Finances for Further Education colleges in trouble

The National Audit Office (NAO) has reported a “rapid decline” in the Further Education sector’s finances, with almost 50 per cent of colleges in deficit in 2013-14.

The NAO said that from autumn 2013 to summer 2015, there were 22 colleges where the Further Education commissioner intervened due to financial troubles. As well as this, the number of colleges in deficit rose from 52, the figure in 2010-11, to 110 in 2013-14.

The Further Education sector receives £7bn each year in order to educate four million students.

In the report, the NAO suggests a “joined-up” response from the sector, due to a high number of colleges in financial difficulties. The Department for Education, and the Business, Innovation and Skills (BIS) department, have been appealed to by the watchdog to work closer, for decisions which decide whether colleges must close or join together.

“Colleges have been battered by a swathe of funding cuts over recent years and it is no surprise that their financial health has suffered as a result,” said the Chief Executive of the Association of Colleges, Martin Doel.

“Whilst the Further Education sector is resilient, it cannot endure any more cuts without impact on the local communities it serves.”

The government has announced a further £25m of funding into apprenticeship opportunities, to create three million positions by 2020.