Principals rule out own debt collection agency

December 12, 1997

SCOTTISH principals have abandoned plans to set up their own debt collection agency to recover fees from students next session.

A working group chaired by Martin Lowe, secretary of Edinburgh University, found that most institutions opposed the scheme for 1998/99, since they would have to decide next month.

The Committee of Scottish Higher Education Principals is wary partly for financial reasons, following advice from finance directors that they would need parallel systems to an external agency, and would have to set up systems to communicate with it. These costs would more than offset any savings.

The principals had also been keen to have an "arm's length" relationship with students on debt collection, but external accountancy experts had warned that any collection agency would look to institutions to impose academic sanctions on student debtors, such as withholding exam results or the right to graduate.

Dr Lowe said: "As for the future, we have been asked to keep the position under review and to see whether it might be possible in the longer term."

But he acknowledged that once institutions had spent time and effort setting up their own systems for next year, it made an external solution less likely.

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