A surge of optimism over college buildings in 2007 came to a crashing halt just over a year later when it emerged the Learning and Skills Council (LSC) had over-committed and could not fund contracts already signed.

With the expectation of approving just £500m in grants, the proposals facing the LSC for first stage approval in March 2009 had already hit £2.7bn, with a further £3bn needed for 65 colleges submitting plans.

A report by Sir Andrew Foster concluded: “more modest proposals [had been turned] into wholesale upgrading of the entire college estate.”

One college bidding for £18m was urged to resubmit with an £80m new build proposal.

But, as one former senior Further Education Funding Council (FEFC) official told FE Week: “When it comes to an over-optimistic approach to estates management, FE has pedigree.”

When estates were first looked at on Incorporation 20 years ago, colleges underwent surveys to estimate costs of bringing colleges up to standard. FEFC estimated that £850m was needed.

But, set against local authority details of work in progress and new commitments — and Treasury estimates that FE replacement costs would be £4.4bn — FEFC urged colleges to come up with more radical rebuilding plans.

Mick Fletcher, (pictured) planning and funding specialist with the Policy Consortium, recalls: “There was a tendency for ‘visionary’ principals to build vast open plan areas without walls as colleges of the future, such as South East Essex and Stroud, which succeeding principals spent money turning back into classrooms.”

Private cash either failed to materialise or was too often inappropriately spent”

Each subsequent government policy change brought new building priorities — first health and safety, then replacing substandard teaching facilities followed by demands to expand floor-space for a new student-centred focus on learning and so on, to the new national skills drive.

But one after another, magic solution building initiatives fell short.

In late 1996, private finance initiative thinking proved a spanner in the works as FEFC funds were slashed from £126m to £59m, but private cash either failed to materialise or was too often inappropriately spent.

A formula to make the wealthiest colleges pay most through an Average Level of Funding formula was described by one finance director as “a complex and hair-raising disaster dreamed up by FEFC bean counters”.

The most successful period of rebuild and refurbishment came not from government initiative, but the property boom when college asset sales rose to record levels.

And so hopes for the latest £270m cash injection are welcomed with caution. Skills Minister Matthew Hancock said at the announcement: “With colleges trebling the amount of government money invested in capital projects we expect to see over £1.5bn in new college construction projects get off the ground in the next two years.”

Martin Doel, chief executive of the Association of Colleges, says: “This investment will allow colleges to continue to update their estates, helping them to deliver continuing high standards to their students, communities and industry partners.”

But he knows there are many imponderables such as the availability in colleges of matched funding and the capacity of private commerce to triple the investment.

This time, however, there is clear evidence of benefits that make this investment essential, he says. A major study for the Department for Business, Innovation and Skills by Frontier (Europe) in December 2012 showed that every £1m capital investment brings 62 to 86 extra learners each year and that large investment reduces colleges’ dependency on other government money as they become more self-sufficient. Other benefits from spending on buildings include greater environmental sustainability and support for local economic regeneration. There is proven increased student satisfaction and better engagement with employers, the report concludes.

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