Real-Time Training Ltd, which trades under the name RTT Group, has had its £3.3m contract with the Skills Funding Agency (SFA) terminated.
A spokesperson for the SFA told FE Week: “The Agency has taken the decision not to re-contract with RTT for the 2012/13 academic year and has issued notice to terminate the current contract in accordance with our agreed terms and conditions.
“The Agency continues discussions with RTT over the concluding position on its contract including any financial out turn.”
The spokesperson added that the Agency is working with the National Apprenticeship Service (NAS) and RTT to protect public funds and ensure “minimal disruption to learners” while they are placed with local providers and employers.
The Agency has not revealed however why the contract with RTT was terminated.
At the time of publication Mike Barton, executive group chairman at RTT Group, told FE Week he was “99 per cent” sure the company, based in Leicestershire, would be put into administration later that day.
“Since we opened the learners have been – and will be until we’re no longer connected in any way – our main priority,” he said.
“That’s always been our philosophy, and will continue to be so.”
Mr Barton said he had written to all of the FE colleges which RTT works with to inform them of the situation.
The family company, which includes managing director Emma Barton and director James Barton, is understood to have also worked for the Department for Work and Pensions (DWP).
A spokesman for the DWP said: “We have received a call from RTT to say that the offices have closed temporarily. The DWP has not been told anything formally at this stage.”
Christian Gibbs was enrolled on a Security Industry Authority (SIA) course with RTT when it closed last week.
“I received a phone call on Friday and was told not to come in on the following Monday as it was a training day, but to attend on Tuesday as sessions would commence as normal,” he told FE Week.
“I must have waited just over an hour with a group of other students for one of the RTT employees to open the shutters so that we could begin, but that didn’t happen.
“None of the students were notified in any way by the RTT Group and had to find out for ourselves what had happened.”
A former employee told FE Week he was “extremely saddened” to hear that the company might close.
“Most of all I feel sorry for the staff,” he said.
“I know many of them have been so loyal to the family, working long hours and giving their all.”