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Sale of Student Loans Bill

The debate is important. First, let me deal with the comments of the hon. Members for Bristol, West (Stephen Williams) and for South Holland and The Deepings (Mr. Hayes) about data security. The subject was debated at length in Committee, but, given that the concern has been raised again, it is important for the record to make it clear that there have been no breaches of data protection protocols in student loan administration. We are certain that no data have gone missing. Personal data are exchanged between the Student Loans Company and owners of sold, mortgage-style loans electronically, using a secure virtual private network or VPN. That VPN is facilitated using an internet protocol secure encrypted tunnel. As hon. Members who take an interest in such issues know, that method of data sharing is considered robust by industry standards. In future, as we plan to require purchasers of income-contingent repayment loans to use the SLC to administer and enforce the sold loans, loan account data will not need to be transferred to the purchasers for day-to-day purposes. In the event of purchasers requiring access to data—for audit purposes, for example, as was mentioned in Committee—the method of data transfer would again be secure and encrypted. I hope that that provides the reassurance that was sought. The intention of the amendments in the group is to ensure that borrowers continue to be protected in the event of the onward sale of student loans. I genuinely share hon. Members' determination to ensure that the protection for borrowers that we put in place must still hold good after any onward sale—were I not assured of that, I would not be putting forward these arguments today—so that the graduate can continue to experience no difference in treatment. Let me turn to the points that my hon. Friend the Member for Hayes and Harlington (John McDonnell) raised. As I made clear in Committee, the motivation for the legislation is not ideological; rather, the Bill is about the transfer of risk between the public and the private sector. It is about securing for the public sector—for the Government and the taxpayer—greater certainty about the income that we get from loans. That will generate a receipt that can be used for a variety of public spending purposes. I should like also to address my hon. Friend's comments about student bursaries. The student finance system cannot, in any shape or form, be described as not working, especially if we bear it in mind that applications for university this year are up in England by more than 6 per cent. and that the proportion of students applying from lower socio-economic groups is up too.