Historic college under threat from new owner's cash crisis

24th June 2011 at 01:00
Fears grow for institution that spawned Open University

The future of one of the UK's oldest distance-learning colleges has been thrown into doubt by a financial crisis at its new owner, the Learning and Skills Network (LSN).

LSN has put the site of the National Extension College (NEC), which was founded in 1963 by Labour politician Michael Young, up for sale to avoid a cash crisis that threatens its own survival.

But supporters say directionless management and the sale of its assets, expected to generate at least pound;6.5 million for LSN, put the college's future at risk.

The NEC - which has around 20,000 students a year following vocational programmes and was a forerunner to the Open University - was taken over by LSN last year.

LSN pledged to invest in IT systems and facilities, and to double student numbers within three years.

But after a series of ambitious acquisitions, LSN found itself short of cash.

Its latest accounts show that while it spent pound;8.8 million on companies such as FE Associates and Learning Resources International, its revenue was pound;12 million under budget in 200910 and its pension deficit grew to pound;7.9 million.

Chief executive John Stone retired earlier this year and chief operating officer Colin Kerr also left the charity.

Acting chief executive Yvonne Smithers wrote to a supporter of the centre: "It is clear that in order to survive LSN will have to become a much leaner organisation than it has previously been.

"We have taken the decision to sell the land at Cambridge in order to realise some of our assets to enable the business as a whole to move into a revival stage.

"I believe that this will be a major factor in enabling LSN to move forward and operate a fully integrated business model that is both sustainable and economically viable."

Ms Smithers said that LSN did not intend to shut down the college and was working to create a viable business plan for it.

But Ros Morpeth, a former executive director of the college, along with former trustees and other supporters, wrote to FE Focus this week to call for the NEC to be reconstituted as an independent charity to guarantee its future.

They said the promised investment from LSN never came, and that the college suffered from a lack of direction under the supervision of a series of interim directors, while experienced staff left.

Dr Morpeth said: "This is going to be another body blow for the NEC. There's been no leadership, no proper marketing.

"The vision Michael Young set out for the NEC in 1988, its 25th year, was to provide all adults with innovative, open and flexible ways to develop new skills for work, for personal fulfilment and to make a wider contribution to society.

"That vision is just as relevant now as it was then. There is huge scope for the NEC to continue to demonstrate its gift for flexibility, innovation and openness."

Dr Morpeth said LSN is required to use the assets of the college to further "the legacy of Michael Young" under the merger contract.

Ms Smithers has said LSN intends to do this by creating an annual lecture in his name and preserving the archives of the college.

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