Governors 'lack expertise' to deal with colleges in financial trouble, warns FE commissioner

16th June 2014 at 11:16

Most colleges in financial trouble are not being properly held to account by their governing bodies, the FE commissioner has warned.

David Collins (pictured) made the warning in a letter to the FE sector setting out what he had found in his first ten college interventions. He also warned that colleges in financial trouble are spending too much money on staffing costs and maintaining small class sizes.

He said: “In most of the colleges I have visited to date, it would be true to say there hasn’t been the level of challenge and scrutiny by the governing body that might be expected in an organisation that is dealing with financial concerns.

“This is often because some governing bodies do not have sufficient financial expertise within their membership to oversee complex multi-million pound organisations.”

Mr Collins, who was appointed to the role last November, said college governing bodies must have the right skills mix among their members rather than being purely concerned about being “representative”.

The commissioner revealed that in colleges in financial trouble, costs are well above what might be expected in the rest of the sector. He said an excess of support staff and small class sizes were to blame.

“Too many groups in colleges with financial problems were in single figures and far from the 16-20 averages that would be found in the more efficient,” he added.

Some colleges, he said, had also been caught out by their failure to properly cost “vanity projects” that have been pursued at the cost of their core business.

He said that despite the issues he has encountered so far, it was “encouraging” to see the speed at which new college leadership teams had got to grips with the problems they had inherited.

“In some cases, there is early evidence that the college is on course to deliver a financial ‘turnaround’ in a remarkably short period of time,” he added.

Martin Doel, chief executive of the Association of Colleges, said the observations represent a "useful checklist" for colleges. "As colleges have been given greater autonomy, the role and responsibilities of their governing bodies has also expanded and governors have oversight of both fiscal performance and the quality of provision," he said.
 
"Our governance review last autumn identified the need for colleges to ensure that governing bodies reflected a full range of skills, including financial expertise."
 
He said AoC offers governance support programme alongside the Education and Training Foundation and is currently developing a network of experienced national leaders of FE governance to act as mentors.

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