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Student News

The Student Loans Company just made £50m of taxpayers’ money disappear

The SLC finally started modernising their archaic IT systems. However, they've just unexpectedly abandoned the project – blowing £50m in the process!
student loan applicationAnyone who's ever had to deal with the Student Loans Company will know that their whole system really isn't working.

It's infuriatingly slow, hard to change details, and it's not uncommon for SLC to miraculously lose vital information or make errors in calculating how much you're entitled to borrow (or meant to pay back!).

Just a few years ago, we reported how thousands of UK students were accidentally overcharged by the SLC, resulting in them having to repay £107 million to those affected. Ouch!

Are you aware that the government is planning to make retrospective changes to student loan terms that could see students repaying a lot more than before?

What was due to change?

Kitten and computer keyboard

Back in 2014, the SLC were publicly scoffed at by MPs for having such an inefficient and out-dated IT system. The government decided to allocate a budget of £139 million of taxpayers' money to the SLC to find a supplier to start working on a major project that would massively improve their software.

The SLC asked a company called HCL to completely modernise their IT systems - a bit like transforming Cinderella from drab to fab (with HCL as the Fairy Godmother).

The new infrastructure would involve completely digitalising the end-to-end application process, including a brand spanking new banking platform, which would allow students to apply for their loans as easily as possible – on iPads, laptops, even smartphones if they wanted – instead of having to print off forms and send them in.

Currently, thousands of students complain to SLC every year - if everything was done digitally there would be less room for errors and there would be far fewer complaints!

The project was set to be a win-win - easier for students to apply and make changes, and less complaints to SLC. So what went wrong?

What went wrong?

and it's goneIt's unclear what exactly has happened, but earlier this week it was revealed that the entire project has been quietly scrapped and HCL staff were asked to leave SLC's premises.

So far, around £50m has been spent on the project, so abandoning ship at this stage basically means watching that money evaporate into thin air. Facepalm!

The SLC are yet to comment, but The Register requested some answers under a Freedom of Information request, and were told that the project has been shelved for the time being, to "allow for a tighter focus on specific priority areas of investment."

Surely renovating their medieval IT system should be a priority investment area... but, hey, what do we know?

What happens now

Finger with a question markCredit:Tsahi Levent-Levi – Flickr

The Student Loans Company are not looking for another supplier - for the time being, at least. This is particularly worrying as the total value of national student debt is set to increase massively in the next twenty or so years – from £46bn in 2013 to approximately £200bn by 2042.

How will they cope with such a massive increase in repayments when they have a system that's repeatedly proven to be completely rubbish?

Another elephant in the room, of course, is the question of what a massive figure like £50m could've been spent on had the government not wasted it on the SLC. Hopefully our new PM will give the SLC the shake-up that it needs – but we're not holding our breath.

If you've had a problem with SLC, or have been overcharged in your repayments don't forget to complain - perhaps they'll then get the message that something needs to change!


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