The regulations do not sufficiently prevent students with poor academic results from building up loans they cannot repay, says Jonas Lundstedt, project manager for the review.
The Swedish National Audit Office (the government’s audit agency) has reviewed the conditions for receiving student funding from the Swedish Board of Student Finance (CSN) and believes it is too easy for students to requalify after failing to meet the academic requirements.
To receive funding while studying, students must pass at least 75 percent of their courses at universities and in municipal adult education, and, in practice, 100 percent at vocational colleges. According to the National Audit Office’s review, just over one in five students is rejected at some point because they do not meet the requirement.
Requalifying
Three out of four later requalify for student loans.
You just need to earn the missing credits, says Jonas Lundstedt.
At the same time, rejected students have much more difficulty repaying their loans than other students, according to the review.
Just over 3,000 people in each cohort who took out their first student loan between 2014 and 2016 and failed to meet the academic requirements at some point had at least one year’s worth of student loans referred to the Swedish Enforcement Authority (the government’s debt collection agency).
Debts referred to the Swedish Enforcement Authority
Municipal adult education students who repeatedly failed to meet the academic requirements were the worst affected. In this group, one in four students had an annual amount referred to the Swedish Enforcement Authority.
We see that this is a cost both for the individuals affected and for the state, which will find it more difficult to recover the money, says Jonas Lundstedt.
The National Audit Office does not recommend removing the possibility of requalifying for student loans, as it gives students an important second chance. However, to prevent those with the greatest difficulties from remaining in debt for a long time, the rules for requalification should be tightened.
The National Audit Office does not suggest how this should be done.
We identify a problem and recommend that the government fix it. We haven’t looked at exactly what that would involve.
The government should tighten the requalification rules to better prevent students with poor academic results from receiving additional student loans they are later unable to repay. The government should also clarify municipalities’ responsibility to provide municipal adult education students with accurate information about means-tested study grants.
CSN should align the academic requirements at vocational colleges and in municipal adult education with those in higher education. It should also ensure that vocational colleges and municipal adult education are not overlooked when the academic requirements and weekly limits are monitored and evaluated. This is especially important if the conditions are substantially changed.
Source: National Audit Office
