Regional Governance Newsletter

Welcome to the AoC West Midlands Governance Newsletter for the spring term.

We’ve been continuing to run our regional programme of workshops and network meetings in the region, with great feedback about the speakers and session content that we’ve included.

This issue includes a variety of articles and regular information about resources, best practice andupcoming events.

In this edition:

• A round-up of national and regional governance news and forthcoming events

• Top ten merger tips• Think Piece – John Tew, Chairman of the

Board of Governors at Sandwell College shares his thoughts on area reviews

• Useful resources

Spring Issue 2016

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National and regional governance news

Area Review Support for Governing Bodies

AoC has produced a Guide for Governors and Senior Leaders on New Structures (including collaboration, federation and merger) which also includes advice on engaging with the area review process and its recommendations. The purpose of the guide is to provide practical support for college governing bodies who are considering structural change, either proactively or as an outcome of the area review process.

The guide has been based mainly on the experience of several of the National Leaders of Governance (NLG), principals and chairs of merged colleges. The guide includes checklists, templates and case studies, and addresses five key areas:

• How to influence area reviews?• What evidence is necessary to inform decision-making?• What form of new relationship is most appropriate?• What process should be adopted to ensure the most effective outcome?• Due diligence and when should we bring in financial and legal advisors?

Through February and March, AoC has held three conferences on Area Reviews and College Structures including an event at Stoke which a good number of governors from colleges in the West Midlands attended. The events have included:

• Staff from BIS and the Joint Area Review Delivery Unit outlining the process

• Chairs from colleges involved in wave 1 giving comment and insight on their experience of the review

• Case studies from colleges with experience of merger or collaboration• Legal briefing from Eversheds LLP on merger and governor liability

National Activities

Presentations from all three events will be available to download from the AoC website following the final conference which takes place at Reading on Wednesday 16 March 2016.

At the end of February, the Department for Business, Innovation and Skills (BIS) published the much anticipated second edition of guidance on area reviews. The update includes a lot more detail on the process and aims of reviews, some recommendations about implementation, the process for applying for financial support from the restructuring facility and a promise that the Government will introduce an insolvency regime for colleges in 2019 (this will require legislation).

Three areas reviews are now underway in the West Midlands – in Birmingham and Solihull which is due to conclude shortly; in The Marches and Worcestershire and involving 12 colleges; and in Staffordshire and Stoke-on-Trent. Reviews in the Black Country and in Coventry and Warwickshire are due to commence in April.

NLG Programme

The NLG programme continues to provide valuable support to governing bodies not just on area reviews but more generally too. Several NLGs are working with colleges across the region on many aspects of governance development either with individual governors and chairs or with the governing body as a group.

Analysis from AoC’s Governance Development Unit shows what is motivating Governing Bodies to take up NLG support.

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Not previously accessed NLG support in 2014 programme 47%

Recently been inspected and received a lower Ofsted grading for overall effectiveness or leadership, management and governance

44%

Identified in their self-assessment report area for improvement in governance 58%

Experience a change of leadership (chair or principal) 81%

There is a change of circumstance or provision in their area/region 44%

Any other significant factor present 53%

**47% of applications made reference to the Area Review process in at least one/several parts of their application form**

Overall desired outcome from accessing NLG support

Improving college performance 44%

Supporting the Chair of Governors 53%

Improving board effectiveness 79%

Governance Summit

AoC’s Governance Summit was held on 2 March 2016 in London. Alongside key note speeches from the Prime Minister’s Apprenticeship Adviser, Nadhim Zahawi MP, and Peter Lauener, Chief Executive of the two funding agencies, the Summit included seminars on governing in times of change, devolution, localism and outcome agreements. The Summit was followed by a ministerial address from Nick Boles MP, Minister of State for Skills and a question and answer session with the Minister.

