IN AN unprecedented move the Further Education Funding Council has admitted it may be in danger of breaching its statutory duties.
Under the 1992 Further and Higher Education Act the council has a legal duty to ensure "the sufficiency and adequacy" of courses. This ensures that across the country students have access to minority subjects, that courses are viable and of reasonable quality.
But for the first time since the Act was passed the council is at risk of failing in its duty. The East Midlands region has advised the council "that the duty to secure the sufficiency and adequacy of further education provision could be at risk in some areas because of the weak financial health of a small number of colleges".
In another part of its regional report it talks of the "slight possibility" of breaching its duty.
The region has 32 colleges and 21 per cent of them fall into the council's C category, which means they are financially weak.
There has been a 13 per cent de-crease in full-time student numbers in Greater Nottingham, and five lifelong learning partnerships experienced a decrease in part-time students between 199899.
There was a 41 per cent decrease in part-time construction students, compared to a 6 per cent increase nationally. Derbyshire, Greater Nottingham and Lincolnshire all reported large decreases, mainly because of a withdrawal from franchised courses - where there is now less funding.
As it has never happened before, the law has not been tested. John Hall, head of education law at Eversheds, said it was a unique situation.
"This is te first time there has been an admission of a possible breach of a duty. It may be they want to use it as the rationale for intervention.
"It is couched in such defensive and tentative language that the regional committee seems uncertain as to what action should flow from their statement. This does not fill me with confidence.
"If there is a breach, you have to ask how is it to be remedied? It would have to be by the intervention of the Secretary of State, by appointing new governors or even dissolving bodies."
Sources in the East Midlands region say the council is playing a high-risk strategy. It is using the Act to ensure that colleges discussing mergers, and those only thinking about it, will not lose their nerve.
They would prefer merger to forced closure because if an institution went under students could be left without a local college.
The FEFC has set a precedent. It virtually forced Bilston College to merge with Wulfrun College to create Wolverhampton College, because it was concerned about the former's viability.
A merger proposal between the Tresham Institute in Northamptonshire and Rutland College will be considered by the funding council on March 8. Derby, Wilmorton is planning to merge with Broomfield, in Derbyshire. Brooksby, in Melton Mowbray, is talking to Melton Mowbray College.
A spokesman for the council confirmed it was being "proactive" in the region. "We are encouraging colleges to see the benefits arising from closer collaboration and potential mergers.
"We are advising them of the prospect of additional funds through rationalisation, and assisting them in looking at ways of working closer together."
FE Focus, II