Prisoners given student money

15 February 2008

Catherine Watts

News Editor


More than £500,000 worth of funding meant for students has mistakenly been given to prisoners, the government has only just realised.

250 prisoners studying degrees, mainly through the Open University, have received up to quarter of a million pounds of loans intended to help students with living costs. They have also been given £250,000 of non-repayable maintenance grants over the last decade.

The funding loophole was uncovered as preliminary investigations were carried out by the government. Last week the payments were finally cut off, as the opposition slammed the error as the “latest in a long line of Labour fiascos”.

John Denham, universities secretary, called the payments “unjustifiable” and has since laid down amendments to funding regulations, which clearly define who is eligible for financial support and the means by which students can access any money. It is hoped the corrections will ensure that offenders no longer receive the maintenance loans and grants to which they have had access for the last decade.

Denham said: “I do not believe that it has ever been the intention of parliament that prisoners, who are accommodated at public expense, should receive any additional form of financial support for maintenance. Nor do I believe that it is an appropriate use of public money.”

He said that payments to prisoners are now suspended, and that the new regulations would be effected at the end of the month.

According to the amendments, universities, colleges and prison governors will now be obliged to tell the Student Loan Company (SLC) when inmates commence full-time courses so that they do not qualify for extra funding. Governors have also been instructed to inform prisoners that they are no longer able to apply for maintenance grants.

The SLC must now review all current and past applications to assess the full cost of the error, and to check that the payments were legal.