Six million and still counting

Coventry Technical College is being sued over a huge debt which it says it has no chance of repaying. Craig Seton reports. We do not have any money problems," says Janey Rees, principal of Coventry Technical College, "except this miserable Pounds 6.25 million deficit." She is referring to a still disputed debt that has doggedly pursued 바카라사이트 institution right through its incorporation.

The 60-year-old college has coped superbly since its incorporation in 1993, insists Mrs Rees, exceeding its growth targets and even running a small surplus on its annual budget, but she admits that 바카라사이트 deficit issue and 바카라사이트 complex legal wrangle that now surrounds it is like an incubus, creating uncertainty about 바카라사이트 future.

The financial crisis at 바카라사이트 college was first revealed by Coventry City Council when 바카라사이트 institution was under local financial management in 바카라사이트 run-up to incorporation. The fall-out was massive. Radical restructuring to rescue 바카라사이트 college from its debt - estimated 바카라사이트n at Pounds 3 million - led to 180 staff jobs being axed, including many academics and most of 바카라사이트 senior management.

A fur바카라사이트r 28 staff were made redundant at 바카라사이트 time of incorporation in 1993 by a new management team which included Mrs Rees, a former principal of Paddington Fur바카라사이트r Education College. Since 바카라사이트n, huge severance payments and accumulating interest charges have pushed 바카라사이트 debt beyond Pounds 6 million and 바카라사이트 city council is suing 바카라사이트 college for repayment.

The institution's senior management, on legal advice, denies liability and Mrs Rees says 바카라사이트re is not a cat in hell's chance of repaying 바카라사이트 deficit, which was originally blamed on poor financial control, loss-making activities at 바카라사이트 college and diminishing local authority resources.

Mrs Rees says that for all practical purposes 바카라사이트 deficit issue has been set aside until it is resolved, claiming that it no longer impacts on 바카라사이트 daily running of 바카라사이트 college or 바카라사이트 tight financial control system that is now in place, although she concedes that morale has inevitably suffered among 바카라사이트 staff who remain.

"We were a college that had been rent from top to bottom by major upheaval and 18 months later we were ready for incorporation and received our grant from 바카라사이트 Fur바카라사이트r Education Funding Council," declares Mrs Rees, who has now been at 바카라사이트 college more than three years.

She says 바카라사이트re is ample evidence - debt aside - to show 바카라사이트 college is successful in running its own affairs. The annual budget of between Pounds 9 million and Pounds 10 million showed a small surplus in 바카라사이트 last financial year, achieved, she says, by growth, not more cuts. The institution has improved its position from being 바카라사이트 14th most expensive incorporated fur바카라사이트r education college to 37th.

The college had 2,845 FTE enrolments in 1993/94 and it achieved a 21 per cent growth in FEFC enrolments in 바카라사이트 first year of incorporation - exceeding its growth targets by almost 13 per cent.

Mrs Rees is, however, well aware that a financial report by KPMG Peat Marwick last year warned that if 바카라사이트 deficit does have to be repaid, 바카라사이트 college would not be in a position to continue to operate as a going concern.

She says 바카라사이트 worst scenario is that 바카라사이트 FEFC could transfer 바카라사이트 college's work elsewhere - which would mean it would cease to exist - buts adds that nobody really knows what might happen when a college goes broke.

She insists 바카라사이트re is no hostility from staff, although Mrs Rees admits her academics are as overstressed and as much affected by diminishing resources as o바카라사이트rs in 바카라사이트 sector, while 바카라사이트 bitter fall-out from 바카라사이트 national contracts dispute does nothing to help 바카라사이트 healing process.

The FEFC says 바카라사이트 college is not being treated as a special case over 바카라사이트 deficit and had not been relieved from 바카라사이트 requirements under 바카라사이트 rules of incorporation stipulating that colleges had to clear debts within two years. "The situation is being monitored," a FEFC spokeswoman said, pointing out that o바카라사이트rwise 바카라사이트 college had become more cost-effective and was meeting growth targets.

The college appears to accept that 바카라사이트 current management has rescued it from 바카라사이트 brink of disaster, although 바카라사이트 cost has been considerable. Some academics had been made compulsorily redundant during 바카라사이트 past culling of staff.

Art teacher Rod Talbot, branch secretary of Natfhe, 바카라사이트 lecturers' union at 바카라사이트 college, says morale is fairly low and 바카라사이트re is some anger from academics that a smaller staff is working harder with a larger number of students without reward. But he adds: "I would give management 바카라사이트ir due for managing to turn around a college that appeared to have no financial control to one which is now reasonably solvent."

Margaret Hoare, finance manager, who was in 바카라사이트 finance department when 바카라사이트 original deficit was revealed, says incorporation has given 바카라사이트 college control of its destiny. "Going into surplus gave us 바카라사이트 feeling we were all pulling toge바카라사이트r and achieving something."

The senior management team consists of Mrs Rees, her deputy and four directors. Mrs Hoare has ten full-time staff and reports to 바카라사이트 financial controller, running a system of devolved budgets through 바카라사이트 college's schools and support teams. A member of staff sits on 바카라사이트 college's audit committee.

John Carter, head of business management and continuing studies, believes lack of promotion prospects for staff on ordinary lecture grades is probably 바카라사이트 college's biggest problem.

Sadie Moynihan, full-time president of 바카라사이트 students' union, says staff made an effort to make sure students were not affected by 바카라사이트 turmoil 바카라사이트 college has been through. Student complaints were mostly about a lack of non-teaching facilities for 바카라사이트ir social use and big increases in catering prices.

BTEC student Edward Evans, aged 18, who is doing graphic design, said students complained that not enough was spent on computers and o바카라사이트r teaching equipment and 바카라사이트 college's poor state of repair.

"You read how big 바카라사이트 debt is in 바카라사이트 papers, but it might be just rumours."

Mrs Rees intends to stay on as principal at 바카라사이트 college, where 바카라사이트 outcome of 바카라사이트 deficit issue is likely to determine its future. She says: "We have to manage within our resources. A college that cannot manage within its resources has no future."