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Update on Further Education Capital Programme

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Update on Further Education Capital Programme Update on Further Education Capital Programme Round 1 1.1 Following endorsement by the FE Capital Steering Group in May 2015, 15 projects were endorsed to proceed for full GLA approval. Subsequently recommendations were endorsed by the GLA’s Investment and Performance Board and full approval was provided by way of Director Decision for 14 of these projects (further due diligence is undertaken on one project where new information came to light). The following table indicates projects from Round 1 which have approval. Applicant FE Capital indicative grant amount Westminster Kingsway College £700,000 College of North West London £6,500,000 Barking & Dagenham College (Priority 1) Construction £373,000 Barnet and Southgate College £6,088,438 West Thames College £912,578 City of Westminster College £3,666,668 South Thames College £472,499 Uxbridge College £196,000 Richmond upon Thames College £16,335,000 East London Advanced Technology Training £86,880 Harrow College (Digital) £100,000 Bromley College £850,214 Harrow College (Health) £1,820,124 Total £38,101,401 1.2 Subsequent to the projects being approved the following has taken place: Funding agreements were circulated in July once full GLA approval was secured. Progress in completing funding agreement schedules has taken some time during the period of Colleges’ academic summer break. Four funding agreements for Round 1 projects are now signed and three funding agreements are either with the GLA for imminent signing or are expected to be signed by mid-November. In August, the Skills Funding Agency (SFA) provided information on college financial health as submitted to them by Colleges in July 2015. It was considered at the time prudent to hold projects where there is a risk of default or worsening of financial health rating following financial plans being updated to include additional July cuts and moderation of these by the SFA. As a result those colleges which had a rating of inadequate or satisfactory were placed on hold until moderated ratings were provided in mid-November. The SFA have confirmed good or outstanding ratings for 4 of the affected projects and those projects are proceeding to grant agreement. One project was confirmed to have an inadequate rating and therefore further information is sought from the SFA and the College. After seeking further state aid advice East London Advanced Technology Training is expected to submit a proposal to increase its grant request. Further information on the revised proposal is sought. Barking and Dagenham College has recently informed the GLA in relation to the Priority 1 project that it wishes to reconsider its project in light of the potential to scale down costs and deliver the same outcomes. Further information is sought and the project has been placed on hold. Croydon College have confirmed they wish to formally withdraw their proposal for £1.5m grant funding which had full approval because the College has plans for redevelopment of the College campus in conjunction with Croydon Council which have been brought forward. For the time being the resultant unallocated sum will be held against potential inflationary risk until all Round 1 colleges are into grant. Round 2 1.3 Round 2 applications have been brought forward in two tranches. The first tranche of four applications was submitted in June for assessment. The second tranche of applications was submitted in September. Three applications were received in this tranche. Recommendations on all applications will be made following confirmation of the LEP’s 2016/17 funding allocation which is expected after the Spending Review and the Annual Conversation meeting with BIS to discuss progress and pipeline. An urgent decision will be sought once the allocation is confirmed. 1.4 A number of projects with approved Expressions of Interest which were expected to submit in December did not. Reasons such as timing, match requirements and changes to their circumstances were provided. 1.5 Full GLA approval for £544,000 is now in place for a project by the Fashion Retail Academy (FRA) which was fast tracked and endorsed by the Steering Group in June. 1.6 A further Round 2 applicant, the National College for Digital Skills requested to fast track their application in June. Recommendations were made to the FE Capital Steering Group and LEP who supported an option to defer any decision to fund. Taking into consideration the concerns raised by the Steering Group and the LEP, the Investment and Performance Board felt the risks associated with deferring any decision were too great and therefore IPB endorsed the option to fund the project. A Mayoral Decision for £7,165,000 is now approved. .
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