Hadlow College: a statement from Association of Colleges

17 May 2019

You may have seen in this morning’s media that Hadlow College may be placed into educational administration over the coming days or weeks. Please see our official statement below:

"This is an exceptional case under new legislation which has never been used before. Because of that, everyone involved in this will be learning as they go, so it is more difficult than usual to forecast what might happen.

We know that the Department for Education was providing exceptional financial support to Hadlow College to cover running costs and that the decision was taken to petition the High Court to place the college into educational administration. The Court will decide whether to appoint an education administrator using the new college insolvency regime introduced by Parliament. The education administrator has a primary duty to protect the interest of current and enrolled students first, and then creditors so the normal activities in the college will continue in the short-term and students should hardly notice any difference. That is an important difference to straightforward commercial insolvency and students and their families as well as staff should be reassured by that.

We also know that there have been a number of investigations and processes underway at the college including those by the ESFA and the FE Commissioner because of the financial problems the college faces, as well as concerns about how the governance and leadership has allowed the college to get into trouble. The college has also been in receipt of exceptional financial support. We don’t know all the circumstances, but we do know that ministers told Parliament that they would only use the insolvency process in exceptional cases and there have been media reports which suggest very unusual behaviour which is not the norm in other colleges.

We see no sign that DfE will remove exceptional financial support from other colleges where they and the FE Commissioner are working together to address the tough funding environment. In fact, DfE recently confirmed that it may make emergency funding available where a college would otherwise run out of money in order to help the college to find a viable future solution. It is worth remembering that it is in the interests of the DfE to make every effort to ensure that their interventions, through the ESFA and the FE Commissioner lead to successful outcomes and for insolvency to remain a very rare process.

The duties on college governors and leaders are clear. They need to manage resources responsibly and be careful about making commitments and in virtually every case they do that exceptionally well. This appalling situation must not overshadow the incredible work that thousands of college governors and senior leaders do to support 2.2 million people in England to learn and train, despite a decade of severe cuts. Their collective dedication to leading viable and successful colleges shines through even the darkest gloom from examples like this."

Julian Gravatt, Deputy Chief Executive, recently produced a comprehensive set of FAQs on the new college insolvency regime, which you can find here. Please do contact AoC if you have other questions or concerns.