Select Committee · Public Accounts Committee

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

4 items
14 Conclusion Twenty-Eighth Report - Student loans is… Deferred

Significant growth in student numbers at franchised providers concentrated in few institutions.

Between 2018/19 and 2021/22 the number of franchised providers increased 6%, but the number of students attending them more than doubled from 50,440 (2.5% of all students) to 108,600 (4.7% of all students). Some 63,680 (59%) of the 108,600 students enrolled on business and management-related courses. The increase in students …

Government response. The government is proposing to consult on proposals to strengthen oversight of partnership delivery in higher education, working closely with the OfS, and will set out these proposals by January 2025. They will also develop options for legislative change, if …
HM Treasury
15 Recommendation Twenty-Eighth Report - Student loans is… Deferred

Inadequate governance and safeguards by lead providers over franchised institutions risk fraud and misuse.

DfE recognises that the franchising model creates risks, given it encourages providers to do new things, but accepts that some lead providers have not taken their responsibilities for governance and safeguards in their franchised providers as seriously as within their own institutions.33 The regulatory framework relies on lead providers’ controls …

Government response. The government is proposing to consult on proposals to strengthen oversight of partnership delivery in higher education, working closely with the OfS, and will set out these proposals by January 2025. They will also develop options for legislative change, if …
HM Treasury
16 Recommendation Twenty-Eighth Report - Student loans is… Deferred

Numerous franchised providers operate unregistered, including some previously denied OfS registration.

There is no statutory or regulatory obligation on franchised providers to register directly with OfS. The lead provider retains responsibility for a franchised provider’s compliance with academic quality, financial sustainability, governance and accountability standards. In 2021/22, 229 (65%) of the 355 franchised providers were not registered with OfS. However, there …

Government response. The government is proposing to consult on proposals to strengthen oversight of partnership delivery in higher education, working closely with the OfS, and will set out these proposals by January 2025. They will also develop options for legislative change, if …
HM Treasury
17 Recommendation Twenty-Eighth Report - Student loans is… Deferred

DfE considers requiring all franchised higher education providers to register with OfS.

DfE told us that even if a provider could not meet all the registration criteria it might still be a good franchisee. DfE recognised, equally, that if providers do not pass that threshold, it would be right to question them providing a service for students.41 DfE told us that it …

Government response. The government proposes to consult on proposals to strengthen oversight of partnership delivery in higher education by January 2025, working closely with the OfS, and will develop options for legislative change if required.
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…