It is not surprising that the FE sector has been subjected to a rigorous scrutiny in recent months. The 1992 Act projected 457 colleges into independence from local authority control at a time of great change and expansion.

The National Audit Office report “Managing to be Independent”, published in February 1995, found that in spite of fears to the contrary colleges had responded well to this challenge. The appalling story of financial mismanagement at the Coventry Technical College which hit the headlines in 1991 showed that local authority control was not in any case the safeguard it was always cracked up to be.

The saga of Derby Wilmorton Tertiary College was not, however, about financial mismanagement in the narrow sense of a college running into financial difficulties but arose from mismanagement in a much wider context and governance that failed the basic test of acting in the public interest.

There is no evidence that there are replications of the Wilmorton case, in all its evidence of arbitrary misrule, around the sector, but there are lessons to be drawn which can be of value to colleges struggling in difficult times to be effective under all the day-to-day pressures of financial stringency and political turbulence.

The most important lesson is that running a college is a shared responsibility between the governing body, the principal and the staff. The instruments and articles of government assign legal and managerial powers to different elements of the structure but the reality is that unless all three are working to broadly a common agenda the college’s effectiveness will be gravely impaired.

Governing bodies play a crucial role in this and their performance is critical to a college’s success. Staff, students and the public are entitled to expect that people who accept public office as governors and who therefore knowingly take on statutory responsibilities for the control of public monies, the management of a college and the direction in which it develops will exercise their powers in a way that serves the college’s best interests and satisfies both formal and wider tests of accountability.

They must conduct their business in a professional manner and must encourage an active and, if necessary, a questioning and critical attitude to the conduct of the college’s affairs.

Wilmorton showed how seriously things could go wrong when due process was self evidently not followed. An effective clerk to the governing body has a responsibility, with the chairman and the principal, for ensuring that membership questions are adequately handled, quorum rules addressed, minutes accurately drafted and expeditiously circulated and meetings called with due notice.

A chairman will ensure that a register of members’ interests is maintained, that conflicts of interest, potential and actual, are avoided and that an audit committee takes an interest in college affairs beyond the merely technical questions of accounting controls. But the governing body as a whole must see that these necessary functions are carried out.

Governors and the principal have particular responsibilities for the strategic development of the college. While it is for the principal, with the help of senior staff, to bring forward a strategic and financial plans and update them annually it is for the governors to discuss and approve them. Again, while it is for the principal to ensure that quality procedures are in place, the governors must not only take an interest in them but give the principal full support in their implementation.

Strategy can never be divorced from finance and management. Opportunism should not be decried but events at Wilmorton illustrated how the purchase and development of property could be undertaken without an adequate assessment of its strategic, managerial or practical implications. Moreover, headstrong and arbitrary decision-making ignored the fact that spending tax-payers money required the observance of procedures to safeguard the public interest.

Some of these were described in the Further Education Funding Council’s financial memorandum, in its circulars, in the council’s guide for governors and in the college’s own financial regulations. Others were plain common sense.

A principal’s most difficult task may well be to manage the staff. Human resource management is professional-speak for recruiting, leading, motivating, organising and developing staff. At Wilmorton these functions were carried out disastrously and the staff, understandably, reacted against a confrontationist management style.

But it does not have to be this way. Principals need to listen as well as lead from the front. Above all, principals must observe due process in appointments, promotions, disciplinary matters and cases of redundancy.

Staff will feel a sense of partnership with a college’s management only if they believe it is operating reasonably and takes them into its confidence in regard to the problems the college faces. And colleges need a professional management - general, financial, estate and personnel - as well as academic leadership.

Wilmorton showed that arbitrary decision-making, taking constitutional short-cuts, and imposing rather than consulting over staff structures is both inefficient and, in the long term, just does not work.

Wilmorton was a one-off case and decisive action was taken to put matters right. Perhaps, in a way, it was helpful that it surfaced so early in the life of the newly independent FE sector. Colleges in the post-Nolan era will inevitably find themselves under scrutiny from their staff, their students and the public at large. At times this scrutiny may constrain actions which may be for the good of a college but in the long run it is more important for colleges to build a reputation for good governance than for the sector as a whole to be tainted by the actions of individual colleges seeking short-term competitive advantage in a scramble for students, funding and real estate.