Corporate report

SLC Annual Business Plan 2023-24

Published 2 February 2024

1. CEO’s Introduction to the Annual Business Plan

I am delighted to introduce SLC’s annual business plan for the financial year 2023-24, and my first as CEO of this outstanding organisation.

As this plan demonstrates, we will continue to deliver our purpose to enable people to invest in their future.  We are building from a very strong foundation built by my predecessor as Chief Executive Paula Sussex.  Paula transformed SLC and my task now is to capitalise on that transformation – continuing to embed technology-enabled change that will help our customers interact easily, seamlessly and safely as we support generations to equip themselves for the future.

2022-23 was another successful year for SLC.  We delivered: - improvements for our customers by supporting the use of new self-serve channels through our CEM system; - improvements for frontline colleagues in the form of new, more intuitive customer management technologies; and - significant cashable benefits to DfE and HMT by maximising loan repayments and yield and increasing efficiency in processing applications and repayments.

In the coming year, we will build on these successes and foundations to continue to drive better outcomes for our customers, shareholders and colleagues.

The improvements we have started to deliver in contact channels – greater digital functionality and guiding customers to the right channel depending on their circumstances – form the basis of our focus this year on enabling and promoting self-service.  We know that the majority of our customers prefer to self-serve, and we therefore plan further enhancements to ensure most of our customers will be able to interact without the need to contact us. 

This will ultimately free up resource to support our customers who need us most, which is at the heart of our customer strategy.  This year, we will continue to work with our Stakeholder Group and wider voluntary and community sector to develop and implement system indicators to alert our colleagues to customers who may need additional support – and we will deliver colleague training to underpin that.  This year will also see us progress the transformation of Disabled Student Allowance (DSA) which, over the coming two years, will provide a simpler and smoother application journey for customers.

We will continue to develop SLC as an Employer of Choice. That means building a positive, supportive, and inclusive workplace where everyone is treated fairly, can achieve their full potential, and feels comfortable to be themselves. This year, we will update our Equality, Diversity and Inclusion (EDI) Strategy to build on the progress we have made and work to reach even further.  This will include working towards our goal to close the Gender Pay Gap.  We will also take steps to address pay and reward as SLC lags behind the wider public sector and that creates challenges for the sustainability of our business which needs skilled and talented colleagues to deliver our shareholder’s priorities.  Working with our colleagues in DfE, we will develop and implement a new reward strategy.

Driving value for taxpayer money through increased organisational efficiency is also a key theme for the year ahead.  We are facing significant headwinds with increasing costs, driven in part by inflation.  I’m determined that we proactively mitigate any impact to customer experience through efficiency – by focusing on the opportunities to reduce the cost to serve, making it as easy as possible for customers to self-serve wherever possible, and accelerating our continuous improvement capability.  A key part of driving value for taxpayers is to ensure that we guard against financial crime and fraud.  Last year we established our Financial Crime Prevention Unit which will develop to full operational capacity in the coming year.

Another ongoing project that comes to fruition this year is the move, of our Glasgow headquarters, to a purpose-built office at 10 Clyde Place, Glasgow which supports our net zero ambitions and increases our technology resilience. 

We will also continue to work with DfE on the design and delivery of the Lifelong Loan Entitlement (LLE) for 2025. LLE is a key policy change that will transform and simplify student finance for HE and FE making life easier for our customers and our colleagues. We will build on our partnership working with DfE to achieve the best outcome possible as we move into the delivery phase of the programme. 

I am excited about the year ahead and confident in SLC’s ability to deliver.  We have a great team who are passionate about delivering better outcomes for our customers, our shareholders and for each other.

Chris Larmer, Chief Executive

2. SLC’s Performance Focus for 2023-24

In the year ahead, we will monitor our performance via three lenses; the Customer Lens; the Frontline Lens; and the Corporate Lens. Each lens contains a hierarchy of measurement and performance targets for 2022-23. This plan sets out the highest-level metrics and targets, as agreed with our Board and shareholders in the Annual Performance and Resource Agreement (APRA).

