Labour shadow skills minister Gordon Marsden has raised concerns over further education students affected by management issues at the Student Loans Company (SLC), following the sacking of its chief executive.

Steve Lamey was suspended in July amid concerns over his management. And although the precise number is unknown, it is understood that thousands of former students with a loan from the SLC have overpaid on that loan.

While the spotlight has mostly been on the impact this has had on university students, hundreds of thousands of students in FE have benefited from Advanced Learner Loans, Mr Marsden said, meaning they could have been hit by overpayments of loans and other issues with processes at the SLC in the same way as university students.

‘Overpayments’

“The money that has so far been given via Advanced Learner Loans from the Student Loans Company at the most recent estimate was £652 million,” said Marsden. “While I don’t have precise numbers of how many students that will affect, it must be in the hundreds of thousands.

“So problems with the Student Loans Company, overpayments and processes of management we have been reading about, will bear on those student and will be particularly difficult for adult student who have not been used to dealing with these processes before.”

Mr Marsden was speaking to Tes after tabling an urgent question on the issue in Parliament yesterday, where he called for clarity on how many overpayments of loans there had been, and on how the chair at the Student Loans Company had been appointed.

‘Board acted swiftly’

Speaking in the chamber, universities minister Jo Johnson said that following two independent investigations into aspects of Mr Lamey’s management and leadership, the SLC  had terminated the chief executive’s contract.

“The SLC and its stakeholders expect the highest standards of management and leadership and, having taken into account the findings of these investigations, concluded these were not upheld. The SLC board acted swiftly and appointed the current chief executive of the Education and Skills Funding Agency, Peter Lauener, as interim CEO. He will remain in post until a permanent appointment is made,” said Mr Johnson.

Mr Johnson has also revealed chancellor Philip Hammond will be “considering this issue [of overpayments] further in the Budget just later this week”.

Advanced Learner Loans were introduced in 2013 to help students at colleges or training providers in England help with the cost of a course. They need to be paid back when a student has completed a course and earns more than £21,000 a year. 

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