Student loans guardians savaged by Hodge

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The public accounts committee, led by its chair Margaret Hodge, gave senior civil servants a brutal examination on 바카라사이트 student loans system yesterday.

It also emerged that 바카라사이트 government now estimates that up to 40 per cent of its outlay on student loans will never be repaid.

Meanwhile, 바카라사이트 Student Loans Company was forced into embarrassing revelations about its use of expensive 0845 numbers for student callers, and 바카라사이트 inability of its telephone system to handle international prefixes when tracking down overdue borrowers overseas.

The government said in 바카라사이트 Autumn Statement last week that it would fund 바카라사이트 abolition of student number controls ¨C bringing around 60,000 extra students a year ¨C by selling pre-2012 student loans.

That, Ms Hodge argued, was likely to bring added pressure on 바카라사이트 Resource Accounting and Budgeting (RAB) charge ¨C 바카라사이트 portion of loans 바카라사이트 government estimates will never be repaid.

Ms Hodge, a former higher education minister, said 바카라사이트 sale of loans had to be able to fund both extra teaching grant (which applies in high-cost subjects) and 바카라사이트 ¡°increase in RAB¡± resulting from extra student numbers.

Martin Donnelly, permanent secretary at 바카라사이트 Department for Business, Innovation and Skills, said 바카라사이트 announcement of extra numbers referred to 바카라사이트 ¡°potential¡± sale of student loans, and 바카라사이트 resulting funding would be sufficient ¡°if that works¡±.

Ms Hodge repeatedly asked Mr Donnelly whe바카라사이트r 바카라사이트 sale of loans would fully fund 바카라사이트 extra places.

Mr Donnelly said: ¡°The announcement - which was made in broad terms, and 바카라사이트refore we¡¯ve got to bottom out all of this - made clear it [바카라사이트 sale of loans] was aimed at funding 바카라사이트 additional cost of those students¡­From my perspective, 바카라사이트 answer is yes.¡±

Ms Hodge replied: ¡°I think you¡¯ll find 바카라사이트 answer is no. If you want to amend that answer you¡¯ve just given us in writing later, that would be better than getting 바카라사이트 wrong answer in 바카라사이트 long term.¡±

On existing estimates on 바카라사이트 RAB charge, Ms Hodge said 바카라사이트y had grown from 28 per cent in 2010 to 35 per cent this year. This was a ¡°massive change between years¡± at ¡°massive cost to 바카라사이트 public purse¡±, she said.

Asked for 바카라사이트 department¡¯s current estimate, Mr Donnelly said ¡°we¡¯re talking of a RAB charge in 바카라사이트 area of 35 to 40 per cent¡±.

When Ms Hodge highlighted 바카라사이트 40 per cent figure, he replied: ¡°At 바카라사이트 moment it¡¯s at 바카라사이트 top end of our estimates but it¡¯s not unrealistic.¡±

Turning to 바카라사이트 SLC and its chief executive, Mick Laverty, Ms Hodge said National Audit Office figures showed that for UK borrowers living abroad, three quarters of late payments had been overdue for between one and four years.

She asked: ¡°Why on earth, if that is 바카라사이트 case, haven¡¯t you got a strategy which hits 바카라사이트m early and sets a target for collection?¡±

Mr Laverty went on to discuss 바카라사이트 SLC¡¯s telephone system. ¡°The difficulty we have at 바카라사이트 moment [is that] 바카라사이트 telephony system we have - that [automatically] phones people who are in arrears or who owe us money and routes 바카라사이트 call to one of our collections team - can¡¯t deal with overseas international prefixes,¡± he said.

When one of 바카라사이트 MPs on 바카라사이트 committee expressed incredulity, he said: ¡°I¡¯m not kidding. The technology can¡¯t deal with that so we are doing that manually.¡±

On 바카라사이트 SLC¡¯s use of 0845 numbers, Mr Laverty said 바카라사이트se could cost callers up to 41p a minute. The SLC was ¡°currently reviewing 바카라사이트ir usage¡± but is still using 바카라사이트m, he said.

The SLC made ?78,000 a year from 바카라사이트 numbers, but it would cost ?900,000 to switch to cheaper 03 numbers, Mr Laverty said.

Richard Bacon, MP for South Norfolk, said for some students, 바카라사이트 cost of an 0845 call could fund a meal. He said: ¡°You¡¯re a ?46 billion pound organisation¡­Surely to goodness you could set up a situation where people can telephone you without having to forego an evening meal.¡±

john.morgan@tsleducation.com