Will the Cabinet Secretary explain why it took over a decade to find out that grants for dependents was being incorrectly paid, clarify from which budget the £3.25 million written off by the Welsh Government comes from, and outline what impact this lost money will have?
The discrepancy was first identified by Student Finance Wales (SFW) when it was implementing regulatory changes relating to distance learning courses in 2017/18. As part of the 2017/18 policy review, my officials confirmed with the Student Loans Company (SLC) that students undertaking distance learning courses are not eligible for Grants for Dependants (GFDs). The SLC and The Open University (OU) in Wales advised that in previous years they considered these students as eligible.
As the legislation for this element of the regulations had not been changed or amended since before the devolution of student support in 2006, there would not have been an opportunity to review this area prior to the introduction of the reforms that I have implemented in 2018.
As I explained in my statement published on the 28 November, my officials then worked closely with The OU in Wales and SFW to analyse and scope the scale of the issue, to identify the individual students impacted and to develop a a fair and sensible solution. As this is a complex legislative area time was needed to properly assess the legal position as well as analysing information relating to multiple financial and academic years.
Maintenance and tuition fee support for eligible students is paid through the normal SLC payment system, with grant support paid from Budget Expenditure Level (BEL) entitled “Welsh Government Learning Grant”, within the Education Main Expenditure Group (MEG).
The £3.25m represents 0.3% of the annual student support budget. As part of the deliberations on how to address this matter, I have been reassured that the £3.25m write-off will not have a negative impact on our ability to meet our financial commitments given that the expenditure has been incurred over a number of financial years. I can also confirm that future payments will be covered from within existing budgets.
My statement confirmed that the Welsh Government’s internal audit unit will investigate and report on its findings, alongside recommendations for improvements in the governance processes. I expect them to liaise with the Wales Audit Office if they have any queries.