this college attracted many middle-income parents to send their children. Unfortunately, what I feared most happened last year. As I wrote over HERE , HERE and HERE, the college finally closed down and all it’s students were forced to transfer to another MMC accredited university. Some ended up repeating their years. The UKM degree students were absorbed into UKM. So, what happened to the loan promised by this college? I understood then, that the college were offering almost free tuition fee as you will receive RM 150K from PTPTN and the balance will be paid by a collaboration with Maybank. This fund paid by Maybank suppose to be a convertible loan, informed to many as “scholarship”. Many did not realise that they are going to end up with a huge loan. I had always said that doing medicine by taking a huge loan does not make any economic sense. While the students have been transferred to other colleges, Maybank is now going after their loan. I attach a letter from Maybank to a student asking them to pay back the loan already paid to the college. So, now you are in debt even before you graduate!
Malaysia is probably one of the very few countries where their people go into debt to make someone else rich! A private college gets its money from PTPTN loan and many more scholarship/loans from MARA, JPA etc. Most of these loans are paid back by the students but the college can go laughing to their banks! Education should never be commercialised. Another interesting fact has emerged recently. As you are aware that the government has slashed PTPTN loan amount by about 15% for private colleges and 5% for public universities except for medicine (which will be a maximum of about Rm 150K). This has resulted in many private college’s intake reducing. The minimum entry qualifications introduced in 2011 had also gradually reduced the number of medical students in many private medical schools. A research done by a think-tank group revealed that close to 45% of private colleges do not have sufficient assets to cover their liabilities. It also said that close to 35% of private colleges and 41% of universities have bigger debts than their total assets, technically insolvent! This may affect close to 120 000 students!
There are many medical colleges which are facing enrolment problems. The MMC’s guideline and the cost of medical program has prohibited many students from entering medical course. The recent issues concerning possible unemployment of future doctors has also opened the eyes of many people. Medicine is no more a guaranteed future and money! I know a foreign university branch campus which is struggling to even get more than 100 students as the chances of their graduates getting an internship post overseas are very slim. This resulted in them not being able to recruit foreign students. A major administrative restructuring will happen soon.
I believe this could be a blessing in disguise. I had expected that some of the medical schools will close shop sooner or later. With the demise of AUCMS resulting in 5 medical programs closing shop, I also heard that UniKL’s twinning program with an Indian university will also close it’s doors. I also know that MMC has asked some of the medical schools which had intention to start twinning programs with overseas universities to postpone/terminate the idea.
I just hope our general public will realise that being a doctor does not guarantee anything. MMC being a corporatised body under MOH after the Medical Act was amended in 2012 will soon increase their fees. A recent letter was circulated to all organisation regarding their proposed fee hike as shown below. I did mention about this last year. Worth to mention that the fee for sitting MQE examination will also be increased to RM 2500 from RM 200. Please also note that you need to pay RM 500 for Certificate of Good Standing ! A specialist will pay RM 300 for APC and RM 300 for specialist registration per year. I wonder whether this will apply for government doctors as well? Hopefully they will revise some of it after feedback. All doctors will also need certain minimum CME points for APC renewal( I heard 10 points per year and 20points per year for specialist) as well as a compulsory Indemnity Insurance.
Well, the world is changing and the cost of living will only increase further. Never take huge loan to do medicine. Never forget that many more loans will come along the way after you graduate. Life will never get any easier…………..
New rules squeezing private colleges of funds, says think tank
Published: 6 April 2015 11:02 AM
The Alliance University College of Medical Sciences (AUCMS) in Kepala Batas, Penang, which closed down to shortage of funds. The Penang Institute warns that more private colleges may have to close down. – The Malaysian Insider file pic, April 6, 2015.
The Alliance University College of Medical Sciences (AUCMS) in Kepala Batas, Penang, which closed down to shortage of funds. The Penang Institute warns that more private colleges may have to close down. – The Malaysian Insider file pic, April 6, 2015.
The Penang Institute in Kuala Lumpur has warned that some 70% of private higher education institutions can see red this year, following changes in funding rules.
The think tank said based on data from the Companies Commission of Malaysia (SSM), 45% of private universities and university colleges have insufficient assets to cover their current liabilities.
Around 71% are below the market average in terms of sufficient assets cover while SSM data also showed that 28 private varsities, or 46% of those reported, made year-on-year losses in the 2013 fiscal year.
Penang Institute said finances were further tightened starting November last year when cuts were made to the public loans system for higher education or National Higher Education Fund Corporation (PTPTN) by Putrajaya.
PTPTN loans were cut by 5% for public universities and 15% for private universities. Loans for medical courses were unchanged.
“According to estimates by the Penang Institute using the SSM data, these changes would lead to 69.2% of private varsities falling into the red in the coming year.
“Around 76.2% of university colleges and three-quarters of the foreign branch campus could see their finances in negative territory due to these changes.
“Around 120,000 students are currently enrolled in those private varsities facing financial stress and this could rise to 215,000 students, or 44.5% of total private sector enrolment, due to funding changes according to the research,” Penang Institute said in a statement today.
The think tank cited Allianze University College of Medical Sciences (AUCMS), which had around 2,000 students and 500 staff, as an example. The medical school had to close due to financial problems.
The Masterskill Education Group Berhad, which owns the Asia Metropolitan University, has also been a case of financial squeeze, it said.
The group saw its share price fall from RM4.24 in August 2010 to a low of RM0.30 in May 2014, before recovering only to RM0.62 last month following restructuring and changes in its management and share ownership.
Penang Institute’s study looked into 41 private universities, eight foreign branch campuses and 27 university colleges.
At least two university colleges were upgraded to university status in recent months, but both are in the “financially stressed” group.
The revelations come as the National Higher Education Sector Blueprint 2015-2025 is set to be launched by Prime Minister Datuk Seri Najib Razak tomorrow.
Penang Institute’s general manager Dr Ong Kian Ming (pic, right) said the preliminary blueprint released by the Education Ministry for public feedback appeared to largely focus on the public higher education institutions.
“The fact that the private higher education sector was largely ignored is a serious omission given that almost half of the total enrolment in post-secondary education are in private universities, university colleges and colleges.
“In our recent comprehensive study to examine the organisational structure and financial sustainability of 41 private universities, eight foreign branch campuses and 27 university colleges in Malaysia, we found serious implications on the overall health and sustainability of the private higher education sector in Malaysia,” he said.
Ong, who is also Serdang MP, said the think tank would release a series of statements over the next few days to highlight some of the other important findings from the study.
“The complete report will be released at a later date at a public forum where the authors of the report will present their findings and invited panellists will be asked to comment on this report and the National Higher Education Sector Blueprint 2015-2025,” he added. – April 6, 2015.
– See more at: http://www.themalaysianinsider.com/malaysia/article/new-rules-squeezing-private-colleges-of-funds-says-think-tank#sthash.9YrohBsN.dpuf
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