Education CommitteeWritten evidence submitted by the Association of Colleges

1. Introduction and Background

1.1 The Association of Colleges (AoC) is pleased to respond to the Education Select Committee’s invitation to help to inform the Committee’s inquiry into the role of school governing bodies by providing comparative, contextual information for governance in the College sector.

1.2 AoC was established in 1996 by Colleges themselves as a voice for further education and higher education delivered in Colleges at national and regional level. AoC is a not for profit membership organisation that exists to represent and promote the interests of Colleges and provide members with professional support services. 

1.3 FE and Sixth Form Colleges form a distinctive sector that has been described by Government as “central to achieving the Government’s ambitions for Britain”. They have a unique role in delivering the Government’s skills agenda whilst supporting other cross-Government initiatives, and are essential in helping young people and the unemployed move into sustainable work.

1.4 All Colleges are incorporated under the 1992 Further and Higher Education Act, leaving local authority control, and are exempt charities (with the exception of Specialist Designated Colleges, which were established in 1988 and are registered charities), and consequently have much in common with incorporated higher education institutions. As autonomous institutions incorporated by Act of Parliament, Colleges have the freedom to innovate and respond flexibly to the needs of individuals, business and communities, and have acquired an unrivalled reputation for their cost-efficiency.

1.5 Colleges are much less numerous than schools, but are much more complex , private sector organisations1 delivering a unique, rich mix of academic, occupational and vocational education. Average College income is £22 million per annum, with the largest college’s income exceeding £150 million per annum, and a total income figure for English Colleges in 2011 of £7.7 billion.

1.6 At the time of writing, there are 407 Colleges in the UK: 341 in England, 41 in Scotland, 19 in Wales, and six in Northern Ireland. This compares with some 1,800 schools with sixth forms. As well as delivering classroom-based learning, Colleges support work-based learning and have a key role supporting apprenticeships. Over two million learners participated in Government funded further education in FE Colleges in 2010–11, and Colleges delivered provision to more 16–18 year olds than schools, as well as more provision to adults than other providers:

43% of 16–18 age learners studied at FE Colleges and a further 9% studied at Sixth Form Colleges in 2010–11, compared with 29% in schools.

49% of all 19–24 age Government funded FE learners were in FE Colleges, compared with 35% in private sector institutions.

41% of all 25+ age Government funded learners were in FE Colleges, compared to 31% in other publicly funded institutions including Local Authority provision.

1.7 English Colleges are categorised as follows:

219 are General FE Colleges.

94 are Sixth Form Colleges.

15 are Land-based Colleges.

Three are Art, Design & Performing Art Colleges.

10 are Specialist Designated Colleges.

1.8 A characteristic of the College sector is considerable diversity, not just in type and size of institution, but also in their individual missions, and this helps to determine whether individual colleges play a national, regional or local role, or indeed a combination of all three. The fundamental commitment of individual Colleges to meeting the needs of the learners and the wider communities they serve lies at the very heart of the College ethos, and differs markedly from the prevailing culture in schools and in higher education institutions.

Further key facts about Colleges are attached as an Appendix.

2. Response to the Education Select Committee’s Questions

With regard to the Committee’s questions, as these relate specifically to Colleges:

Q1. The purpose, roles and responsibilities of College governing bodies, within the wider context of College governance and leadership

2.1 As independent, autonomous, incorporated institutions, Colleges’ Corporations (or “governing bodies”, or “boards”) are required to conform with their Instrument & Articles of Government, charity and other legislation, and with other non-statutory requirements (such as financial memoranda stipulated by funding bodies). Since incorporation in 1993, Sixth Form Colleges have had different Instrument & Articles from General FE Colleges, for example requiring that parent governors must be appointed.

2.2 The Department for Education and Skills in 2007 was abolished in 2007 with its responsibilities eventually ending up in the Department for Business and Innovation and Skills2 (BIS) and Department for Education3 (DfE). The former has responsibility for non-Sixth Form Colleges and the Skills Funding Agency, and the latter for Sixth Form Colleges and the Education Funding Agency (formerly the Young People’s Learning Agency). This split is not dichotomous, as there is policy overlap between the two Departments, and between the two funding agencies, but this unusual arrangement does contribute a level of complexity and bureaucracy to the College sector that can be burdensome and costly for Colleges.

