The Progressive Liberal Party (PLP) Government plans to take legal action against students who received education loans from the government, but have failed to repay their debt.

“There are others who can pay, but refuse to pay and we will now have to find ways to get them to pay even if that means taking them to court to do it. We are going to move very strongly in that direction,” said Education Minister Jerome Fitzgerald.

Compounding the problem, Mr. Fitzgerald said there are some people who were granted loans but never even went away to study.

For the past two months the government has been conducting an audit on Education Loan Authority (ELA) operations, something Minister Fitzgerald said has not been done in four years.

The scholarship loan programme, which was established in 2002 to help Bahamian students with their college tuition, was postponed in 2009 after falling millions of dollars into debt.

The education minister said the mere fact that the programme was mismanaged and its books not checked regularly contributed to its downfall.

“I was extremely disappointed upon now returning to government and going into the ministry that there had not been an auditing there in the past four years,” he said. “So we have now instructed an accounting firm to go in there and bring those records up to date.”

“This is critical because as we look to decide how we are going to move forward with the ELA, I want to ensure that we have a correct picture of exactly where we are.”

The ELA was set up so that the government would grant loans to college students studying abroad; in turn, they signed contracts agreeing to repay the money in installments and with interest.

But, according to the education minister, the former government failed to ensure that the programme was properly managed and audited, adding that the government will now do the work.

“Unfortunately, we have to find a way to ensure those who came through the system have jobs so that they can begin to pay monies back,” Minister Fitzgerald. “Unfortunately many of them have come back and don’t have a job; their parents are struggling to pay. This makes it difficult for the programme to sustain itself.”

Mr. Fitzgerald said he sat on the Education Loan Authority board between 2002 and 2007 and claimed this is when that board introduced an auditing programme.

The loan programme, now not taking any new applicants, is owed “a sizeable amount of money.”

The education minister added that he has plans to improve and reintroduce the programme that he will present to Cabinet soon.

Mr. Fitzgerald said the auditing began in early July.