Loss-making businesses leave Grimsby pound;250k out of pocket

19th February 2010 at 00:00
FE Focus reveals string of failed business ventures at institute where new principal took up post this month

A series of business ventures, including a TV station, a golf club and a function suite, lost Grimsby Institute of Further and Higher Education more than pound;250,000.

Companies House records show more than 20 businesses controlled by the college, some of them now dormant, and reveal that a number of commercial enterprises lost the college money.

Propeller TV was set up with the promise of pound;5.2 million of public money from Yorkshire Forward in 2006. But by 2008 it had losses of pound;130,000 and was taken over by Chinese investors the following year.

McMenemy's, a function suite at Grimsby Town FC's ground, was bought from the club in 2004, then sold back after a year at a loss of pound;15,000.

And Laceby Manor golf club was bought by the college for pound;365,000 in 2007. By July 2008 it had lost more than pound;147,000.

Colleges are free to set up commercial operations that are related to their educational purpose.

For instance, Laceby Manor is also the base for the college's advanced apprenticeships in sporting excellence for golf, which aim to nurture future sports stars.

The club's website says: "The Grimsby Institute purchased the club in 2007, and there is a long-term development plan in place, to make the manor the premier golfing venue in the region. We pride ourselves on the warmth of our greeting and every player, whatever their standard, is welcome."

As well as offering individual and corporate memberships, the club, based four miles outside Grimsby, promotes itself as a wedding and conference venue.

Propeller TV was intended partly as an outlet for the work of centres of excellence in media such as Grimsby's own East Coast Media.

As well as providing a platform for new broadcast talent, the channel was set up to show documentaries about media careers, skills and technology.

At the time of its launch, the institute claimed it was the only educational institution in Europe to have a TV station broadcast on Sky TV's satellite service.

Earlier this month, the college lost its principal, Daniel Khan, who resigned to pursue other professional interests. His deputy, Ray Ellis, took over as acting principal immediately as Mr Khan was due to go on sabbatical.

A college spokesman said the companies' performance was not a factor in Mr Khan's decision to stand down.

Mr Khan also resigned from directorships of a string of college-controlled companies two days after his departure from the college was announced.

Three governors and four members of staff, including acting deputy principal Gill Alton, also resigned their company directorships at the same time, although they remain in their roles at the college.

A spokesman for Grimsby Institute said: "The institute has a range of commercial activity which supports the core value of providing realistic working environments for our students," he said.

"Feedback from students shows that this is valued. Commercial activity also generates revenue for the Institute.

"However, the first and foremost value is the experience these operations give our students to enhance their employability skills."

Grimsby Institute: anatomy of a college

  • 4,500 full-time students and 14,000 part-time in 2008
  • 77 per cent of full-time students are aged 16-18
  • About 1,400 staff (2007)
  • Runs Research Interest Group for staff
  • Offers 100 HE programmes
  • Awarded grade 2 in its 2008 Ofsted inspection, which noted:
  • Strong 14-16 provision
  • High success apprenticeship rates
  • Good leadership and management
  • Good governance
  • Stong financial management.

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