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Driving force in the west

Three West Country colleges have bought-up and turned round a failing motor vehicle training company - and rescued 32 people from redundancy.

Now profit-making, and with a Pounds 1.3 million turnover, money not reinvested will be ploughed back into Yeovil College, Somerset College of Arts and Technology and Strode College.

Many colleges have training companies which have either grown from within the institution or have been set up to handle training and enterprise council contracts which they have won for private sector work. But for a college to buy a company outright is rare, if not unique, says Richard Atkins, principal of Yeovil College (the major shareholder) and non-executive director of Wessex Vehicle Training Ltd.

Yeovil had contracts with the company when it hit cash problems. By taking it over, the colleges have not only saved jobs and cornered the market but also improved its reputation. Wessex Vehicle Training won two out of three TEC contracts it recently bid for and has a deal with the Ministry of Defence to retrain returning armed-forces personnel.

But what is the status of the company? What right would the Further Education Funding Council have to see its books? Can the FEFC inspectorate demand to scrutinise training operations and push for more efficiency? It is an arms-length company, owned by but independent of the colleges. It has charitable status with the three principals acting as non-executive directors.

And while the company gives the colleges a potentially formidable foothold in the private training market - it already takes in 600 trainees - it has complete freedom, provided it publishes annual reports and meets the directors' demands for a return on the colleges' investments.

The nearest example to the new-style college management practice is in the hospital trusts which have purchased private companies to provide them with services. Trust directors shape strategic policy, but the company itself handles the day-to-day management.

A highly entrepreneurial college could theoretically shift the balance of funding well away from FEFC control by buying companies and trawling for private profits. But Richard Atkins says this is not the intention of the colleges in the Wessex scheme. He sees his college having "a regional role, firmly in the public sector".

But, he says, as the sector becomes more mature, it will be tempting for colleges to do "more of this sort of thing - particularly if we are being financially squeezed by the FEFC".

And with the effective privatisation of training through learning credits as envisaged in last year's Government White Paper on competitiveness, colleges could conceivably treat the whole of education and training as an open market.

The arrival of the colleges has brought benefits to Wessex Vehicles Training, says the chief executive Mark Hillyard.

"Motivation of staff is the biggest change, also the quality of operations. Under the previous boss, there was no real management structure."

Mark Hillyard has been with the company for six years and, as its former training instructor, did his teacher training at Yeovil. This makes him a valuable link between the two organisations. He sees a nice irony in the idea of public sector colleges turning round a private company and bringing it into the real world.

Before the college took control, staff turnover at Wessex was high -50 in two years. Now it is virtually nil: "staff of proven excellence are not upping and leaving after their training," he says.

Richard Atkins, recently appointed Yeovil College principal, says the acquisition of the company offered timely in-service training.

"The experience has proved a great advantage to me and other staff at Yeovil, running a middle-sized business enterprise. Dealing with accountants, solicitors and the like is all good experience when it comes to running a college."

Wessex is now an accredited national vocational qualifications training centre for a wide range of motor vehicle operations from fork-lift truck driving to maintenance and road haulage lorry training.

Administrative manager Isabel Thomas says that in a rural area like the West Country "we must go countywide to pick up business because it is so remote". In doing so, she takes with it not only the good name of the company but the names of the colleges. And that must be good for recruitment all round.

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