And on ministerial addresses, you will probably be aware that Nicky Morgan MP and Secretary of State for Education spoke at a special event for principals and chairs of governors. She reinforced the Government’s commitment to further education whilst outlining some of the policy initiatives currently underway. You can read a copy of her speech on the government website.

Webinars

Through the Governance Development Programme, AoC is organising a series of webinars on subjects of interest to governors and clerks.

The webinars are free and provide a presentation, and question and answer session with a subject expert. To hear a webinar live you will need to complete a simple registration form before each event.

Recordings of all the webinars held to date are available to listen to via the AoC website where you will find further details on registering for the latest webinar.

**Figures correct as at beginning of February 2015

For more details on the NLG programme please visit the website or contact Fiona Telford, Governance Recruitment Manager, AoC.

Reasons given for accessing NLG support

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Our West Midlands Governance Programme

Introduction to Further Education and College Governance

This session was led by Steve Sawbridge, AoC WM Regional Director, and was aimed primarily at new governors. Steve outlined the scope of the further education system and the place of colleges within it; the business of college governance and the responsibilities of college governors; the Code of Good Governance for English Colleges; and the characteristics of effective governance.

Student Governor Event

Angelina Linker, Governor Development Officer, National Union of Students, led a lively and engaging session specifically for student governors at colleges in the West Midlands.

Angelina covered all aspects of the role of a student governor, including: what does a student governor do; what are good communication skills; asking effective questions; active listening; body language, and shared information about useful resources and further information.

Funding and Finance

This session was a repeat of the very well received session we ran earlier in 2015 and was led by Peter Merry, Finance Director from Walsall College, and Steve Sawbridge, AoC WM Regional Director. The session covered many aspects of college funding including the allocations process; financial

planning and budgeting, and using the right data to take a strategic view of college finances.

The Legal Framework for Governance

The workshop was led by Mark Taylor, Principal Associate - Corporate Education, with Nicola Bennison, Partner, Midlands Education Team at Eversheds LLP. Mark and Nicola covered relevant legislation as it applies to colleges; the legal obligations and requirements of governance; and the legal implications arising from merger, federation and other organisational models and structures.

Delegates were able to network and share their experiences, and took the opportunity to ask questions of the speakers, who both have extensive experience of advising colleges of their legal obligations.

Audit and Financial Regulation

Anna Lancefield of Grant Thornton UK LLP led this session which was particularly useful for chairs and members of audit committees. Anna covered the current regulatory challenges for further education governance; the responsibilities of governors and the audit committee; achieving effective assurance; and equipping the Audit Committee to meet its responsibilities. Delegates found the session particularly useful in comparing practice at their own colleges with others.

Presentations and other materials from our events can be downloaded from our website.

Sessions run so far this year have included:

We have a full programme of events and workshops running in our regional governance development programme, details of which you will find in our brochure. Since the beginning of this academic year we have run four Saturday morning workshops on various topics.

These popular informal sessions enable governors not only to gain further knowledge and insight into their roles but also provide opportunities to share experience with governors from other colleges.

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Governor Workshops and Network events still to come

There are a number of regional governance sessions still to take place:

• Managing Performance on Saturday 19 March at Wolverhampton Science Park. Led by Carol Jones, NLG

• Curriculum, Quality and Inspection on Saturday 30 April at Walsall College. Led by Ian Smith, Senior HMI, Ofsted, and Steve Sawbridge, AoC WM Regional Director

• Area Reviews Governors’ Network on Tuesday 24 May at Eversheds Birmingham (10 – 1pm). Led by Mark Taylor, Eversheds LLP

• Strategy, Planning and Organisation Review on Saturday 4 June at Solihull College & University Centre. Led by a member of the FE Commissioners team

• Scrutiny and Accountability on Saturday 2 July at Queen Alexandra College. Led by Brenda Sheils, NLG

Specifically for Staff Governors we will be holding a networking event on Thursday 23 June with a view to making this a more permanent part of next year’s regional programme. And we will be running a development event for Clerks on Tuesday 19 April at South and City College Birmingham.

