Via The Santiago Times: Chilean minister presents university funding plan to president. Excerpt:
The state, not banks, are to fund higher education scholarships through the creation of a new specialized government agency, Chile’s education minister, Harald Beyer, announced in a press conference at La Moneda on Monday.
“In practical terms, this means that the funds originate from the state and banks cease to fund higher education,” Beyer said.
This proposal fulfils one of the biggest requests of Chile’s student movement, which last year saw massive demonstrations with thousands demanding free quality education.
The education minister met with President Sebastián Piñera in the presidential palace to present a package of reforms, which includes the exclusion of banks from the scholarship system in exchange for a single system of state-provided credit; changes in the requirements for scholarship access for poor students; and a new means of financing the gap between actual and reference tariffs, which are projected figures for the cost of a degree, as well as a better system of calculating reference tariffs.
“We want a more just system with no discrimination and more equality that integrates scholarships and loans for all students of higher education,” Beyer said.
Under the old system, banks facilitated the access of the middle classes to private universities through the Crédito con Aval del Estado (CAE), a program of state-guaranteed credit, established in 2007. The loans came with an interest rate of almost 6 percent, three times what some public universities charge their students through their internal loan systems.
This situation resulted in students graduating from university with large amounts of debt. Estimates place the number of students currently in debt through this system at 350,000. These students supposedly accrue an average of $100,000 USD each by the end of their studies.
The new credit system will be administered by the government and have a single interest rate of 2 percent a year. This will be the case for nine out of 10 students from both private and public institutions, excluding only the richest 10 percent.
It remains to be seen what Camilo Vallejo and other student leaders will say about this proposal.
Update: She tweeted: Se está sacando a la banca privada, pero el lucro todavía está presente en el sistema. "They're getting out of the private banks, but profit is still in the system."




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