3. The Customer Lens

We are continuing to transition from a primarily phone-based organisation to one where customers can increasingly manage their end-to-end journey through a range of digital services and self-service support options such as our Virtual Assistant. 

The ability for customers to self-serve online will be enhanced as we build on work to simplify evidence requirements, making it easier for customers to complete their applications without having to provide additional documents.

As our wider range of channels mature and customer behaviours are better understood we will be able to guide customers to the most appropriate channels. Customers will be able to pick up where they left off as they move between channels, getting real-time information such as progress on their student finance application. Advanced customer analytics will underpin the channel strategy, helping us to develop a deeper understanding of customer needs to enable us to continually respond to those needs and improve our service.

3.1 Channels

We will continue to reduce the need for our customers to contact us by working to ensure that the best service for the majority of them is to complete their student finance application online without requiring any additional help.  

We will also begin work to look at an improved channel offering for customers during the repayment phase of their journey. The Online Repayment Service will continue to be enhanced with a focus on increasing the options for customers to self-serve and, responding to customer feedback, on how the user experience can be improved. We will continue to enhance the final stage of our customers’ experience as they finish repaying their loan by making it easier to join the direct debit scheme online.

3.2 Customers who need additional support

This year we will publish our Charter for customers who need additional support and implement additional support indicators within our systems so that our frontline teams can identify customers who may need additional help. 

Having delivered the commercial underpinning for DSA transformation, we will make progress this year towards providing DSA customers with a ‘one stop shop’ that will provide a single point of contact for all elements of the service, enabling a simpler and smoother application process.

3.3 Improving customer journeys

Our strategic focus on improving customer journeys by simplifying evidence requirements, reducing system defects and continuous improvement will progress this year.  We will

• review service levels and turnaround times, remove points of friction in the customer journey - including by reviewing evidence requirements - and bring greater consistency to all our customer communications and interactions;
• further reduce print communications, delivering key documents to our customers directly in a way that is accessible digitally; and
• continue to work with HMRC to ensure accurate PAYE deductions are made at the right time, and changes are processed efficiently and effectively.

3.4 Key Performance Targets for the Customer Lens

Assess-to-Pay (A2P) Customer Satisfaction to be ≥ 75%.

Repayment Customer Satisfaction to be ≥ 62%.

Repay Customer Satisfaction has been lower than we would want. We continue to progress a number of activities to increase this satisfaction score and expect to see incremental improvements in the coming year.

In addition to the APRA targets above, SLC monitors a range of metrics, including how effectively we are reducing customer effort, getting it right first time, customer satisfaction by channel and journey, contact reasons and complaints analysis. This will cover all contact channels to drive the principle of “right customer, right channel, right time”.

4. The Frontline Delivery Lens

4.1 Delivering for our customers applying for student finance

We anticipate demand following a similar pattern to the last academic year with a continued increase in applications and ongoing increases in workloads through the mix of complex cases.

Despite these projected increases, we will endeavour to maintain our operational budget in line with the 2022/23 academic cycle, consistent with our goal of being leaner, better and doing more for less. This will be enabled by the benefits being realised through the efficiency of our digital channels and operating model.

4.2 Customers who need additional support

SLC is transitioning from a task-based delivery model to a case-management solution in order to provide a better level of support for customers with additional needs and for those with more complex applications. Where customers need help to navigate the application process, we will support them through a new case management approach both by building, piloting and rolling out tactical solutions using existing technology functionality and also by ensuring that a case management approach is embedded as we go forward.

Allied to this focus on improving our service to customers who need additional support, we will help embed DSA transformation by aligning DSA teams to the Operations 2.0 operating model and create a new DSA Supplier Management Team.

4.3 LEAN and operational excellence

LEAN Thinking has helped us to identify the value in moving to case management as well as understanding that a small number of our customers currently have to call us repeatedly in order to achieve a successful outcome. We will use LEAN Thinking to continue to identify the areas where we are not serving our customers to the best of our abilities, identify the root causes and come up with solutions to improve both the customer and colleague experience. By training our colleagues in this methodology, we can develop a continuous cycle of improvement that means we are always striving for greater efficiencies and better outcomes for customers. This will also drive ownership of issues and gives our colleagues the mandate and the tools to help promote change.