Programmes for each of these events will be circulated closer to the dates. Further details of these events can also be viewed in our Governance Programme brochure 2015/16.

Peer support programme for Chairs from West Midlands Colleges

Finally through the regional programme we are piloting a peer-to-peer support programme with a small group of Chairs and facilitated by Brenda Sheils, NLG and experienced coach.

The aim of the pilot is to enable participants to share and benchmark their own experiences as college governing body chairs in a confidential setting with a view to identifying areas in which they can further develop both individually and with their respective governing body members. The pilot project is funded by the Education and Training Foundation (ETF) and if successful will be offered again later in the year.

Forthcoming events

Coming up in the next couple of months we have further Saturday morning workshops as well as a week day Governor Network meeting.

All are free to attend and places can be booked via clerks or directly with the regional office on 01902 824399 (email yasmin_byrne@aoc.co.uk).

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Top ten merger tips

1There is no secret to implementing a merger. Like any project, it requires leadership, management, communication and good sense. The report “Current Models of Collaboration” contains a useful description of five factors necessary for successful structural change:

• Clarity and realism about the process and outcomes • Identifying and addressing vested interests • Rigorous consideration of options • Strong, sustained leadership • Appropriate governance structures

2Some of the hardest challenges in college mergers revolve around the simplest issues, for example the name and identity of the combined entity or who fills the senior roles. Colleges rely on the commitment of lots of people from a variety of backgrounds. Successful mergers require a strong focus on the culture of the new organisation and need a great deal of work to ensure that those involved understand its purpose.

One recent lesson from mergers is that colleges need to maintain the confidence of financially important stakeholders. The views of students, parents, employers, staff, MPs and councils all matter but funding agencies, banks and LGPS funds may have financial stakes which give them the ability to delay or prevent a merger taking place. They need to be involved at an early stage.

College names: College mergers often involve a change of name. The merger may involve the change to the legal name for the college (or a new name if there is a Type A merger and a new corporation) but this does not automatically require a change in the name used for the courses at a specific campus.

Leadership: The decision on who should lead the new college is one of the most important that will be made in the merger process. The decision can also be legally tricky because of the employment law implications. There are a number of issues which governing bodies need to think through:

Governing bodies have the responsibility for the appointment of the principal or chief executive of the newly merged college. The FE Commissioner letter sent in June 2015 notes that “leadership of large organisations may require a different skill set to leadership of smaller organisations” and that “the choice of principal and the senior management team should not automatically be limited to internal candidates”.

Timetable: Those involved in college mergers often want to move quickly to completion but there are a number of things that can slow things down. College mergers typically take around six to nine months between the formal public announcement of a merger plan and the actual merger date but the time taken depends on circumstances.

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For this issue’s ‘top ten tips’ we have taken ten of the key nuggets from Julian Gravatt, AoC’s Assistant Chief Executive’s merger tips document – a guide for colleges on some of the areas to be considered in undertaking college mergers. The guide is based on experience and practice from merged colleges gathered over a number of years.

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Business systems (eg IT, MIS, Finance, HR and Payroll): Colleges work in a regulatory and funding environment which is dominated by data. Decisions on systems and data collection are incredibly important. Like it or not, a college with excellent teachers and bad data is likely to have more problems than a college with average teachers and excellent data.

Just as colleges need to have full and early discussions about staffing issues so that plans can be put in place, so it is necessary to create a road map which clarifies which systems will be in operation from Day 1 and which will be changed later.

It is obviously important to work out how and when to combine finance, HR and student record systems to ensure that normal business is unaffected (and hopefully enhanced) in the merger process.

Governance of the merger process: The way in which colleges tackle governance issues depends on their approach but there are a number of useful lessons from recent experience:

A merger steering group is generally a good idea, comprising key governors from each college.

Membership needs to be decided with a view to who might be planning to stand down and who would like to continue.

