The number of students defaulting on loan repayments rose by 10 per cent to 6,300 in the 2006/7 academic year, leaving the government HK$117 million out of pocket, the education minister has revealed. The defaults represent more than 9 per cent of the total HK$1.29 billion the Student Financial Assistance Agency lent in four schemes last year, figures from the agency showed. In a written reply to the Legislative Council this week, Secretary for Education Michael Suen Ming-yeung said officials had yet to have sufficient information to account for the increase. The cases were under two means-tested loan schemes for students from families on limited incomes, the Tertiary Student Finance Scheme and the Financial Assistance Scheme for Post-secondary Students, and two non-means-tested loans. Mr Suen said most defaulters had not approached the Student Financial Assistance Agency, which operates both schemes, to resolve their outstanding loans or disclose their reasons for default. He said the operator had also failed to contact some defaulters, who had moved out of their registered addresses. 'The SFAA is aware that some loan borrowers have changed their correspondence address without notifying the agency, and hence may not have received the demand notes and subsequent reminders,' Mr Suen said. Mr Suen said the increase in default cases was probably not due to financial, study or health grounds because the SFAA helped loan borrowers with these difficulties. The education chief said the agency had enhanced publicity measures, reviewed the debt collection process and made more manpower available to expedite debt recovery. Officials would study new measures to deter defaulters, such as providing information to credit reference agencies. 'The SFAA will check the latest correspondence addresses of these loan borrowers with other government departments as permitted under law,' he said. Cheung Man-kwong, legislator for the education sector, blamed defaults on an increase in associate degree graduates who found it difficult to get jobs.