Approved capital projects must cut costs by pound;50m

31st July 2009 at 01:00
LSC discloses college bid assessments and how seven matching scores bust the building budget

The 13 colleges whose capital funding bids were approved last month will have to cut their combined costs by nearly pound;50 million if the projects are to go ahead, official figures reveal.

A chart of scores showing how the Learning and Skills Council decided which projects could get the green light reveals it has approved pound;547m of spending for a budget of only pound;500m.

The LSC had said colleges would need to cut costs, but until now declined to reveal how much it needed them to save.

With seven colleges receiving the same score in the assessment of projects by PriceWaterhouseCoopers, the LSC was forced to approve more than it could afford because it could not separate the bids.

However, colleges have already said their bids were as cost-effective as possible and raised doubts that cuts averaging pound;3.6m each would be realistic, although the LSC is convinced it is possible.

Martin Doel, chief executive of the Association of Colleges, said: "We are aware that the Learning and Skills Council feels it needs to drive as much value into each of these programmes and bear down on costs as far as they are able." He said there was still a need for more "transparency" of the extent of funding available so that colleges could help bring the costs within budget.

The scoring has prompted some colleges to question the fairness of the assessments. Despite an effort to measure the impact of projects on education, the condition of existing buildings, value for money, the impact on other projects and the effect on the economy, some questioned whether all these factors could be measured objectively.

Moira Tattersall, principal of Carlisle College, which missed out on funding approval by just four points, said: "Some of the detail we need to look at, because there are many things which seem like subjective judgments.

"We have 1950s buildings that have major health and safety issues, rat and cockroach infestations. One of the buildings was flooded in the 2005 floods," Ms Tattersall said.

The college was rated four out of five over concerns about the condition its estate. About half its provision is in temporary accommodation, costing pound;250,000 a year.

Losing out on approval is particularly frustrating for the college as an earlier bid for refurbishment had been accepted, but it withdrew that in favour of a bid for a more substantial rebuilding programme. Now it is seeking to raise Pounds 9m to carry out refurbishment itself.

Other colleges, such as Barnsley, were rated more highly for issues with their estate and even had a extra "sensitivity" score of six out of five, at least in part because it had demolished some of its buildings.

Rotherham College of Arts and Technology was another to miss out by being scored in the tier just below those approved.

George Trow, the principal, said: "We are devastated for Rotherham learners. We have had a really difficult time, particularly with the recession and the Corus steel works lay-offs and the closures at Burberry. We are a college with high deprivation and very difficult economic conditions."

The LSC also disclosed that 92 projects were ready to start by September and 15 more early next year.

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