Edinburgh College had £1 million deficit last year

Edinburgh College's Granton campus. Picture: Jon Savage

And the Audit Scotland assessment, published today, also highlighted a series of other issues, including the late appointment of a principal for the merged college, technology problems and missed targets.

Colleges across Scotland have undergone a massive shake-up over the past few years. Mergers have cut the number of colleges from 37 to 20, Scottish Government funding was cut by 12.3 per cent in real terms between 2011-12 and 2013-14 and the number of full-time equivalent staff has fallen from 11,300 in 2011-12 to 10,250 last year.

Audit Scotland said the country’s colleges had generally managed to maintain sound finances and to date the changes had had little negative impact on students.

Edinburgh College was formed by the merger of Telford, Stevenson and Jewel and Esk colleges. Audit Scotland said its income in 2013-14 had been £44.4m, compared with expenditure of £45.4m.

Audit Scotland’s guidance stressed the importance of appointing the leaders of a new organisation as early as possible, ideally six months in advance of its launch.

The report said: “Edinburgh College appointed its principal designate only one month before its formation, and subsequent mergers have shown that an earlier appointment of a principal designate should have been possible.”

The report also noted Edinburgh College had “difficulties in some curriculum areas” as new processes and structures were implemented.

And it said the Scottish Funding Council had imposed a £400,000 penalty on the college in 2012-13 for failure to meet agreed outcomes.

A college spokeswoman said it had expected to report a deficit, resulting from the unification work associated with the merger.

The spokeswoman said it had been decided in April 2012 to appoint an interim principal designate to allow time for a robust recruitment process to be undertaken with a view to appointing a new principal for October 1 via open competition.

She said: “During this period of merger activity the college fell short of achieving its full year targets, and was therefore subject to a penalty.”

The EIS union, which represents lecturers, said while staff appreciated that austerity cuts to further education funding and the complications of the merger process had presented a range of challenges, these had been “unnecessarily amplified by a senior management team reluctant to fully engage the experience and skills of staff, or to consult and negotiate with their elected representatives”.

Annette Bruton will take over as principal this year following Mandy Exley’s resignation.