Area review: end of
programme report
Restructuring of the FE Sector 2015 - 2019
September 2019
2
Contents
Table of figures 3
Executive summary 4
Context 6
Purpose of this report 6
Introduction and background to area reviews 6
Financial support for change: restructuring facility, transition grants and exceptional financial
support 9
Implementation of area review recommendations 11
How did the restructuring facility support the implementation of area reviews? 13
Applications 14
Restructuring facility governance and decision making 15
Allocation of funding 15
Refinancing commercial debts 16
Estates 17
Conditions of funding 17
Sixth form colleges converting to academy status 18
Outcomes of area reviews 19
Associated research publications 21
Annex One: NAO recommendations and associated government response 22
Annex Two: College mergers – original and changed area review recommendations 23
Annex Three: Area review implementation funding 24
Funding for college mergers 24
Funding for standalone or other area review recommendations 25
Funding for sixth form colleges to academy status 25
Funding for transition grants 27
Annex Four: Related / associated publications and links 40
3
Table of figures
Figure 1: Number of changes implemented by 1 April 2019 ...................................................... 4
Figure 2: Restructuring facility and transition grant financial support ......................................... 9
Table 1: Summary of structural recommendations ................................................................... 12
Figure 3: Status of area review recommendations at end of March 2019 ................................ 13
Figure 4: Combined debt and restructuring facility support ...................................................... 13
Table 2: Restructuring facility funding profile ........................................................................... 14
Figure 5: Restructuring facility applications - by type ............................................................... 15
Figure 6: Summary of outcomes at end of area review programme ........................................ 19
Table 3: NAO recommendations and associated government response ................................. 22
Figure 7: College mergers - Northern area and Midlands s and East England area ................ 23
Figure 8: College mergers - South and South West area and London and South East ........... 23
Table 4: Funding for college mergers ...................................................................................... 24
Table 5: Funding for college mergers - individual colleges ...................................................... 24
Table 6: Funding for standalone or other area review recommendations ................................ 25
Table 7: Funding for standalone or other area review recommendations - individual colleges 25
Table 8: Funding for sixth form colleges to academy status .................................................... 25
Table 9: Funding for sixth form colleges to academy status - individual colleges .................... 26
Table 10: Funding for transition grants - individual colleges .................................................... 27
4
Executive summary
Figure 1: Number of changes implemented by 1 April 2019
On 20 July 2015, the National Audit Office (NAO) published its report “Overseeing the financial
sustainability in the further education sector”
1
. As well as commenting on the rapidly declining
financial health of the further education (FE) sector, who acknowledged the Department for
Business, Innovation and Skills (BIS) and the Skills Funding Agency (SFA) had taken steps to
deal with, they noted the lack of a clear process to inform decisions about local provision and
the need for more than a college-by-college approach.
In response to this, government announced a review of post-16 education and training
institutions across England.
The objectives of the area review programme were to achieve
2
:
• Institutions that are financially viable, sustainable, resilient and efficient, and deliver
maximum value for public investment;
• An offer that meets each area’s educational and economic needs;
• Providers with strong reputations and greater specialisation;
• Sufficient access to high quality and relevant education and training for all; and
• Colleges well equipped to respond to the reform and expansion of the apprenticeship
programme.
1
National Audit Office: Overseeing financial sustainability in the further education sector
2
See pages 6 – 7 of Reviewing post-16 education and training institutions - updated guidance on area reviews
5
Area reviews took place in five waves between September 2015 and March 2017, followed by
an implementation phase. The programme officially closed in March 2019. As at the end of
March 2019, two merger recommendations were still being implemented
3
.
Area review recommendations
4
included a range of structural solutions such as mergers, the
creation of federations and colleges joining existing group structures. The programme also
resulted in a number of non-structural recommendations to improve collaboration and
efficiency, for example shared service arrangements, and the establishment of joint skills
ventures and apprenticeship delivery models.
Area reviews also provided an opportunity for sixth form colleges (SFCs) to become
academies
5
. This was designed to enable these colleges to make a contribution to the
academy programme by setting-up new academy trusts or joining existing trusts, thereby
strengthening their relationships with the school sector.
At the start of the area review process, there were 93 SFCs and 241 general FE colleges
(GFECs), of which 37 had a Financial Health rating of inadequate. As of April 2019, the
number of SFCs had reduced to 54 and the number of GFECs to 193, meaning the number of
individual college corporations in the FE sector has been reduced by 26%, whilst provision has
been protected. In financial year 2017-2018, 21 colleges had a Financial Health rating of
inadequate.
It is too early to assess the true impact of the area review programme on the FE sector, in
particular the impact of mergers on both the financial health and quality of the colleges.
However, early indications suggest that area reviews have had a broadly positive impact to
date. A number of stronger colleges have taken the opportunity to restructure through the area
review process and to use their strong leadership to bring about improvement by merging with
colleges that needed to improve their quality or finances, or both. By doing so, it has been
possible to protect provision in areas that had been under threat of losing access to a local FE
college. In time, we expect to see greater efficiencies in the sector resulting from the changes
driven by area reviews.
The area review programme and the investment we have made in restructuring has changed
the landscape of the further education sector in many areas of the country, driven by those
with knowledge of the education and training required in their communities.
3
As of 1 August 2019, one of these mergers has completed and the other is no longer progressing.
4
Further education area reviews: policy and reports: https://www.gov.uk/government/collections/post-16-
education-and-training-area-reviews
5
Excluding Catholic SFCs – see see ‘Sixth form colleges converting to academy status’ section
6
Context
Purpose of this report
The purpose of this report is to provide a factual record of the implementation of the area
review programme. This report does not cover individual area reviews and is not an evaluation
of the programme. We intend to publish an evaluation report in 2022, which will focus on the
impact of the programme. This report also gives us the opportunity to publish information
about the restructuring facility (RF) funding and transition grants that were made available to
support the implementation of the programme.
Introduction and background to area reviews
On 20 July 2015, the National Audit Office (NAO) published its report “Overseeing the financial
sustainability in the further education sector”
6
. The NAO examined oversight of the financial
sustainability of the FE sector in England, with specific focus on general further education
colleges (GFECs) (excluding sixth form colleges (SFCs)).
One of the key findings of the report focused on the rapidly declining financial health in the FE
sector since 2010/11. Whilst there were, and still are, many excellent further education (FE)
colleges, there was an increase in the number requiring exceptional financial support (EFS), or
likely to need it in the short to medium term, to continue to operate. Therefore, reform was
necessary to address some of the underlying reasons for the financial pressures that many
colleges were facing.
The NAO acknowledged that steps had already been taken to tackle the financial decline of
individual colleges, for example by creating the role the Further Education Commissioner (FE
Commissioner) and the Sixth Form College Commissioner (SFC Commissioner)
7
. However,
they observed that the sector lacked a clear process to inform decisions about the
restructuring of local FE provision and that the steps already taken were “not likely to be
sufficient to address a growing structural problem”
8
.
The work of the FE Commissioner and SFC Commissioner also identified significant scope for
greater efficiency in the sector, in a way that would free up resources to deliver high quality
education and training to support economic growth.
6
https://www.nao.org.uk/report/oversight-of-financial-sustainability-in-the-further-education-sector/
7
The role of the SFC Commissioner was merged into the role of the FE Commissioner following machinery of
government changes in July 2016
8
See paragraph 23 of the NAO report “Overseeing the financial sustainability in the further education sector”
7
Therefore in response to the NAO report, the Government announced in a policy statement
9
on 20 July 2015 a programme of area reviews to review post-16 education and training
institutions across England. These reviews were to commence in September 2015 and
conclude in March 2017. Each review was designed to cover GFECs, specialist colleges
including land-based, and SFCs, and could include other providers where they opted in and
this was agreed locally. The area reviews considered all provision delivered in an area, even
where those providers were not in scope, but the recommendations focus specifically on those
included in the reviews. Guidance on how the area review process would work was first
published in September 2015
10
.
The identification of an area, and the colleges to be included within it, was done by looking at
the travel to learn patterns of students, the location of colleges, relevant groupings of local
authorities and took into account areas with combined authorities. The reviews were carried
out in five waves with priority given to areas where there were a number of financially weak
colleges.
Each review was led by a local steering group composed of a range of local stakeholders.
Members included the chairs of governors of each institution included in the review, supported
by their principals or chief executives, the FE Commissioner and SFC Commissioner, local
authorities, Local Enterprise Partnerships (LEPs) and the funding agencies (the Education
Funding Agency (EFA) and the SFA). BIS and the Department for Education (DfE) were also
represented, either directly or by the funding agencies.
Areas with secured devolution deals took a leading role in their area reviews, in most cases
taking the role of chair of the steering group, as someone independent from the providers. In
other reviews the independent chair was either the FE Commissioner or the SFC
Commissioner.
Governing bodies of colleges, as independent bodies, were responsible for deciding whether
to accept the area review recommendations and for implementing them
11
. However, in
considering their response, college governors were urged to give careful weight to their
responsibilities for ensuring the long-term stability of their institution and to their broader
fiduciary duty.
