Single agency report warns of more grant fraud

Will education control be local, regional or national? THES reporters monitor moving battlelines

An increase in student grants fraud is possible if local authorities' awards role is replaced by a single Student Support Agency, according to a report by management consultant KPMG.

The creation of the SSA, currently being explored by government, was recommended by Dearing for the handling of all matters related to student payments such as means testing and paying grants and loans for students' living expenses.

The move would, however, severely curtail the involvement of local education authorities in student support.

The report, commissioned by the Society of Education Officers, says the principal impact of the SSA on authorities would be loss of staff experience built up over many years.

There could be increased fraud and possible breakdown in the overall system.

On the basis of a survey of authorities, KPMG estimate 1,300 staff are employed by local authorities for the administration of higher education awards. If the SSA did not have local offices, transfer of these employees "would not be a realistic option for the vast majority of staff." Redundancy costs could run to nearly Pounds 4 million.

The l.e.as want the case for their continued involvement in higher education to be fully considered. The study says principal benefits of leas' participation include a readily accessible, local service which enables individuals to pursue personal concerns. L.e.as are the "only agencies at local level that are able currently to take a view on learning from schools to higher education and so promote lifelong learning".

KPMG says that local links are likely to become increasingly important as increasing numbers of students, for financial or other reasons, choose to study at local colleges and universities.

The study proposes an alternative to the proposed SSA called the Support Agency. The crucial difference between the two is that the Support Agency would be required to contract out the local delivery of the service for which it was responsible.

Under the arrangement the leas would remain major players in the administration of student support and be under a duty to deliver services like means testing, paying out loans and providing information for collection of repayments.

The Support Agency's tasks would include establishing quality control and assurance arrangements under which l.e.as would operate, collecting loan payments and providing information to students, the l.e.as and the career service.

Philip Hunter, vice president of the Society of Education Officers said: "We have put forward these arguments to ministers and are confident that they will take full account of them during their considerations."