A local authority may terminate its role as a major adult-education provider by converting its lifelong-learning service into a social enterprise and raising the organisation's rent to a level that could threaten its survival.
Westminster Adult Education Service's (WAES) run of misfortune began when it lost a bid for pound;9.3 million of capital funding during the budget crisis of 2008.
Now it is less than six months away from being evicted from its headquarters by Westminster City Council to make room for a free school, with no alternative facilities secured. If it finds a new building, it claims it faces a rent hike that could jeopardise its provision.
Furthermore, the council is considering ending its involvement with the service altogether and spinning it off as an independent company.
Barbara Holm, head of WAES, said in a report to councillors: "The service is being advised that the council is proposing to charge WAES market rent for council buildings occupied.
"WAES has undertaken an analysis of this new cost and, should market rent be levied on the service, WAES would be unable to maintain its current operation."
The council, one of three in London praised by communities secretary Eric Pickles last year for "leading the way" in a cost-cutting merger, says that the service will eventually be rehoused alongside the free school run by education charity ARK Schools. It will operate from a temporary site during the two years of construction, which may mean moving to the neighbouring borough of Brent.
However, Ms Holm told councillors: "The service is currently planning its programme for next year, but will not be able to advertise courses without knowing where these courses will be delivered. The prospectus should go to the printers in late April."
She said that as part of its decision to become a "commissioning-only authority", the council had begun discussions over whether WAES would remain a part of the local authority with additional autonomy, would be removed and continue as a co-operative or social enterprise, or would be merged with a college.
Brian Connell, the council's cabinet member for business, enterprise and skills, said that the potential changes to the council's role in adult education followed its changing role in schools, of which all but one is now independent of the local authority.
But he said the council had a duty to provide primary places and was facing a shortage near the adult- education site. "We have to honour our legal obligation first and foremost, which is to provide primary school places," he said.
Mr Connell said he was confident of securing one of three potential temporary sites for WAES in time for it to produce its prospectus.
He said the service had reserves of pound;4 million and that it should contribute to the cost of building new premises, adding that the rent would be sustainable. He suggested that the claim that WAES would be charged "market rent" for its new premises was misleading.
Paul Dimoldenberg, leader of the council's Labour group, said any threat to adult-education provision could be a particular blow for a part of the capital that had so many people in need of English classes.
He said: "It's the first step to getting a job and taking part in civic life, and Westminster is the gateway to the UK for many."
Original headline: Westminster may axe its adult-learning service