ERRORS of commission and omission virtually brought Cricklade College, in Hampshire to its knees, an independent report has found.
Governors made significant errors of judgment in the way they handled a franchise agreement with a private trainer, said Sir Patrick Lowry, the former chairman of the Advisory, conciliation and Arbitration Service, ACAS.
In 1994 trainers Extras Ltd entered into an agreement to supply Cricklade College with IT training. Under that agreement, 45 per cent of the cost would be paid by the European Social Fund and the remaining 55 per cent would be paid in a shared-funding arrangement.
But the college failed to keep proper account of student numbers or a record of their attainments. It not only failed to contribute its share of the funding but had also got control of some of the ESF money. The police investigated although no charges were brought.
Sir Patrick said the failings in the past of governance and management "constituted mismanagement of the college".
Senior management had described their horror at what was unfolding "yet their horror seems to have been more that they should be seen to have associated with Extras, rather than that, through that association, they had put the very future of the college in doubt." said Sir Patrick.
The governing body was not put fully in the picture, nor did the governors sufficiently probe. At one stage the finance committee noted that the franchised activity might be a risk, but this was not pursued.
"The attitude seems to have been tthat, provided the goose was laying golden eggs, question's about the bird's health were unnecessary." He felt that at times any opportunity to avoid decisions was embraced with relief.
After the suspenion of the Prncipal Richard Evan, the acting principal Elizabeth Blakemore took charge. There was a dispute between the college and Mr Andrew Murray, a NATFHE regional representative.
Mr Murray subsequently was elected to the national executive of the union. Later he was one of three lecturers made redundant.
Sir Patrick said he found it "astnishing" that Mrs Blakemore did not alert the chair of governors to the likely consequences of making redundant such a highly-placed national executive member of
the leading teachers' union in the sector.
Sir Patrick also criticised the college for its lack of openness after the suspension of the principal. They should have appreciated that in the frenetic atmosphere prevailing "rumour, innuendo and gossip about sleaze and corruption would fill the vacuum which the governors' silence would create.
"Parents would be worried; the college's credibility mwould suffer...By their inaction, the governing body failed to retain control of the situation."
Between 1995 and 1997 a surplus of pound;700,000 had become a deficit of pound;1,000,000.
Sir Patrick has recommended that the college and the Further Education Funding Council should undertake a through evaluation of the individual contribution of members of the current governing body.
For at least the next two yearsw it should concentrate on meeting the the needs of the local cxommunity, and review the extent of its distance franchising.
He said that all colleges should inform their staff as soon as possible after a senior postholder is suspended from duty.
The Association of Colleges should give guidance and examples of good practice in the public handling of difficulties.
Tessa Blackstone, the minister of state, accepted all his recommendations and urged all governors in the further education sector to study it.