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| Version 3 | Version 4 |
|---|---|
| College building scheme 'flawed' | College building scheme 'flawed' |
| (10 minutes later) | |
| The collapse of a multi-million-pound scheme to rebuild England's colleges was "predictable and avoidable", an inquiry has said. | The collapse of a multi-million-pound scheme to rebuild England's colleges was "predictable and avoidable", an inquiry has said. |
| Sir Andrew Foster said "delays and confusion" meant early warnings in February 2008 were not acted upon. | Sir Andrew Foster said "delays and confusion" meant early warnings in February 2008 were not acted upon. |
| 144 colleges had their building projects put on hold after the Learning and Skills Council ran out of money. | 144 colleges had their building projects put on hold after the Learning and Skills Council ran out of money. |
| Sir Andrew described himself as incredulous at what he discovered when he began to investigate the affair. | Sir Andrew described himself as incredulous at what he discovered when he began to investigate the affair. |
| The LSC was managing a £2.3 bn budget for the spending period 2008-2011, but Sir Andrew's report said this was all but spent by Christmas 2008. | The LSC was managing a £2.3 bn budget for the spending period 2008-2011, but Sir Andrew's report said this was all but spent by Christmas 2008. |
| Projects worth another 2.7 bn were awaiting final approval. | Projects worth another 2.7 bn were awaiting final approval. |
| 'Incompetent' | 'Incompetent' |
| Sir Andrew said the LSC had failed to keep a proper cumulative tally of projects it was allowing to go into the pipeline, which he described as "frankly incompetent". | |
| And there was no prioritisation of these schemes, he said. | |
| He also criticised government officials for failing to challenge the LSC's figures. | He also criticised government officials for failing to challenge the LSC's figures. |
| Sir Andrew, former head of the Audit Commission said: "At the heart of the problem is the absence of a proper long-term financial strategy and inadequate management, information and monitoring. | Sir Andrew, former head of the Audit Commission said: "At the heart of the problem is the absence of a proper long-term financial strategy and inadequate management, information and monitoring. |
| "I have been forced to conclude that the crisis was predictable and probably avoidable. Certainly it could have been mitigated if action had been taken earlier." | "I have been forced to conclude that the crisis was predictable and probably avoidable. Certainly it could have been mitigated if action had been taken earlier." |
| The priority now was for there to be a consultation to decide on criteria for funding the projects concerned, he said. | The priority now was for there to be a consultation to decide on criteria for funding the projects concerned, he said. |
| This should be based on the need of colleges, rather than on a first-come-first-served basis, he added. | This should be based on the need of colleges, rather than on a first-come-first-served basis, he added. |
| 'Mismanagement' | 'Mismanagement' |
| Colleges believed they had got approval to go ahead with rebuilding projects for which the LSC did not have sufficient funds. | Colleges believed they had got approval to go ahead with rebuilding projects for which the LSC did not have sufficient funds. |
| The Association of Colleges, which represents the colleges involved, said they had already spent a total of £220m. | The Association of Colleges, which represents the colleges involved, said they had already spent a total of £220m. |
| South Thames College in London is seriously in debt, having borrowed £13m on a long-term basis and £33m in the short term. | South Thames College in London is seriously in debt, having borrowed £13m on a long-term basis and £33m in the short term. |
| Principal Sue Rimmer said she went ahead on the strength of a letter from the LSC saying the money for the project was ring-fenced. | Principal Sue Rimmer said she went ahead on the strength of a letter from the LSC saying the money for the project was ring-fenced. |
| She stands to lose £70m on a new building if funding is not forthcoming soon, she says. | She stands to lose £70m on a new building if funding is not forthcoming soon, she says. |
| Martin Doel, AoC chief executive, said: "The report reveals mismanagement on an astonishing scale. | Martin Doel, AoC chief executive, said: "The report reveals mismanagement on an astonishing scale. |
| "Colleges that have had to invest heavily in preparing for these projects should be indemnified against any losses. | "Colleges that have had to invest heavily in preparing for these projects should be indemnified against any losses. |
| "We also need a quick, clear and fair resolution." | "We also need a quick, clear and fair resolution." |
| 'Overheating' | 'Overheating' |
| Sir Andrew's report concluded that monitoring by the Department for Innovation, Universities and Skills (Dius) could have been better. | Sir Andrew's report concluded that monitoring by the Department for Innovation, Universities and Skills (Dius) could have been better. |
| "The responsibility of Dius was to determine and monitor the implementation of broad policy. Effective implementation was the role of the LSC. | "The responsibility of Dius was to determine and monitor the implementation of broad policy. Effective implementation was the role of the LSC. |
| "There were warnings of overheating as early as February 2008, but there was delay and confusion in addressing them." | "There were warnings of overheating as early as February 2008, but there was delay and confusion in addressing them." |
| Dius said it accepted Sir Andrew's recommendations. | Dius said it accepted Sir Andrew's recommendations. |
| The Secretary of State for Innovation, Universities and Skills, John Denham, said: "We have already made clear to all college principals that we will not allow any college to get into a situation where it cannot meet its financial obligations as a result of decisions taken by the LSC on the capital programme." | The Secretary of State for Innovation, Universities and Skills, John Denham, said: "We have already made clear to all college principals that we will not allow any college to get into a situation where it cannot meet its financial obligations as a result of decisions taken by the LSC on the capital programme." |
| He added that any college concerned should speak to its local LSC who will "work with the college to agree an appropriate financial plan". | He added that any college concerned should speak to its local LSC who will "work with the college to agree an appropriate financial plan". |
| Last week, the head of the LSC, Mark Haysom, resigned from his £200,000 a year post, admitting there had been "failures" in the way the LSC had handled the project. | Last week, the head of the LSC, Mark Haysom, resigned from his £200,000 a year post, admitting there had been "failures" in the way the LSC had handled the project. |