UCU says 'catastrophic mismanagement' report must lead to compensation for colleges hit in buildings fiasco

The union said the cash-strapped colleges had to be compensated urgently, otherwise jobs would lost, communities would suffer a lack of educational opportunity and it would be staff and students who suffer the most from mismanagement. It also raised concerns about the ability of the new 'enormous' Business, Innovation and Skills (BIS) department's ability to ensure nothing like this could happen again.
 
The report criticises 'catastrophic mismanagement' and warns that the mismanagement, coupled with 'government oversight failures', could cost hundreds of millions of pounds. It adds that a 'heinously complicated management structure at the Learning and Skills Council (LSC) and approaching government department changes bred a lack of responsibility and gave an air of distraction.'
 
Seventy nine further education colleges had building schemes approved by the LSC - and a further 120 were carrying out feasibility studies - when work was halted in December. Only 13 are now continuing. Data from the Association of Colleges suggests £215m has already been spent on stalled projects and £187m will be written off if projects do not continue. A further £269m will be spent in extra costs over the next five years maintaining sites.
 
UCU general secretary, Sally Hunt, said: 'This report quite rightly identifies and criticises the failings we have uncovered in our own dealings with those culpable for this disaster. We welcome recommendations for compensation for those colleges encouraged to take forward the building plans and who now find themselves cash-strapped and in perilous positions. We are unconvinced that the new enormous Business, Innovation and Skills (BIS) department will be in a better position to ensure nothing like this happens again though.
 
'The report's recommendations represent an excellent opportunity for the Prime Minister, and the government, to put some action behind recent rhetoric that education would not become a victim of the recession. Those colleges that find themselves out of pocket because of the failings of the government and the LSC must now be properly reimbursed. It would be quite tragic and utterly outrageous if staff and students were to suffer because of the failings that have created this fiasco.'
 
The report recommends:

• all national capital programmes should have an agreed in-built mechanism for prioritisation from the start, even if they initially underspend
• a review takes place across the whole of government of the operation of non-departmental public bodies
• the LSC must immediately take steps to set out a timetable for the remainder of the evaluation process
• DBIS and the LSC must ensure that the arrangements for compensation for colleges' sunk costs are settled urgently
• a small amount of government funding must be made available to support colleges who wish to raise alternative finance for their projects, and the potential to involve HEFCE and local authority funding investigated
• colleges must be assisted to share best practice and contacts or reduce costs through shared use or redesign
• funding for an innovation fund and for small projects should be set up as soon as possible
• the new BIS committee must maintain scrutiny of how LSC deals with Train to Gain and Adult Apprenticeship funding.