Battening down the hatches may not be enough

29th May 2009 at 01:00

Warnings of redundancies have traditionally been issued by principals anxious to leave themselves options, or by trade unionists seeking to rally the troops. In both cases, politics play a large role. But when people who keep the books warn about job losses, the only appropriate response is to ask how many and how much money will be saved.

The finance directors gathering for their annual conference next week (page 29) may not yet know exactly how many jobs will go or when, but clearly they are doing the sums.

Whatever other staff feel about those who control the purse strings, they must surely have some sympathy for their colleagues in finance departments in these times.

Most financial directors have done very well to steer colleges through the financial challenges of recent years while helping to deliver more courses to more people at a higher quality. This takes nothing away from the remarkable achievements of teaching staff. But, let's face it: excellence in teaching and learning requires proper funding.

Now colleges face a near-perfect financial storm. Government-imposed efficiency gains, uncertainty over future funding for young people and adults, a cack-handed capital strategy and changes to funding agencies all come as the sector faces high expectations of its contribution to recovery from the recession.

For all but the biggest andor most financially robust colleges, simply battening down the hatches is unlikely to save them. For some, staying afloat will entail ditching plans, projects and, unfortunately, people.

The predominant mood among finance directors seems to be anger. They and their colleagues have helped to deliver progress across further education despite the chronic underfunding of colleges relative to schools and universities. Recently, colleges have been feted and courted by ministers desperate to avoid repeating mistakes made in previous recessions when those laid off were left to their fate, with long-term consequences for the economy and society. Colleges have responded, as they always do in such circumstances, but they seem expected to work financial and educational miracles.

With staff costs accounting for at least 60 per cent of most college budgets, it is inevitable that savings will have to be wrung out of wage bills.

Loss of personnel will, as the University and College Union says, limit the capacity of the sector to deliver all that is already required of it, let alone to rise to new challenges. For colleges unable to balance the books even after such drastic measures, merger may be the only option.

Alan Thomson, FE Focus Editor?


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