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Sunday, December 27, 1998 Published at 02:51 GMT


Students attack loans 'shambles'

Students' living expenses are met by grants and loans

The National Union of Students says thousands of students are facing financial hardship because their loans have been delayed.

It says many of them have found it difficult to obtain application forms from the Student Loans Company, and these are then taking up to six weeks to process.

The union is also claiming that many students whose loans are delayed have been unable to access the company's student loan hotline because of the volume of complaints it is receiving.

At the University of Portsmouth, claims on the student hardship fund are said to have doubled as a result of delays in the processing of loan applications, while students at the University of Glasgow are said to have waited three weeks to receive application forms.

The President of the National Union of Students, Andrew Pakes, has written to the Chief Executive of the Student Loans Company, Colin Ward, demanding that action be taken. He has also called for assurances that the situation will not be repeated in subsequent years.

Grants to be abolished

Students' living expenses are currently met through a combination of grants and loans, but grants will be abolished from next year and replaced with a new system of loans administered by the Student Loans Company.

Mr Pakes said tens of thousands of students had suffered serious delays in receiving loans.

"Many have been forced into taking emergency loans and in some cases have even had to drop out of their courses. The current claim of a seven-day turnaround for loan applications is a sham.

"Student loans will be the primary mechanism for delivering support to students next year, and in the light of this year's fiasco, I am unable to face that prospect with any kind of confidence."

The Student Loans Company was unavailable for comment.

'Not their fault'

Commenting on the survey, the Conservative Party's Higher Education Spokesman, Damian Green, said the NUS figures were devastating, but the loans company was "the wrong target".

"The Student Loans Company has been set an impossible task by the government, which rejected the Dearing recommendation to keep maintenance grants and changed the loan system at the same time," he said. "The resultant pressures on the Student Loans Company have contributed to the chaos."

[ image: Damian Green:
Damian Green: "Government is to blame"
Mr Green also quoted figures from the Committee of Vice-Chancellors and Principals showing how local authorities are failing to assess how much of the full £1,000 tuition fees student should pay.

"Students need to know quickly what proportion of the fees they are liable to pay, otherwise they cannot budget," he said. "What we have seen this time is that only 67% of English students had been assessed by the middle of November, leaving a third in the dark about their potential debts."

Fourteen per cent of local authorities had provided less than 30% of students with the information about their liability for fees, he said.

"Next year students will be relying completely on loans, so both the loans system and the assessment of liability to fees will have to be fast and efficient. On this year's showing, I have no confidence that the system will cope."

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