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Law reform may halt competition;FE Focus

College leaders want legal changes in order to end damaging rivalry between education and training providers, reports Ian Nash

College leaders are to press the Education and Employment Secretary David Blunkett for sweeping reforms to company law which would allow colleges to eliminate damaging competition they say has undermined the service since incorporation.

The vested interests of individual college corporations are said to be hampering merger and amalgamation plans which could lead to more efficient, cost-effective organisation. The Association of Colleges has been in talks with a range of groups of neighbouring colleges which could benefit from a new approach to providing services.

A widespread and unnecessary duplication of services has been revealed not only in basic areas such as catering and maintenance but in the provision of key courses such as construction and engineering.

Preliminary research suggests that questions of merger or amalgamation are undermined by "corporate" issues.

It shows that too often the last matters to be raised in merger talks are the basic questions of efficient provision of education and training. Senior AOC sources told The TES: "Sensible proposals are ground down by arguments over which board is willing to vote itself out of existence and which principal does not get the job at the end of the day.

"No one will acquiesce to such demands, however altruistic they may think they are. We must sweep away such issues and think again about how the basic core business is delivered."

The AOC proposals would allow, say, four or five colleges to combine a range of services, under a separate limited company, while retaining the existing corporations and management structures of the colleges. It is likened to a partial merger.

The AOC is understood to believe that significant reforms can be brought about by a change to the instruments and articles of government affecting colleges. It may be possible without any significant changes to the law governing the use of cartels and restrictive trading.

Such reforms might appeal to Mr Blunkett, who will be seeking ways of bringing colleges into the Government's regional plans without undermining the autonomy of individual colleges. It would also bring in an element of the former local education authority-style organisation without a return to the old days.

Roger Ward, chief executive of the AOC, responded cautiously. He said: "I can see that this is a way forward, but we have a long way to go before convincing colleges to give up their control. And this would mean giving up some control, whichever way you look at it."

He confirmed that the AOC was to seek an audience with Government over the more efficient uses of resources but said he would expect Mr Blunkett to give a clear indication of what resources would be available to help in such a transition.

"If we could get this right, then individual chairs and governors would not have to consider standing down. Once you unlock that deal then the next time a college principal is due for retirement arguments over succession should be avoided. They should not 'muddy' the wider picture of college reorganisation."

A wave of mergers has constantly been predicted but has yet to happen.

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