4.4 Investing in our colleagues

Over the course of 2022 we invested in our people to enable us to build an Operations Directorate which is better for customers, better for us. Our investment has provided our leaders with the tools to engage colleagues in the new ways of working and enabled them to remain confident throughout significant change.  We will continue to embed a culture of “Building Better Together” throughout 2023-24.

4.5 Delivering for our customers repaying student finance

Improving collections performance

We want to deliver value to the taxpayer by ensuring that loans are repaid when they are due. To meet this goal, we aim to make it as simple and intuitive as possible for our customers to manage and repay their loans, by providing an up-to-date online view of their account.

Our key priorities for the year ahead are to commence:

• delivery of the foundation phase of new Pega Collections system and preparation for Tallyman decommissioning and data migration;
• explore options for an ‘invest to save case’ through which we will seek investment to make improvements that will lead to increased repayments yield.

Improving verification

Improving verification is our key internal control for increasing repayment rates and values. Verifying residency and employment status through the tax or benefits system, from information supplied by the customer themselves, or through trace and data sharing means that more eligible customers will repay their student loans, either through PAYE deductions or directly to SLC.

The verification rate is expected to continue rising steadily: from 91.1% at the end of FY2021-22, to 91.6% at the end of FY2022-23 to 92.1% at year-end FY2023-24. A 1% increase in the rate equates to circa 60k additional customers being verified and an additional circa £27m being repaid. 

To maintain this positive progress this year, we will

• continue to trace and verify out-of-contact customers to ensure that all customers are repaying their loans, through continued efforts to optimise our data, run campaigns, and deliver process improvements;
• focus on ensuring that overseas customers (both UK and EU citizens) are established in a repayment channel by enhancing our international trace capability; and
• fix prioritised defects as raised on the Corporate Risk Register and deliver key enhancements which will reduce the need for manual workarounds, minimising customer impact and make it easier for colleagues to serve customers.

Key Performance Targets for the Frontline Lens

Processing Quality Assurance (QA) Score to be ≥ 92%.

Inhouse Contact QA Score to be ≥ 92%.

Customer Repayment Conformance to be ≥ 90%.

In addition to the APRA targets above, SLC Directorates also monitor a range of metrics, including tasks backlogs, application processing and payment status, and yield from repayments. We will also leverage our data Centre of Excellence to develop new service and operational efficiency metrics.

5. The Corporate Lens

The ‘Corporate Lens’ includes our approach to our people, our physical and IT estate, activities to drive change within SLC, our finance, commercial and risk functions, legal, governance and communications.  In this section, we set out some of our key priorities for the year ahead.

5.1 Our people

Our people are the key to our business, and we are proud of what each individual does to help customers invest in their futures.  We need to work hard to make SLC work for our people too – we want colleagues to be able to grow their careers with us, to take advantage of training and development opportunities and be strong advocates for SLC.

5.2 Implementing our integrated Talent Management strategy

We are continually working to create the environment within SLC that nurtures and develops diverse talent and makes our colleagues feel valued. 

To keep encouraging great people to join our team and retain our dedicated workforce we will embed Career Pathways and continue to grow and develop the ‘emerging talent’ programme which focuses on graduate trainees, apprenticeships and interns.

We will also continue to develop our EDI strategy and associated policies and processes.  We will set a new EDI strategy for 2023-2026 which will focus on further embracing the diversity of our workforce and ensuring that no person feels excluded or less well treated than others.  Having achieved Disability Confident Leadership status last year, we will focus on raising colleague awareness and embedding best practice. We are determined to reduce our gender pay gap, which, disappointingly, widened last year, and we will work to improve our diversity profile in senior leadership roles.

5.3 Ensuring workforce sustainability

To ensure that SLC is sustainable and able to deliver our purpose to enable opportunity and deliver shareholders’ priorities, we need to be able to attract and retain talented and skilled colleagues.  SLC’s pay has fallen behind other public sector bodies and this impacts our ability to deliver the colleague, customer and shareholder outcomes that we want.

