Exclusive: College asks ESFA for help paying staff

A college which sold off land for £6.3m to secure its finances has asked for further help from the ESFA

Julia Belgutay & Stephen Exley

A Greater Manchester college has asked for government help paying its staff

A cash-strapped sixth-form college which sold off land to bolster its finances has asked the government for emergency funding to pay its staff.

Cheadle and Marple Sixth Form College approached the Education and Skills Funding Agency (ESFA) last week, requesting additional funding to allow it to pay staff wages, Tes understands.

In 2017, the college sold off land adjacent to its Cheadle site to the Department for Education for £6.3 million, which was to be used for the building of two new free schools. Some £3 million of the proceeds were used to pay off debts the college owed to Lloyds Bank and the ESFA.

Quick read: First college set to go into insolvency regime

Read more: Hadlow College placed into education administration

Background: Hadlow College insolvency: How to ensure it doesn't happen again

College future secured?

Its accounts for 2017-18 state that ”the sale of land at Cheadle secures the college, its cash flows and ongoing concern basis for the foreseeable future”.

However it has now turned to the ESFA once more for assistance at short notice, raising concerns about the institution’s future.

The move comes a month after crisis-hit Hadlow College in Kent became the first FE institution to go through the college insolvency regime, after it was placed in education administration by the High Court.

Turnover falls by £7 million

In May, Cheadle and Marple – which operates across two sites in Greater Manchester – saw its overall Ofsted grade drop from good to requires improvement. However the college claimed that this was not a fair reflection of its overall performance, and it understood to have lodged an complaint over the verdict.

The Greater Manchester area review recommended that the college convert to academy status and join a multi-academy trust. However it instead opted, with the approval of the FE commissioner, to form a federation, supported by Liverpool Hope University, to support the nearby St Mary’s College in Blackburn.

The college’s accounts for 2017-18 reveal that its turnover has almost halved over the last seven years.

The document states: “Successive years of decline in student intake coupled with funding reductions during a period of austerity have had a significant adverse impact on the organisations turnover which has fallen by £7 million in seven years, from £15.6 million in 2010-11 to £8.3 million in 2017-18.”

Working with the college

The report adds: “At the end of 2017-18 the college generated a deficit before other gains and losses of £3 million (2016-17 £1.98 million deficit). The comprehensive income for the year was £3.795 million surplus (2016-17 £0.24 million surplus).”

A Department for Education spokesperson told Tes: “The Department is working closely with Cheadle and Marple College. More information will be available in due course.”

A college spokesperson said:“Like many colleges, we regularly meet with external stakeholders to discuss the financial challenges facing post-16 education and we look forward to continuing our constructive dialogue with the ESFA and other agencies.”

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Julia Belgutay & Stephen Exley

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