9
Post-16 education and training institutions review: https://www.gov.uk/government/publications/post-16-
education-and-training-institutions-review
10
Further education area reviews: how they work
11
Area review implementation guidance: https://www.gov.uk/government/publications/post-16-education-and-
training-institutions-area-based-reviews
8
To stress the importance of the opportunity afforded by the area reviews, Government also
announced that it was intending to introduce an insolvency regime for GFECs and SFCs,
which would come into effect around the end of the implementation of area reviews.
9
Financial support for change: restructuring facility,
transition grants and exceptional financial support
Figure 2: Restructuring facility and transition grant financial support
The Government recognised that as part of the area review process some colleges would face
additional costs associated with restructuring in order to deliver long-term savings. In most
cases, colleges, as independent institutions, were expected to meet these costs themselves.
In cases where the required funding could not be secured, the Government made an offer of
funding available to support the implementation of area reviews.
As part of the Spending Review 2015, the Government made available access to the
restructuring facility (RF) to facilitate the implementation of area review recommendations. By
the end of the programme, up to £432m has been made available to colleges. In total, not
including those proposals that received funding for VAT liabilities only, 36 area review
proposals benefitted from RF grant or loan funding.
Part of the RF was made available as transition grants
12
. Grants of up to £100,000 were
available to colleges to make a contribution towards the costs of the implementation of each
significant change resulting from an area review in recognition of the challenges and costs
associated with implementing recommendations effectively.
• A grant of up to £100,000 was made available for:
• A closure of a college;
• A merger of more than two institutions or of two institutions with a combined turnover of
more than £25 million;
• Establishment of a multi-academy trust of two or more colleges.
12
Transition grants guidance: area reviews of post-16 education and training institutions
10
A grant of up to £50,000 was made available for:
• single sixth form college conversion to a 16 to 19 academy
• merger of 2 institutions with a combined turnover of less than £25 million or
• a significant rationalisation
13
or other significant change at a college or colleges where
this change is reasonably expected to have significant upfront costs
In total there were 157 grants awarded during the programme, totaling just under £11.5 million.
See Annex Three for a full list of transition grants awarded.
EFS continued to be made available to colleges in exceptional circumstances to make sure
they could continue to operate whilst the recommendations of area reviews, or subsequent
changed recommendations, could be implemented. EFS was not intended to fund the
implementation of the area review recommendations.
13
A significant rationalisation may have included significant curriculum rationalisation, set up of a shared service
arrangement or the establishment of a joint venture.
11
Implementation of area review recommendations
37 locally led area reviews were held across five waves between September 2015 and March
2017 with participation from 332 GFECs and SFCs. Local authorities, LEPs, Regional Schools
Commissioners (RSCs), and other parties that may have ‘opted in’ to the process, also
participated. Reports on the outcomes of each of the reviews have already been published.
Following the area review recommendation all proposals had to follow due process, including
financial due diligence, before progressing. For a number of reasons, not all recommendations
were implemented and some of the recommendations changed. The type of
change depended on individual circumstances. In some cases, as independent bodies, college
corporations decided not to proceed with the original recommendations for change or looked
for other options. In these cases, they were encouraged to take part in an FE Commissioner
led structure and prospects appraisal (SPA) to identify the best option for the college. In a few
cases college carried out their own SPAs. The FE Commissioner (or the SFC Commissioner
whilst this was a separate post) endorsed changes to original recommendations and the local
area review steering groups were informed of the changes. By the end of the area review
programme in March 2019, the number of recommended mergers had risen from 55 to 68.
The steering groups approved a total of 376 individual recommendations, which included the
following structural recommendations:
12
Table 1: Summary of structural recommendations
Structural
recommendation
Number of
recommendations at
March 201714
Number of
recommendations
following SPA or
agreed change
Number of changes
implemented by 1
April 2019
Mergers 55 (involving 114
colleges)
68 57 mergers
Colleges remaining
standalone
133 (of which, 3
were ‘fresh start’
15
)
127 (of which 5
were ‘fresh start’)
N/A
Federations 3 (involving 8
colleges)
N/A 3
Colleges joining an
existing group
structure
3 N/A 0
Creation of a joint
Further Education
College with a Higher
Education Institution
4 5 3 Joint FE and
HE Institutions
Sixth Form Colleges
exploring academy
status
54 28 23 academy
conversions
There were 16 other types of recommendations for individual colleges, which included colleges
developing shared services, partnerships, joint ventures, or specific recovery plans. In addition
to the above structural recommendations, there were also 61 non-structural recommendations,
including the establishment of local steering groups, improved and joint curriculum planning,
creation of apprenticeship companies and institutes of technology.
At the end of March 2019, 57 mergers had completed (84%), nine (13%) are not being
progressed and a further two merger recommendations were still being implemented (3%).
By 1 April 2019, 23 SFCs had converted to an academy. One SFC assessed and approved
during the area review process converted on 1 September 2019. We have now extended the
opportunity so that SFCs can continue to covert to academy status by joining or establishing a
multi academy trust (MAT).
14
March 2017 marked the end of the Steering Group process
15
A ‘fresh start' is where the FE Commissioner agrees a recommendation to standalone only if subject to specific
leadership and other changes
13
Overall, the implementation percentage for all recommendations (including changed and non-
structural recommendations) at end of March 2019 is:
13% 71% 13% 3%
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Not progressing Completed Progressing/further work required Progress not being monitored
Figure 3: Status of area review recommendations at end of March 2019
* 2% of ‘not progressing’ relate to Catholic SFCs – see ‘Sixth form colleges converting to
academy status’ section
**’Progress not being monitored’ refers to those colleges that had recommendations that were
being implemented locally, and therefore have not been nationally monitored
How did the restructuring facility support the implementation of
area reviews?
Figure 4: Combined debt and restructuring facility support
14
RF funding was available across three financial years 2016-17 to 2018-19 with a small amount
of funding set aside in 2019-20 to support cases where restructuring could not be completed
by March 2019. The responsibility for deciding whether to agree the area review
recommendations, and if so whether to apply for RF funding, was for individual colleges as
independent corporations. The implementation of some area review recommendations, or
changed recommendations, were complex and the full financial business case took time to
emerge and develop.
RF funding was profiled in response to the pace of delivery and the final level of available
funding was:
Table 2: Restructuring facility funding profile
£m 2016-17 2017-18 2018-19 2019-20* Total
Total £21m £133m £251m £40m £445m
*2019-20 allocation remains subject to drawdown conditions
Applications
In total, 76 RF applications were received. Of these, 62 were approved and 14 were withdrawn
or rejected. Of the 62 applications that were approved, 39 related to restructuring proposals
from FE institutions, which included GFEC and SFC mergers, with 23 applications from SFC to
convert to academies (for both compensatory VAT funding if the liability arises and academy
conversion). 36 applications benefitted from funds to support restructuring (i.e. excluding
compensatory VAT).
Of the 14 that were withdrawn or rejected, seven of these were from SFCs seeking to convert
to academies, where either the SFC chose not to proceed with conversion, or the academy
proposal was not approved, two SFCs went on to form different partnership. Four were from
GFECs seeking to merge or to standalone, where the application was rejected because the
proposal did not meet the RF objectives or eligibility criteria. Three mergers did not progress
because the GFECs seeking to merge could not agree terms with their prospective partners,
or were unable to agree on the level of available funding to support the merger. In these
cases, applications were withdrawn.
15
Figure 5: Restructuring facility applications - by type
Restructuring facility governance and decision making
The RF was subject to a rigorous governance and decision-making process in order to make
sure that all applications were thoroughly assessed and made best use of public funding. Each
case was considered by a Funding Committee chaired by a DfE Director and with a
representative from HM Treasury. In line with published guidance some cases required advice
from an External Advisory Panel (EAP) of senior advisers with a range of backgrounds
including commercial, financial and estates. Recommendations from the Funding Committee
and advice from the EAP were submitted to DfE Ministers for approval and to HM Treasury to
secure funding.
Allocation of funding
Applications were assessed and scrutinised against published eligibility criteria
16
. Decisions on
whether or not to support an application were based on the type of funding required and
whether this was in line with the purpose of RF; whether funding could be spent by March
2019; and whether it offered sufficient value for money.
The area review guidance noted that RF funding was being made available where other
sources of funding had been exhausted. It also set out the circumstances in which grants
would be considered, with the expectation that loan funding would be the default. Pro-active
discussions took place with colleges in advance of potential applications to determine their
16
Further education area reviews: funding to restructure colleges:
https://www.gov.uk/government/publications/post-16-education-and-training-institutions-apply-for-financial-
support-for-area-reviews
76
14
1
2
9
23
27
0 10 20 30 40 50 60 70 80
Total
Rejected or withdrawn
Disaggregation
HE designation
Standalone
Academy conversion
Merger
16
financial position and potential funding need. These discussions in some cases led to colleges
borrowing commercially rather than submitting an RF application. This was a positive outcome
for the programme and in line with our policy of only funding cases that presented the greatest
need and where RF funding was the only solution to bring about the change recommended in
the area review.
