Justin Donovan told the Education and Home Affairs Scrutiny Panel yesterday that if students and families asked the department if they could apply for money from the Student Loans Company, which provides finance for students in England, Scotland, Wales and Northern Ireland, they were told that they were not eligible.
The panel also heard that the department’s student finance team talks to students and parents to inform them that as Jersey residents, they are not able to receive loans from the SLC.
Last year the JEP revealed that a total of 129 students from Jersey and Guernsey had applied for finance from the company and were successful – but only due to a system error.
The SLC called for the money to be repaid immediately, but many students had already spent it on tuition fees.
The error led to more than £700,000 being handed out incorrectly and 49 families have now been referred to debt collectors.
Panel chairman Deputy Louise Doublet asked Education Minister Rod Bryans and Mr Donovan at yesterday’s hearing what stage the department was at in considering the possibility of introducing a new funding mechanism for local students.
Referring to the SLC situation, Mr Donovan said: ‘We did tell them not to apply for funding, but they went ahead anyway.
‘We need to make a decision on whether Jersey can afford a loan system or not.’
Deputy Bryans added that the students were ‘making their own decisions’ and that the department was looking into how to alleviate the pressure on Islanders.
Currently, Jersey’s student finance works on a means-tested grant system and any money given to Islanders does not have to be paid back.
The level of support a family receives depends on a combination of their income and net assets.
Families earning below £26,750 are eligible to receive the maximum £9,000 annually to help towards tuition fees and a £5,500 maintenance grant for accommodation costs and food.
- Jersey students who started their courses after 2012 pay between £6,157 and £24,065 in tuition fees per year
- A recent study showed that for essentials such as accommodation, food, study materials and travel, first-year students at UK universities pay an average of between £167 and £287 per week
- In the course of a 40-week year, essential costs vary between £6,680 and £11,480
- For tuition and essential costs, first-year students beginning in 2014 are likely to pay between £12,837 and £35,545 per year[/breakout]
STUDENTS left in debt to the tune of tens of thousands of pounds because of a UK loan error will be allowed to apply for finance in Jersey despite the window for applications being shut, a senior Education Department official said earlier this year.
Andy Gibbs, head of careers and learning support at Careers Jersey, said in January that students who received UK loans in error would be allowed to apply for student funding in the form of a grant from the States to help offset the cost of repayments, as long as they are eligible.
Mr Gibbs had been in contact with Student Finance England, a branch of the Student Loans Company, and the UK department for Business, Innovation and Skills to try to persuade them to show some leniency over the issue.
He proposed that the loans could be honoured on this occasion, but even though the UK government department admitted that it was their error when processing Jersey postcodes, they insisted that the money had to be paid back immediately.
Mr Gibbs said: ‘Financial support is difficult for us, but students who are eligible for funding can still apply and we would consider their application even at this stage.
IT is hard to express anything but sympathy for those families caught up in the middle of an administrative error over student loans handed out last year.
Nearly 50 families across the Channel Islands now have UK debt collection agencies breathing down their necks after students were ‘accidentally allocated’ funds to pay for their time at university.
For years a separate system has existed for students from Jersey and Guernsey to help them meet the huge financial burden of furthering their education. But a mistake from the Student Loans Company in the UK meant that nearly £700,000 was handed out ‘in error’ to islanders.
According to data released to the JEP only eight students and their families have managed to repay the money in full, five of whom are from Jersey. The remainder that have not yet negotiated a payment plan with the company are now being actively pursued for the funds and face the very real threat of legal action.
Usually the loans are repaid over the course of several years, after graduation.
But the problem that some families now face is that the money has already been spent as those students affected are now entering their second or third years at university, or even their first year of employment and paying back this money will be very difficult indeed.
One father of four has spoken today of his frustration at the situation, particularly as the SLC confirmed his son was eligible for financial help.
Citizens Advice Bureau chief executive Malcolm Ferey is right in warning those caught up in this saga to contact the SLC as soon as possible because once an individual’s credit rating is affected, it can be very difficult to undo the damage.
An error is an error, and we all make them. But is it right to punish and harass these students at such a testing time in their lives?
Perhaps the relevant CABs in each island, or governments, could act on behalf of all of these families affected and negotiate for the entire group?
A joined-up approach will have better outcome for all.
