London colleges' budgets at risk

November 8, 1996

Further education colleges in London could lose up to a third of their budgets if present funding policy continues, a London principal has warned.

Figures compiled by Adrian Perry, principal of Lambeth College, show Hackney Community College and Lambeth College both losing more than Pounds 5 million next year, if average levels of funding (ALFs) in all colleges converge to about Pounds 17.50.

An average level of funding is the cash each college receives per year from the Further Education Funding Council for each unit they deliver. Units are calculated by a combination of student numbers, the type of course followed, student achievement and additional support provided for students with learning difficulties or disabilities.

On incorporation, ALFs varied from Pounds 7.44 to Pounds 47.48 per unit. By last year this variation had narrowed to Pounds .73 for the highest funded college and Pounds 13.54 for the lowest.

The FEFC made a commitment three years ago to converge ALFs in all colleges to within 10 per cent of the average by 1996/97. It must now decide whether to continue with the policy by bringing ALFs into line still further.

London colleges, many of which began incorporated life with high ALFs and have already undergone severe belt-tightening, argue that they have extra expenses which should be recognised.

Mr Perry has calculated the losses for 19 London colleges if average levels of funding are set at Pounds 17.50 - a figure based on the present national average of about Pounds 18.65 and likely political pressure for efficiency gains.

Cuts would vary from 12 per cent at South Thames College to 22 per cent at the College of North East London, 29 per cent at Tower Hamlets, 31 per cent at Lambeth and 33 per cent at Hackney Community College.

Only Kingsway, which is already experiencing serious financial difficulties, will escape a cut, according to the table.

Mr Perry, who said his table was a rough guide, said: "We can show that social workers, fire services and hospitals add costs for the capital so it seems there is definitely a London factor." London principals are seeking further meetings with the FEFC on the issue.

High and low ALF colleges are jostling for position over funding before the end of consultations this December on a funding methodology review and the separate review of convergence.

John Bolton, principal of Blackburn College, which has a low ALF of just Pounds 16.40, said: "The figure of Pounds 17.50 looks pretty good to me.

"The low ALF colleges have taken all the measures possible and it is now a case of serious damage being done to their fabric. There should be additional weighting for London colleges. But this should not cloud the central issue, which is that we need to accelerate convergence. There are still startling differences between high and low ALF colleges."

An FEFC spokesman said: "We get as much pressure from either side so we must be getting it about right."

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