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| College funding fiasco condemned | College funding fiasco condemned |
| (about 5 hours later) | |
| MPs have condemned the "catastrophic mismanagement" of a college building scheme in England which could cost hundreds of millions of pounds. | MPs have condemned the "catastrophic mismanagement" of a college building scheme in England which could cost hundreds of millions of pounds. |
| The Learning and Skills Council, which ran the scheme, and the government are criticised in a report by the committee which deals with further education. | The Learning and Skills Council, which ran the scheme, and the government are criticised in a report by the committee which deals with further education. |
| The LSC encouraged colleges to bid for funds and approved projects it did not have money for, their report says. | The LSC encouraged colleges to bid for funds and approved projects it did not have money for, their report says. |
| Ministers have acknowledged mistakes made and say lessons are being learned. | Ministers have acknowledged mistakes made and say lessons are being learned. |
| MPs on the Innovation, Universities, Science and Skills Committee say the government should review the way all such quangos operate, so that such a situation cannot happen again. | MPs on the Innovation, Universities, Science and Skills Committee say the government should review the way all such quangos operate, so that such a situation cannot happen again. |
| The LSC was charged by the government to deliver its programme to rebuild or refurbish England's colleges. | The LSC was charged by the government to deliver its programme to rebuild or refurbish England's colleges. |
| The MPs said that at the time building projects were being approved, the body had been preparing to be disbanded and "wanted to go out with a bang", and had encouraged colleges to "big up" their plans. | The MPs said that at the time building projects were being approved, the body had been preparing to be disbanded and "wanted to go out with a bang", and had encouraged colleges to "big up" their plans. |
| But there was no process for prioritising bids and by last November, when the alarm was finally raised, 144 colleges had together invested tens of millions of pounds in preparing bids and getting approval from the LSC. | But there was no process for prioritising bids and by last November, when the alarm was finally raised, 144 colleges had together invested tens of millions of pounds in preparing bids and getting approval from the LSC. |
| Warning signs were missed and even worse, ignored Phil Willis MP, committee chairman | Warning signs were missed and even worse, ignored Phil Willis MP, committee chairman |
| Recently, it was announced only 13 of those projects would go ahead this year. | Recently, it was announced only 13 of those projects would go ahead this year. |
| Committee chairman Phil Willis, a Liberal Democrat MP, said: "It really beggars belief that such an excellent programme which had showed real success in transforming the further education experience for students was mismanaged into virtual extinction. | Committee chairman Phil Willis, a Liberal Democrat MP, said: "It really beggars belief that such an excellent programme which had showed real success in transforming the further education experience for students was mismanaged into virtual extinction. |
| "Warning signs were missed and even worse, ignored. LSC didn't notice as the total value of the projects it was considering began to overshoot the budget and a review which could have prompted action was shunted around committees and policy groups." | "Warning signs were missed and even worse, ignored. LSC didn't notice as the total value of the projects it was considering began to overshoot the budget and a review which could have prompted action was shunted around committees and policy groups." |
| The report follows one by Sir Andrew Foster, who was asked to carry out an inquiry into what went wrong with the college rebuilding project. | The report follows one by Sir Andrew Foster, who was asked to carry out an inquiry into what went wrong with the college rebuilding project. |
| Both reports talk of mismanagement by the LSC and also criticise the government. | Both reports talk of mismanagement by the LSC and also criticise the government. |
| The report from the committee concludes: "Both Dius (the former Department for Innovation, Universities and Science) and the LSC are jointly liable for not recognising the weak points of a capital programme which suffered from no overall budget and poor management information but which was being heavily marketed by the LSC to colleges." | The report from the committee concludes: "Both Dius (the former Department for Innovation, Universities and Science) and the LSC are jointly liable for not recognising the weak points of a capital programme which suffered from no overall budget and poor management information but which was being heavily marketed by the LSC to colleges." |
| The MPs also said that the atmosphere at the funding body was one of being "de-mob happy", because it was to be wound up under government changes. | The MPs also said that the atmosphere at the funding body was one of being "de-mob happy", because it was to be wound up under government changes. |
| Gordon Marsden, a Labour MP on the committee said: "There was a sense that the LSC wanted to go out with a bang. They did - but not in the way they intended." | Gordon Marsden, a Labour MP on the committee said: "There was a sense that the LSC wanted to go out with a bang. They did - but not in the way they intended." |
| Lessons learned | Lessons learned |
| The MPs recommend that arrangements for compensation for colleges costs be settled urgently and that colleges which want to press ahead by finding alternative funding be offered government help to do so. | The MPs recommend that arrangements for compensation for colleges costs be settled urgently and that colleges which want to press ahead by finding alternative funding be offered government help to do so. |
| Minister for Further Education Kevin Brennan said the college building programme, begun in 2001, had renewed or rebuilt "half the further education estate" and the MPs' report had acknowledged that this was a great achievement. | Minister for Further Education Kevin Brennan said the college building programme, begun in 2001, had renewed or rebuilt "half the further education estate" and the MPs' report had acknowledged that this was a great achievement. |
| "The committee recognises this is still an excellent programme but one that has been compromised by poor management," he said. | "The committee recognises this is still an excellent programme but one that has been compromised by poor management," he said. |
| "Ministers have acknowledged the mistakes that were made and have already made improvements to ensure rigorous management going forward, based on the recommendations of our own independent review. | "Ministers have acknowledged the mistakes that were made and have already made improvements to ensure rigorous management going forward, based on the recommendations of our own independent review. |
| The committee issues a timely warning Martin Doel, Association of Colleges | |
| "The former Dius 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 of Business, Innovation and Skills." | "The former Dius 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 of Business, Innovation and Skills." |
| Martin Doel, the chief executive of the Association of Colleges, said: "The committee issues a timely warning. | |
| "Colleges need to be free to get on with the job of serving millions of students without having to endure mismanagement by a quango. | "Colleges need to be free to get on with the job of serving millions of students without having to endure mismanagement by a quango. |
| "The LSC must assist any colleges placed in financial difficulty as a result of preparing, in all good faith and with due diligence, for a building project. We are therefore pleased that the committee has recommended that arrangements for compensation for colleges' sunk costs are settled urgently. | "The LSC must assist any colleges placed in financial difficulty as a result of preparing, in all good faith and with due diligence, for a building project. We are therefore pleased that the committee has recommended that arrangements for compensation for colleges' sunk costs are settled urgently. |
| "Colleges warmly welcome the committee's recommendations that there should be additional support for those who wish to raise alternative finance, as well as additional funding for innovation and for small projects." | "Colleges warmly welcome the committee's recommendations that there should be additional support for those who wish to raise alternative finance, as well as additional funding for innovation and for small projects." |