"The federal student aid system needs “robust interventions” in order to break the cycle of inequity in higher education finance, the ombudsman for the agency that runs the system concluded in its annual report," Inside Higher Ed reports.
..."'There’s plenty for us to be worried about from this report,' said Justin Draeger, president of the National Association of Student Financial Aid Administrators. 'We’re heading into the highest stakes ever for students and borrowers.'
Student loan payments, which have been paused since March 2020, could resume this year after the Supreme Court rules on whether the Biden administration’s plan to forgive up to $20,000 in federal student loans for eligible Americans is legal.
Additionally, several new regulations for debt-relief programs will go into effect July 1. The department also is planning to adjust borrowers’ accounts to more accurately track their repayment progress. In October, the department is supposed to launch a new version of the Free Application for Federal Student Aid, though some experts are concerned the agency won’t meet that goal.
'There are more challenges ahead,' Draeger said. 'If you were stressed already, this report didn’t help.'
Draeger said that FSA’s annual report shows the need for reform at the agency, which is one of the few performance-based organizations in the federal government. The performance-based organizations were created in part to give agencies private-sector flexibility. The agency is managed by a chief operating officer but doesn’t have a Board of Directors like other performance-based organizations.
'This report points to the fact that FSA governance needs to be revisited by Congress,' he said."
NASFAA's "Notable Headlines" section highlights media coverage of financial aid to help members stay up to date with the latest news. Articles included under the notable headlines section are not written by NASFAA, but rather by external sources. Inclusion in Today's News does not imply endorsement of the material or guarantee the accuracy of information presented.
Publication Date: 1/30/2023