Colleges too broke to educate properly

November 7, 1997

THE TOTAL further education deficit has rocketed by nearly 2,000 per cent in just two years, funding chiefs have revealed.

The crisis is so acute that it threatens the ability of the Further Education Funding Council for England to meet its statutory duty to ensure "sufficient and adequate" further education, David Melville, the council's chief executive, has warned.

In the funding council's annual report he says: "Without a stronger financial base, the council will find it increasingly difficult to ensure that there are sufficient and adequate facilities for further education. Colleges will find it difficult to meet the urgent challenges now facing them."

The sector incurred a deficit of Pounds 112 million in 1995/96, compared to Pounds 6 million in 1993/94, according to the report. This is almost an 18-fold increase.

The average unit of resource has been cut by 28 per cent since incorporation in 1992. The number of colleges classed as financially weak grew from 25 (6 per cent) to 93 (21 per cent) between 1993/94 and 1996/97. During the same period, the number of council-funded students grew by a million to stand at around three million while full-time numbers increased by 75,000 to around 770,000.

Lifelong learning minister Kim Howells told The THES this week that most of an extra 500,000 student numbers planned by the Government will flow into FE.

"Getting 500,000 extra students into the sector is going to be some achievement, but we are confident we can do it," he said.

Professor Melville said that the funding position looked bleak. He warned: "The pressures on colleges will be even greater next year as the ending of demand-led element funds, worth some Pounds 100 million in 1996/97, works its way through the system.

"It is unfortunate that, at a time when the need and demand for further education is increasing, student numbers funded through the council may fall in the year ahead due to this reduction in the funds."

The warning came as lecturers' union Natfhe published a further education campaign pack highlighting the plight of the poorest colleges.

The union is calling for an extra Pounds 250 million to be pumped into the sector.

Nearly four out of five colleges have had their FEFC funding cut for 1997/98, meaning no funding for 43,000 full-time equivalent students. The crisis has been compounded by a reduction in capital spending of 30 per cent from Pounds 157 million in 1995/96 to Pounds 110 million in 1996/97. The FEFC contributed Pounds 14.7 million, or 6 per cent, towards the total Pounds 236 million cost of capital projects in 1996/97.

Colleges have been forced to turn to banks and other financial institutions for capital. The previous government hoped that private finance initiatives would replace state investment for capital projects but the FEFC says that PFI is not supporting the full range or scale of capital development needed in the sector.

A report released this week by the funding council's chief inspector of colleges, Jim Donaldson, says while colleges have improved standards they still face serious quality assurance problems.

The report says 92 per cent of college teaching was satisfactory or better in 1996/97. But real problems lie in colleges' quality assurance mechanisms and procedures.

Mr Donaldson said: "The gap is widening between colleges that have developed effective quality assurance arrangements and those where relatively little progress has been made since incorporation."

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