COLLEGE chiefs have called for more robust checks on the actions of local learning and skills councils after a principal and his chairman quit following a row over funding.
The Association of Colleges has expressed concerns to John Harwood, the national LSC chief executive, after the South Nottingham College principal, Ahmed Choonara, resigned along with the chair of governors at the college, Kevin Shine.
South Nottingham College is now facing a bill from Nottinghamshire LSC of pound;3.4m after failing to hit student targets.
It must repay pound;568,000 for a shortfall in 2001-02 and will receive pound;759,000 less than it expected for 2002-03. The bill also includes pound;2.1m from the University for Industry after a recruitment shortfall, said the LSC.
The row over the college's ability to repay the cash came to a head last week. Mr Choonara said the local LSC had exaggerated the college's financial problems and failed to discuss "reasonable" plans to refund cash.
"We had sufficient funds to pay back for the shortfall in recruitment," he told FE Focus.
"Also, the University for Industry money is not ours but we hold it for others who recruit. Therefore, it will have little effect on our student numbers. We had short-term and medium-term plans to deal with these issues, but they (local LSC chiefs) refused to discuss these papers.
"The LSC came up with its own plans, without consultation, and they put me in a position where I had no option but to resign."
But Rob Valentine, executive director of Nottinghamshire LSC, insisted: "We did discuss the college plan - it was a statement of objectives and ideals but did not give rise to practical outcomes."
"It is true to say that they made some previous reductions, since they came from a difficult position in the 1990s when they had more than 40 per cent of their contracts from franchising.
"But this is now about the college not having enough income to cover its costs. They say they have enough income to cover costs but we don't agree."
Teaching standards were not in question. South Nottingham is a Centre of Vocational Excellence with a national reputation for printing and graphics.
The AoC said that while it was not willing to comment on the South Nottingham case, it was concerned about a number of recent cases which demonstrated "a lack of clarity about the powers of local LSCs in relation to college boards."
There was also concern among employer groups and unions - including the Association for College Management, of which Mr Choonara is vice-president - that the LSC was both judge and jury in such cases.
Dave Gibson, AoC chief executive, said: "There is a new, welcome determination by the LSC to ensure that their relationships with colleges are built on mutual trust and respect. However, questions remain about the basis on which some local LSCs have intervened in the internal affairs of colleges."
While the AoC recognises the need for some LSC intervention to secure quality and safeguard public money, Mr Gibson said that "in some instances intervention would appear to have gone beyond published LSC guidance.
"There is also room for concern about the extent to which LLSC decisions are open to challenge and scrutiny. In the AoC view, existing internal LSC procedures for dealing with such matters are unclear and insufficiently robust.
"Nor is it clear that there are adequate mechanisms for external scrutiny of LSC decisions - as yet for example, LSC is not formally subject to the jurisdiction of the Parliamentary Ombudsman."
A spokesman for the national LSC said: "The LSC has acted entirely properly under its complaints procedure in asking David Hughes, an executive director in Derbyshire who is unconnected with the complaint, to investigate this matter.
"His enquiry is ongoing and, once the findings are known, we will consider appropriate next steps."