A cash-strapped college has received a financial health notice to improve from the government after requesting exceptional financial support to the tune of £2.1 million.
West Nottinghamshire College will now be referred to the FE Commissioner for an independent assessment to test the college’s “capability and capacity to make the required changes and improvements”.
A spokesperson for the college confirmed the amount it requested from the Education and Skills Funding Agency.
FE Week reported earlier this year that West Nottinghamshire College had blamed changes to subcontracting rules for the fact it was having to cut more than 100 jobs in an effort to make £2.7 million in savings.
The notice, sent to West Nottinghamshire College’s chair of governors Nevil Croston on July 24 and published today, said the college board “will be expected to engage positively and responsively in the intervention process including attendance at regular case conferences to report on progress to financial recovery”.
The college was told to provide the ESFA with a two year financial forecast and weekly cash flow by August 17, and consult with the agency before “any asset disposal or inter-company financial transfer”.
West Nottinghamshire College is still yet to publish its most recent accounts online, despite the January deadline for doing so. The notice said the college must now share its management accounts with the DfE and any other relevant financial and cash flow information.
If the college “fails to take the necessary actions (in whole or part) within the timescales to be agreed, or if evidence of progress is not appropriate or not available”, the ESFA will “take further action”.
Dame Asha Khemka (pictured), principal and chief executive of West Nottinghamshire College, said the college had asked for “a short-term loan” from the ESFA, which was provided in July.
She added that, although close to 100 members of staff were made redundant or accepted voluntary redundancy before the summer, the “full impact of savings” from this will not be realised until 2018/19.
“The college’s plan for financial recovery, which led to the restructure, was also based on us meeting student enrolment targets in 2018/19. Early indications are that we are well on track to do so,” she said.
“Despite the challenges the college has faced, I am confident we will continue to serve our local communities as a vibrant institution that provides high-quality education and training to local people and employers.”
West Notts was the largest college provider of apprenticeships in 2016/17, and had contracts to deliver apprenticeships and traineeships worth £19.8 million last year. However, the overwhelming majority of this was subcontracted.
New rules for contracting and subcontracting, which came into force in May 2017, mean lead contractors can no longer subcontract entire apprenticeship programmes but must “directly deliver” at least some of each programme.
West Nottinghamshire College subcontracted 82.4 per cent of its apprenticeship provision in 2015/16, which earned it £3.2 million in top-slicing fees from provision worth £15.5 million.