This needs to be chaired and minuted so that there is effective communication to each Corporation using the same reports and minutes.

It may be sensible to constitute this group as a formal joint committee of both colleges using the college federation powers contained in the Education and Inspections Act 2006.

Staff:Mergers have a big impact on the people who work in the colleges affected. When merger plans are published, statements about reducing duplication between courses or making savings inevitably raise concerns from staff because they are directly affected.

Colleges typically spend more than 60% of their income on staff costs so getting things right is important. Any savings from a merger process will generally involve restructuring, job changes, redundancies and removal of vacancies. Once a merger has taken place, there will inevitably be pressures to harmonise HR policies and terms and conditions. This does not have to happen but if differentials remain between similar groups of staff, then they will need to be properly justified. There is a long list of HR tasks in a merger. These include:

• Sharing information about current organisation structures, staffing levels, contracts and HR policies

• There will involve a detailed discussion of issues like pay, hours, holidays, sickness absence, expenses, appraisal and other issues

• Designing new structures for the new college

Students, parents and employers may be relatively unaffected by a planned merger because it does not directly affect the course, campus or service that they use.

Nevertheless it is important for people to feel involved and to have the chance for give their views in the consultation and during merger implementation. The process could be disrupted by late objections and because engagement is likely to produce longer-term success. Merger planning needs to cover communications; there need to be consistent messages from both colleges and consultation needs to address the issues raised.

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Think PieceJohn Tew, Chair at Sandwell College, has contributed at several meetings we’ve held on area reviews recently. Here he shares his personal reflections on the implications for governance.

In contributing my thoughts on area reviews I am aware that there are still many more questions than answers out there.

I have never been against the principle of a review of FE, after all why should we be any different as a sector to others particularly when there is a lot of public money involved and we are attempting to serve our learners, our businesses and our wider communities to best effect.

Where I begin to have a problem is where a politician decides on the outcome “fewer, larger, more resilient and efficient colleges etc.” in advance to which the pieces of the jigsaw then have to be made to fit.

Given that each area is different is it really a one size fits all solution that will work?

Maybe surprisingly I don’t spend my day reading Hansard but it may be helpful to look at the recent debate in the House of Lords on FE and as pointed out by Martin Doel in his recent newsletter. For newer governors in particular it is a reminder of what has already happened with cuts to funding since 2011. This type of thing does not of course register often on those

Area reviews – some thoughts!outside the FE ‘loop’ but maybe it should.

Also is it really so long ago that governors in many colleges were urged to ‘splash the cash’ in terms of new builds etc., including taking on significant bank borrowings to do so? OK so times change and we have to change with them but it would be disingenuous in the extreme to suggest that colleges where in some cases financial issues have arisen, have been entirely responsible without the influence of others.

Questions of course have been asked for many months now such as, why are school sixth forms not directly part of this, why are University Technical Colleges not part of it, no point in simply reiterating those if people are not fully listening.

One further thing that does frustrate me is of course why is the position of schools not more generally part of this equation? As a college along with many others who have spent a very considerable amount of time, money and effort in helping young learners with the ‘requirement’ to achieve results in maths and English should we not be pointing out that we are a college of FURTHER EDUCATION, not somewhere where we are playing catch up as a result of

deficiencies elsewhere. Perhaps a wholesale review of education should be undertaken – now there’s a thought!

Possibly the outcome of the Birmingham area review which will be ‘unveiled’ in a series of recommendations in a few weeks’ time may help us answer some more of the questions, or not? I will not comment specifically on the ‘leaks’ of what that may reveal but as Chairman of Governors of a college that sits within the Black Country but also sits literally on the doorstep of the Birmingham area I am doubly interested in what direct and indirect implications there may be for Sandwell College?