2.3 In May 2010, Government stated that “We will set Colleges free from direct state control and abolish many of the further education quangos”. The decision by Government to grant Colleges “new freedoms” resulted in the Education Act 2011 and associated modification orders which restructured and reduced Colleges’ Instrument & Articles to two common core sets, one for Sixth Form Colleges and one for the rest. This has enabled those College governing bodies that wish to amend their Instrument & Articles to do so in order for their College to pursue its particular mission, and will over time likely result in a wide diversity of individually tailored Instrument & Articles across the College sector compared to the relative uniformity of previous years. Developmental support to assist College governing bodies in engaging with the new freedoms has been provided throughout 2012 through close co-ordination by AoC, LSIS (Learning and Skills Improvement Service), BIS and other sector bodies, and will continue into the future. AoC’s Governors’ Council, the representative body for all College governors, plays a central role in guiding the sector’s support programme for governors and governing bodies.

2.4 Following publication in 2009 of the AoC/LSIS “Schofield report” (“The future challenges facing governance and strategic management in FE”), and subsequent consultation, AoC led the production of a voluntary Code of Governance intended to establish a common set of recommended threshold standards of good governance practice expected of all governing bodies of Colleges in the English FE College sector. The Code’s development was overseen by all key sector stakeholders, including Ofsted.

2.5 The “English Colleges’ Foundation Code of Governance” was published in 2011, and in its foreword John Hayes, then Minister of State for FE, Skills, and Lifelong Learning, wrote:

“No College that listens first and foremost to the people it serves can go far wrong. That is why this Foundation Code of Governance for English Colleges places such emphasis on the role of governors in ensuring that the voice of local communities is clearly heard when key decisions are being taken, whether it is articulating the needs of local employers, the wishes of voluntary groups or indeed the aspirations of young people for a brighter future.

By working collectively and collaboratively to produce this new Code, Colleges and organisations across the Further Education sector have, for the first time, taken real shared ownership of good governance and shown a willingness to embrace increased levels of responsibility for their own affairs. Self-assured, autonomous Colleges will be able to create the space to listen to the people they serve and respond flexibly to the challenges of a new, lightly regulated environment.

The Foundation Code is an important milestone in making Colleges more locally accountable and in freeing them to respond more effectively to local learners, employers and community partners.”

2.6 The Code has been widely adopted by College governing bodies, and has provided a flexible framework for the ongoing development of an on-line “governance library” which contains key reference information, and good practice evidenced through case studies.

2.7 The Code states that every College should be headed by an effective governing body, led by an elected Chair, the members of which (the “governors”) are collectively responsible for formulating strategy by identifying strategic priorities and providing direction within a structured planning framework. The governing body provides overall strategic leadership and takes all final decisions on strategic matters affecting the College. The governing body is responsible for:

Determining the College’s mission, educational character, values and ethos. Governors have a collective and unambiguous leadership role in fostering an environment that enables the College to fulfil its mission, for the benefit of learners and the community it serves.

Ensuring compliance with the statutes, ordinances and provisions that form the College’s governance, regulatory and accountability framework, and compliance with the requirements of the College’s Instrument and Articles of Government.

Ensuring that the respective functions of governance and management, and the roles and responsibilities of the chair, the principal, the clerk and individual governors, are clearly defined.

Establishing a Code of Conduct for governors, which has regard to the accepted standards of behaviour in public life of leadership, selflessness, objectivity, openness, integrity, honesty and accountability.

Ensuring that governors exercise their responsibilities in the best interests of the College, rather than selectively or in the interests of a particular constituency, setting an example to their colleagues and stakeholders.

Ensuring that decision-making processes are transparent, properly informed, rigorous and timely, and that appropriate and effective systems of financial and operational control, and risk assessment and management, are established and monitored.

Ensuring that the governing body receives appropriate, timely and high-quality information in a form that allows it to monitor and scrutinise the College’s activities effectively, and to challenge performance where required.

Ensuring that the governing body is accountable to its learners, to the wider community it serves, and to other stakeholders. It should have close regard to the voice of its learners. It should agree and maintain a public value statement that describes how the College seeks to add value to the social, economic and physical well-being of the community it serves. It should take steps to ensure that information on the activities of the College is made widely available and to forge effective relationships with stakeholders.

Q2. The implications of recent policy developments for College governing bodies and their roles

2.8 The “new freedoms” provided to Colleges by the Education Act 2011, and expounded by BIS’s “New challenges, new chances” policy agenda published in November 2011, have presented College governing bodies with the opportunity to change their Instrument & Articles of Government, and also gave corporations the power to dissolve themselves and transfer their property, rights and liabilities to a prescribed list of organisations and bodies for the purposes of delivering education. The new freedoms are intended to make Colleges and their governing bodies “horizontally accountable” to the learners and communities they serve, rather than “vertically accountable” to Government and its agencies as hitherto. This policy, and the recommendations contained in Baroness Sharp’s report “Colleges at the heart of their local communities”, are driving the accountability agenda for governing bodies. Many Colleges are involved in their Local Enterprise Partnerships (LEPs) and help to identify and meet local needs in partnership with other stakeholders.

