On Wednesday 13 October, the Office for National Statistics (ONS) announced that it has now chosen to reclassify general further education colleges as part of central Government.
This decision results from powers provided in the Further and Higher Education Act 1992. General further education colleges had previously been classified as part of the private sector.
This decision will have implications for the way that colleges are treated for national accounts purposes and therefore may impact on the collection and monitoring of financial information from institutions. However, we do not expect it will have any direct impact on colleges for the remainder of the financial year.
I have already written to the governing bodies of further education colleges reiterating the Government’s commitment to reduce unnecessary administrative burdens on colleges, thereby giving them the freedom to make their own judgments and decisions about how they work with partners, and how best to manage their internal affairs for the benefit of learners, employers and wider communities.
As part of this work the Department for Business Innovation and Skills is exploring options to bring forward legislation that will seek to repeal the requirement on further education colleges to secure the consent of the chief executive of Skills Funding before borrowing money. The Department will also review all the conditions in the financial memorandum between colleges and the Skills Funding Agency as part of the wider assessment of freedoms.
I will continue to keep the House informed as our plans are further developed and refined.