On Saturday night, Malaysiakini published an article written by YB Yeo Bee Yin entitled “Review JPA's 'convertible loan' scholarship policy, gov't told”: In this article, she criticizes the recent change in the JPA 2016 scholarship policy toward convertible loans - Some of the remarks that YB had made about the necessity of a review of this policy are not without merit, yet they are predicated upon several assumptions invalidated by my actual experience as a scholar under the Malaysian government. This article, therefore, will begin by summarizing some of YB Yeo’s points, and then addressing them line by line.

YB Yeo’s argument is well-structured, and rests upon an introduction, three main points, and a conclusion: I will rebut it in turn, quoting the entirety of her article as it was written, in bolded font.

“The Public Service Department (JPA) has recently dropped another bombshell on its scholarship offers, that all scholarships from 2016 will be in the form of convertible loans.

Upon completion of their studies, JPA scholars are mandated to work in the public sec-tor. If they choose to work in government-linked companies (GLCs) or in the private sec-tor, they will have to pay back 50 percent or 100 percent of the scholarship amount re-spectively.

Such policies are actually not an entirely new concept.

Many JPA or government scholars in the past have been made to sign contracts that ne-cessitate them to work in the public sector if they are offered a job within a period of time after their studies - failing which, they are required to pay back the scholarship amount.

In any case, the recently announced JPA “convertible loan” policy is unjustifiable and should be reviewed immediately.”

What exactly is YB Yeo saying? Think from the perspective of the government, and from the perspective of the taxpayer: She is saying that the government has essentially chosen to man-date enforcement of the scholarship money, by placing it in the civil service: If you choose to break your bond, then you pay back the scholarship in entirety. If you choose to work at a gov-ernment-linked company, you pay back 50% of the amount that the government has chosen to pay on your behalf for your role in having served as a government scholar but not under the di-rect jurisdiction of the Malaysian government. In other words, what the government is saying is that well, if you’re Malaysian and you happen to be a scholar, either you serve the taxpayers and do exactly what you’re supposed to do, or you just pay the taxpayers back.

…Why exactly is this unjustifiable?

YB Yeo goes on to say:

First, it is mind-boggling to see that another government agency, Talent Corporation Malaysia Bhd (TalentCorp), is doing the reverse. Its ‘Scholarship Talent Attraction and Retention (Star)’ programme helps government scholars to serve their scholarship bond

with leading private sector - instead of public sector - companies “as a way of contribut-ing back to the nation”.

According to TalentCorp’s website, there are a total of 1,681 Star private/GLC employers.

Why has JPA made it compulsory for scholars to serve their bond in the public sector, while on another hand, TalentCorp helps them to “escape” by connecting them to jobs in GLCs and the private sector?

Why the double work? Why waste taxpayers’ monies for TalentCorp to run the Star pro-gramme when JPA can only allow their scholars to serve their bonds in Malaysia?

Clearly, YB Yeo believes that there is some sort of contradiction of terms with the Malaysian government here: She seems to think that our goals are indistinct and lie contradictory to one another when in reality, that is not the case, because the context under which both programs have been set up have differed throughout time.

TalentCorp existed at a time when the Malaysian government could afford to allow its scholarly talent to not be involved in the administration of the country, but rather to simply have them come back and work under the conditions of the Star program: The idea, nominally, was then that scholars would be able to justify and increasingly procure economic growth for our country by interaction with the various people around our nation whether they had worked in private companies or in public companies…

A policy that the Malaysian government recognized in recent years does not work, because in some sense the scholarship system has faced a misallocation of resources such that scholars themselves have not yet, according to the present year, yielded return on investment according to the government’s key performance indices: As such, it did what any sensible investor would do - Restructure the asset so that the Malaysian government would have to receive the talent that it had invested in, and to utilize it in the administration of the civil service.

“Double work”? Hardly: This was nothing more than the Malaysian government doing what it needed to do in the face of evidence that the current policy was not tenable to achieve the pur-poses that it had set out to achieve… These were two different policies that were introduced at two different points in time, and any comparison that fails to incorporate these nuances shall eventually fail.

Second, the terms and conditions of the convertible loans are unjustifiable as it may lead to using taxpayers’ monies to reward under-performers.

Under such a policy, students with 2.8 cumulative grade point average (CGPA) - who can’t get a job in the private sector, but can only wait for one in the public sector - will be able to get the scholarship for free, while a highly competent student with a 3.8 CGPA, who has been hired by a multi-national company through many rounds of competitive in-terviews, will be forced to pay back the scholarship amount in full.

