College merger process requires ongoing monitoring

28.09.2015

The merger of Scotland’s colleges has been a challenge for the sector and more information is required before it can be judged a success, a Scottish Parliamentary Committee found today.

Reporting a number of observations and recommendations in its ‘Report on Scotland’s colleges 2015’, the Public Audit Committee has raised concerns about the validity of efficiency savings claims; the impact on staff and students; the accountability of Arm’s-Length Foundations (ALFs); and the handling of severance payments in the sector. 

Public Audit Committee Convener Paul Martin MSP said: 

“We know that assessing costs and expected efficiency savings is a major challenge for mergers.  The Committee was assured by the Scottish Government that the lessons identified by the Auditor General from previous public body mergers had been learned.  So it is disappointing that the Scottish Government and Scottish Funding Council (SFC) have not yet been able to provide detailed figures to demonstrate efficiencies. 

“The £50 million figure for savings has frequently been referred to but we have yet to be convinced and we have sought clarity on the timescale for achieving this saving.  Given the cost of the mergers and particular concerns around some severance payments made we have asked the Scottish Government to provide greater detail on the merger costs and the achieved savings.  

“Further, the Committee understands why Arm’s-Length Foundations (ALFs) are being used by colleges, but calls for greater transparency in how they are being used by extending FOI legislation to cover them.

“We acknowledge the Auditor General’s finding that the merger planning process was generally good but we require more evidence of the benefits claimed.”  

The two colleges that displayed “significant shortcomings” in their severance arrangements process were North College Glasgow and Coatbridge College.  The Public Audit Committee is still considering reports from the Auditor General on both colleges.     

Background 

The relevant Audit Scotland report is available at http://www.audit-scotland.gov.uk/docs/central/2015/nr_150402_scotlands_colleges.pdf

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