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Insolvency regime publication: Introduction comes at historic low point in college funding

20 May 2019

Following the response of the Government to the consultation feedback on the insolvency regime, David Hughes, Chief Executive of the Association of Colleges, said: “The Government's publication today sets out its response to the consultation feedback and covers a lot of complex areas of policy and law. The media focus has, understandably, been on the figure of 100 colleges over 10 years which may require legal advice on insolvency, as set out in the impact assessment. That number may be misleading and is certainly not intended to imply that 100 colleges are at risk of insolvency. "The insolvency regime being introduced in itself is not a bad thing, the problem is that it is likely to come into effect at an historic low point in college funding. The Children’s Commissioner just this week pointed out that 16 to 18 funding in 2019-20 will be at the same level in real terms as 30 years ago; this was described as remarkable and is completely out of step with funding in HE and for younger pupils. That lack of funding has made running a college harder than ever, just at a time when colleges want to provide a full and rich curriculum and support for young people and adults. The balance between balancing the books and meeting students’ needs is not an easy one. “College funding has been cut harder than any other part of the education system over the past decade; that’s why we’re calling on the Government to provide fair funding for colleges. We will work with the Government to ensure the insolvency regime is implemented sensibly and does not have perverse outcomes.”