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£19.99The scandal involving millions of pounds in student loans being fraudulently claimed by individuals who have no intention of studying has prompted the education secretary to take action. In response to a report by the Sunday Times, which uncovered evidence of individuals enrolling in courses solely to access loans without any plans to repay them, Bridget Phillipson has called upon the Public Sector Fraud Authority (PSFA) to lead the investigation. Describing the situation as “one of the biggest financial scandals in the history of our universities sector,” Phillipson is determined to protect the public purse from further misuse.
According to the Sunday Times, the majority of individuals under scrutiny are students at franchised universities, which are small colleges that offer courses on behalf of established universities. There are concerns about the potential “organised recruitment” of Romanian nationals to enroll in these courses. The Student Loans Company (SLC) has identified suspicious applications involving fake documents, address duplication, and students with insufficient English proficiency. Phillipson expressed disappointment in the inadequate measures taken to prevent such widespread abuse, emphasizing the need for swift and decisive action to safeguard taxpayer money.
In light of the revelations, Phillipson plans to introduce legislation to grant the Office for Students (OfS) additional powers to protect public funds. The current student loan debt in the UK stands at £236.2bn, with students, including those from overseas with settled status, eligible to access government-subsidized loans for tuition fees and maintenance costs. Repayment of the loan is only required once the individual reaches a certain income threshold after graduation, with the loan eventually being written off after 40 years in England. The Department for Education has already taken steps to combat fraudulent activities among franchise operators and promises to enhance regulation to prevent further misuse of funds.
Acknowledging the severity of the situation, OfS chief executive Susan Lapworth denounced the alleged misconduct as “entirely unacceptable” and pledged to collaborate with relevant stakeholders to address the issues. Universities UK, representing 141 universities, expressed support for the government’s proposal to compel franchise partners to register with OfS. While emphasizing the need to root out criminal behavior, a spokesperson highlighted the legitimate role of franchise provision in accommodating students with unique circumstances. They also commended universities for implementing stricter controls in response to the evolving challenges in higher education
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