2.9 Two recent policy developments that will impact upon College governing bodies are:

The proposed establishment by August 2013 of an independent FE Guild, which will likely undertake the development of governance, leadership and management for Colleges in place of provision currently supplied by LSIS.

The proposal to create legally protected “chartered status” for Colleges to help them celebrate their success, build their reputation and status and gain recognition for what they have achieved within their communities.

2.10 Despite the new freedoms and policy developments described above, the role and influence of Ofsted is still of key importance to Colleges and their governing bodies. Ofsted’s annual report for 2011–12, which was published on 27 November 2012, stated “the quality of provision in Colleges is not improving and teaching is still not good enough”, with “weak accountability, leadership and governance being common failings in poor provision”. The report specifically focuses for the first time on what it considers to be the paramount role of governing bodies in shaping College strategies for learning and teaching assessment, whereas in previous years this was not prioritised in this way; rapid changes by Ofsted in determining key inspection priorities of this kind pose major challenges to governing bodies faced with a wide array of key responsibilities. AoC considers that the report contains inaccuracies and opinions (as opposed to evidence) and is currently challenging the conclusions robustly albeit in a measured way, with the aim of focussing Ofsted’s inspection process to best serve the needs of students and the communities in which they live, which is central to the mission being pursued by College governing bodies.

Q3. Recruiting and developing governors, including the quality of current training provision, and any challenges facing recruitment

2.11 There are some 8,000 College governors, all of whom are volunteers prepared to commit their time and expertise as non-executive directors to helping their College support the needs of the community it serves. The workload and responsibilities of chairs and governors is already considerable, and is set to increase as College’s engage with the new freedoms. Succession planning is essential to ensuring that a College’s governing body’s composition remains representative whilst at the same time having the desired mixture of skills, background and experience to maximise its effectiveness. The ideal profile of a governing body will depend on that College’s agreed strategy to deliver its particular mission, but governor recruits with current business experience/financial acumen are often sought after.

2.12 The College sector, the composition of its governing bodies, and the relative ease with which Colleges are able to recruit new governors with the requisite background, experience and skills set, is extremely diverse. Some Colleges have waiting lists of governors, whereas others struggle to recruit the numbers and profile of members desired to meet an individual College’s needs.

2.13 A number of initiatives are currently under development by AoC’s Governors’ Council and BIS, including recruitment material and approaches, and good practice in terms of governor recruitments is being collected to be shared on the on-line College governance library. The recruitment service provided by the DfE-sponsored “School Governors” One-stop Shop Service’ (SGOSS) for recruiting individuals to specific College governor vacancies is also being actively promoted across the College sector.

2.14 LSIS has actively supported governor recruitment and induction, and the withdrawal of LSIS’s service during 2013 as the FE Guild is created will need to be managed carefully.

Q4. The structure and membership of governing bodies, including the balance between representation and skills

2.15 As described in the Code, a College’s governing body should determine the size and composition of its membership in accordance with its College’s Instrument and Articles of Government. It should aim to:

Achieve an appropriate balance of skills, experience, and knowledge.

Acknowledge the value of refreshing its membership.

Have due regard for the benefits of diversity.

Establish its own clear rules for the appointment and re-appointment of governors (these rules should be publicly available).

Ensure that governors have, between them, the necessary skills and experience to enable the governing body to undertake its role effectively on a sustainable basis. It should undertake a regular skills analysis as needed to identify areas of expertise in which it may be deficient, and develop strategies to make good any deficiency.

Plan for succession for the office of Chair and other offices held by governors.

Require that an induction programme is in place, which ensures that all new governors receive full induction to their roles and responsibilities. All governors should be expected to undertake further training and development, and opportunities for this should be provided regularly on an individual and collective basis.

Conduct business so as to allow open discussion and debate. Information and papers should only be restricted when this is considered necessary to protect the interests of the College or the wider public interest, including the observance of contractual obligations or disclosing an individual’s personal details

Conduct business in accordance with agreed rules and procedures (often described as standing orders), which the governing body should review and update on at least a biennial basis, and which should be publicly available.

