Lame duck govt agency 'behaved recklessly'

Tuesday 28th July 2009

Further education colleges across England and Wales face an uncertain future due to mismanagement of a renovation programme overseen by a soon-to-be-defunct government agency.

The Learning and Skills Council (LSC), which is being dissolved next year, is guilty of a "very serious" management failure, according to a pre-eminent committee of MPs.

According to the public accounts committee, the council approved projects in 79 separate colleges to the cost of £2.7 billion over what it could afford over the last seven years.

But from last year onwards that failure in management occurred, with the LSC not prioritising projects of controlling costs.

Edward Leigh, chairman of the committee, today accused the LSC, which is being replaced by the Skills Funding Agency and Young People's Learning Agency next year, of behaving recklessly.

"The programme had looked promising in its earlier stages," he said. "It had stimulated capital investment in the further education estate, much of which was in poor condition, and completed schemes generally provided good value for money. However, by early 2008, the council was no longer controlling the flow of projects which were becoming unaffordable. The department's oversight of the council was remiss for it failed to recognize that this was going on.

"The future of the programme is now beset with considerable uncertainty which must be dispelled as soon as possible. Some colleges are heavily committed to projects on which they have incurred costs. Some straight talking is needed from the council so that colleges in this position are aware of the difficult decisions they will have to take.

"There remains a risk that some colleges are taking on more debt than they can reasonably service. The council must keep under close review the financial health of the further education sector, especially in the current economic downturn."

The University and College Union (UCU) took up that last point from Mr Leigh to describe the report as a "damning indictment" of the LSC's management of college refurbishment budgets.

Sally Hunt, its general secretary, said: "The bottom line is that these colleges find themselves out of pocket because of the failings of the government and the LSC. It would be quite tragic, and utterly outrageous, if staff and students were to suffer because of the failings that have created this fiasco."

Minister for business, innovation and skills Pat McFadden, told inthenews.co.uk that mistakes had been made.

"There has been open consultation with the college sector and colleges now have clarity about how the programme is being taken forward," he said.

"A further 13 new projects should begin later this summer, alongside discussions on how funding should be prioritised over the next spending review period.

"The former [Department of Innovation, Universities and Skills] began a review of the relationships with all our non-departmental bodies to ensure wider lessons are learned to inform the arrangements for the new Skills Funding Agency which will have closer ties with the new Department for Business, Innovation and Skills."

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