The Learning and Skills Council this week admitted that it may not be able to cope with looming structural change across education planning and funding while also meeting its current responsibilities.
In the week that the LSC started the process that will lead to its eventual dissolution next April, its annual report said the forthcoming machinery of government changes would provide a considerable diversion from ongoing business.
Chief executive Geoff Russell said in the report: "As the transition progresses over the next year, there are significant risks that the LSC will not be able to meet its objectives, staff morale will be affected and systems of internal control will break down."
Mr Russell added that the council may have to make short-term compromises on the vision for its successor structures "in order to deliver intact the new structures while not losing control of the current operations".
He said he had accelerated the move to the successor organisations - the Young People's Learning Agency and the Skills Funding Agency - by setting up shadow bodies to test the new business processes before they go live. The LSC began the shadowing process this week when its national council was formally split in two, creating a committee that will eventually become the YPLA and an SFA committee.
Les Walton, the former principal of Tyne Metropolitan College, chairs the new YPLA committee, while Chris Bank, the LSC's chairman, will chair the SFA committee.
Peter Lauener, the YPLA's chief executive designate, is due to join the committee in September from the Department for Children, Schools and Families where he is director of Local Transformation.
From now until March 31, when the LSC is officially dissolved, the two committees will operate as shadow agencies, the YPLA committee planning and supporting under-19 provision and the SFA focusing on adult education and skills. LSC staff will begin migrating to one or other shadow body next month.
One of the main tasks of the shadow YPLA will be to en-sure local authorities are ready to assume responsibility for commissioning and funding all under-19 provision, including that delivered by further education providers such as colleges.