Further into crisis

The announcement that De La Salle College, a sixth-form college in Salford, is to close at the end of this academic year has sent a shiver throughout the further education sector. "Who is next?" is the unspoken question.

While all the attention has been focused on the universities, few have noticed the grim fight for survival of many of the colleges.

Patricia Twyman, Principal of Bournville College of Further Education in Birmingham, says: "De la Salle college was the first to go under. The writing's on the wall. I think there will be other examples in the future."

Yet the colleges are an enormous success story. The sector does include sixth-form colleges but it also includes further education colleges which are educating large numbers of young people who don't want to stay on at school or have failed to gain the qualifications which will propel them immediately to A-level and university, as well as adults who missed out on qualifications at school. Further education enrolments grew by 25 per cent in the first three years of this decade. They are projected to grow by a further 20 per cent between 1993/94 and 1998/99.

They enrol more full-time students aged 16-18 than all schools (375,000 as compared with 332,000). They also enrol substantially more adults than universities (2.7million compared with 1.4 million).

The Government did announce an extra pounds 40m for further education in the Budget but the figure is misleading. Almost half of it will be clawed back because colleges will be expected to bid for money from European- funded schemes.

The Further Education Funding Council estimates that the real funding increase is only pounds 23m. Student numbers will still be expected to rise and colleges will have to make five per cent efficiency gains every year for the next three years.

John Brennan, director of development at the Association of Colleges, says : "The consequences of the continuing efficiency squeezes will still leave many colleges struggling. Five per cent is hard to cope with given the precarious state of some colleges. Many will find themselves hard up against it."

A mood of anger is percolating through the further education colleges. At Bournville College of Further Education in Birmingham there have been two rounds of redundancies. Sixty staff, teaching and business support, have gone over the past two years.

Patricia Twyman, the college principal , says: "We are a very lean and fit college; we have lost a lot of people. If more efficiency savings are required I do not know where they are going to come from. We have cut everything, there is nothing left to cut."

This year Hackney Community College has been able to reduce its operating deficit by more than half a million pounds, despite big expansion. But it is not enough. On all sides, the funding council, Hackney borough, and its local Training and Enterprise Council, income continues to fall.

The college estimates that if it hits its student enrolment targets it will have to make savings of pounds 3,677,000 in 1998-9. But if it misses its student targets the savings required will be a huge pounds 5,273,000.

The fear of more efficiency savings being imposed upon them can be understood when you look at the figures. Hackney Community College reduced unit costs by 11 per cent in the period under local management (1989-1993), and has improved by a further 20 per cent since it left local authority control in1993.

At Government behest it has expanded at a furious pace and cut costs. The Association of Colleges has surveyed more than 400 colleges and found that for this year they are expected to show a trading loss of nearly pounds 77m (significantly worse than the previous projection of pounds 46m.)

For some it is just getting too much. A campaign is to be organised this month in the South-east to publicise the plight of the colleges and to emphasise the importance of their work. Leading industrialists will highlight the effect of the funding policies on the sector's ability to contribute to national training and education targets.

Judy Vegh, principal of Hastings College of Arts and Technology, says: "We are called whingeing principals. They say you have managed so far, you can keep managing. But they can't see the damage they are doing."

Her college offers highly specialist, vocational courses. She says course hours have been cut so drastically that it is no longer possible to achieve the skills necessary for industry in the time available.

"Recruiting more students means increasing your income. But there is a limit to how many students you can attract to a specialist programme. You cannot just let lots of people loose on their own on a construction course. Students also need extensive practice with machinery and materials.

"There needs to be a proper assessment of the true costs of providing vocational education and training." Schools tend to opt for less equipment- based, cheaper General National Vocational Qualification programmes, and this inevitably leaves further education with the resource-intensive provision.

Sir William Stubbs, former chief executive of the Further Education Funding Council, says: "The push on costs is now happening too fast and nearing its limits . Building improvements, equipment replacements and, more importantly, fair rewards for staff now merit genuine recognition.

"Further savings risk exceeding management's capacity to cope with them. In other words, the breakneck pace of change must slow down, or the quality of programmes will inevitably decline"n

Countdown to the death of a college

De La Salle Sixth-Form College - named after the patron saint of teachers - is to close next July because everything that could go against it, went against it at the same time.

The 70 year-old college was criticised by inspectors (though staff contested the findings), not enough was spent on buildings which were left in poor repair, it was small and struggled to survive in a new competitive era, and its designated status meant that it had no assets against which it could borrow.

This July inspectors were troubled by the way it was governed and discerned a lack of experienced staff with financial and personnel acumen. There had been high levels of staff sickness.

Student numbers were dropping, the pay bill was getting unmanageable and in August there were redundancies. A proposal to merge with a neighbouring sixth-form college fell through.

Then the red tape. The college could not meet its student recruitment targets, incurred funding penalties by the funding council as a result. It could not use any assets to allow it to borrow because government legislation says it cannot.

Estimates vary as to how many colleges are vulnerable. Two years ago management consultants estimated that 100 colleges would go. Principals dispute this figure but still say privately it will be in double figures.

The Further Education Funding Council figures for 1995/96 show that the number of colleges in the red rose from 243 in 1994/5 to an estimated 292 in 1995/6. The proportion of colleges with weak financial positions rose from 6 to 13 per cent. Twenty-three colleges needed temporary help.

The annual deficit incurred by the sector rocketed 10 times from pounds 10m in 1993/4 to pounds 101m in 1994/95 and stood at an estimated pounds 119m in 1995/6 n