Transparency data

SLC Board meeting minutes 29 September 2022

Updated 3 March 2023

1. Attendees

1.1 Present

• Peter Lauener (PL) - Chair (by videoconference)

• Paula Sussex (PS) - Chief Executive Officer

• Mary Curnock Cook (MCC) - Non-Executive Director (by videoconference)

• Gary Page (GP) - Non-Executive Director (by videoconference)

• Charlotte Moar (CM)- Non-Executive Director (by videoconference)

• Rona Ruthen (RR) - Non-Executive Director (by videoconference)

• Andrew Wathey (AW) – Non-Executive Director (by videoconference)

• Audrey McColl (AMC) - CFO

• Gary Womersley (GW) - Company Secretary

1.2 Also in attendance

• Paul Kett (PK) - DfE (by videoconference)

• Ailsa Harris (AH) - DfE (by videoconference)

• Lauren McNamara (LMC) – Scottish Government (by videoconference)

• Chris Williams (CW) - Welsh Government (by videoconference)

• Laura Irvine (LI) – Department for the Economy, NI (by videoconference)

• Stephen Campbell (SC) – CIO (by videoconference from Glasgow Boardroom)

• Chris Larmer (CL) – Executive Director, Business Operations

• Bernice McNaught (BMC) – Executive Director, Repayments & Customer Compliance

• Derek Ross (DR) - Executive Director, Programme Director HE/LE Reform (by videoconference)

• Helen Bogan (HB) – Head of Governance and Planning (by videoconference)

• Stuart Brydson (SB) - Board Secretary (Secretariat)

• Nathan Glancy (NG) - Business Manager to the Office of the CEO (for Item 5.1 and 5.3 only) (by videoconference)

• Adam Treslove (AT) - Head of Corporate Affairs (for Item 5.1 only) (by videoconference)

• Steven Darling (DS) – Director of Customer Experience (for item 5.1 only)

• Margaret McMullen (MMC) – Director of Finance (for item 5.2 only) (by videoconference)

• Angela McCafferty (AMCC) – Head of Change Governance and Assurance (for item 6.1 only) (by videoconference)

• Mark Cassidy (MC) – Head of Estates and Sourcing (for item 6.2 only)

• Colette Sherry (CS) – Commercial Director (for item 6.2 only) (by videoconference)

• Brian Morris (BMO) – Head of Technology Operations (for item 6.3 only) (by videoconference)

1.3 Apologies

• Stephen Tetlow (SLC)

• David Wallace (SLC)

• Morven Spalding (SLC)

• Sinead Gallagher (Welsh Government)

• Anne Spinali (DfE)

2. FOI Notice

Where asterisks (*) appear, these sections have been excluded from the minutes before placing on the website as the subject under discussion falls within one or more of the exemptions contained in Part II of the Freedom of Information Act 2000 and can be reasonably withheld.

3. Chairman’s Opening Remarks / Directors’ Matters / Declarations of Interest

PL welcomed everyone to the meeting.

Apologies were noted from ST, DW, MS, AS, and SG.

There were no declarations of interest.

PL announced that, following ministerial approval, CL had been confirmed as the new SLC CEO. There had been a rigorous selection process, including a staff panel, and CL had been identified as a great leader who would uphold the values of SLC and offer continuity. PL asked the Board to treat this information as confidential until the formal announcement was made later in October. The precise handover date had not been agreed but there would be time for a good handover period before PS left SLC, ahead of Christmas.

PL noted that Non-Executive Directors would convene for a strategy review on 30 November, the day before the November Board meeting. The structure of the strategy review had still to be finalised, but it would be an opportunity to take stock and consider the issues which may knock SLC off course. PL asked NEDs to forward any ideas for the agenda and noted that there would be a dinner on 30 November to say farewell to PS.

4. Strategic items

4.1 CEO Report

AT, SD, and NG joined the meeting.

PS introduced the CEO Report, noting her key areas of focus.

Death of Queen Elizabeth II

PS explained that the date of the Queen’s funeral had been designated as a public holiday and coincided with one of SLC’s largest payment dates for first term maintenance loans. As this was no longer a bank processing day, SLC Finance, Partner Services, People, CX, Customer Communications, TG, Business Continuity, and Payment Services teams had worked together to bring 300,000 payments to the value of £655m forward to 16 September. PL noted that this had been a magnificent effort and that it had been recognised by central government.