If convertible loans is unavoidable, then the payback amount must be performance-based (academic and non-academic) and not based on which sphere the scholars choose to work in - public sector, GLCs or private sector, as long as they are in Malaysia.

Why exactly is YB Yeo saying that taxpayer monies are being used to reward under-performers when many years ago, the Malaysian Government had instituted a policy of creating scholar-ships that were awarded purely on the basis of merit? My scholarship was the JPA Ivy League dan Setara Scholarship 2013, and only students who had managed to obtain placements in uni-versities that were among the top 10 universities in the world for each field - The latest JPA scholarship, the JPA Bursary scholarship scheme, is a scholarship scheme that made the JPA scholarship a completely meritocratic endeavor, whereby only those who had scored above 10A+ during the SPM examinations would receive full scholarships to go overseas?

Furthermore, she makes the assumption that the civil service should stay static in number and size: As far as I am concerned, that assumption is questionable, particularly in a modern age where the Chinese stock market is undergoing transition, and major economies have hit peaks in growth - Government can create a variety of new functions with modern technology that make use of civil service talent and labor, and it is fitting that it should do so in order to stay abreast of the current employments of labor and learning that must be executed in order for our country to achieve Wawasan 2020 in the many years ahead: It is not a question of performance-based or not performance-based repayment…. It is not the duty of the civil service to find ‘jobs’ for peo-ple in terms of purely administrative tasks: These are literally the brightest minds and the bright-est students in your country - Use them to dream of better things, of a better future, of a greater Malaysia in the days ahead.

Third, I believe that this policy that forces all our top brains to work for the government would not best serve our national economic agenda. I believe that the role of the private sector is equally, if not more important, than the public sector in driving the nation’s economy.

To move out from the middle income trap, Malaysia needs to change quickly to a knowl-edge-intensive and innovation-led economy.

We have spoken about becoming a knowledge intensive and innovation led economy for the past decade, ever since I was in primary school. When will we become a knowledge-driven economy? When will we achieve all our goals as the Malaysian people? Well, speaking as one of those ‘top brains’ that the Malaysian government has paid for to study overseas…

The first step to becoming a knowledge driven economy is to accept that we have already be-come a knowledge driven economy.

The egg cooker, the USB drive, the Rainbow Loom… All of these are Malaysian made and Malaysian founded. Startups such as Grabtaxi, founded by University of Chicago alum and Tan Chong Motors heir Anthony Tan, and KFit, whose COO, Mr. Yeoh Chen Chow, has worked on driving Malaysian talent overseas to the US via USApps, have brought glory to our nation… Yet paradoxically much of which has failed to manifest in an increased confidence in the Malaysian population’s ability to create, innovate, and make new things possible, despite the fact that now ten Malaysians stand on the Forbes 30 under 30 list for 2016: Should we ask for Malaysia to be competitive on the international arena when it is clear that we have succeeded, we continue to succeed in the private sector… Yet the extent to which these private sector successes have contributed toward the economy remains unacknowledged, which makes me wonder why it is that politicians comment day in and day out about how they wish for the private sector to flour-ish: Do they mean that wages need to stop being stagnant and move up? Because that is not

an issue of a lack of innovative capacity: That is a consequence of country economic policy that cannot directly be changed by single individuals.

For that matter, Malaysia is one of the countries that has sent the largest number of government scholars overseas relative to the majority of other countries on full ride scholarships as a conse-quence of JPA’s completely meritocratic policy, the current criteria for distinction of which is predicated upon SPM results: There is no question of race in the JPA scholarships - I’m one of the first Malaysian Chinese scholars, and I can confirm for you that not a single one of the 800 JPA Scholars who have had their scholarships converted to convertible loans has scored any-thing below 10A+: We now have one of the largest educated workforces for the civil service in Malaysia compared to any other country in the world as a result of the Government’s actions in previous periods, almost all of which will have their contracts mature into civil service employ-ment.

Now, as an economist and an academic, it seems to me that the idea of knowledge driven and innovation led our words that are used in this particular context as referring specifically to the development of the corporate world. By that definition, to a large extent up until the present, we have managed to create a knowledge driven economy, whether politicians may agree with it or not, or whether talent in the civil service is made use of or not: The reality is that they are not, and that

Trivially, as we know, does not constitute the entirety of the entire scale of intellectual human endeavors: the issue of government scholars being unable to start new ventures of their own is a non-issue:

There are two realities of entrepreneurship: Firstly, it takes a certain sort of spark. There is no one individual who would be able to become an entrepreneur because of the JPA scholarship, convertible or otherwise, because entrepreneurship itself is a self-directed effort, and saying that working in the government stops one from becoming an entrepreneur is a convenient way for a person to express that they will never become an entrepreneur: Saying that serving in the public service would stop one from starting a company itself is predicated upon the faulty assumption that one would not have the time or encouragement to pursue their passions within the context of civil service when in reality, civil service itself is a multifaceted and nuanced creature and de-serves more respect than it currently gets:

