Pennsylvania’s student-loan agency, under fire recently for spending on executive bonuses, posh travel expenses, and parties for employees, has decided to make some cuts — in programs that benefit students, The Patriot-News reported.

According to the Harrisburg, Pa., newspaper, the board of the Pennsylvania Higher Education Assistance Agency, or Pheaa, voted on Friday to accept a list of recommendations to reduce its spending on financial-aid programs in the 2008-9 fiscal year by a projected 58 percent, to $44.4-million. Those cuts would mean a drop in the number of students receiving grants, and less money for nursing students and educators, as well as adults in job-training programs.

James Preston, Pheaa’s interim president, told The Patriot-News that the reductions were needed because of recently enacted cuts in federal subsidies on student loans and financial market conditions.

State lawmakers and others were quick to denounce Pheaa’s action, which came on the heels of a scathing report by the state auditor’s office and after months of criticism for such practices as handing out $2.5-million in bonuses to 325 employees last year and spending more than $860,000 on seven vacation-like retreats for board members and executives and their guests since 2000. State Rep. Josh Shapiro said the board’s decision was “in part because they wasted money on incomprehensible excesses designed to serve the interests of high-level Pheaa executives rather than the students.”

A spokesman for Pheaa, Keith New, said that despite the financial uncertainties ahead, the agency would do its best “to ensure that every student receives the most aid possible.” —Charles Huckabee