Student Loans bosses forced to quit after IT disasters

The chief executive and chairman of the Student Loans Company have been forced to resign after a processing fiasco last September left hundreds of thousands of students without finance.

The problems began with what the National Audit Office called a document scanning “meltdown” at the SLC, after the system was introduced without full testing, and then failed to work. A backlog of a quarter of a million cases built up. According to a separate independent report, the company still lacks a formal IT plan.

Both the chief executive and the chairman had insisted that lessons had been “learned”, staying in their jobs in spite of extensive pressure to quit from angry students, university heads, the media and politicians.

Ralph Seymour-Jackson, the chief executive, quit yesterday following a damning report by PricewaterhouseCoopers that said it was “surprised by the lack of focus and urgency” to remedy the problems.

New universities minister David Willetts said he had “no confidence” in Seymour-Jackson. Following the publication of the PwC report it had become clear, he said, that “urgent changes to the leadership” were needed.

SLC chairman John Goodfellow also stepped down, under government pressure. In the short term, Professor Sir Deian Hopkin has been appointed chairman, and he will select a chief executive.

The report found that there was no evidence of a “robust and comprehensive plan to manage strategic resources” including IT, communications and people. It also urged the SLC to implement a clear IT strategy that is “documented and maintained”, and to improve testing by conducting usability assessments as “part of the development lifecycle”.

Nevertheless, it noted that the SLC had taken action and “re-developed” the document scanning software, with testers seeing its proper functioning as a “case of personal pride”. The company is also moving to a service oriented architecture, which “should allow the introduction of new services without significant impact on the existing applications”. It was also training IT staff so that more could be deployed in specific areas when demand arises.

But the SLC remained behind schedule on developing a link with HM Revenue & Customs’ databases to verify the financial status of students and their families. PwC found that the automated verification of household income will not be available until the end of this financial year, in 2011.

Copyright © 2010 IDG Communications, Inc.

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