National Star College has scaled back its plans and, after raising pound;3.6 million from donors, it is ready to start work. It will borrow an extra pound;3.2 million in the hope that it can be recovered with further donations.

Helen Sexton, principal at the college, said: “The last year has been hugely frustrating and debilitating for all concerned with the college. The decision of the governors to press on with part of the project is very good news and it has led to a very positive feeling.

“Clearly the board and management, however, are faced with the significant challenge of funding the pound;3.2 million shortfall that will remain after utilising all of the existing charitable fundraised cash and pledges.”

The plans will provide the specialist college with a new therapies centre, improved creative and performing arts facilities and residential accommodation to support disabled people in independent living.

But they are much reduced from the original pound;13.5 million plans. The Learning and Skills Council had planned to fund half of the project, but ran out of cash.

Kate Green, capital director at the college, said the donations had mostly come from large companies or charitable foundations, but that individuals had also donated.

“Our students are absolutely brilliant at working with us, talking about their experiences here and what it means to them to come to the college - and how this will help future students,” she said.

The college said it would continue to campaign for public funding in order to complete the entire project as originally envisaged.