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Colleges will be given three years to drag themselves out of the red

THE "vast majority" of colleges are expected to be financially stable by 2006.

This bold declaration, revealed by ministers in a paper to the Scottish Parliament's audit committee last week, will emerge from the Scottish Further Education Funding Council shortly. It will be seen as particularly ambitious in the light of the fact that 34 of the 43 incorporated colleges recorded operating deficits in 2000-01, and 16 had deficits greater than forecast.

Following further pressure from Iain Gray, Lifelong Learning Minister, the council is to embark on a campaign designed to achieve financial security in the sector within three years.

This is the first major move from the funding council's development directorate which was set up last year to help turn round the fortunes of struggling colleges under the supervision of John Burt, principal of Angus College.

Mr Gray confirmed in his letter of guidance to the funding council that there is to be no let-up in ministerial pressure on colleges to wipe out deficits. The Scottish Executive has already poured millions into struggling colleges - pound;7 million last year alone - in the hope that this will improve what has become a growing political and financial embarrassment. More cash is expected.

But Mr Gray reiterated his concern and said that he wanted "to accelerate the pace of reduction and elimination of college deficits".

Roger McClure, the funding council's new chief executive, lost no time in complaining that publicity over poor college management and financial performance could harm the case for more money.

Mr Gray made it clear last June that the revelation in the Auditor General's report into college finances that some could take up to 10 years to clear their deficits was "unacceptable".

The Executive says it would be happy to report on progress to the committee on how the pound;7 million is being spent.

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