Sometimes, life calls for one to be cruel in order to be kind.

Looking at the recent mess the government has found itself in, maybe the above should be applied, particularly in tackling loan defaulters of its National Higher Education Fund.

The government's earlier soft or velvet glove approach in soliciting the loan amount lent to students has backfired, landing the fund in dire straits, with an arrear of RM7 billion gawking at it.

It was reported in the newspapers recently that graduates owe the government more than RM7 billion in unpaid student loans since 1997, which was when the revolving fund was set up by the government to assist deserving students with financial aid to further their higher studies.

Progress for the corporation has been lousy. As of Dec 31 last year, the corporation had merely collected RM93 million.

This fiasco concerning the National Higher Education Fund Corporation (PTPTN) going broke has also clearly displayed the mentality of the loan borrowers - who come out as being insensitive.

Calling such irresponsible defaulters selfish would be no exaggeration for their lame excuses in repaying the amount taken is costing other needy students unnecessary and avoidable stress of seeking financial aid in pursuing their education.

Higher Education Ministry Parliamentary Secretary Dr Adham Baba told Parliament in last November that only 28,629 of more than 600,000 borrowers had started repaying their loans.

He added that as of Aug 29 last year, the above repayments amounted to only RM13.5 million or 0.18 percent of the total RM7.3 billion disbursed so far.

So pathetic has the situation become that PTPTN chairperson Razali Ismail said Malaysia's worry is that it is close to becoming the worst country in non-performing student loans, with its percentage of borrowers who are ignoring repayments or not responding to the corporation standing at 74 per cent compared with countries like Ghana and Australia.

Poor collection of study loans given out is not a peculiar problem facing the country. The headache is plaguing Majlis Amanah Rakyat (Mara), a government agency that has been providing scholarships and loans since 1966. Mara is reported to have 68,000 errant borrowers who owe it RM200 million. And 10 per cent of this number has been hauled to court.

No mercy

Besieged by no cooperation from loan borrowers, the corporation decided to take a more radical approach, that of 'name and shame' the borrowers.

Voila! Threats of debt collectors coming to their houses, their names published in newspapers and legal action prompted some of the defaulters. And within two days about RM500,000 was collected.

Higher Education Minister Dr Shafie Salleh early this year said that 200 of the higher education loan defaulters will be taken to court for failure to settle their respective study loans.

This 200 comprise those who studied in private and public institutions of higher learning. Despite the corporation sending the defaulters four warning letters, with the last one being a legal letter, the borrowers still paid no attention to the call to pay up.

Regrettably, the damage has been done. The corporation, having gone broke in just eight years, turned to the ever 'generous' Employees Provident Fund (EPF) for a quick RM2 billion bail-out, a move that annoyed many EPF contributors.

The move to seek SOS from EPF has raised many questions from the curious public wondering what exactly are the obstacles that have hampered PTPTN's efforts in nailing the loan borrowers promptly to ensure the revolving fund survives unscathed.

Is the lack of a well planned strategy to re-claim the amount loaned a problem? Perhaps because the fund is a government-backed initiative, the attitude that prevails is that the government will deal with the problem should one crop up.

The government should also in hindsight determine whether the fund's coffers are going to remain open to applications submitted by students of well to do families.

Previously that was the case and it comes as no surprise that such shallow modus would have a contributing hand in leading to the fund's downfall.

Lessons not learned

Now, instead of finger pointing and pushing the problem from one agency to another, it is best that the government stop 'slouching' and sit up straight to tackle this problem.

If the system of repayment is at present not borrower-friendly, then the corporation should assign other feasible and transparent modes of payment collection. But at the end of all help rendered, loan borrowers should not ever be mollycoddled.

There seem to be genuine concerns over the transparency in the loan repayment method. Currently the system does not provide immediate confirmation by the corporation that payment has been made. Those making payments are required to print out a receipt and call the corporation after three days to inquire whether payment has been received.

This does not sound like a hassle-free mode of making payment. But still, it serves as no excuse for the loan borrowers not to settle their respective loans.

If the loan borrowers want to be spared the 'shame and name' by the government, then the responsibility is solely theirs in keeping their reputation intact.

Do not blame the government if it starts adopting an iron-fist attitude in reclaiming the amount loaned.

Nor should the government be blamed if it discontinues service of this fund. The blame lies very much on the shoulders of the loan borrowers. Should such unconventional approaches come their way, the defaulters should bear in mind that 'you asked for it'.

JJ RAY started her career with a mainstream publication. A non-conformist, she soon saw the barriers that went up whenever, through her writing, she tried to make the world a home for one and all.