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Taxpayers to pick up £80m bill for risky private college expansion

19 November 2013 | last updated: 10 December 2015

Taxpayers have been hit with an £80m bill after private colleges took advantage of state-funded student loans and went on a recruitment drive.

This figure was revealed in internal forecasts from the Department for Business, Innovation and Skills (BIS) seen by the Guardian.

UCU said it appeared the government had learnt nothing from the high-profile scandals that rocked US higher education when for-profit providers milked public funds but left students with enormous debts and degrees of questionable quality. 

UCU general secretary, Sally Hunt, said: 'For two years, we've been warning the government that this would happen. Ministers have created an unregulated private sector that they can't control.

'We have the farcical situation of a government pleading with private companies not to recruit any more students while it cuts teaching budgets in public universities to pay for its blundering. This risks making a laughing stock of UK higher education'

This time last year UCU wrote to the Public Accounts Committee asking for an inquiry into the trebling of taxpayers' money going to private providers of higher education through student loans in just one year. Over the past 12 months the public subsidies have rocketed again, despite the fact that private colleges are not subject to the same regulation as public universities.

Private providers do not have to observe controls on the number of students they recruit, nor do they have to provide information about completion rates.

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