Rigour and responsiveness: new intervention powers for FE

Joanna Forbes

Last month’s DfE/BIS publication ‘Rigour and Responsiveness in Skills’ sets out the government’s proposals for further reform of the skills system.

One of the more interesting proposals is the strengthening of intervention powers where colleges are failing:

‘where performance is inadequate, there will be a faster, more robust intervention regime that protects learners while firmly tackling poor provision by providing a clear administration process for failing colleges’

The new powers will be triggered where a college is judged to be ‘inadequate’ by Ofsted or ‘where a college is failing on minimum standards or financial management requirements’. In such a case, a new FE Commissioner will lead action on behalf of the various government departments and funding agencies and will meet with the college’s management and governors to put in place a series of measures to turn the situation around.

Possible steps which the FE Commissioner might recommend include:

  • The college may be put into ‘administered college’ status, resulting in the loss of its freedoms and flexibilities
  • New governors may be appointed
  • There may be an open competition for new providers to takeover the college’s provision
  • The college could be dissolved

Comment

The proposed strengthening of the Secretary of State’s powers of intervention comes only a year after those powers were scaled back by the Education Act 2011 following the decisions by the NAO and ONS to classify colleges as ‘public sector bodies’.

The 2011 Act removed the Secretary of State’s power to dissolve a college and transfer its assets and liabilities to a third party, and also removed the SFA’s powers of intervention and its power to appoint up to two members of a college’s governing body.

However, a number of residual intervention powers were transferred to the Secretary of State, including the power to remove all or any of the members of the governing body and to appoint new members where there are vacancies, and the power to direct a corporation to pass a resolution to dissolve the college (a direction which the corporation must comply with). Such powers can be exercised where a the Secretary of State is satisfied that the college’s affairs are being mismanaged, or that the governing body has failed to discharge any of the duties imposed on them, or has acted unreasonably with respect to the exercise of any power conferred on them, or that the college is performing significantly less well than might be expected or is failing to provide an acceptable standard of education or training. These are fairly wide grounds which give the Secretary of State considerable discretion to act.

At the time the 2011 Act was going through Parliament assurances were made that these residual powers would ‘never be used’, but they are clearly a key part of the current proposals. Concerns have already been raised about exactly what will trigger intervention, particularly on financial grounds, and the Minister for Skills Matthew Hancock has promised further detail before the summer.

It will be interesting to see how the proposed ‘administered college’ status will operate, in particular the proposed ‘removal’ of a college’s freedoms and flexibilities. Corporations have a statutory power to dissolve the college and transfer its assets and liabilities to a third party, a power which is also contained in the college’s articles of government. The government is proposing that these powers will be removed via a renegotiation of the financial memorandum, in effect by a contractual agreement between the college and the SFA that the college will forgo its statutory powers as a condition of funding. This would raise some interesting contractual questions if the college were to disregard the funding agreement and dissolve itself anyway, as the SFA would presumably have to seek to impose sanctions on any successor body. It has also been suggested that administered college status could result in the college’s reclassification by the NAO/ONS, thus requiring its accounts to be consolidated with those of the SFA.

BIS is currently advertising for applicants for the new FE Commissioner post together with a pool of FE Advisers ‘to support the government where intervention is needed in GFEs’. The new intervention process is due to come into force in August once the Commissioner has been appointed.

Joanna Forbes
Senior Associate Solicitor
Education Team
DD: 0800 763 1310
M: 07725 241552
F: 0800 763 1710
International DD: +44 870 763 1310
E: joanna.forbes@sghmartineau.com
W: www.sghmartineau.com

Comments - No comments posted yet.

Leave a Comment

 


Please add 3 and 3 and type the answer here: