Student Loan Defaulters Scandal Denied

Fri, 13 Mar 2009

The Government has hit back at claims by the Conservatives of a "developing scandal" of foreign students failing to repay the student loans they took out while studying in the UK.

The Tories suggested that 70 per cent of students from the European Union, who are entitled to loans on the same basis as British students, "are not making repayments, cannot be contacted, or are falling into arrears ".

David Evennett, the Conservative universities spokesman, warned of a "much bigger problem to come" as increasing numbers of overseas students graduate in coming years.

However, higher education minister David Lammy dismissed the 70 per cent figure as "just plain wrong", saying that most of these students have changed their courses, dropped out, are still in education or are not yet earning enough to begin repayments .

"Most of these students do not graduate until the summer of this year," he said. "The Student Loans Company is putting in place everything it can to ensure that we chase down those students when they graduate ."

He added that nine overseas students are currently being pursued through the courts, while around 7,100 students from the EU will be due to begin loan repayments in spring 2010.
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