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Scrap all the regulations and set them free

A lot happens in 10 years but some things do not change. In 1993, further education colleges were incorporated. Ten years later, FE corporations are an entrenched part of the landscape.

There are many plans to change what colleges do but no plan to change what they are. Some colleges may gain responsibility for the education of 14-year-olds. Others have centres of vocational excellence intended to revitalise whole economic sectors. Yet more will lose their sixth forms or their poorly-performing courses.

Learning and Skills Council area reviews may result in wholesale reorganisation. There are, however, no plans to change the legal structure of colleges. They will continue to be corporations governed by a set of laws and rules.

The survival of colleges in the 10 years since incorporation has defied many predictions. Local government resisted the idea and tried in the early years to have it reversed. There were predictions that hundreds of colleges would disappear through failure or merger. Large numbers did experience financial difficulties but almost all have been rescued through a form of intensive care called a recovery plan.

Jobs, courses and buildings may have been lost in the process but the college survived. The only one that has disappeared in 10 years is Bilston Community College.

Arriving in 2003, we have no real challenge to the legal fundamentals. Colleges are FE corporations. They live under a single set of rules written by civil servants and policed by auditors. The rules allow colleges to manage their affairs but within tight limits. Governors must be unpaid volunteers who follow instructions about how to organise committees. The principal must be the chief executive.

Colleges own their land and buildings but must seek approval for relatively small changes. Mergers with other colleges are possible but only after extended consultation. External partnerships are encouraged but rigorous accountability ensures that the buck will always be thrown at the individual college. Most joint projects and shared services end when the funding for them stops.

Diversity is supposed to be in fashion but there is a one-size-fits-all model for the legal structure of colleges. They must stick to a set of rules and, what's worse, the rules are specific to them. This has insulated FE from the rest of the public services. The academic language of governance has made it difficult to spot that colleges are community-owned organisations. They have boards drawn from their local area and some of their directors are elected by their workers and customers.

One might ask whether the balance of interests always has to be equal. Could some colleges be owned by their students like co-operatives? Could community links be strengthened by restoring local government control? Should businesses run or even own colleges? A financial stake may be the fastest route to engage employers. Current rules do not allow these questions to be asked.

The advantage of the current arrangements is the control it gives the centre. Because colleges are FE corporations, they are easier to control than established companies. The Department for Education and Skills has been able to create new rules for them without having to consult too widely. The more alike colleges are, the easier it is for LSC auditors to enforce compliance.

Control has helped civil servants respond quickly to political demands and National Audit Office criticisms but has created a tick-box culture lower down. Creativity has been applied in implementing the latest instruction rather than innovation for the benefit of customers.

Command and control from the top has developed over the years and has been linked to the increasing dependence of colleges on government money. The LSC is more financially important to them now than the Further Education Funding Council was a decade ago.

The recent bureaucracy task force report concluded that the current systems did not work and should be fixed. The LSC and colleges should work in partnership to achieve shared goals. The LSC should act as a gatekeeper to prevent new regulations being imposed on colleges.

Perhaps the report needs to go further. Fewer new regulations would be welcome but deregulation might be better. A better relationship with the LSC is important but perhaps more so is the need to develop better relationships with individuals and employers to encourage them to pay more. The promise of incorporation was freedom. The realisation will only come through greater financial independence from the Government.

Julian Gravatt is finance director at The City Lit, London

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