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4.2 Stakeholder Engagement

PS explained that Andrea Jenkyns MP had visited SLC’s Darlington office on 26 August, where she had met with colleagues from across the business to better understand the size, scale and complexity of the operation, as well as finding out more about progress and performance with the current academic cycle. Separately, PL had already met with the new Secretary of State for Education, the Rt Hon Kit Malthouse MP.

PL highlighted that he, PS, AH, and BMC had attended a meeting in the summer with HMT where repayments and Evolve had been discussed and there has been a positive recognition of the progress made by SLC.

4.3 Apply to Pay

CL noted that progress on application processing remained positive. The total number of applications submitted for SFE was 0.7% lower than 21/22, and for SFW was 2.7% lower. Across all UK domiciles the number of applications ready for payment was closely aligned with the same level as last year, at 0.4% lower. In terms of work queues, there were 72k cases currently in the primary work queues compared to 149k at the same time last year. CL outlined that SL had ‘flattened the peak’ by prioritising processing.

As anticipated, clearing had been volatile, with 33% higher demand than last year. CL noted that the Board would have the opportunity to look at the data at the October Board.

CL explained that, as previously reported, the introduction of new self-service capabilities and digital channels had increased overall net contact. In comparison to 21/22, overall contact volumes had increased by 3.9%. Flexible working within Operations had ensured that 19% (253k) more contacts were answered than in 21/22. Despite increased volumes, customers continued to provide positive feedback on the new channels.

CL highlighted the forward view which would bring a continued focus on stabilising contact. There would be a renewed effort to address processing timescales, to continue with the positive downward trend.

4.4 CX

SD explained that the applicant CSAT score for August had been 79.4%, which was down on the July figure, as expected during the peak, but 0.7% up on the previous year. Within the application journey, SLC was working to reduce the evidence burden on the customer, to address a stronger theme of dissatisfaction, and had also been building out customer knowledge briefs.

SD highlighted that the CSAT for repayment customers had improved from July to August and while still below target was trending up overall. CX were looking into dissatisfaction on customer communications in relation to the switch to online statements. New guidance products had been launched in August and were being further developed for overseas customers.

Channel satisfaction was above last year but as anticipated, lower in the peak August month than it had been in July. Chatbot satisfaction remained low, but this was due to the simplistic nature of the queries that Chatbot could handle. CX was looking to develop functionality after the peak.

GP highlighted the slow pace of progress on repayment customers CSAT and questioned whether the target or measure needs to be changed. SD explained that CSAT scoring in apply to pay was different from repayments with the former quick and transactional and the latter stretched over many years, a much larger population and a significant degree of nuance between the various stages of the repayment journey. SD noted that survey methodology may be a factor but agreed that the target and measure should be reviewed. BMC also noted that the ‘happy path’ of a repayment customer was dependent on the quality of data, and for the past two years data quality enhancement projects had had to be deprioritised within Evolve.

GP noted that if the current limitations of the chatbot were resulting in low CSAT scores it may be better to switch the channel off. CL highlighted that discussions around the chatbot were ongoing, and that it was a route to live chat so it had to be considered in conjunction with other channels. RR also noted that the chatbot is a viable channel but success was dependent on effort and investment.

GP noted the new FCA Consumer Principle that requires firms to act to deliver good outcomes for customers, and that although SLC was not regulated it would be good practice to work towards this new principle. BMC explained that SLC were reviewing the new principle with the intention of alignment.

AW noted that it may be helpful to strike up a dialogue with the sector about staying in touch with graduates, in terms of improving repayments. PS noted that a CX Update, including repayments was due to come to the October Board, with the Repayments Biannual Update then due at the November Board.

4.5 Evolve

BMC noted that the elements of Evolve that continued from the previous year were going well, including Salesforce and Post Graduate Loans. New areas within Evolve had seen some drag, including DSA Assessment Improvements and the Sponsor Journey Redesign.

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4.6 Recruitment

PK noted the reference in the report to improved recruitment and retention. PS explained that RemCo considered this topic in detail and that SLC was weathering the storm due to the strength in the recruitment team. There were, however, still issues with retention and that it was affecting different parts of the organisation at different times with the current challenge in Change.

4.7 Truss Government / LLE

CM asked about the impact on SLC, now that the new SoS was in place, and in the context of the current financial situation. PK noted that there had not been a commission on efficiency savings, but he expected it to come. He did not expect any flex in Programme budgets and noted that, in his view, the productively and growth focus felt profoundly different under the new Government.

