The body which operates student support body SUSI has sought approval to write off grant overpayments totalling €4.1m, it emerged yesterday.
The Dail's Public Accounts Committee (PAC) heard yesterday that earlier this year the City of Dublin Education and Training Board (CDETB) wrote to the Department of Education seeking permission to write off the amount.
PAC chairman John McGuinness expressed deep dissatisfaction at this revelation.
Department of Education Secretary General Sean Ó Foghlú, said a decision hasn't been made on this yet but will be "in the near future", after legal advice has been received.
Mr McGuinness said it was unacceptable that taxpayers could be "expected to carry that €4.1m, no questions asked", noting that no private business would be able to do this.
Mr Ó Foghlú said that the planning and implementation of the reform of the administration of student grants took place "in a very different economic environment", meaning there was "little scope to put in place the kind of dedicated resources now recommended for projects of this size and scale".
At the meeting, Mr Ó Foghlú said a number of changes had been made in the way the student grants system is run after the overspend occurred.
The Comptroller and Auditor General (C&AG) told the PAC that 790 students in receipt of 'back to education' grants from the Department of Social Protection also received grants from SUSI in 2012-2013 to which they were not entitled - costing €1.9m.
He said there was a further €2.2m in other overpayments, noting SUSI encountered "serious operational issues" when the system went live in June 2012 and was unable to cope with the level of demand.
At one point, students had to wait more than 11 minutes on the helpline to have theier call answered, while the goal was 30 seconds.
Mr McGuinness described the delays as "absolutely chaotic". He noted that SUSI had spent over €20m on operational costs and overpayments since it was set up. Responding, Mr Ó Foghlú, said he wanted to "express my sincere apologies".