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Colleges braced for cash regime change

In 25 days, colleges across the country will hold their breath as the new funding regime faces its first test: distributing millions of pounds into college bank accounts.

In 25 days, colleges across the country will hold their breath as the new funding regime faces its first test: distributing millions of pounds into college bank accounts.

Next week, responsibility for funding post-16 provision transfers to local authorities after 17 years of a quango-run system. If the first monthly payment on April 20 goes through without a hitch it will be the earliest sign that the system is working.

At Surrey County Council, the country's fifth largest education authority, officials are confident the process will be as smooth as possible. A brief shadow crossed the face of Frank Offer, head of 14-19 transition, when asked if anything could go wrong, but he expressed no doubts.

"We have had a dry run of the process and we are confident in Surrey that it will go right," he said.

Even under the Learning and Skills Council (LSC), councils were responsible for distributing post-16 money from the funding body to schools, so sending the cash to colleges is not an onerous task. For Surrey, it represents an extra pound;120 million on an education budget of pound;600 million.

Having put payment systems in place, councils will then begin planning for their first year in charge of commissioning the balance of provision, which will be 201112. Mr Offer said he hoped to be able to give first indications of funding allocations in the autumn, with a final plan to be adopted next March.

Peter Martin, cabinet member for children and learning, said his main priority would be coping with growth driven by the raising of the education participation age and of the rising population in south-east England, but without capital funding from central government.

He has already approved pound;145 million to be spent over four years, increasing capacity in primary schools, and similar sums will have to be found at secondary and post-16 level as the cohort grows older.

"Just three years after the raising of the participation age, we will need another 20 per cent increase in capacity," he said.

In other parts of the country, priorities will be different. In the north, for example, school rolls are declining, raising the possibility of decommissioning.

Sunaina Mann, principal of North East Surrey College of Technology, said colleges felt they had been consulted by the council and joint events held with school heads were beginning to foster a collective spirit.

"If we're going to be successful as a county, we have to stop looking after number one and do the right thing by the learner," she said.

There are unresolved issues, however. The council has yet to decide how it will reconcile the different performance measures used by schools and colleges in its commissioning process - with colleges being held to a higher standard which penalises them for student drop-outs.

And Ms Mann said she was still concerned about small, inefficient school sixth-form classes, and hoped schools would consider working in federations.

There are signs that the council recognises that colleges could play a greater part. Mr Offer said it needed to address the advice students were getting, since drop-out figures suggested that too many were getting on the wrong courses at 16.

He said: "One of the issues we have is the drop-out rate after the first year. At 16 and 17, 90 per cent are studying, at 17 and 18 it's 80 per cent. Getting information, advice and guidance right first time around will give a better experience for the young person, and be better for the taxpayer."

Whatever happens under local authority funding - and however long it lasts, with the Conservatives planning to revive a simplified FE funding body if they win the election - one thing seems likely: there is scope for greater public accountability and reduced central control.

Local councils' decisions are under far more public scrutiny, with publicly attended meetings, public agendas and access to minutes enshrined in law. With this level of scrutiny, someone might have blown the whistle on the out-of-control capital spending earlier.

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