Southampton City College ordered to improve finances

City College admitted it was "financially weak"

The future of a cash-strapped college is hanging in the balance as it has been told to improve its finances.

Southampton City College's accounts revealed its deficit rose to £1.65m last year.

The Education and Skills Funding Agency (ESFA) which is financially supporting the college said it must find a "long-term solution" to its funding issues.

The college said it aims to merge with a sixth form college to reduce its costs.

The further education college, caters for 16-to-18-year-olds as well as adult learners and has about 5,000 students.

Its financial report revealed its deficit had grown by £1m in 2018-19 and a £500,000 overdraft facility had been removed by Santander bank, according to the Local Democracy Reporting Service.

The report showed it had £5.86m of loans outstanding with Santander.

In the letter to the college the ESFA has reissued a Notice to Improve (NTI) first sent in 2016 and told the college to find "a long-term financial solution that does not require ongoing emergency funding."

In a statement, City College admitted it was "financially weak".

"The challenge is that our provision is highly technical and inclusive and this is more expensive to deliver than other types of Further Education.

"It is a small college, so it cannot achieve the economies of scale that larger colleges achieve."

It said it was planning to begin a merger with Itchen Sixth Form College in the late spring.

A proposed merger with Eastleigh College was abandoned early last year.

Darren Paffey, cabinet member for aspiration, schools and lifelong learning at Southampton City Council said it was monitoring the college's situation.

"City College makes an important contribution to Southampton's education .... we are keen for colleges to explore options that would place Further Education in the city on a more sustainable foundation."