This year, we plan to submit a Pay Flexibility Case alongside our annual Pay Remit proposal to help SLC attract and retain the talent we need to remain sustainable.

This is not something SLC can achieve alone – we need our colleagues in DfE and wider Government to support our proposals.  Working with our colleagues in DfE, we will review the company’s total reward offering and develop and, with government approval, implement a pay strategy to address the significant challenges that SLC faces.

5.4 Improving Colleague Engagement

SLC’s Employee Engagement Survey (EES) allows us to gain broad insight into colleagues’ experiences and views of working at SLC - what they feel is going well, and where they think we can make improvements. Results are used to help inform and enable our strategic goal of making SLC a great place to work.

Last year our EES score dropped to 6.1 – lower than our targeted 6.6 and lower than the 2021 score of 7.  Pay was the single biggest issue, with colleagues telling us about the impact of the increased cost of living and travel and their views on SLC’s pay and reward.  This sentiment is not unique to SLC and is evidenced across Government Departments. However, SLC’s salary points are behind other parts of the public sector, and we plan to address this through the pay strategy.

Colleagues expressed positive views on connectivity within teams, how they feel about the future of SLC, and their understanding of how they contribute to achieving SLC’s goals.  

In the coming year, we will:

• implement a colleague-led improvement plan;
• increase the frequency of our engagement survey to quarterly;
• improve senior leadership visibility through ‘leaning-in activity; and
• accelerate and amplify the involvement of our colleagues in activity to make SLC better for customers, for shareholders and for themselves.

5.5 Enhancing flexible working

Like many organisations, we have adopted hybrid working to provide balance between business needs and colleagues’ personal circumstances. Our model supports colleague development, social connection and wellbeing, while safeguarding our commitments to our customers and stakeholders.

We believe that spending time with colleagues in person enables teams to ignite ideas and solve problems quicker, fosters collectiveness, and helps colleagues maximise learning and development opportunities. The office and the emotional connection that it allows plays an important role in maintaining a strong and cohesive organisational culture. In the coming year, we will implement the final phase of our new approach by reinvigorating social activities and rolling out an enhanced flexible working offer.  Flexible working will be easier to access, benefit more colleagues and allow colleagues to test different approaches until they get it right for them and the business. 

5.6 Progressing towards Net Zero

During late 2023 we will relocate our Glasgow head office, where over 1,500 colleagues are based, to a new purpose-built office at Clyde Place on the south bank of the River Clyde, which is part of the Government hub for the city. The new office will help us progress towards our net zero ambitions by reducing our carbon footprint.

5.7 Driving transformation through technology

In the coming year we will maintain progress on delivering our Technology Strategy by embedding its execution across key areas of activity, focusing on:

• developing strategic target architecture through development of shared services and modernising core line of business applications including the next phase pf the Customer portal transformation; and
• delivering more efficient and effective change and services through our strategic partners.

5.8 Managing Change

SLC manages a significant amount of change activity which has driven our transformation to be a digitally enabled, customer-focused business.  This year, we aim to strengthen the effectiveness, efficiency, governance and assurance of project delivery lifecycles to ensure that the investment we make in change continues to deliver tangible outcomes and benefits for colleagues, customers and shareholders.  We will move to a pipeline approach which, combined with robust upfront strategic design, will reduce overall project costs.

A significant number of change deliveries will continue from 2022-23 into 2023-24.  This means we have limited capacity and resource to commission new initiatives, and we have prioritised our resources to focus on the change initiatives that will deliver the most positive outcomes.  In 2023-24 key elements include:

• delivery of shareholder requirements and service launches for the current and next academic years;
• DSA journey improvement to further embed our approach to supporting our customers who need us most;
• channel management and digital optimisation; and
• continue investment in our systems to keep customers’ data safe.

