Prompt loan cheque promise in jeopardy

June 11, 1999

Education secretary David Blunkett's promise that every student will have a loan cheque on the first day of the new university term is in jeopardy, it emerged this week.

Members of a working party looking into the introduction of new higher-value student loans are understood to be worried by the brief time available to process loans for students who gain places in clearing.

The Education (Student Support) Regulations 1999 govern access to and repayment of the new increased loans, which will be available from this autumn, when maintenance grants will be abolished. Students should get the loans in three instalments, starting with their first day of term.

Two groups within the working party studying aspects of implementing the regulations include representatives from the Department for Education and Employment, local authorities, higher education, the National Union of Students and the Student Loans Company. They are known to be working flat out to prepare the system, but clearing is proving a major headache.

One insider said the government's promise to get cheques out by the first day of term was "easy to say - harder to achieve".

He said the working party was "struggling" with the problem that time between clearing and the start of term might be too short for required administration.

"Probably there will be guidance given in the next four or five weeks as to what institutions would be (affected), and we will consider if we could speed up the turn-around time. Students offered a higher education place will have to apply to their local education authorities for means testing for loans within a set time to be assured of a cheque on their first day."

The SLC, LEAs and the agency responsible for issuing cheques for the SLC have promised to take no more than five days each to process applications.

According to the Universities and Colleges Admissions Service, 50,650 students were accepted into higher education places last year through clearing. It said the time between the end of clearing and the start of term could be anything up to six weeks.

An SLC spokeswoman said that as long as a student applies on time, the cheque will be there at the start of term. But she added: "The whole question of clearing is a nightmare for everyone."

The National Union of Students, which complained about a backlog in last year's cheques, said it did not want to see a repeat of the problems this year.

The DFEE said ministers "fully expected" that students would have their cheques by the first day of term. A spokeswoman said there were arrangements for students who apply late for new loans.

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