Foreign students leaving UK debts

The Student Loans Company says 2,240 students should have begun repayments but 1,580 are not accounted for.

A Spanish student said she had heard nothing five years after graduating.

The government says the SLC is doing what it can to track people down. Take-up of the entitlement is growing fast, with 46,000 now having borrowed £130m.

Students from EU countries have been eligible for low interest loans from the British taxpayer to pay for their tuition fees since 2006.

EU students are entitled to the same allowances as those in the countries in which they study.

So the loans are available for those at universities in England, Wales and Northern Ireland. EU students at Scottish universities do not normally have to pay fees.

Most of those involved are still at university so are not due to begin repaying loans until the year after graduation or withdrawal from university, and once they are earning more than £15,000. Lower salary levels apply in most other European countries.

SLC figures show that 2,240 students were due to begin repayment in 2007 and 2008. But 59% of those due to start paying back their loans in 2007 did not do so, while last year that number rose to 70%.

According to the SLC records those students, some 1,580 of them, are unaccounted for. The loans for both years were worth about £3.8m.

'Shockingly ineffective'

Experts believe this is a warning sign of much larger repayment problems to come when greater numbers of EU students start graduating.

David Willetts MP, Shadow Secretary of State for Innovation, Universities and Skills believes the SLC is not doing enough to track students down once they leave the country.

"It's very important that the Student Loans Company is as energetic in collecting debt built up by students across the continent of Europe as they must be in collecting debts from students in Britain," he said.

"The evidence that we're getting already shows that the Student Loans Company is being shockingly ineffective in collecting money that's owed."

One Spanish former student who graduated from a university in England almost five years ago.

Now living in her home country, she said she had been surprised that she had had no communication from the SLC about repaying her loan since graduating. She asked not to have her name published.

"If you don't have anyone reminding you that you owe them money, and that you have to pay, you can forget about it," she said.

"You don't live there and you have other priorities. It's quite easy just to forget.

"If you owe money to the bank but then you don't hear from them, then you just don't worry. It's just human nature."

Voluntary

This graduate owes £10,000 and said that in the end she became concerned that the size of her loan was increasing because of interest, so she contacted the SLC herself. She has just begun repaying the loan voluntarily.

"It is a loan, and when you sign a contract you have to pay it back. It's my responsibility to do so," she said.

However she added that she knew of several other students who were not intending to pay back their loans until they heard from the SLC.

Students applying for loans always have to provide a permanent address, such as their parents' home address.

But a spokesman for the SLC said it did not routinely write to parents' addresses because it might be a breach of data protection rules.