Secondly, a definition of ‘entrepreneurship’ that unfairly conflates economic output with innova-tive capacity should be discouraged: Innovation should encapsulate the freedom of each person to decide how it is that their country should be run or administered rather than serving as a buzz-word for people to utilize whenever they cannot think of anything else:

Let us not speak of state owned enterprises for now in this conversation of entrepreneurship. Even leaving this, and the waning Chinese growth miracle aside, many other things can be done for our country such as updating national historical records to make them available and accessible to historians, thinking about solutions to ensure clean water to different provinces of Malaysia (i.e. Selangor), making available data to academics and political analysts within the country so that we can study the trends of our society, and to create, if they do not exist already, bodies that will allow JPA scholars not to spend their time aimlessly, but instead for the purpose of increasing access to knowledge, information, and thus the development not just of our subse-quent generation, but of a present generation that has been convinced all its life that success lies in getting a good job, yet has never learned how to create one.

This would be impossible when we have a major scholarship policy that penalises our top brains for getting involved in the private sector and entrepreneurial ventures.

Under such a system, we may force a talented JPA scholar - who has just done a ground-breaking research that can be commercialised through a highly potential start-up - to pay back the scholarship because he/she starts a business instead of working for the government. This is completely illogical.

In order for Malaysia to be competitive in the international arena, we urgently need to manage our talents better.

This scholarship “penalizes” our scholars? Scholarships are a privilege, not an entitlement, as is work in the civil service fighting for one’s country, as opposed to being elsewhere. The pre-sumption of the convertible loan is that the government will get its money’s worth in the form of some return in the civil service: Why exactly would this scholarship ‘penalize’ our scholars when the reality of the matter is that without our government’s aid, almost none of these people would have gone overseas in the first place, and why try to single out a single entrepreneurial scholar when, arguably, that is not the kind of thing that you can create with policy actions? Further, the sword cuts both ways: Why raise the possibility of a scholar starting a business or assume that negotiations with the Malaysian government about scholarship terms and conditions binds com-pletely and is not subject to negotiation when it has been made clear to some extent that the na-ture of these scholarships is and will continue to be subject to scrutiny?

To summarize, YB Yeo thinks that the convertible loan scholarship policy denies freedom to its scholars and stops them from achieving their full potential - She says that it is illogical to force a JPA scholar to pay back the scholarship even if that scholar had happened to create a ground-breaking business: My two contentions are that scholars would not have had this freedom in the first place if not for the Malaysian government or their scholarship money, that it is perfectly rea-sonable for Malaysian taxpayers to ask for a return on investment of its scholars, but not to have decided the form exactly in which that return should come:

I say that it is illogical in general to expect that the majority of JPA scholars will start businesses upon graduation or within the six year timeframe in which a scholar is meant to serve their bond, and that it is most assuredly completely illogical to deny the government access to labor that it had invested in simply for the sake of a single scholar, or to presume that the government is static when that bears no actual meaning in reality.

This is not to say that the convertible loan policy has been completely perfect in implementation: It remains unclear as to whether students will be permitted to go overseas on their convertible loan scholarships, or if they will still be forced to go to IPTA or study at local institutions consid-ering the change in policy has not been followed by statements that the scholars affected will be allowed to continue their education at their universities of choice overseas. The drama resulting from the conversion to a convertible scholarship policy has allowed us to create a Facebook group that incorporates about 400 JPA scholars from all across the nation that will eventually constitute a significant plurality within the civil service, if not an absolute supermajority. A group of scholars that will all eventually go into the civil service, and is connected by Facebook and therefore is one of the most connected government entities on this planet.

What our government needs to do right by the younger generation that will eventually take on the reins of the country, is to be genuine about sending these scholars to the countries that they have gained offers of university admission to, to continue to keep its commitment to its students, and to preserve goodwill and harmony in the nation: I agree with YB Yeo’s assessment that we urgently need to manage our talents better, but I respectfully disagree with the means.

Victor Tan is a Malaysian Chinese government scholar studying Economics under the JPA Ivy League dan Setara Scholarship 2013 at The University of Chicago, hailing from SJK(C) Damansara and from SMK Damansara Utama. He has written and photographed for numerous publications, including The Malaysian Insider, Recom, USApps Malaysia, Scientific Malaysian. His personal projects include Humans of Ridesharing, and The Legend of 42.