On LLE, PK did not anticipate any change in direction and as he had suggested previously, the questions were about whether it could be delivered more quickly. Decisions would still need to be made as early as possible but the previously noted timeframe of November had now been extended to February.

PL summed up the discussion noting the importance of joint working with OfS and DfE on OCG and that the Board would maintain a focus on this issue, including in the October CEO Report. PL commended SLC in flattening the peak on the apply to pay cycle and looked forward to the review of the cycle in CL’s November update. Likewise, PL looked forward to the Repay update in November. PL was reassured to hear SLC’s thinking on a new pay case and, overall, noted that the Board took assurance from the CEO Report.

AT, SD and NG left the meeting.

4.8 CFO Report

MMC joined the meeting.

AMC introduced the CFO Report noting that it reflected the additional £20m funding that DfE had provided. AMC noted that although the additional £20m was very welcome, it was not recurring so SLC would face the same funding challenges in FY2023-24.

AMC noted that ELT had allocated the required £2m Admin savings to directorates as no significant additional savings had been identified at enterprise level, that an additional £1m needed to come out of the corporate budget and that cost classification of activity to exit Bothwell Street was still underway.

New priorities and emerging pressures included GDPR and pressures within the Evolve portfolio, both of which may result in current project plans being re-prioritised.

AMC acknowledged that there were in-year challenges and that these would be the focus of the Q2 deep dive. AMC also flagged that the budget process for FY2023-24 would be set out in the October CFO Report, with a further update setting out the draft FY2023-34 budget coming to the Board in November.

GP noted the change in recharge methodology and asked if this may call into question some of the information that had been calculated in the past. AMC explained that this was not the case as SLC conducted a ‘true up’ process. She explained that her aim in changing methodology was to reduce complexity and variance in the finance process.

4.9 GDPR

GW explained that during the most recent engagement with the Information Commissioner’s Office they had intimated a general hardening of their stance on GDPR compliance. SLC aimed to maintain a defensible position and there had been discussion at ELT level to revisit and take stock. The matter would be more fully set out in the GDPR Update to the October ARC.

PL noted that the CFO Report had set the tone for autumn discussions on the FY2023-24 budget and that close collaboration with DfE colleagues remained critical. He confirmed that the Board took assurance from the CFO Report.

MMC left the meeting.

5. Reports from Committees

5.1 RemCo Chair Report

AW introduced the RemCo Chair Report noting that the Committee had met in July and August. An ongoing area of focus was the cost of living crisis in tandem with the SLC pay case. AW recognised SLC’s focus on the impact of inflation on colleagues, particularly the lowest paid, and the consideration of how greater flexibility could support colleagues.

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AW also highlighted the focus on EDI with the presentation given at the July meeting by the new Policy, Equality and Wellbeing Manager. RemCo had discussed ‘prefer not to say’ returns and the overall impact of EDI which was noted as having a strong impact on recruitment and retention. AW concluded by noting that there may be a role for the Board in role modelling and advocating EDI best practice and that this was an issue he would return to in a future update.

The Board took assurance from the RemCo Chair Report.

5.2 Technology Strategy and Evolve Oversight Committee Chair Report

MCC introduced the Technology Strategy and Evolve Oversight Committee (TEOC) Chair Report noting that there had been a catch-up meeting earlier in the week. MCC noted that the Committee was short of one NED as the appointment of the new NED had not yet been approved. AH noted that No10 and Cabinet Office had approved the appointment and that the next stage was Ministerial approval.

MCC reported that the Evolve programme was amber but was trending down and there was a lack of subject matter expertise in design largely caused by attrition. Additionally, costs were going up and with SLC committed to stay within budget, this meant that less would be achieved.

BMC noted that existing projects within the programme had stable teams and were delivering. The headwinds were being felt in new projects, with the challenge exacerbated by the attrition in design and outcome-based delivery where there were many moving parts.

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PL noted the link with the Infrastructure and Projects Authority recommendation for continuous improvement and asked about implementation timescales. PS explained that this would happen by the end of 2022 and the focus was on ensuring SLC’s processes were more effective and efficient. BMC noted that there were pockets of good practice across SLC and the key focus was on making sure that accountabilities were clear.

The Board approved the TEOC ToR and took assurance from the Chair’s Report.

