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Explanatory Memorandum to Higher Education (Northern Ireland) Order 2005

Commentary on Articles

Part 111 – Student Support

32.Article 11 (1) inserts a new paragraph (f) into Article 3 of the 1998 Order. With this new paragraph, it will be possible for regulations under Article 3 to include provision relating to the effect of bankruptcy on the liability to repay student loans provided under the 1998 Order. It is intended to use this power to ensure that the liability to repay student loans is not cancelled by the bankruptcy of the borrower. Regulations under Article 3 (3) (e) of the 1998 Order already provide that funds advanced under student loans cannot be taken by a student's trustee in bankruptcy to pay off other debts.  The changes made by Article 11 will not affect the position of any borrower whose bankruptcy commences before the section comes into effect.

33.By virtue of Article 255 of the Insolvency (Northern Ireland) Order 1989, when a bankrupt is discharged, he is released from all his bankruptcy debts. The amendment to Article 3 of the 1998 Order, together with the regulations proposed to be made under section 22 as amended, and the amendment of the Education (Student Loans) Order 1990, will have the effect of excluding student loans from bankruptcy debt. It follows that student debt in relation to both types of loan will not be written off on discharge from bankruptcy.

Other amendments to the Education (Student Support) (Northern Ireland) Order 1998

34.Article 12 (2) amends Article 3 (2) (i) of the 1998 Order. It provides that a loan payable to a student in relation to deferral of fees may be paid direct to the institution at which the student is studying. This is a key part of the machinery for students to defer payment of their fees by taking out income contingent loans on which no interest will be charged in real terms.

35.Article 12 (3) amends Article 3 (7) of the 1998 Order by repealing it, thereby removing the requirement that regulations relating to the increase in the maximum grant for fees should be subject to the approval of the Assembly where the increase in the grant in respect of fees is above the rate of inflation. This requirement was a consequence of the close link between the level of the standard fee and the maximum grant for fee. In this Order, that link no longer exists: there is no need for the increase in the maximum grant for fees to be approved by the Assembly since such an increase will no longer automatically increase the level of the standard fee.

Supply of information held by student support authority

36.Article 13 permits the Department to make regulations allowing student support authorities to supply information collected in connection with the operation of the student support scheme to prescribed persons, with the consent of the individuals in relation to whom information is to be supplied. The intention is to be able to simplify the interactions of citizens with other government or higher education authorities. The regulations will specify the conditions under which information may be supplied including what information may be supplied and the authority to which it may be supplied. They may also specify further constraints such as restrictions on passing on information received and the manner in which consent must be obtained.

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