Next Steps

Julian Gravatt

National politics
General election, change of govt, education less important to voters than in 1997, squeeze on public spending

2009 budget
Tax income lowest since 1960s, deficit wont close until 2017, public spending growth 0.7% (if GDP back to 3% by 2011 otherwise lower). Public capital spending to be cut by 50% by 2014 (Crossrail, Olympics)

Budgeting for next year 2010/11
efficiency gains, up to 6% in Adult budget, 1% 16-18.
Post election budget 2011/12 likely to be very difficult academic year.

LSC funding 2009/10
Problems in unexpected places (T2G, extra unemployed)

Aggregate deficit predicted for colleges in 08/09 (capital write-offs)

Capital funding
Many of 200 the 200 colleges with projects will have to wait, AoC estimates sunk costs of £220m, new prioritisation process in Autumn 2009. Not clear how 16-19 will work. DIUS/DCSF capital budgets empty until 2011, few new projects after this round. Need to rely on own resources and alternative funding sources.

College expenditure:
New pressure on efficiency. Pay, pensions, productivity, procurement. End of LSC means colleges will have to take more control of own finances.

Reasons to be cheerful:
College sector reputation never been higher, political support is strong
Financial leadership and management never been more important
Denham - we will never let any college go bust (20 May 09)