Many of colleges in greatest financial distress were unable to attract any or further commercial
credit facilities, and in some cases existing debt liabilities owed to banks and/or government
had become unaffordable. This situation presented a risk to provision of education and
training, indicating that there would be a likely need for long-term government support or
insolvency. In these cases, there was a need to reduce debts to support the merger of a
financially stronger college with a financially weaker college to create a sustainable institution.
There was a strong argument for the provision of grant rather than loan funding from the RF. In
all cases, the cost was robustly compared to alternatives including closure and leaving the
provision to ensure value for money.
A total of £432m was approved. £393m has been paid out and up to £39m is expected to be
drawn down during the course of the 2019-20 financial year. £79m of funding has been
provided as government loans and over £353m as grant funding, the majority of which is
covered by grant terms and conditions whereby the grant is repayable if financial performance
improves.
Refinancing commercial debts
45.8% of RF funding has been provided to colleges to reduce their liabilities (i.e. commercial
borrowing) to free up resources which would have been used to make repayments. At the start
of the area review process the FE college sector held bank debts of £1.6bn. Since colleges
were incorporated, they have had the ability to borrow from banks, most commonly to fund
capital expansion.
The major change that area reviews would make to the sector presented an opportunity for
Government to engage with the main commercial lenders to the sector to explore joint
solutions where colleges had a higher level of debt than they were able to service.
For many colleges, RF deals meant deleveraging debts to decrease funds owed to affordable
levels and in doing so protect frontline services. RF deals were structured in a way that sought
to reduce potential break costs and costs associated with breaches of loan covenants. Some
colleges had little capacity to continue to service commercial debts, so their RF deals involved
refinancing commercial borrowing to more affordable Government loans or where necessary
replacing borrowing with grants. Each RF case was individually negotiated and this often
included joint discussions between the colleges, banks and Education and Skills Funding
Agency (ESFA). Many deals included changes to lending terms and in some cases banks
provided additional funding to colleges to support them in restructuring or investing.
17
Estates
14.4% of RF funding was allocated to costs associated with colleges’ estate. In reviewing the
financial sustainability of applicant colleges, their estate was very often a crucial issue. In
addition to the relevance of condition and suitability for provision of quality further education
and the direct costs associated with required maintenance, particularly in the case of mergers,
there can be potential opportunities for rationalisation of college estate. For this reason, an
estates strategy, based on the space requirement (guided learner hours) for the relevant
curriculum was an application requirement for RF. Site sales require careful consideration and
planning and can often be delayed. In some cases, grant and/or loan terms include security
over estates to ensure that any cash realised from asset sales, as part of the college’s estates
strategy, would provide a payback on any public funds extended ‘up-front’ from the RF.
Further education colleges are expected to fund maintenance from their ongoing operations
and can apply for LEP and/or commercial funding for major capital investment projects. RF
funding was not available for major capital projects. In a few cases, colleges had attempted to
manage their financial position through chronic underinvestment in their estate. RF made
provision of funding for urgent maintenance works where this was essential, for example with
implication for health and safety of students, and where this was required to secure the long-
term sustainability of the college. In some cases, terms of funding included security over
estates to ensure that investments supported through RF deals would not be sold off without
the RF funds being repaid.
Conditions of funding
The terms and conditions attached to RF deals are outlined in a grant or loan agreement and
supplementary agreements where applicable, for example legal charges. Standardised
documentation was adapted and changed to reflect individual cases and the terms and
conditions applied.
Government loans are repayable with interest, linked in most cases to the Public Works Loan
Board rate
17
, plus a margin where relevant. Provision of RF funding is expected over time to
improve the financial performance of the college. In some cases, grant conditions trigger
repayment where financial performance is over and above a certain level of performance, for
example, as a result of estate disposals or improved recruitment of learners.
In some cases, colleges had received EFS whilst their area review recommendations were
being implemented. The affordability of repaying EFS loans or grants was considered
alongside the requirement for RF funding, and in some cases Ministers in the DfE and HM
17
The Public Works Loan Board (PWLB) is a statutory body operating within the United Kingdom Debt
Management Office, an Executive Agency of HM Treasury. The Board's interest rates are determined by HM
Treasury in accordance with section 5 of the National Loans Act 1968.
18
Treasury agreed to waive the repayment of the EFS loans and repayable grants. All waived
amounts are published in the ESFA’s annual report and accounts.
All RF deals are subject to ongoing monitoring and scrutiny. Grant and loan funding
agreements set out delivery milestones for key elements of the turnaround plan and key
performance indicators for the new or restructured entity. The period of monitoring for RF
cases is generally at least 5 years. Details about providers that benefitted from RF funding are
included in Annex Three.
Sixth form colleges converting to academy status
Of the 93 SFCs operating in August 2015, 54 agreed a recommendation to explore conversion
to academy status. 24 SFCs made an active decision not to convert to academy status and 30
applied to convert.
All SFCs applying to convert to academy status were subject to a viability and sustainability
assessment and these assessments were presented to the Funding Committee. Approval for
conversions were subject to Ministerial, RSC and the ESFA’s Director of Further Education
Directorate’s approval.
In principle, Catholic SFCs could access this funding to convert to become 16-19 academies.
However, the legal framework for 16-19 academies does not permit them to maintain the
freedoms and protections afforded to them by the Further and Higher Education Act 1992 as
faith-designated institutions, so the Catholic Education Service has advised these colleges not
to convert without these protections.
RF was made available to support colleges in meeting a VAT liability arising from the change
of ownership of buildings (which have previously been zero rated for VAT purposes) and other
costs where required such as the refinancing commercial borrowing. This was required in a
small number of cases where debts could not be paid off before transfer or novated to the
academy trust. In total 23 SFCs converted to academy status by 1st April 2019. 19 of these
transfers required little or no RF funding to support the conversion.
19
Outcomes of area reviews
Figure 6: Summary of outcomes at end of area review programme
Although it is too early to determine the long-term financial position of the FE college sector,
early analysis suggests that area reviews have had a broadly positive impact to date. It is too
early to assess the full impact of the process, in particular the impact of mergers on both the
financial health and quality of colleges, because the mergers happened relatively recently, the
majority in 2017/18. It will take time for financial efficiencies to be fully realised and for the
benefits of stronger leadership to show in improved financial performance and Ofsted grades.
Some early inspections have had promising results but we will continue to track and monitor
performance.
The area review programme and the financial support it provided delivered a great deal of
focussed progress in a relatively short time to re-shape the sector and deal with some of the
most difficult financial cases. In terms of immediate measurable outcomes to date, there has
been a reduction of 26% in the number of separate college corporations, with the associated
running costs, as a result of the FE restructuring process without any reported loss in provision
or negative impact on student numbers.
There were 37 colleges with inadequate financial health based on their 2014/15 finance
records. There were 21 in 2017/18. Nineteen colleges that had inadequate financial health in
2014/15, and nine that had an Ofsted grade of inadequate prior to merger have now dissolved,
with stronger colleges taking the opportunity to restructure through the area review process
and to use their strong leadership skills to bring about improvement by merging with other
colleges to improve their quality or finances, or both. By doing so, it has been possible to
maintain provision in areas that could have been under threat of losing access to a local FE
college.
As well as achieving these structural changes, the area review steering groups brought
together the colleges, LEPs, Mayoral Combined Authorities, local authorities and other
stakeholders in localities to discuss issues and recommended solutions together. In some
areas these partnerships have continued to work together to improve and plan provision to
meet local demands.
A number of the proposals that are being developed further through new government policies
and strategies, including the Social Mobility plans and the Industrial Strategy, were developed
20
as non-structural recommendations from the area reviews, for example, Institutes of
Technology, Skills Advisory Panels and skills partnerships.
Following this large investment in the FE sector, the expectation is that, going forward,
colleges will manage themselves effectively to ensure their sustainability, and support will be
available through early engagement with the ESFA or the FE Commissioner. The College
oversight: support and intervention guidance
18
sets out how we will continue to monitor
colleges, offer support and intervene when necessary.
18
College oversight: support and intervention: https://www.gov.uk/government/publications/post-16-education-
and-training-institutions-apply-for-financial-support-for-area-reviews
21
Associated research publications
This report is being published alongside the two research reports that have been
commissioned:
• ‘FE College merger impacts’ report. Frontier Economics were commissioned to carry
out an econometric evaluation of the impact of FE college mergers between 2005 and
2015.
• ‘Further Education sector reform case studies: area reviews’ report. CFE Research
were commissioned to carry out a process evaluation of the areas reviews that took
place between 2015 and 2017.
Annex One: NAO recommendations and associated government response
Table 3: NAO recommendations and associated government response
NAO recommendations Departmental/Agency response
BIS, working with DfE, should consider whether the existing
college-by-college approach to intervention will address the
more fundamental structural problems faced by the FE sector.
