SLC investigates for-profits’ funds

Inquiry into 24 private institutions is triggered by ‘potential irregularities’

May 29, 2014

Source: Alamy

Suspended: student loans will not be paid during the investigations

The Student Loans Company is investigating 24 private colleges after finding “potential irregularities”, amid claims that some for-profit institutions are misusing public funding.

Margaret Hodge, chair of the Public Accounts Committee, last week said she has asked the National Audit Office to start an inquiry into public funding at for-profit colleges, following allegations about empty classrooms at the London School of Science and Technology.

There is growing scrutiny of David Willetts, the universities and science minister, over his decision to allow unrestrained expansion of student numbers by for-profit colleges.

Nearly £1 billion will be paid out to students at private providers by the Student Loans Company next year, up from just £30 million in 2010, a level of spending that will add to the squeeze on funding for universities.

Following the suspension of designations at a number of private colleges last year, a spokesman for the SLC said it has been “investigating 24 private institutions after identifying potential irregularities during routine checks and being alerted to possible issues from other sources.

“The Department for Business, Innovation and Skills instructed SLC to suspend payments to students at these institutions while investigations were carried out.

“BIS and SLC have a duty to protect public monies and must thoroughly investigate any such allegations. These investigations are still ongoing and an update will be issued once concluded.”

The Guardian has alleged that classrooms at LSST were empty despite it having 1,500 students, many of them claiming support from the public-backed Student Loans Company, and that the college has offered places to students without the required skills. LSST denied the allegations.

The Quality Assurance Agency is now investigating LSST under its concerns scheme, just eight months after giving the college a clean bill of health in a review for educational oversight (REO).

A QAA spokeswoman said the organisation first visited LSST in 2012, but an increase in student numbers “triggered a further full review in 2013, which resulted in positive judgements about LSST. However, in the 11 months since this review was published, the school has expanded rapidly, triggering a further full review in 2014.”

The spokeswoman added that “an application to our concerns scheme earlier in the year means that the review is on hold until the autumn while QAA carries out a full investigation into the allegations brought by the complainant”.

The spokeswoman also said: “We do not have the capacity or authority routinely to monitor student attendance.”

But she said that new applicants for REO – the QAA review route favoured by private colleges – will be subject to checks on governance, management and financial sustainability from 2015-16.

john.morgan@tsleducation.com

Times Higher Education free 30-day trial

You've reached your article limit

Register to continue

Registration is free and only takes a moment. Once registered you can read a total of 6 articles each month, plus:

  • Sign up for the editor's highlights
  • Receive World University Rankings news first
  • Get job alerts, shortlist jobs and save job searches
  • Participate in reader discussions and post comments
Register

Reader's comments (1)

Another negative press about Alternative Providers (APs). Everyone who has interest in the characteristics of the UK private higher education sector should take time and aim to reach a balanced conclusion. A knee-jerk reaction is not the way forward, instead a balanced response which protect the public purse and at the same time shape the future of this sector which is still in an embryonic stage. BIS, SLC, HEFCE, HESA and APs should have a round table discussion where they collectively set out the ground rules, policies, guiding principles and key performance indicators to be used to assess the performance of the APs. Some of the private sector providers will emerge as the trend setter; this has been the case in cases of some of the private secondary schools.

Have your say

Log in or register to post comments

Featured Jobs

Analyst

Greenwich School Of Management Ltd

PhD Research Fellow in Medical Physics

Norwegian University Of Science & Technology -ntnu

Senior Knowledge Officer

European Association For International Education

Postdoctoral position in Atmospheric and Space Physics

Norwegian University Of Science & Technology -ntnu
See all jobs

Most Commented

Doctoral study can seem like a 24-7 endeavour, but don't ignore these other opportunities, advise Robert MacIntosh and Kevin O'Gorman

Matthew Brazier illustration (9 February 2017)

How do you defeat Nazis and liars? Focus on the people in earshot, says eminent Holocaust scholar Deborah Lipstadt

Improvement, performance, rankings, success

Phil Baty sets out why the World University Rankings are here to stay – and why that's a good thing

Warwick vice-chancellor Stuart Croft on why his university reluctantly joined the ‘flawed’ teaching excellence framework

people dressed in game of thrones costume

Old Germanic languages are back in vogue, but what value are they to a modern-day graduate? Alice Durrans writes