This article first appeared in The Edge Financial Daily on October 26, 2018

KUALA LUMPUR: Private Technical Vocational Education and Training (TVET) providers will need an allocation of at least RM1 billion a year for the next five years from the federal budget in order to support a total of 60,000 students, according to the Federation of JPK Accredited Centers Malaysia (FeMAC).

The amount is more than five times this year’s allocation of RM180 million to TVET providers.

FeMAC president P Sailanathan said the group has engaged and presented the figures to TVET task force chairman Nurul Izzah Anwar, who had said she would raise the issue in Parliament.

According to the federation, TVET providers are facing funding crunch. FeMAC alleges the TVET providers have yet to receive up to RM20 million of the total allocated funds since January this year.

“Only a selected few of us (private TVET providers) have received funding [but] a lot more were denied,” Sailanathan told the media yesterday.

So far, the Department of Skills Development and the Skills Development Fund Corp (PTPK) have been “pointing fingers at each other”, without having yet come to a positive outcome on when the remaining funds can be distributed, he added.

Although Minister of Human Resources M Kulasegaran recently said that his ministry has secured an additional RM140 million in funding from the finance ministry for TVET students and providers, the minister has so far not given a timeline for the disbursement, nor has it engaged with FeMAC on the matter.

“We are willing to cooperate, but there is no direction from the ministry. We are neither here nor there,” Sailanathan said, adding that many providers are on the verge of ceasing operations as the students are considering dropping out due to a lack of financial support and they can no longer afford to pay teachers.

To make matters worse, the students may often end up with a minimum of three overlapping loans as they are required to take a new loan for every level of vocational training, which usually amounts to four levels for a diploma.

Kulasegaran has proposed a fixed monthly repayment of RM100 for these students, but details are lacking on implementation.

Considering as many as 90% of TVET graduates find jobs within a year after completing their courses, Sailanathan does not foresee a major problem of them not repaying loans.

Currently, between 60,000 and 80,000 TVET students attend private TVET colleges, which are equivalent to about 13.3% to 17.8% of total tertiary-level students in Malaysia, according to data presented by FeMAC.

A total of about 45% of tertiary-level students in Malaysia are studying for TVET qualifications, compared to 55% at universities.

FeMAC, which represents about 350 private TVET providers out of 636 in total, has called for PTPK to be modelled after National Higher Education Fund Corp, with an abolishment of the current quota system.