Area review process introduced aimed at restructuring the FE
college sector. Expanded FE Commissioner Role and early ESFA
intervention measures introduced aimed at reaching colleges in
financial difficulty before they get to a stage of formal intervention.
Where major decisions are taken relating to individual colleges,
BIS, working with DfE, should clarify roles and responsibilities
for informing decisions about local provision.
Central Intervention Team established – with local territorial
intervention teams working with individual colleges. Good use is
made of the ESFA and FE Commissioner resources to influence
local decisions.
BIS should reconsider the extent to which the current approach
to oversight of public investment in the sector, and the
responsibilities of the various parties involved, helps to resolve
problems quickly to the long-term benefit of students and
taxpayers.
Area reviews of FE colleges introduced from August 2015 – led by
local steering groups, aimed at restructuring the post 16 FE sector
to make it more financially resilient.
BIS and SFA, working with relevant sector bodies, should
consider how they might better support the development of the
management skills needed in this more challenging
environment.
Governance and training for senior managers introduced by ESFA
– working with the Education Training Foundation. Better support
provided through the Strategic Quality Improvement Fund and
National FE Leaders scheme.
SFA should build on the action it is taking to provide
benchmark information to college governing bodies and their
management teams.
ESFA has developed a financial benchmarking tool, published on
GOV.uk, to help colleges compare their financial performance with
the sector. See Financial benchmarking tool for colleges.
BIS, working with DfE, should ensure that there is capacity to
deal with the expected increase in the number of colleges
requiring support.
The restructuring facility introduced to provide financial support to
those eligible colleges requiring help to restructure as a result of
the area review process.
Annex Two: College mergers – original and changed area review recommendations
Northern Area
• South Tyneside College/Tyne
Metropolitan College
• Furness College/Barrow
-in-Furness Sixth
Form College
• Hugh Baird College/South Sefton College
• King George V College/Southport
College
• Knowsley College/St Helens College
• Bolton College/University Of Bolton (Re
-
designation pilot)
• Mid-Cheshire College/Warrington
Collegiate
• Hartlepool Sixth Form
College/Sunderland College
• West Cheshire College/South Cheshire
College
• Carlisle College/NCG
• Doncaster College/North Lindsey College
• Stockport College/Trafford College
• Redcar and Cleveland College/Stockton
Riverside College
• Northumberland College/Sunderland
College
• Accrington and Rossendale
College/Nelson and Colne College
Midlands and East England Area
• North Warwickshire and South
Leicestershire College
• Shrewsbury College Of Art and
Technology/Shrewsbury Sixth Form
College
• South Worcestershire/Warwickshire
College
• Newcastle Under Lyme/ Stafford Colleges
• Great Yarmouth /Lowestoft College
• Bournville South and City College
Birmingham
• City College Coventry/Henley College
• Huntingdonshire Regional
College/Cambridge Regional College
• Central College Nottingham/New College
Nottingham (NCN)
• Dearne Valley College/RNN
• Bedford/Tresham College
• Regent Sixth Form/Wyggeston and QE I
College
• Stratford-Upon-Avon/Solihull College and
University Centre
• Telford College Of Arts and
Technology/New College Telford
• City College Norwich/Paston Sixth Form
College
• North Shropshire/Herefordshire and Ludlow
College
• Cadbury College/Sandwell College
• Barnfield College/West Herts College
Original recommendation
Changed recommendation
Figure 7: College mergers - Northern area and Midlands s and East England area
Original recommendation
Changed recommendation
South and South West Area
•
Aylesbury College and
Amersham/Wycombe College
•
East Berkshire College/Strode's
College
• Activate Learning/Guildford
College/Bracknell and Workingham
College
• Alton College/Havant South Downs
College
London and South East
• Hillcroft College (Incorporated)
Limited/Richmond Adult Community
College
• Lewisham Southwark College/NCG
• South Thames College/Carshalton
College/Kingston College
• College of North West London/City of
Westminster College
• Harrow College/Uxbridge College
• Tower Hamlets College/Redbridge
College
• Northbook
College/City College Brighton
and Hove
• Tower Hamlets College/Hackney
Community College
• Westminster Kingsway College/City Of
Islington College
•
Palmer's College/
Seevic College
• Central Sussex College/Chichester
College
• South Downs College/Havant College
•
East Kent College/Canterbury College
• Sussex Downs College/Sussex Coast
College
• College of Haringey, Enfield and NE
London/WKCIC
• Worthing College/Chichester College
Group
• Coulsdon College/Croydon College
• John Ruskin College/East Surrey College
• PROCAT/South Essex College
• Epping Forest College/New City College
Figure 8: College mergers - South and South West area and London and South East
24
Annex Three: Area review implementation funding
Funding for college mergers
Table 4: Funding for college mergers
Total number of FE
colleges
August 2015
Area review
recommendation for
mergers
Total number of
mergers by 31 March
2019
Total restructuring
facility funding provided
for mergers
Number of self-funded
mergers
241 55 (involving 114
colleges)
57 £281,385k *30
*This includes those mergers that benefitted from RF grant to meet VAT liabilities only
Table 5: Funding for college mergers - individual colleges
College name Type of change Date RF funding
£
In receipt of EFS
Cheshire College, South and West (South Cheshire
College, West Cheshire College)
Merger 01/04/2017 £23,135k Y
Greater Brighton Metropolitan College (City College
Brighton and Hove and Northbrook College Sussex)
Merger 01/04/2017 £2,850k N
The Windsor Forest Colleges Group (East Berkshire
College and Strode's College)
Merger 09/05/2017 *£60k N
Nottingham College (New College, Nottingham and
Central College Nottingham)
Merger 08/06/2017 £16,200k N
HCUC (Harrow College and Uxbridge College) Merger 01/08/2017 *£397k N
South and City College Birmingham (Bournville
College of FE)
Merger 03/08/2017 £9,082k Y
a) East Coast College (Lowestoft College and Great
Yarmouth College of Further Education)
b) Lowestoft Sixth Form College)
Mergers a) 01/08/2017
b) 01/08/2018
a) £4,017k
b) No RF
Y
SK Group (merger of Knowsley Community College
and St Helens College)
Merger 12/12/2017 £15,242k Y
New College Telford (merger with Telford College of
Arts and Technology)
Merger 20/12/2017 £11,386k Y
Southport College (merger between King George V
College, Southport College)
Merger 31/01/2018 £6,240k N
Solihull College and University Centre (merger
between Solihull College and Stratford upon Avon
College)
Merger 01/02/2018 *£50k Y
East Kent College Group (merger of Canterbury
College and East Kent College)
Merger 01/02/2018 £16,976k N
East Sussex College Group, ESCG (merger of
Sussex Coast College Hastings and Sussex Downs
College)
Merger 29/03/2018 £8,465k Y
Trafford College Group (Stockport College of
Further and Higher Education and Trafford College)
Merger 05/04/2018 £26,024k Y
New City College (merger of Tower Hamlets and
Hackney Colleges, Redbridge College and Epping
Forest College)
Merger 01/08/2018 *£735k N
Stockton Riverside College (merged with Redcar
and Cleveland College)
Merger 01/08/2018 £12,332k Y
Herefordshire, Ludlow and North Shropshire College
(merger of Herefordshire and Ludlow College and
North Shropshire College)
Merger 31/10/2018 £8,616k Y
Nelson and Colne College (merger of Accrington
and Rossendale College and Nelson and Colne
College)
Merger 30/11/2018 £14,166k Y
South Essex College (merger of South Essex
College of Further and Higher Education and
Prospects College of Advanced Technology aka
PROCAT)
Merger 31/01/2019 £6,240k Y
25
Croydon College (merger of Coulsdon Sixth Form
College and Croydon Further Education College)
Merger 12/02/2019 £5,181k Y
a) Havant and South Downs College
b) Merger of Alton College with Havant and South
Downs College
Mergers a) 01/08/2017
b) 01/03/2019
a)*£281k
b) £6,178k
N
a) City of Sunderland College (merged with
Hartlepool SFC
b) Merger with Northumberland College
Merger a) 01/08/2017
b) 22/03/2019
a) No RF
b) £21,323k
N
a) Chichester College Group (Central Sussex
College, Chichester College of Arts, Science and
Technology
b) Merger with Worthing College)
Mergers a) 01/08/2017
b) 29/03/2019
**£34,297k Y
a) Activate Learning (merger Bracknell and
Wokingham College)
b) Merger with Guildford College of Further and
Higher Education)
