Colleges applying for bailouts will NOT be automatically placed in formal intervention, DfE says

Colleges which apply for government bailouts will not automatically fall into formal intervention from now on, the Department for Education has said. 

The department’s ‘College oversight’ policy was today amended to say they reserve the right, where a college makes a request for emergency funding to continue running, to place the college into formal intervention or not. 

A DfE spokesperson confirmed the amendment means colleges will not “automatically” be placed into formal intervention if applying for exceptional funding. 

They said the department is providing “maximum support” to colleges during the Covid-19 pandemic, and “we will continue to intervene where colleges are at financial risk”. 

However, they added, “we want to make sure our action fits the college circumstances,” based on “thorough” assessment. 

Colleges which are placed in such measures are usually published online, with the subsequent assessment by the commissioner explaining if it was because they had applied for emergency funding. 

However, if colleges do not automatically enter intervention following an application for emergency funding, it could lead to the public being left in the dark as to which colleges requested bailouts. 

Skills minister Gillian Keegan told the House of Commons last month five colleges had needed emergency funding due to the Covid pandemic – the department has refused to reveal the names of the providers. 

This comes after the number of colleges entering formal intervention rose by two-thirds in 2018-19, according to FE Commissioner Richard Atkins’ annual report from February. 

An application for emergency funding was what brought formal intervention down on Hadlow and West Kent and Ashford colleges, the first two FE providers to enter the insolvency regime. 

And earlier this year, Greater Brighton Metropolitan College was put in formal intervention after it applied for emergency funding. 

The amended oversight policy does warn that if a college is placed into formal intervention, it will trigger a notice to improve from the government.