Previous
Students have been advised to apply for refunds from the Student Loans Company
(SLC) after it emerged that the firm had collected an additional £3.65m from
students repaying their students loans.
The
controversial company in charge of collecting student loan repayments for the
Government has taken tens of millions of pounds extra from unwitting graduates.
Tens of thousands of people have been advised to apply for refunds from the
Student Loans Company (SLC) after it emerged that the firm had collected an
additional £36.5m from them in 2010-11 alone.
More than 63,000 former students carried on
repaying from their salary, often for months, after they had paid off loans
taken out to fund university education. The average amount overpaid was £577,
although several graduates claim they paid out several thousand pounds more
than they owed.
The total
"over-repaid" by graduates is the highest amount ever taken by the
SLC, despite assurances that it had made strenuous attempts to ensure it didn't
collect more than was due. Graduates overpaid by £22m in 2009-10, compared to
£19m in 2008-09 and almost £16m in 2007-08.
Student
groups last night blamed a lack of communication between the SLC and HM Revenue
& Customs (HMRC) for the millions disappearing from graduates' incomes.
Pete
Mercer, vice-president of the National Union of Students (NUS), said: "The
huge overpayments we're seeing annually on student loans demonstrate that a
switch to real-time communication between the Student Loans Company and HMRC
cannot come soon enough."
The
revelation is the latest in a series of embarrassments to have hit the
Glasgow-based organisation, founded in 1990 to administer low-interest loans
for UK students. The SLC chief executive and chairman were forced to resign in
2010, following repeated criticism of delays in processing applications for
financial support.
It emerged
earlier this year that the new chief executive, Ed Lester, was being paid
through a private company in an arrangement that helped to slash tens of
thousands of pounds from his tax bill.
As student
debt has risen to an average of £13,000 per graduate, almost three million
people are now making regular payments to the SLC, often directly through their
pay packets. The company has now revealed, in response to a Freedom of
Information request, that 63,210 customers over-repaid a total of £36.5m in
2010-11, the last year for which figures are available.
The SLC
claims the problem is caused because HMRC only tells it how much has been paid
by each borrower once a year, usually a few weeks after the financial year ends
in April. The time lag means graduates who settled their loans during the year
may not have their direct payments stopped until several months later, when the
SLC has received confirmation of how much they have paid.
"We
contact all graduate customers who are identified as likely to overpay their
loans and advise them of their options coming towards the end of their
repayment," said Kevin O'Connor, SLC head of repayment.
"They
can choose to take up our direct debit scheme or make arrangements to pay their
loan balance."
Since 2009,
the company has allowed customers coming to the end of their loan to pay by
direct debit for the last two years, making overpayment less likely. But almost
60,000 of the 151,000 offered the facility have failed to take it up. The SLC
insists all over-repayments are refunded with interest, but the onus is on
borrowers to notice they have paid too much and demand their money back.
No comments:
Post a Comment