Mergers a) 10/01/2019
b) 29/03/2019
£32,283k Y
* RF grant to meet VAT liabilities only
**£13,700k relates to the purchase of the Hayward Heath site.
Funding for standalone or other area review recommendations
Table 6: Funding for standalone or other area review recommendations
Number of standalone or other area review recommendations Total restructuring facility funding provided for mergers
159 £145,524k
Table 7: Funding for standalone or other area review recommendations - individual colleges
College name Type of change Date RF funding
£
In receipt of EFS
Hull College Group Fresh start 28/02/2018 £30,410k Y
City of Wolverhampton College Standalone 29/03/2018 £12,500k Y
City of Bristol College Fresh start 30/07/2018 £9,449k Y
Berkshire College of Agriculture Standalone 30/07/2018 £5,559k N
Bolton College (subsidiary of Bolton
University)
HE Designation 01/08/2018 *£293k N
Stoke-on-Trent College Fresh start 27/09/2018 £16,374k Y
Kirklees College Fresh Start 22/11/2018 £7,605k Y
South Bank Colleges (subsidiary of
London South Bank University previously
Lambeth College)
HE Designation 31/01/2019 £18,126k Y
Bradford College Standalone 14/03/2019 £17,837k Y
Cornwall College Fresh start 22/03/2019 £23,449k Y
Weymouth College Standalone 29/03/2019 £2,419k Y
Harrogate College Campus (Hull College
Group and Leeds City College)
Disaggregation 31/07/2019 £1,501k N
* RF grant to meet VAT liabilities only
Funding for sixth form colleges to academy status
Table 8: Funding for sixth form colleges to academy status
Total number of sixth form
colleges August 2015
Number of academy area
review recommendation
Total number of
sixth form colleges converted
to academies start April 2019
Total restructuring facility funding
93 54 23 £4,763k
26
Table 9: Funding for sixth form colleges to academy status - individual colleges
College and academy trust name Date RF funding
£
Hereford Sixth Form College (Heart of Mercia Trust) 01/03/2017 No RF
The Rochdale Sixth Form College (Altus Education Partnership) 01/04/2017 No RF
Priestley College (The Challenge Academy Trust) 01/05/2017 No RF
New College Pontefract (New Collaborative Learning Trust) 01/05/2017 £2,416k
Birkenhead Sixth Form College (BePART Educational Trust) 01/08/2017 *£141k
Longley Park Sixth Form College (Brigantia Learning Trust Limited) 01/08/2017 No RF
The Sixth Form College, Solihull (Summit Learning Trust) 01/08/2017 No RF
Reigate College (Reigate Learning Alliance) 01/09/2017 No RF
Woking College (Woking College Trust) 01/09/2017 No RF
The Sixth Form College Farnborough (The Prospect Trust) 01/09/2017 No RF
City of Stoke-On-Trent Sixth Form College (Potteries Educational
Trust)
01/09/2017 No RF
Oldham Sixth Form College (The Pinnacle Learning Trust) 01/09/2017 No RF
Queen Mary's College (North Hampshire Education Alliance) 01/10/2017 No RF
Prior Pursglove College and Stockton Sixth Form College (Tees Valley
Collaborative Trust)
01/11/2017 *£250k
Thomas Rotherham College (Inspire Trust) 01/11/2017 No RF
Richard Taunton Sixth Form College and St Vincent College
(Lighthouse Learning Trust)
01/11/2017 £533k
Godalming College (Godalming College Trust) 01/01/2018 No RF
Sir John Deane's College (The Sir John Brunner Foundation) 01/04/2018 *£371k
East Norfolk Sixth Form College (East Norfolk Multi-Academy Trust) 01/08/2018 No RF
King Edward VI College Nuneaton (Better Futures Multi-Academy
Trust)
01/01/2019 *£102k
Ashton-Under-Lyne Sixth Form College (Stamford Park Trust) 01/02/2019 £949k
Worcester Sixth Form College (Heart of Mercia Trust) 01/04/2019 No RF
* RF grant to meet VAT liabilities only
Funding for transition grants
Table 10: Funding for transition grants - individual colleges
UKPRN College Name Area Review
Wave/Name
Area review recommendation being pursued Value of grant Relevant skills Relevant
services
10000055 Abingdon and Witney
College
Thames Valley Following an FE Commissioner-led structure and prospects
appraisal, Moulton College agreed to merge with Abingdon
and Witney College
£100,000 Project
management,
Legal, Finance
Due diligence
10004927 Activate Learning Thames Valley The original recommendation was changed following an FE
Commissioner led SPA process. The outcome of this process
was that Bracknell and Wokingham College has agreed to
merge with the Activate Learning group
£100,000 Project
management,
Legal, Estates
Due diligence
10004927 Activate Learning Thames Valley
The agreed recommendation of the Surrey area review was
for Guildford to explore options for federation or other
structural partnership. A subsequent FE Commissioner led
structure and Prospects Appraisal resulted in a
recommendation for Guildford to merge with Activate Learning
£100,000
Project
management,
Legal, Estates
Due diligence
10000409 Ashton Sixth Form
College
Greater
Manchester
Academy conversion £50,000 Project
management,
Legal, Finance
Due diligence
10000473 Aylesbury College Thames Valley Merger with Amersham and Wycombe College £100,000 Project
management,
Legal,
Commercial,
Estates,
Turnaround
Due diligence
10000528 Barking and Dagenham
College
London East Merger of Barking and Dagenham College and Havering
College of Further and Higher Education (HCFCE)
£100,000 Project
management,
Legal, Finance
Due diligence
10000528
Barking and Dagenham
College
London East
The South London boroughs to explore ways of formal
collaboration sub-regionally to deliver adult community
learning services
£50,000
Project
management
10000533 Barnet and Southgate
College
London West Barnet Southgate college to merge with Waltham Forest
College
£100,000 Project
management,
Legal, Finance
10000533 Barnet and Southgate
College
London West The West London boroughs, to explore ways of formal
collaboration sub-regionally to deliver adult community
learning services where it can be shown that savings could be
made and/or quality and/or effectiveness of delivery can be
improved
£50,000 Project
management
10000552 Barton Peveril Sixth
Form College
Solent Establish a single-academy trust £36,000 Legal, Finance
10000560 Basingstoke College Of
Technology
North and Mid-
Hampshire
Merge with Alton College £100,000 Project
management,
Legal
Due diligence,
Asset or liability
valuation
28
10000610 Bedford College South East
Midlands
Bedford College and Tresham College to merge to form a
single college
£100,000 Project
management,
Legal, Finance,
Commercial,
Estates
Due diligence,
Asset or liability
valuation
10000654 Berkshire College Of
Agriculture, The (BCA)
Thames Valley Due to the college being unable to secure a suitable merger
partner to implement the Area Review recommendation, it
was agreed that BCA will continue as an independent
institution with some restructuring
£50,000 Legal Due diligence
10000695 Bilborough College Derby,
Derbyshire,
Nottingham and
Nottinghamshire
Derby
Bilborough Sixth Form College to continue to take short-term
actions to improve its financial position pending completion of
a Structure and Prospects Appraisal
£49,860 Legal, Finance Due diligence
10000702 Birkenhead Sixth Form
College
Liverpool City
Region
Birkenhead Sixth Form College to convert to an academy and
join a multi-academy trust
£50,000 Legal, Estates Due diligence
10006442 Birmingham
Metropolitan College
Birmingham and
Solihull
To remain as a standalone institution and concentrate on
financial recovery, working in collaboration with other
colleges, in particular on shared services, apprenticeships
and an Institute of Technology
£50,000 Finance,
Commercial,
Turnaround
10000796 Bolton Sixth Form
College
Greater
Manchester
Academy conversion - new multi-academy trust with a school £50,000 Legal, Finance,
Commercial
Due diligence
10000887 Brighton Hove and
Sussex Sixth Form
College
Sussex Academy conversion £45,000 Legal Due diligence
10000944 Brockenhurst College Solent Establish an apprenticeships joint venture £50,000 Commercial
10001000 Burnley College Lancashire Burnley College and Accrington and Rossendale College
merger
£100,000 Project
management,
Legal, Finance
Due diligence
10001005 Bury College Greater
Manchester
Dissolution of Bury College and Incorporation into University
of Bolton Group and Dissolution of Bolton College and
Incorporation into University of Bolton Group
£100,000 Legal, Finance Due diligence
10001082 Cadbury Sixth Form
College
Birmingham and
Solihull
Academy conversion - new multi-academy trust with Coventry
University
£50,000 Legal, Finance,
Commercial,
Turnaround
10001116 Cambridge Regional
College
Greater
Cambridgeshire
and Greater
Peterborough
Cambridge Regional College and Huntingdonshire Regional
College to merge
£100,000 Project
management,
Legal, Finance
Due diligence
10001116 Cambridge Regional
College
Greater
Cambridgeshire
and Greater
Peterborough
To support the creation of a Joint Venture for the iMET Centre
to deliver specialist higher and degree level technical
pathways for the manufacturing, engineering and technology
sectors
£50,000 Project
management,
Legal
10001207 Carshalton College London South Kingston College and Carshalton College to merge with South
Thames
£100,000 Legal, Finance,
Estates
Due diligence
29
10001744 Central Sussex College Sussex Chichester/Croydon merger exploration £80,000 Project
management,
Finance
10001346 Cheadle and Marple
Sixth Form College
Greater
Manchester
Academy conversion - multi-academy trust with South
Manchester Learning Trust
£50,000 Project
management,
Legal, Finance,
Turnaround
Due diligence