As part of our strategy we have already in our curriculum reflected the priorities of both the Black Country LEP and that of the Birmingham and Solihull LEP. However it is difficult for others on the outside of FE to truly understand the breadth of offer that FE colleges provide, and that is not a criticism of others, maybe more of FE itself in not communicating things as efficiently as we should. Even if we are instrumental in helping to plug the gaps in terms of the skills needed by those LEP priority areas we would go nowhere near being able to get all our learners into meaningful employment.

Is there a potential conflict with what is good for local economies in terms of skills needed and what money ‘needs’ to be saved?

Apprenticeships is another factor of course. Too complicated to get into here fully as it is still developing (or should that be unravelling).

Of course it needs to be affordable, coming from a business background that is an obvious

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one to me but it is also true that to succeed a country needs to invest properly (and fairly) in its education.

I am concerned at the lack of knowledge that some who sit around an area review steering group table may have so we need to ensure that a full picture is available to them and they are not ‘steered’ by others to unsatisfactory/unworkable conclusions.

Do we really want to go through this whole thing again in a few years? That I feel is a significant danger unless all factors are taken into account.

As a sector we need to be better at engaging with others and working in collaboration, including with other establishments but imposing something from on high is not I believe the answer.

As independent governors it is right that we are held to account for the decisions which we make, after taking all facts into account and of course seeking legal and other outside advice where necessary. It was John Maynard Keynes who said “when my information changes, I alter my conclusions. What do you do sir?”.

It is to be hoped that the powers that be are sufficiently grown up to adopt the same stance?

Whilst we are all waiting our turn for an area review, life needs to go on of course. The distraction caused by this process helps no one.

I do not believe that as yet the voice of governors collectively has been heard enough and that is something that we need to focus on. There are many thousands of us out there and where necessary we can and should exert influence and pressure – collectively.

There have been some recent suggestions that legislation may be sought to force through some measures which colleges do not support arising from recommendations. If that were to be the case I believe we would be entering into very dangerous territory. What would be the point in being an ‘independent’ governor in such circumstances?

You will no doubt like me, draw your own conclusions.

John Tew, Chairman, Board of Governors, Sandwell College.

Our thanks to John for being the first to share his thoughts in our newsletter.

As we go to press the Black Country area reviews have just been announced and will commence at the end of April.

If you’d like to contribute your own think piece on a topic for a future issue of our regional newsletter do please get in touch with Sara King.

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Useful resources and contactsFor full access to all the available resources, please register your details by emailing our national governance team. Governors will then be registered for an account and AoC will issue a personal password to enable access to the content of the briefings listed in the notification emails. The AoC website offers an extensive range of essential material for the support of governance including:

• AoC Governance Briefings• Pages dedicated to governance issues• Information to support the induction of new governors• Guidance for would-be governors• Guidance for clerks seeking to recruit governors• Guidance notes, which are brief introductory guides to governance matters• Templates, which are examples of good practice materials• A collection of some of the more recent published policy and other papers• A repository that holds copies of publications and material held elsewhere in the library, as well as videos from the Governance

Conference• 2013 board composition results• 2013 board composition tables

The AoC governance resources page includes a number of useful links and is organised according to the ten principal responsibilities of good governance, as stated in the Code of Good Governance for English Colleges, 2015.

A programme of webinars on subjects of interest to governors and clerks is available on-demand. Details of these are made known through the AoC Governance briefings. If you haven’t already done so, register on the AoC website to see the on-demand webinars.

External resources

• A report, and open letter to FE and Sixth Form College Chairs on the review of Further Education and Sixth Form College Governance• BIS guide for College Governance: how Further Education Colleges operate• For advice and support for student governors, please contact Angelina Linker, Governor Development Officer at the National Union of

Students• SGOSS - Online Governor recruitment site• Visit the University and College Union website to find out how college staff are represented at your organisation

Contact Us

For any questions, comments or queries relating to the programme such as advice on commenting or feeding in to the advisory group, or suggestions for areas of specialist training, please contact AoC West Midlands Projects Manager, Sara King.

Additionally, please also send Sara any suggestions for content or articles you wish to be included in future editions.

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