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Investigation into student loans issued to those studying at franchised higher education providers

Status: Closed Opened: 10 Jan 2024 Closed: 29 May 2024 9 recommendations 18 conclusions 1 report

Higher education providers can create partnerships, or ‘franchises’, with other institutions to provide courses on their behalf. These franchised providers are not required to register with the Office for Students (OfS), which regulates higher education. Lead providers keep responsibility for teaching quality and protecting students’ interests. In 2022 and 2023, the Student Loans Company (SLC) …

Clear

Reports

1 report
Title HC No. Published Items Response
Twenty-Eighth Report - Student loans issued to those studyi… HC 455 24 Apr 2024 27 Responded

Recommendations & Conclusions

3 items
11 Recommendation Twenty-Eighth Report - Student loans is… Acknowledged

Lack of transparency regarding tuition fee retention by lead providers in franchise arrangements.

The C&AG’s report indicated that some lead providers retained between 12.5% and 30% of tuition fees received for courses at their franchised providers.25 DfE confirmed that the information is not in the public domain and that students are not always made aware of these arrangements. DfE told us that it …

Government response. The government acknowledges the need for greater transparency over franchising arrangements, notes a sector-led response by Universities UK, and will ask the Office for Students to consider requiring providers to publish details on the proportion of tuition fees they retain …
HM Treasury
20 Conclusion Twenty-Eighth Report - Student loans is… Acknowledged

Fraud involving franchised providers makes up over half of all detected student loan fraud.

The value of detected fraud in 2022/23 involving franchised providers totalled £2.2 million, 53% of the total £4.1 million fraud SLC identified.49 In our July 2023report on tackling fraud and corruption across government, we concluded that tackling fraud cannot be left to counter-fraud technical experts.50 We asked DfE whether it …

Government response. The government acknowledges the importance of addressing fraud and misuse of student funding and highlights existing collaborations and protocols between DfE, SLC, and OfS, including data sharing and incident response plans, while considering further improvements.
HM Treasury
21 Conclusion Twenty-Eighth Report - Student loans is… Acknowledged

Detected fraud value at franchised providers increased disproportionately despite stable student numbers.

We asked why the value of detected fraud at franchised providers has increased almost sevenfold, from £329,831 in 2018/19 to £2,163,459 in 2022/23, when the number of 43 Universities UK (ISL0002) 44 Universities UK (ISL0002) 45 Qq 39–41, 74; C&AG’s Report, para 2.19 46 Q 74 47 Qq39, 41, 76 …

Government response. The government acknowledges the increase in detected fraud at franchised providers and highlights existing collaborations and protocols between DfE, SLC, and OfS, including data sharing and incident response plans, while considering further improvements.
HM Treasury

Oral evidence sessions

1 session
Date Witnesses
26 Feb 2024 Chris Larmer · Student Loans Company, Julia Kinniburgh · Department for Education, Susan Acland-Hood · The Department for Education, Susan Lapworth · Office for Students View ↗

Correspondence

1 letter
DateDirectionTitle
18 Mar 2024 — Correspondence from Susan Acland-Hood, Permanent Secretary, Department for Educ…