EU students at private providers – 5000 found to be ineligible for maintenance support

David Willetts issued a written parliamentary statement this morning covering the results of the BIS / SLC investigation into EU students claiming maintenance grants and loans at alternative providers.

The results of this exercise are now available. Of the 11,191 students who we
asked for additional residency evidence, 1,333 (12 per cent) received a
payment but were either unable to or chose not to demonstrate that they had
been in the UK for the three years prior to the start of their study.

Around £65 million was due to have been paid out to these individuals. As a
result of our prompt action only £8 million was actually paid. We have taken
immediate action to recover these sums and already have recovered around
£2.5m. Work continues to recover the rest including using debt collection
agencies, court action, and if we find evidence of fraud, we may prosecute
those involved.

After speaking to BIS, I can confirm that in fact 5 342 of those 11 191 were found to have made ineligible claims, but only 1333 had received funding by the time the investigation was launched and payments suspended. 48% of claims were therefore rejected for 2013/14 indicating a much wider problem than suggested by the official statement.

£65million would have gone to those 5 342 students over the course of their study. £8m had already been paid out to 1 333 students of which £2.5m has since been recovered. BIS has sought the help of EU governments to recover the additional £5.5m outstanding.

Willetts used the occasion to launch a ‘Fraud & Debt’ review of the student finance system. This is in addition to the National Audit Office review into the funding of students at alternative providers due to commence later in the year. He also threatened legal action against any provider found to be complicit in fraudulent claims.