We will also carry out detailed design and delivery work in preparation for the launch of LLE and other key reforms to student finance policy. We will build on our established partnership working with DfE and other stakeholders following user-centred design principles to deliver an efficient and effective student finance system that will support the broader changes in lifelong learning the policy enables.

5.9 Delivering operational excellence and efficiency

Delivering value for money is an ongoing commitment and, in the year ahead, we plan to drive this forward through specific activities and an overarching programme to ensure that priorities are aligned to deliver better outcomes for customers, shareholders and colleagues.  In the coming year we will:

• initiate an Operational Excellence Programme to systematically identify, prioritise and action cross directorate opportunities to reduce the cost to serve;
• implement our Commercial Strategy which will embed a business partnering model and help us drive continuous improvement;
• fully implement SLC’s three-lines-of-defence model and roll out a company-wide assurance framework;
• further develop our economic analysis and SLC cost-to-serve model; and
• build external relationships with key partners to allow SLC to manage financial crime threats better and to focus our attention on the key risks.

Last year we established a Financial Crime Prevention Unit (FCPU) to modernise SLC’s financial crime risk management arrangements.  Building on the foundations we have established in centralising SLC’s financial crime specialists in one team and developing a Financial Crime Strategy, this year we will build and implement a financial crime risk framework and improve transaction monitoring.

5.10 Financial Plans

The overall funding that will be provided to SLC by DfE is detailed in the table below:

£m	Admin	Programme	Capital	Total
DfE Confirmed funding	42.2	207.7	72.3	322.2

5.11 Governance and Communications

Corporate Governance

Legal, Information and Assurance together with Governance and Planning will continue to provide high quality advice and support across SLC, seeking to increase quality, engagement and alignment to help meet SLC’s strategic goals. 

Communications

What people think of SLC as an organisation matters to us and to our shareholders.  We have a strong social purpose, and we want to convey that more effectively.   

We will continue to protect and enhance the reputation of SLC through strategic engagement with shareholders, stakeholders, the media and the wider sector to ensure SLC is recognised as enabling student opportunity, delivering an outstanding customer experience and being a great place to work.

Key Performance Targets for the Corporate Lens

Variance from approved Administration budget is to be between 2% (underspend) and 0% (overspend).

Variance from approved Programme budget is to be between 5% (underspend) and -1% (overspend).

Variance from approved Capital budget is to be between 5% (underspend) and -5% (overspend).

Employee Engagement to be ≥ 6.6.

Policy Portfolio RAG Status to be “green”.

Evolve Portfolio RAG Status to be “green”.

Technology “green days” to be ≥ 87%.

In addition to the APRA targets listed above, SLC Directorates monitor a range of metrics, including benefits realisation, sickness absence, learning days per capita, headcount, attrition and the RAG-status for all six change portfolios.

6. Risks and Issues

In the coming year, SLC will focus on management of risks that stem from the following: 

• Providing an effective employee proposition that attracts and retains required expertise;
• Managing a complex change environment including LLE;
• Strengthening defences against financial crime and cyber risks whilst building strong and sustainable third-party relationships; and
• The handling and processing of data.

7. Further Information

SLC has arrangements in place to ensure good corporate governance, and the Framework Document, which can be found at www.gov.uk/slc, provides comprehensive detail of the roles and responsibilities of Executives, Board members and Shareholders, and the remit of the two standing Committees – the Audit and Risk Committee (ARC) and the Remuneration Committee (RemCo).

The Responsible Minister accounts for SLC’s business in the Parliament of the United Kingdom.  The Sponsor Department, acting on behalf of the devolved administrations, is responsible for appointing the SLC Chair and Non-Executive Directors and determining their terms and conditions.  Appointments are made for a period of three years and comply with the Code of Practice for Ministerial Appointments to Public Bodies. The Sponsor Department, acting on behalf of the devolved administrations, also approves the Board’s appointment of the Chief Executive.

Details about SLC’s executive and non-executive teams can be found at https://www.gov.uk/slc along with the addresses and contact details for our offices.

SLC is established as a company limited by shares under the Companies Act with its registered office at Memphis Building, Lingfield Point, McMullen Road, Darlington, DL1 1RW