10001353 Chelmsford College Essex Chelmsford College and Writtle University College to establish
a formal collaborative partnership to rationalise and improve
the curriculum offer, drive up quality and share services to
reduce costs
£50,000 Project
management,
Legal,
Commercial
10007817 Chichester College Sussex Merger exploration with Central Sussex £10,000 Project
management,
Legal, Estates
Due diligence
10007817 Chichester College Sussex Shared Services lead college £48,750 Commercial
10007817 Chichester College Sussex Additional £10,000 for the merger with Central Sussex when
an alternative merger partner was not identified
£10,000 Project
management,
Legal, Finance,
Estates
Due diligence
10007817 Chichester College Sussex The Sussex Coast Area Review recommendation was for
Worthing College to remain standalone. However following a
Structure and Prospects Appraisal, the recommendation was
for Worthing College to merge with the Chichester College
Group
£100,000 Legal, Finance,
Estates
Due diligence
10001446 Cirencester College Gloucestershire,
Swindon and
Wiltshire
Cirencester College to remain a standalone sixth-form college
continuing to explore opportunities for further collaboration or
academy conversion
£50,000 Project
management,
Legal, Finance,
Estates
Due diligence
10001457 City College Brighton
and Hove
Sussex Merger with Northbrook College £100,000 Project
management,
Finance,
Commercial
Due diligence
10004772 City College Norwich Norfolk and
Suffolk
A merger between City College Norwich and Paston Sixth
Form College
£100,000 Project
management,
Legal, Finance
Due diligence
10001467 City Of Bristol College West of England Administered status: fresh start arrangement £33,750 Finance,
Commercial
10001474 City Of Stoke-On-Trent
Sixth Form College
Stoke on Trent
and
Staffordshire
Academy conversion £50,000 Project
management,
Commercial
Due diligence,
Asset or liability
valuation
10007578 City Of Wolverhampton
College
Black Country City of Wolverhampton College to explore and identify future
options for college estate by December 2016 an subsequently
to establish a strategic partnership with the City of
Wolverhampton Council to maintain a thriving, high quality
£50,000 Project
management,
Legal, Finance
Due diligence
30
independent FE College in the interests of the City of
Wolverhampton and its communities
10001548 College Of Haringey,
Enfield and North-East
London, The
London Central Westminster Kingsway College and City and Islington College
to explore options for collaboration with the College of
Haringey, Enfield and North East London
£100,000 Project
management,
Legal, Finance
Due diligence,
Asset or liability
valuation
10001549 College Of North West
London, The
London West Merge with City of Westminster College £100,000 Project
management,
Legal, Finance,
Commercial,
Estates
Due diligence
10001696 Cornwall College Somerset,
Devon, Cornwall
and Isles of
Scilly
Cornwall College to remain as a standalone institution with a
fresh start approach to deliver financial stability
£75,000 Commercial,
Estates,
Turnaround
10001705 Coulsdon Sixth Form
College
London South Coulsdon College to remain a standalone sixth form college,
developing its federated partnership with Reigate College
£50,000 Legal
10001705 Craven College West Yorkshire Craven College to progress towards a three-way merger of
Craven College, Shipley College and the Keighley Campus of
Leeds City College to create a single ‘Aire Valley College’
which will share services with an expanded Craven
Educational Trust (a multi-academy trust)
£100,000 Project
management,
Legal, Finance,
Estates
Due diligence,
Asset or liability
valuation
10001778 Croydon College London South AR change recommendation for Croydon College and
Coulsdon College to merge
£100,000 Project
management,
Legal, Finance,
Commercial,
Estates
Due diligence,
Asset or liability
valuation
10001850 Darlington College Tees Valley Merge with Stockton Riverside College to form a single
college
£100,000 Project
management,
Legal,
Commercial
Due diligence,
Asset or liability
valuation
10001919 Derby College Derby,
Derbyshire,
Nottingham and
Nottinghamshire
Derby
Bilborough Sixth Form College to continue to take short-term
actions to improve its financial position pending completion of
a Structure and Prospects Appraisal (SPA) within a year of
the end of the review. The outcome of the SPA was the
recommendation to merge with Derby College
£39,000.00
Project
management,
Legal, Finance
Due diligence
10001919 Derby College Derby,
Derbyshire,
Nottingham and
Nottinghamshire
Derby
To stand alone working with Chesterfield College to create a
Joint Venture Company to cover a range of shared services
£49,500 Project
management,
Legal, Finance,
Commercial
10002094 Ealing, Hammersmith
and West London
College
London West To establish an employer and learner-facing hub £50,000 Project
management,
Finance,
Commercial
31
10002094 Ealing, Hammersmith
and West London
College
London West Kensington Chelsea College to merge with Ealing,
Hammersmith and West London College, following the
original AR recommendation of KCC and the City of Literary
Institute (forming a larger SDI), not proceeding
£100,000 Project
management,
Legal
Due diligence
10002107 East Berkshire College Thames Valley Merge with Strode's College in Surrey £100,000 Project
management
Due diligence
10006570 East Kent College Kent East Kent/Canterbury merger £100,000 Legal, Estates Due diligence,
Asset or liability
valuation
10002122 East Norfolk Sixth Form
College
Norfolk and
Suffolk
Explore academy conversion or remain standalone Sixth
Form College
£50,000 Project
management,
Legal, Finance,
Commercial,
Turnaround
Due diligence
10002130 East Surrey College Surrey Brooklands College, Guildford College and North East Surrey
College of Technology (Nescot) shared services
£50,000 Commercial
10002130 East Surrey College Surrey East Surrey and John Ruskin College to merge £100,000 Legal, Finance,
Commercial,
Estates
Due diligence,
Asset or liability
valuation
10002143 Eastleigh College Solent Southampton City College to form a partnership with
Southampton Solent University. If this proves not to be
practicable, then Southampton City College and Eastleigh
College will explore merger
£100,000 Project
management,
Legal, Finance,
Commercial,
Estates
Due diligence
10002297 Epping Forest College Essex Epping Forest College to merge with Barnet and Southgate
College
10854 15 Project
management,
Legal, Finance
Due diligence
10002314 Esher College Surrey Academy conversion £21,825 Legal, Finance,
Commercial
Due diligence
10002412 Farnborough College of
Technology
North and Mid-
Hampshire
Either pursue a merger with Guildford College or to stand
alone as a GFE
£50,000 Project
management,
Legal, Finance,
Commercial,
Estates
Due diligence
10002570 Franklin College Greater
Lincolnshire
Franklin Sixth Form College and John Leggott Sixth Form
College to establish a formal federated structure with Wyke
Sixth Form College and Wilberforce Sixth Form College (SFC)
£100,000 Legal, Finance
10002599 Furness College Cumbria Joint venture between Furness College, Carlisle College,
Kendal College, Lakes College and University of Cumbria
£50,000 Project
management,
Legal, Finance
Due diligence
10002710 Godalming College Surrey Academy conversion £12,465 Legal
10007938 Grimsby Institute of
Further and Higher
Education
Greater
Lincolnshire
Grimsby Institute (GI) to retain its position as the leading
general further education college for Grimsby and the
Scarborough area of North Yorkshire. The college will enter a
£100,000 Project
management,
Legal, Finance,
Commercial
32
formal collaborative partnership with Lincoln College to
improve the local education and skills offer
10002815 Guildford College Surrey College to undertake a detailed options appraisal to determine
the best partner and structures for a federation/merger
£37,500 Project
management,
Legal, Finance,
Commercial
10002843 Hadlow College Kent The outcome of the Kent ABR was subject to a review by the
FE Commissioner, which has concluded that Hadlow College
and West Kent and Ashford College should merge
£100,000 Legal, Finance,
Estates
Asset or liability
valuation
10002907 Harrow College London West Harrow College, Uxbridge College and West Thames College
to merge
£100,000 Project
management,
Legal, Finance
Due diligence
10002917 Hartlepool College of
Further Education
Tees Valley Merger with Hartlepool SFC £49,500 Project
management,
Commercial,
Estates
Due diligence
10005979 Havant and South
Downs College
South and
South-West
The outcome of the SPA was a decision by Alton College
Board to seek a merger with HSDC subject to due diligence
and approval form both Boards
£100,000 Project
management,
Legal, Finance,
Commercial,
Estates
Due diligence
10002935 Havering College of
Further and Higher
Education
London East Merger with New City College £100,000 Legal, Finance Due diligence
10002937 Havering Sixth Form
College
London East Merger with New City College £100,000 Legal, Finance Due diligence
10003010 Henley College Coventry Coventry and
Warwickshire
Merger between Henley and City College Coventry £100,000 Project
management,
Legal, Finance
Due diligence
10003021 Hereford Sixth Form
College
The Marches
and
Worcestershire
Academy conversion - single-academy trust £42,750 Legal, Finance,
Commercial
10003023 Herefordshire and
Ludlow College
The Marches
and
Worcestershire
