Mergers will cut colleges by third

November 3, 1995

Accountants reckon that one third of colleges could be lost over the next three years as mergers gather pace because of greater competition for students and the financial straits some colleges find themselves in.

But both sides in the latest merger to be announced stress that their motive is to strengthen "ladders of progression" from further to higher education, not financial necessity.

Negotiations have begun this week to pave the way for a merger between Teesside University and nearby Cleveland College of Art and Design. Ron Jobson, principal of Cleveland, said a merged institution would become a regional centre for art and design and would "put us on the map" alongside other big city universities.

Mr Jobson said the college was in a secure financial position and the merger was not a propping-up exercise. According to vice chancellor Derek Fraser, the merger makes sense in academic terms.

But colleges around the country in less robust financial health are also talking to their accountants about merger prospects.

Chris Horne, education specialist at Leeds chartered accountants Robson Rhodes, said: "It is almost impossible to predict how many colleges will merge but estimates of losing over a third of colleges in the next three years may not be wide of the mark."

Mr Horne added that as colleges look for further efficiencies, cutting back the central overhead through merger may look very attractive. But he cautions against mergers undertaken purely on financial grounds. "If a college is successful and operating well there cannot be much incentive to take on a failing college with all its associated problems and heartaches," he said.

* Plans for the proposed merger of South Bristol College of Further Education and Brunel College of Technology, which are to be circulated to the local community next week, may herald a spate of others in the south-west where some institutions are facing increasing competition, large deficits and a drop in student numbers.

South Bristol and Brunel are not merging because of financial difficulties. But they are in competition with each other and believe that a larger college with nearly 1,000 students could serve the needs of Bristol better and have greater prospects of financial stability.

Edward Sallis, vice principal of Brunel College, said the merger was more likely to increase jobs than cause redundancies.

Stroud College of Further Education, which faces a deficit of some Pounds 650,000 and decided this week to go ahead with 20 compulsory redundancies, is rumoured to be ripe for merger. Possible partners includ Gloucester College of Arts and Technology, Filton College and Cirencester College. Another college, Yeovil, is facing a Pounds 900,000 deficit which it hopes to remedy by making about 40 staff redundant. No merger is planned.

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