A further education college principal who resigned after a row with his local learning and skills council claims college heads across the country are facing similar problems.
Ahmed Choonara resigned as principal of South Nottingham College last week because he claimed Nottinghamshire LSC, one of 47 local LSCs, refused to discuss his proposals for phasing the repayment of money clawed back for underrecruitment of students.
Nottinghamshire LSC said Mr Choonara's college might need to downsize as it faced a total loss this year of more than £3.3 million, including £568,000 for underrecruitment of LSC-funded students, a £759,000 budget reduction after "rebasing" the size of the college, and £2 million for underrecruitment of University for Industry-funded students.
But Mr Choonara said that the LSC exaggerated the seriousness of the financial situation and had refused to discuss proposals to pay back the money owed over three years.
He said his college was acting only as a conduit for other institutions for most of the Ufi money, and its losses would therefore be minimal on this front. He also said that his college had enough money to cover what it owed the LSC, but would prefer to stage repayments so that it did not need to dip into capital reserves.
He said: "We proposed both short and medium-term plans to deal with the cash issue and to realign our expenditure in the new environment. But those proposals were not discussed at all. Instead, the LSC came up with its own plans at breakneck speed and without consultation. This left me in an untenable position and with no choice but to resign."
Mr Choonara said his college, which is nationally recognised for its graphics and printing courses, was not alone in facing problems with its local LSC. He has lodged a complaint with the national LSC.
He said: "This is a sector-wide problem. I have had numerous calls from colleagues across the country who are enraged about the way they have been treated by their local LSC."
Rob Valentine, executive director of Nottinghamshire LSC, said the LSC had looked at the college's action plan, but did not find it convincing. "It contained some worthy ideals for growth and new markets, but it did not have enough realistic numbers of students that could be expected to be attracted to the college."
* College employers and lecturers' union leaders are "inching towards a solution" to the further education sector's pay dispute, after a meeting on Monday.
Although employers have yet to improve their 2.3 per cent offer, unions have postponed calling for industrial action and both sides said they were confident of reaching a deal by the time they meet next week.