Recommendation changed from remain standalone to a
merger with North Shropshire College
£100,000 Legal, Finance,
Estates
Due diligence
10003193 Hugh Baird College Liverpool City
Region
Creation of a single Sefton College £50,000 Project
management,
Legal, Finance,
Estates
10003200 Hull College York, North
Yorkshire, East
Riding and Hull
Hull College Group to remain as an independent institution
under a ‘fresh start’ arrangement
£100,000 Turnaround
33
10003200 Hull College York, North
Yorkshire, East
Riding and Hull
The FE Commissioner and team have been working with the
college on a SPA for Harrogate College and are now working
on the disaggregation with Hull College Group and four
potential acquiring colleges
£100,000 Project
management,
Legal, Finance
Due diligence
10003564
Kensington and Chelsea
College
London Central The AR recommendation was for Kensington and Chelsea to
merge with City Lit institute. A series of events have led to a
SPA. There are two options 1) To merge with Morley College
or 2) Standalone TG is to explore the standalone option
£30,000
Project
management,
Finance
10003564
Kensington and Chelsea
College
London Central Merger with Morley College
£70,000
Legal, Finance,
Commercial,
Estates
Due diligence
10003624 King Edward VI College
Nuneaton
Coventry and
Warwickshire
Enter into a SFC multi-academy trust arrangement with
Coventry University
£50,000 Project
management,
Legal, Finance
10003674 Kingston College London South Representatives from the Central, West, South and East
London area reviews to support the proposed pan-London
review of SEND and high needs provision
£50,000 Project
management
10003674 Kingston College London South The South London boroughs to explore ways of delivering
adult community learning services
£50,000 Project
management,
Legal, Finance
Due diligence,
Asset or liability
valuation
10003189 Kirklees College West Yorkshire Kirklees to remain as standalone institution focusing on the
education and skills needs of the communities it serves in
Kirklees. A change to the recommendation was agreed for
KIrklees to become a 'fresh start'
£50,000 Project
management,
Finance,
Turnaround
10003755 Lambeth College London Central Lambeth College to form a partnership with (1) London South
Bank University (the college’s preferred option) or to merge
with either (2) Lewisham Southwark College or join the new
grouping of (3) City of Westminster College and The College
of North West London
£100,000 Project
management,
Legal, Finance,
Estates
Due diligence
10003755 Lambeth College London Central For additional costs Lambeth College has incurred resulting
from the Structure and Prospect Appraisal to secure a new
merger partner for the College
£10,000 Legal, Finance
10003894 Lewisham Southwark
College
London Central Merger with NCG £100,000 Project
management,
Legal, Finance
Due diligence
10003899 Leyton Sixth Form
College
London East The creation of a London Sixth Form Partnership, a new pan-
London collaborative venture to share best practices and
services
£50,000 Project
management
10004088 Long Road Sixth Form
College
Greater
Cambridgeshire
and Greater
Peterborough
Long Road Sixth Form College to explore academy
conversion as its preferred strategic option, or otherwise to
remain a standalone sixth form college
£50,000 Legal, Finance Due diligence
10008655 Longley Park Sixth Form
College
Sheffield City
Region
Academy conversion £50,000 Legal, Finance,
Turnaround
Due diligence
34
10004112 Loughborough College Leicester and
Leicestershire
Stephenson College to merge with Loughborough College.
Type B merger with Stephenson College to dissolve
£100,000 Project
management,
Legal, Finance,
Commercial,
Estates
Due diligence
10004116 Lowestoft College Norfolk and
Suffolk
Merger of Lowestoft College and Great Yarmouth College £100,000 Project
management,
Legal, Finance,
Estates
Due diligence
10029916 Lowestoft Sixth Form
College
Norfolk and
Suffolk
The planned merger between Great Yarmouth College and
Lowestoft College to be completed in 2017 to form East Coast
College, with Lowestoft Sixth Form College joining the
merged college in 2018
£50,000 Project
management,
Legal, Finance
Due diligence
10004125 Luton Sixth Form
College
South East
Midlands
Luton Sixth Form College leaders and governors have
concluded that the preferred option is academy conversion
within a single-academy trust
£30,750 Finance
10004144 Macclesfield College Cheshire and
Warrington
Macclesfield college to decide one of 2 options £100,000 Project
management,
Finance,
Estates
10023139 Manchester College,
The
Greater
Manchester
Trafford College joining the LTE Group on the equivalent
basis to The Manchester College
£100,000 Project
management,
Legal, Finance,
Commercial
10004344 Middlesbrough College Tees Valley Merger with Redcar and Cleveland College £100,000 Finance,
Commercial,
Turnaround
Due diligence
10004552 Nelson and Colne
College
Lancashire Following an FE Commissioner-led SPA for Accrington and
Rossendale College to merge with Nelson and Colne College
£100,000 Project
management,
Legal, Finance,
Commercial,
Estates
Due diligence
10006963 New City College Essex (Epping
Forest)
Merger of Epping Forest College with NCC. This merger
follows intervention by the FE Commissioner and a selection
process by Epping Forest College
£100,000 Project
management,
Legal, Finance
Due diligence,
Asset or liability
valuation
10004577 New College Nottingham
(NCN)
Derby,
Derbyshire,
Nottingham and
Nottinghamshire
Merger with CCN £100,000 Project
management,
Legal
Due diligence
10004578 New College Pontefract West Yorkshire Academy conversion (a multi-academy trust with sponsored
Free Schools)
£50,000 Project
management,
Legal, Finance,
Commercial
Asset or liability
valuation
10004580 New College Telford The Marches
and
Worcestershire
TCAT and New College Telford merger £100,000 Project
management
Due diligence
35
10004603 Newcastle and Stafford
Colleges Group
Stoke on Trent
and
Staffordshire
Merge with Stafford College £100,000 Project
management,
Estates
Due diligence
10004607 Newham College of
Further Education
London East Newham College to create a shared service and
apprenticeship company with Tower Hamlets, Hackney and
Redbridge colleges
£50,000 Legal, Finance,
Commercial
10004695 North Lindsey College Sheffield City
Region
North Lindsey College to maintain its standalone position as a
financially strong college serving Scunthorpe and to continue
to explore options for merger including with Doncaster
College subject to due process
£100,000 Project
management,
Legal, Finance
Due diligence
10007299 North Shropshire
College
The Marches
and
Worcestershire
Merge with Reaseheath College £100,000 Project
management,
Legal,
Commercial
Due diligence
10004861 Oldham Sixth Form
College
Greater
Manchester
Academy conversion £50,000 Project
management,
Legal
Due diligence
10004969 Palmer's College Essex Palmer’s College and SEEVIC College to merge, developing
a coherent offer that will meet local learner and employer
needs
£100,000 Project
management,
Legal, Finance
10005200 Preston College
Lancashire West
Preston’s College to merge with the University of Central
Lancashire
£100,000 Project
management,
Legal, Finance,
Estates
Due diligence
10005206 Priestley College Cheshire and
Warrington
Academy conversion £50,000 Project
management,
Legal
Due diligence
10005220 Prior Pursglove College Tees Valley Stockton and Prior Pursglove SFC Academy conversion £50,000 Legal,
Commercial
Due diligence
10005325 Queen Elizabeth Sixth
Form College
Tees Valley Remain independent and pursue academy status as part of a
multi-academy trust with local schools
£50,000 Legal, Finance Due diligence,
Asset or liability
valuation
10005339 Queen Mary's College North and Mid-
Hampshire
Academy conversion £50,000 Project
management,
Legal, Finance,
Estates
Due diligence
10005404 Reaseheath College The Marches
and
Worcestershire
Planned group structure with University of Chester £50,000 Legal, Finance Due diligence
10005435 Reigate College Surrey To form a multi-academy trust £50,000 Legal, Finance Due diligence
10005466 Richmond Adult
Community College
(RACC)
London South Merge with Hillcroft College and create Apprenticeship
company
£50,000 Project
management,
Legal, Finance
Due diligence
36
10005534 RNN Group Sheffield City
Region
Merge with Dearne Valley College £100,000 Project
management,
Legal,
Commercial,
Estates
Due diligence
10005534 RNN Group Sheffield City
Region
Barnsley College, Chesterfield College, Dearne Valley
College, Doncaster College, the RNN group, and Sheffield
College to develop a shared apprenticeship company
£50,000 Legal,
Commercial
10005669 Sandwell College Black Country
Cadbury College to merge with Sandwell College following a
Structure and Prospects Appraisal, no later than December
2018
£100,000 Legal, Finance Due diligence
10005687 Scarborough Sixth Form
College
York, North
Yorkshire, East
Riding and Hull
To support and enable faster working and collaboration and
joint working between the two colleges as detailed
£27,015 Project
management
10005822 Shrewsbury Colleges
Group
The Marches
and
Worcestershire
Merger with Shrewsbury CAT £50,000 Finance,
Commercial
Due diligence
10005864 Sir John Deane's
College
Cheshire and
Warrington
Academy Conversion £25,800 Legal, Finance
10005946 Solihull College and
University Centre
Birmingham and
Solihull
Development of Apprenticeship Company £50,000 Project
management,
