Opinion split over debts

October 3, 2003

A clampdown on student debt was advocated by financial consultants this week, while by contrast the higher education minister was urging leniency, writes Alison Goddard.

Some £120 million is lost every year through bad student debt, say consultants PricewaterhouseCoopers. This is equivalent to the cost of employing 4,400 lecturers.

Last year, English universities took an average of 44 days to collect the money and were estimated to be owed £1.5 billion at the end of July.

Peter Buckle, head of income management at PWC, warned: "University staff must ensure effective financial management." He said universities must "ensure that every penny due finds its way to them quickly. There is no room for wastage."

Meanwhile, higher education minister Alan Johnson has written to all vice-chancellors asking them to give students two months to pay. He said students should have as little financial burden as possible at the start of term.

He added that institutions could help by treating sympathetically those students who may have been late submitting their support applications and by being flexible and sensitive in collecting fees.

Students attacked both positions. Mandy Telford, president of the National Union of Students, said: "This is another example of the government recognising the huge problem that student debt is for both students and universities."

She added: "Instead of tinkering and trying to find little solutions, they might be better off addressing issues as a whole and not putting students in a position where their degrees are jeopardised because they cannot afford to pay."

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