SUSI mistakenly gave €4m in grants to ineligible students
Students received grants totalling €4m to which they were not entitled in the first disastrous year of operation of SUSI.
The overpayments by the centralised grant processing body are highlighted in a report from the State public spending watchdog, the Comptroller and Auditor General (C&AG), Séamus McCarthy.
The money has not been repaid and the Department of Education is in discussion with SUSI authorities about the matter, which, the department told the Irish Independent, SUSI was treating as a once-off occurrence.
As many as 850 students were paid maintenance grants in 2012/13 for which they were not eligible, amounting to €1.9m.
SUSI handed out a further €2.16 in overpayments to postgraduate students, to non-Irish students resident in the State and to students not attending courses or who had left college.
SUSI started a phased take-over of the processing of student grants in the 2012/13 year to replace the service traditionally offered by 66 local agencies, such as county councils. It operates under the auspices of the City of Dublin Education and Training Board (CDETB), previously CDVEC.
It promised a more streamlined and cost-efficient service, but it was mired in controversy in its first year because of errors and delays in processing applications.
It was understaffed for months and although billed as an online system, in its first year, applicants still had to gather and post an average of 12 documents to support their claim.
A consultants' report previously identified many of the deficiencies at the start-up and now the C&AG gives further insights into the planning failures associated with the new service, and their consequences.
The C&AG notes that the Department of Public Expenditure and Reform (DPER) required SUSI to take redeployed staff, but six months on only 13 positions from an expected 36 were filled in this way. "It took 17 months until an adequate level of redeployment happened," the report states.
Meanwhile, because of the difficulties SUSI was experiencing, administration costs mounted, primarily for outsourcing work, the bill for which ran to €5.9m by March 2013, compared with a budget of €1.8m.
It is not possible to say whether the new system is making the hoped-for savings in administration costs, because there is no way of comparing the cost of the old system with SUSI.
The report notes that the achievement of economies and efficiency gains was part of the case underpinning the proposal to establish SUSI but "the projected benefits were not quantified, and the baseline cost and operational performance of the existing system had not been identified so it is not possible to evaluate whether the projected benefits have been fully realised", it states.
Mr McCarthy also notes that the level of staffing allocated to SUSI and the level of outsourced services are significantly higher than envisaged and "while there have been reductions in the overall number of staff employed in VECs and local authorities, the extent to which this is attributable to SUSI is not known".
Mr McCarthy states that the expected improvement in service to applicants was not known, although he notes that the performance of SUSI was much improved in 2013/14.
Among the other issues raised are the lack of a penalty clause in contracts for service..