Legal, Finance
10005967 South and City College
Birmingham
Birmingham and
Solihull
Merger with Bournville College £100,000 Commercial Due diligence,
Asset or liability
valuation
10005972 South Cheshire College Cheshire and
Warrington
Creation of a single Cheshire College involving: Warrington,
Mid Cheshire, South Cheshire and West Cheshire Colleges
£200,000 Project
management,
Legal, Finance,
Commercial
Due diligence
10005979 South Downs College Solent Merger with Havant College £100,000 Project
management,
Legal,
Commercial,
Estates
Due diligence
10005981 South Essex College of
Further and Higher
Education
Essex Following a FE Commissioner led Structure and Prospects
Appraisal for PROCAT, the outcome was the
recommendation to merge with South Essex College
£100,000 Project
management,
Legal, Finance,
Commercial
Due diligence
10023526 South Staffordshire
College
Stoke on Trent
and
Staffordshire
Merge with Walsall College £100,000 Project
management,
Legal
Due diligence
10005999 South Tyneside College North East A merger between South Tyneside College and Tyne
Metropolitan College
£100,000 Project
management,
Legal, Finance,
Estates
Due diligence
37
10002356 South Worcestershire
College
The Marches
and
Worcestershire
Merge with Warwickshire College £100,000 Legal Due diligence
10006020 Southampton City
College
Solent Southampton City College to form a partnership with
Southampton Solent University. If this proves not to be
practicable, then Southampton City College and Eastleigh
College will explore merger
£100,000 Legal, Finance Due diligence,
Asset or liability
valuation
10006038 Southport College Liverpool City
Region
Merger of Southport College and KGV SFC £50,000 Project
management,
Legal, Finance,
Estates
Due diligence
10006226 St Mary's College Lancashire St Mary’s College will Federate with Cheadle and Marple
Sixth Form College and Liverpool Hope University
£50,000 Legal, Finance,
Commercial
10006268 St Vincent College Solent Formal partnership with Richard Taunton SFC and create a
SFC multi-academy trust
£100,000 Project
management,
Finance,
Commercial
Due diligence
10006331 Stockport College Greater
Manchester
Oldham, Stockport and Tameside Colleges merger £100,000 Project
management,
Legal, Finance,
Estates
Due diligence
10006341 Stockton Riverside
College
Tees Valley Merge with Redcar and Cleveland College £100,000 Project
management,
Legal, Finance,
Commercial,
Estates
Due diligence
10006349 Stoke On Trent College Stoke on Trent
and
Staffordshire
Fresh start £50,000 Finance,
Turnaround
10006002 Stratford-Upon-Avon
College/Solihull College
Coventry and
Warwickshire
Merger with Solihull College £100,000 Legal, Finance Due diligence
10001475 Sunderland College Tees Valley Merger with Northumberland College £100,000 Project
management,
Legal, Finance,
Estates
Due diligence
10006432 Sussex Downs College Sussex To form a legally binding federation with Sussex Coast
College
£100,000 Project
management,
Finance
Due diligence
10001463 The City Literary
Institute
London Central Merger with Kensington and Chelsea College £100,000 Legal, Finance Due diligence
10023525 The Rochdale Sixth
Form College
Greater
Manchester
Academy conversion £34,500 Legal,
Commercial
Due diligence
10005881
The Sixth Form College
Colchester
Essex
The Sixth Form College, Colchester to explore conversion to
a single-academy trust (single-academy trust) or retain
standalone Sixth Form College status
£50,000 Legal, Finance
Asset or liability
valuation
38
10006814 The Sixth Form College
Farnborough
North and Mid-
Hampshire
SFCF to convert to an Academy £50,000 Legal, Finance Due diligence
10006815 The Sixth Form College,
Solihull
Birmingham
and Solihull
To pursue conversion to academy status and merger with the
Ninestiles Academy Trust to form a new multi-academy trust
£50,000 Project
management,
Legal, Finance,
Commercial,
Estates
Due diligence,
Asset or liability
valuation
10006892 Thomas Rotherham
College
Sheffield City
Region
Academy conversion £50,000 Legal Due diligence
10006963 Tower Hamlets College London Central Tower Hamlets College to merge with Hackney College £100,000 Legal, Finance Due diligence
10006963 Tower Hamlets College London Central Tower Hamlets College and Hackney College to merge with
Redbridge College
£100,000 Legal, Finance Due diligence
10005998 Trafford College Greater
Manchester
Stockport College and Trafford College to merge £100,000 Project
management,
Legal, Finance,
Estates,
Turnaround
Due diligence,
Asset or liability
valuation
10001476 United Colleges Group London Central Costs associated with the development of a detailed
application to partner with Lambeth College, as part of the
recent Structure and Prospects Appraisal
£10,000 Estates
10007212 Varndean College Sussex Shared service option with Brighton and Hove Sixth Form
College
£28,125 Commercial
10007339 Warrington Collegiate Cheshire and
Warrington
Creation of a single Cheshire College involving: Warrington,
Mid Cheshire, South Cheshire and West Cheshire
£100,000 Project
management,
Legal, Finance,
Commercial,
Estates,
Turnaround
Due diligence,
Asset or liability
valuation
10007859 Warwickshire College Coventry and
Warwickshire
Create Joint Venture Company (single lead) £50,000 Legal
10007417 West Herts College Hertfordshire A changed recommendation was agreed Barnfield College to
merge with West Herts College rather than Central
Bedfordshire College following a Structure and Prospects
Appraisal
£100,000 Project
management,
Legal, Finance,
Estates
Due diligence
10007456 WKCIC Group London Central Westminster Kingsway College and City and Islington College
to remain stand alone as WKCIC Group and explore options
for collaboration with COHENEL
£100,000 Legal, Finance,
Estates
Due diligence
10007566 Woking College Surrey Explore Academy conversion £25,650 Legal, Finance Due diligence
10008025 Worcester Sixth Form
College
The Marches
and
Worcestershire
Academy conversion - single-academy trust £50,000 Project
management,
Legal, Finance,
Estates
Asset or liability
valuation
39
10008025 Worcester Sixth Form
College
The Marches
and
Worcestershire
Worcester Sixth Form College should become part of a multi-
academy trust with Hereford Sixth Form College - multi-
academy trust
£50,000 Legal, Finance
10007636 Working Men's College
Corporation
London Central The Central London boroughs, to explore ways of formal
collaboration sub-regionally to deliver adult community
learning services where it can be shown that savings could be
made and/or quality and/or effectiveness of delivery can be
improved
£50,000 Project
management
10007643 Worthing College Sussex
Remain as independent college and explore potential for
academy conversion
£37,500
Project
management
Due diligence
10007671 Wyggeston and Queen
Elizabeth I College
Leicester and
Leicestershire
Wyggeston and Queen Elizabeth I Sixth Form College and
Regent Sixth Form College will develop the option of a full
merger
£50,000 Project
management,
Legal, Finance,
Estates
Due diligence
Annex Four: Related / associated publications and links
Further education area reviews: policy and reports. Updated 3 August 2017.
Overseeing financial sustainability in the further education sector. Published 20 July 2015.
https://www.nao.org.uk/report/oversight-of-financial-sustainability-in-the-further-education-sector/
Further education area reviews: how they work. Updated 1 March 2016.
https://www.gov.uk/government/publications/post-16-education-and-training-institutions-area-based-reviews
https://www.gov.uk/government/collections/post-16-education-and-training-area-reviews
Transition grants guidance: area reviews of post-16 education and training institutions. Published 11 April 2016.
https://www.gov.uk/government/publications/post-16-education-and-training-institutions-transition-grants-for-area-reviews
Further education area reviews: guidance for providers. Updated 10 January 2017.
https://www.gov.uk/government/collections/further-education-area-reviews-guidance-for-providers
Further education area reviews: guidance on restructuring. Published 19 October 2016.
https://www.gov.uk/government/publications/further-education-area-reviews-guidance-on-restructuring
Further education area reviews: guidance for LEPs and LAs. Published 19 October 2016.
https://www.gov.uk/government/publications/further-education-area-reviews-guidance-for-leps-and-las
Further education area reviews: due diligence framework. Published 19 October 2016.
https://www.gov.uk/government/publications/further-education-area-reviews-due-diligence-framework
Reviewing post-16 education and training institutions: area reviews (waves 1 to 5). Updated 21 October 2016.
https://www.gov.uk/government/publications/reviewing-post-16-education-and-training-institutions-list-of-area-reviews
Restructuring Facility: guidance for applicants. Annex C includes restructuring facility case summaries. Updated 16 May 2019.
https://www.gov.uk/government/publications/post-16-education-and-training-institutions-apply-for-financial-support-for-area-reviews
Further education area reviews: standards colleges can expect. Published 10 January 2017.
https://www.gov.uk/government/publications/further-education-area-reviews-standards-colleges-can-expect
College oversight: support and intervention. Published 1 April 2019.
https://www.gov.uk/government/publications/college-oversight-support-and-intervention
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