Skip to main content

Further Education: Capital Investment

Volume 708: debated on Wednesday 4 March 2009


My right honourable friend the Secretary of State for Innovation, Universities and Skills (John Denham) has made the following Written Ministerial Statement.

In 1997 there was no capital budget for further education (FE) colleges and the National Audit Office (NAO) described FE college buildings as “ageing and their quality and fitness for purpose was often unsatisfactory, affecting the reputation of the sector”.

Between 1997-98 and 2006-07, more than £2 billion has been invested in modernising FE facilities. My department will spend another £2.3 billion in the current spending review period. We have brought forward £220 million of this funding, £110 million from 2009-10 to 2008-09 and a further £110 million from 2010-11 to 2009-10, as part of our response to boost the economy. Nearly 700 projects in 330 colleges throughout England have been agreed, and 253 schemes are under way or fully approved. Only 42 colleges have yet to receive any investment. Last summer the NAO reported the programme as making good progress with the renewal and modernisation of the FE estate, with the great majority of projects coming in on budget and delivering great improvement for learners.

I previously informed the House that the demand for funding by colleges has risen. The size of projects and the scale of government funding required have increased. In December, the Learning and Skills Council (LSC), which administers the programme, decided to defer further approvals of projects in principle and in detail while assessing the programme overall. As I said in the House on 3 February, this decision did not affect projects that have already received agreement in detail and are in progress and we anticipate spending the full £2.3 billion allocated in this spending review period.

Today the council met to discuss the results of its assessment of the programme. It has decided to give detailed approval to eight schemes at colleges in Stoke-on-Trent, Coulsdon (Surrey), West Kent, Liverpool, Solihull, Northampton and two in Bolton.

These colleges had all been recommended for approval by the national capital committee of the council and decisions to approve their applications in detail had been deferred from the December meeting.

The total cost of these schemes is nearly £400 million. The council will provide more than £300 million in government funding over the next five years. Following the council’s decision today, the LSC will be working with the colleges involved on the phasing and funding requirements of these projects and how they are now taken forward. Their benefits will be felt by students and their local communities for years to come.

However, the LSC has now completed its assessment of other colleges seeking approval in principle or detail. I am informed that the council has already given 79 colleges the first stage of approval in principle. Government funding of nearly £2.7 billion would be needed for them to proceed. A further 65 colleges have submitted bids to the national LSC for approval in principle with an assumed funding contribution from government of a further £3 billion.

As a consequence, there are many more schemes currently in preparation than can be funded in this spending round. For that reason, I agreed with the council that it would appoint an independent reviewer, Sir Andrew Foster, to find out how this situation arose and what lessons must be learnt for the future. It is clear that even at current record levels of funding not all schemes can be implemented on the timescales originally envisaged. I have therefore asked the council to consult the Association of Colleges and the FE sector to advise me on ways of prioritising schemes in the future programme.  

I have asked the council to keep interested members informed on the progress and status of schemes in their area.