6. Directors’ Reports

6.1 Change Function Biannual Update

AMCC joined the meeting.

BMC introduced the Change Function Biannual Update.

AMCC noted that the paper focussed on achievements against the 2022-23 business plan. AMCC had taken over as Head of Change Governance and Assurance, and there was a new Head of Change Delivery. The Change Function continued to programme manage complex changes across the portfolios, and as of Q2 there were 80 in-flight projects, totalling £247m. The majority of projects were reporting a positive status, and those with an amber rating would still be achievable within cost and schedule if issues were addressed promptly.

AMCC drew attention to attrition within the Change function, which was partly driven by the success of Career Pathways, but also by the external market with pay being a factor. PL asked if 15% attrition was manageable, and what would happen if that rate continued for another year. This resource had been scheduled to last for three years but increased usage meant it was being consumed more quickly. Additionally, time spent on replanning took resource away from delivery work. PS noted that this challenge could not be solved unless or until the issue with SLC pay levels, in particular in comparison to Scottish Government pay levels, was addressed.

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PL noted the connection with the Q2 finance review and summed up by noting the Board’s positive support for the work AMCC and BMC were doing in challenging circumstances. He noted that the Board took assurance that the juggling of resource and capacity was being well managed.

AMCC left the meeting.

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6.2 Technology Group Balanced Scorecard

BMO joined the meeting.

SC introduced the Technology Group (TG) Balanced Scorecard noting that it was at draft stage. He noted that SLC had changed the way it thinks about technology and how it supports the business, but measurement had not been updated. SC noted that he and BMO were looking for Board input to further refine the Balanced Scorecard.

BMO noted that the Technology Strategy defined the vision, principles and roadmap that enabled the technology transformation required to deliver SLC’s Business Plan and had last been presented to the Board in April 2022.

BMO highlighted that the TG Future Operating Model was a key enabler of the Technology Strategy and that through a focus on performance the intention was to measure and report on TG’s delivery of the strategy. A candidate set of Key Performance Indicators (KPIs) had been identified for each of the TG business plan priorities and it was important to ensure that all KPIs could be mapped directly or indirectly to the priorities of other directorates, and cross-cutting initiatives. The scorecard would provide a balanced view across TG’s performance, enabling TG leadership to drive the desired future direction and outcomes, to identify the need for course correction and to know that operational expectations were being met.

RR noted the importance of getting to the point of reporting live data in an agreed scorecard. MCC suggested an NPS-type KPI which would help demonstrate that IT was enabling rather than blocking progress. GP suggested cross-referencing the risk register and giving greater prominence to people risk. PK noted that cost of service as opposed to cost of transaction would be helpful as it was a measure used by GDS. He also suggested that the scorecard should make the connection to business value and that this could be drawn out in narrative. AW note that there were a number of dashboards and scorecards across SLC and that it would be helpful to see the architecture. PL noted that he was unconvinced by the partner metrics and given their increasing importance, this was something for BMO and SC to look at again.

BMO noted comments from the Board and that these would be considered for the next iteration of the scorecard. He noted that he was working collaboratively with colleagues across SLC in developing the scorecard and was keen to reflect business customer and wider stakeholder needs

SC explained that the scorecard would go live when the data was right and he anticipated this would be in Q3. PL noted that benchmarking of best practice would be useful, and SC agreed that this could be useful but only once the metrics were correct.

PL noted that the next iteration of the scorecard would be best taken through TEOC and reported back to the Board via the TEOC Chair’s update.

ACTION: Next iteration of the TG Balanced Scorecard to go to TEOC as the relevant Committee.

BMO left the meeting.

7. Governance

7.1 Minutes of meeting held on 28 July

The minutes of the SLC Board meeting held on 28 July 2022 were approved as a true and accurate record. PL asked Governance to circulate the minutes of the Special Board held in August to be circulated to NEDs for their approval.

8. Matters arising from previous meeting

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The matters arising document was approved as accurate

9. 2023-24 Meeting Dates

PL noted that the Board meeting dates for 2023-24 had been agreed and should now be held in schedules.

10. Any other business

HB highlighted that the minutes for the August special Board meeting had now been published on ibabs and approvals should be sent to SB by email.

11. Date of Next Meeting

The next meeting was confirmed as being at 10:00 am on Monday 31 October 2022 by Teams with Executive hosting from the Glasgow Boardroom.

There being no other business the meeting ended at 1:15 pm.