Loans firm put student in debt

SERIOUS maladministration by the Student Loans Company, acting on behalf of the Welsh Government, resulted in a Welsh student falling into “considerable debt”, an Ombudsman investigation has found.

In addition to incurring an unexpected debt, Mr X (anonymised) suffered “considerable stress” as a result of a catalogue of errors made by the Student Loans Company (SLC), according to a new report issued by the Public Services Ombudsman for Wales.

The report found that the SLC failed to inform Mr X that he was not eligible for a tuition fee loan for the 2014/15 academic year in a reasonable and timely manner.

This failure resulted in Mr X incurring more than £7,000 of tuition fees, which the SLC could not grant him a loan to pay, leaving him in significant debt.

The Ombudsman’s investigation found that the SLC incorrectly asked Mr X for evidence of his circumstances in 2015/16, despite being aware he was not entitled to funding and did not inform him of this in a reasonable timeframe.

It revealed that the SLC knew from October 2015 that Mr X would not be entitled to tuition fee funding. Yet it continued to request information on his circumstances. The body even erroneously granted his application for funding until February 2017, almost 18 months later.

Nick Bennett, Public Services Ombudsman for Wales, said: “It is highly concerning that the public body responsible for student finance was responsible for such a catalogue of errors in this case.

“My investigation found that the SLC’s maladministration led a student struggling with a health condition to incur significant debt, which in itself was highly stressful for the individual concerned.”

The SLC has accepted the findings of the investigation, and agreed to apologise to Mr X, and pay him £500 redress.

The Ombudsman has also recommended that the SLC satisfies the debt Mr X incurred to his university between December 2014 and June 2015.