FE loans in first month ‘low’

The head of the Association of Colleges has expressed concern over “low levels” of applications for 24+ advanced learning loans.

Martin Doel, association chief executive, spoke out as the Student Loans Company (SLC) revealed 338 mature learners had applied for loans in the three weeks after the new payment’s launch on April 8.

Just 75 learners were now ‘ready for payment’ for courses starting in August, each being granted an average of £2,950, according to figures released to FE Week under a Freedom of Information request.

The Skills Funding Agency allocated £232m in loans facilities to nearly 800 training providers for the 2013/14 academic year. If learners were loaned an average of £3,000 each, according to FE Week calculations, the SLC could expect to fund just under 80,000 learners over a year.

But three weeks into the scheme just 68 men and 270 women had requested a loan.

Mr Doel said: “If low levels of applications become an ongoing trend, it may well reflect some of the significant challenges facing colleges in this first year of the new system.”

He said deterrents included “aversion to debt” among mature students, and the “absence of a national marketing drive” for the loans.

The Department for Business, Innovation and Skills (BIS) set up a £6.5m development fund to help providers with loans facilities to market the new loans.

But FE Week has learned that the association set up a survey on loan take-up and associated issues, such as bursary funds available under the scheme, after a number of principals contacted the group to “express concerns”.

The SLC information further revealed that 198 of the 338 initial applications had been processed. Of these, the lender was waiting for final signatures from 116 applicants, while seven were ineligible.

Applications yet to be processed included 91 that were awaiting further information from the learner while 49 were “in progress”.

It said 142 applicants were aged 24 to 30, 121 were aged 31 to 40, 55 were aged 41 to 50, while 13 were over 51. Seven did not declare their age.

Toni Pearce, president-elect of the National Union of Students, said: “The introduction of loans for learners looking for a second chance in education was damaging enough, but that it was done without proper consideration of the consequences or careful planning for its implementation is cause for real concern.

“There could be genuine reasons for the level of applications to be so low at this point, including students waiting for other exam results before applying.”

Gordon Marsden, Shadow Skills Minister, said: “Ministers must watch enrolments and take-up data carefully to ensure that we do not see a lost generation of adult learners.”

A spokesperson for the Association of Employment and Learning Providers (AELP) said the group remained “concerned” about the impact of loans on apprenticeship starts.

It has sent its members a survey, commissioned by the Skills Funding Agency, to find out “how well prepared” the sector was for the introduction of loans.

A spokesperson for the agency said the results were not yet available.

A BIS spokesperson  said: “The system is up and running as planned, and as this . . . information shows, more than 50 per cent of submitted applications have already been processed.”

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Editorial : Loan course data, please

Well done to the government and its partners for getting the FE loans application system up and running.

There has been much speculation about adults rushing to apply for the loans.

After all, the £280m funding pot for loans in 2013/14 is being dished out to applicants on a first-come first-served basis.

But it appears, thanks to our freedom of information (FoI) request, there has been no rush.

With about 800 providers with loan facilities, the 338 applications in the first 21 days since launch equates to an average of less than half an applicant each.

However, a slow start is perhaps not too alarming nor surprising given the lack of marketing and it being six months before relevant courses start.

What the sector should want to know in planning for 2013/14 is which courses are proving attractive to loan applicants.

Sadly, this information was not provided despite forming part of our FoI request. It was too personal, apparently.

All we can hope is that the Data Service will come to the rescue of course planners when it publishes more data, albeit seven months away, in January. Fingers crossed.

Nick Linford, editor