Q5. The effectiveness and accountability of governing bodies

2.16 The College sector is actively committed to a programme of self-improvement across its governance community, as evidenced by production of its Code of Governance, development of its governance library, and the co-ordinated programme of developmental support being delivered by AoC, LSIS and other sector bodies for chairs, governors, clerks, and governing bodies. As described in response to Q2. above, College governing bodies are developing horizontal accountability to their learners and the communities they serve.

2.17 The framework of accountabilities for Colleges is considerably more complicated than for schools, with Colleges being subject to external scrutiny from a number of sector bodies, including Ofsted, the Skills Funding Agency (SFA), the Education Funding Agency (EFA), the Quality Assurance Agency (QAA), and the UK Border Agency (UKBA) amongst others. The complicated and burdensome set of external accountabilities impacting upon Colleges is currently being simplified by BIS, SFA and EFA. However, the National Audit Office (NAO) conducted a review4 of the costs of bureaucracy in further education in 2011, and concluded that:

“In the absence of more precise measurement by the Department, we estimate that dealing with government’s funding, qualifications and assurance system costs the further education sector around £250–300 million a year. This scale of costs shows that substantial savings can be made by reducing bureaucracy, and demonstrates the need for focused and systematic management of these costs to drive sustained improvements in efficiency.”

2.18 With regard to the relevant governance good practice contained in the Code, this states that a regular effectiveness assessment by a governing body should be undertaken to include the following:

Evaluation of the performance of the College as a whole in meeting its strategic objectives.

Use of appropriate key performance indicators to benchmark the College’s performance against comparable Colleges, wherever possible.

Publication each year by the governing body of its overall assessment of the College’s performance.

Evaluation of the reputation of the College and the views of stakeholders.

Self-evaluation by the governing body of its effectiveness as frequently as it determines is appropriate, but at least every three years.

Evaluation of the performance of the Chair and of other governors holding offices or undertaking defined roles within the governance structure.

Assessment of the performance and effectiveness of all governors on an ongoing basis.

Q6. Whether new arrangements are required for the remuneration of governors

2.19 The issue of remunerating chairs, and/or governors, has been widely debated by the College sector over many years. Proponents suggest that Colleges will need highly effective chairs and governors possessing specific skills sets and experience which are highly marketable, and that to secure the level of contribution required will, at least in some cases, need to be facilitated by financial recognition in some way. Opponents contend that to pay chairs or governors would fundamentally alter the governance culture and relationship based upon securing numbers of willing volunteers of the right calibre as “non-executive directors” which has served Colleges well over many years; also that any payment made could not reflect market rates. The same debate continues in the HE sector, and it is noteworthy that no university has decided to pay a chair or governor, despite some having the explicit power to do so.

2.20 In practice, it seems unlikely that a College applying (as an exempt charity) to the Charity Commission for permission to remunerate a member(s) of its governing body would be successful at this time. However, innovative new business structures being considered by Colleges may make this a possibility in the future.

Q7. The relationships between governing bodies and other partners, including local authorities, Academy sponsors and trusts, school leaders, and unions

2.21 Over 40 Colleges are actively involved in sponsoring Academies and University Technical Colleges and partnering schools in their areas.

2.22 As described in the response to Q2., College participation in LEPs will help all stakeholders to identify and meet local needs as effectively and efficiently as possible.

Q8. Whether changes should be made to current models of governance

2.23 College governance is already evolving rapidly, and new models are emerging as Colleges pursue their individual missions in-line with the Government’s new freedoms and in an increasingly competitive market-place. Good practice will be continue to collected and shared via the on-line governance library.

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Appendix

Key facts about Colleges include (figures quoted relate to 2011):

Each year incorporated Colleges educate and train over 3.3 million people.

63,000 14–15 year olds are enrolled at a College.

861,000 16–18 year olds choose to study in Colleges, compared with 434,000 in maintained schools, academies and city technical colleges.

Another 56,000 16–18 year olds study an apprenticeship through their local College.

171,000 students study higher education at a College; 266 Colleges provide undergraduate and postgraduate level courses.

Half of all Foundation degrees are taught in Colleges.

Colleges provide 35% of entrants to higher education.

2.4 million adults study or train at Colleges.

Colleges educate 45,000 students from outside the UK (21,000 from other EU countries, and 24,000 non-EU students).

Total College income in England was £7.7 billion.

Colleges employ 245,000 people, of whom 128,000 are teachers and lecturers.

13.3% of 16–18 year olds in Colleges are from disadvantaged backgrounds compared with 8.3% in maintained school sixth forms and academies.

Ethnic minority students make up 20% of students in Colleges, compared with 13% in the general population.

105,000 College students are aged over 60.

December 2012