Student Loans Company head to stand down

The head of the Student Loans Company will stand down when his contract expires next year in the wake of controversy over his tax arrangements. Ed Lester was paid through a company in order legally to reduce his liability for tax, until ministers intervened.

A spokeswoman for the SLC said: "Ed Lester's two-year contract ends on 31 January 2013. The process to recruit his replacement is under way now."

The arrangement for Mr Lester's pay was disclosed in an HM Revenue and Customs letter obtained under the Freedom of Information Act by Exaro News and BBC Newsnight.

Following the revelations, the Chief Secretary to the Treasury, Danny Alexander, said the way in which Mr Lester received his £182,000 salary would be changed and launched a review of similar arrangements across Whitehall. The review identified more than 2,400 cases of staff being employed indirectly. Since January, 350 such contracts have been ended.