A BBC news report has revealed that 70% of the tuition fee loans due to be paid back in 2008 by European students have remained entirely unpaid. Far from fulfilling the xenophobic notion of mass foreign dishonesty, the report rather demonstrates the gross inability of the government-owned Student Loans company (SLC) to recoup loans from outside the United Kingdom.
In normal circumstances, where the student is living and working in the UK, the process of loan repayment begins automatically when the former student is earning at least around £15,000. The loan is then collected through the tax system, administered by HM Revenue and Customs and repaid to the Student Loans Company.
However, if the student, whether they are British or European, leaves the U.K after university, they are personally responsible for contacting the SLC with details of their earnings and method of repayment. This highly optimistic system is further flawed by the bureaucratic legislation that states that the SLC cannot contact the parents of student. Whilst this might not appear to be too problematic in itself, it must be remembered that the permanent address given by the majority of students will be the residency of their parents.
“…of the 2240 loans that are due to be repaid, a massive 1580 have not.”
European students, who make up under 10% of the yearly intake to the University of Sussex, are entitled to same SLC tuition fee loan as UK students. However, it would appear that only around a third of European students at Sussex take this loan, and unlike British students there is no extra financial assistance with living costs.
The Student Loans Company, rather than the University of Sussex, is in direct contact with these students whilst they are in the UK and therefore takes direct responsibility for the repayment of student loan fees.
Higher Education Minister, David Lammy, admitted some concern about the report but stated that it was wrong to suggest that the SLC had lost contact with vast numbers of European students. This dismissive political rhetoric would appear to miss the point that having the contact details of former students does not change the fact that of the 2240 loans that are due to be repaid, a massive 1580 have not.
Having systematically failed to set up a system of contact and repayment with European students, it now appears as though the SLC is taking the extreme step of taking students to court over debt repayment, with nine students from four European nations said to have been targeted. This, of course, is assuming they can get in touch with them first.