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Universities and the Department for Education and Employment must develop more reliable means of tracing and recording student drop-outs, says a report from the influential House of Commons Public Accounts Committee.

The report on the Student Loans Company follows last year's National Audit Office examination of the crisis in the autumn of 1994, when a massive backlog of applications built up.

The SLC reckons that there is Pounds 15 million of irrecoverable debt. The committee recommends that it should be set a more demanding target for recovering bad debts.

The SLC and the DFEE are criticised for not publicising the loans scheme sufficiently and are told to give wider publicity to the complaints procedure. By the end of the 1994/95 academic year only eight complaints had been referred to the independent assessor.