High Risk Series:
Student Financial Aid
HR-95-10: Published: Feb 1, 1995. Publicly Released: Feb 1, 1995.
GAO reviewed the problems that affect the Department of Education's student financial aid programs.
GAO found that: (1) in 1992, the federal government paid $2.6 billion to support its guaranteed student loan program; (2) the reasons for the government's student loan liability include the complex loan structure, the lack of incentives to prevent loan defaults, financial risks for lenders and state agencies that make guaranteed loans, and inadequate management controls; (3) Education's long-standing management weaknesses could hamper its implementation of the newly authorized Federal Direct Student Loan Program (FDSLP); (4) between 1991 and 1994, loan defaults declined from $3.2 billion to about $2.3 billion; (5) higher education legislation has allowed Education to implement stronger enforcement tools; (6) the successful implementation of FDSLP will be critical to ensuring that eligible students continue to have access to guaranteed loans; (7) Education has reorganized its Office of Postsecondary Education, hired and trained staff to better oversee student aid programs, developed a National Student Loan Data System, and prepared departmentwide strategic and tactical information resource management plans; and (8) although the legislative and administrative changes made to the guaranteed loan process should reduce the risks in federal student aid programs, the implementation of FDSLP and significant growth in student loan demand could hinder Education's efforts to address problems in student aid programs.
Below are the reports in this series:
High Risk Series: An Overview HR-95-1, Feb 1, 1995
High Risk Series: Quick Reference Guide HR-95-2, Feb 1, 1995
High Risk Series: Defense Contract Management HR-95-3, Feb 1, 1995
High Risk Series: Defense Weapons Systems Acquisition HR-95-4, Feb 1, 1995
High Risk Series: Defense Inventory Management HR-95-5, Feb 1, 1995
High Risk Series: Internal Revenue Service Receivables HR-95-6, Feb 1, 1995
High Risk Series: Asset Forfeiture Programs HR-95-7, Feb 1, 1995
High Risk Series: Medicare Claims HR-95-8, Feb 1, 1995
High Risk Series: Farm Loan Programs HR-95-9, Feb 1, 1995
High Risk Series: Student Financial Aid HR-95-10, Feb 1, 1995
High Risk Series: Department of Housing and Urban Development HR-95-11, Feb 1, 1995
High Risk Series: Superfund Program Management HR-95-12, Feb 1, 1995