Question to the Department for Education:

To ask the Secretary of State for Education, how many colleges are currently subject to a notice to improve financial health; and how many are projected to be subject to such a notice in the next (a) five and (b) 10 years.

There are currently 38 colleges that are subject to a notice to improve for financial health.

The published response to the insolvency consultation stated that, using data and assumptions available at that time, over the first ten years of the insolvency policy (commences April 2019), an additional 63 colleges could meet the current triggers for a notice.

The Education and Skills Funding Agency (ESFA) has published an Early Intervention and Prevention strategy, which is available at the following link: https://www.gov.uk/government/publications/college-funding-early-intervention-and-prevention/early-intervention-strategy. This strategy outlines how the ESFA works with colleges where data shows that they could be at risk of failure.

In addition, the ESFA is improving and increasing the financial information that it requests from colleges, which will be analysed by integrated expert teams, and is developing a strengthened approach to intervention and prevention approaches in advance of financial crisis.

The department is also updating improved guidance for college governors, due later this month, to highlight governors’ fiduciary duties. They are in the process of appointing National Leaders of Governance to deliver sector-led support (alongside the National Leaders of Further Education). The Further Education Commissioner’s team has also expanded coverage of ‘diagnostic visits’ to colleges, which also highlight potential issues in advance of crisis, and offer recommendations for support and improvement.