UP TO 60 staff could be made redundant as Halton College faces massive budget cuts - despite it having £11 million in the bank.

Lecturers were this week shocked to discover savings of £1.5 million must be made because of falling income and a failure to meet performance targets.

Principal Martin Jenkins, the highest paid college principal in Britain, and vice-principal Jenny Dolphin were suspended on full pay last year - believed to be in excess of £200,000 - pending the outcome of an investigation by Government auditors.

An internal college panel has been set up, the Worldcan exclusively reveal this week, to investigate their role.

It is understood that the FEFC intends to claw back up to £8 million in overpaid funding to the college since 1994.

Two long-awaited reports by the FEFC and national audit office are now expected to be published at the end of March.

David Cavanagh was this week appointed as acting vice-principal on a six-month contract.

Members of three unions - NATFHE, UNISON and PAT (Professional Association of Teachers) and other members of staff this week overwhelmingly passed a motion that, with the exception of acting principal John Bolton, it has no confidence in senior management and the corporation board.

They are calling for the immediate resignation of the board.

Halton MP Derek Twigg said he was "very angry" about the way the job cuts were announced and pledged his support for staff.

He said it was "nonsense" to blame the job cuts on the Government.

"They should have looked after their own community first," said Mr Twigg. "Instead, they have been concentrating on their dispersed business.

"I am very, very annoyed about the way this week's announcement has been done."

He is seeking an urgent meeting with college management.

In an exclusive interview, acting principal John Bolton explained why the proposed job cuts had to be made.

He said: At the moment, we are very rich. Yes, we have £11 million in the bank but, unfortunately, re-calculations of funding units show over claims for large numbers.

"Repayments to the FEFC will be much higher than we had anticipated.

"In addition, because of the way the funding base is re-calculated, what we thought was a surplus last year is a deficit. We are now facing another deficit next year.

"The two deficits will have to come from our material reserves and will cost a further £2.8 million.

"If we don't take action now, the funding problem will arise again next year. We must act now to get back to what we do best - provide high quality education."

The college has 482 staff and 8,000 attending students. Enrolment is down eight per cent on last year.

However, it still has 30,000 registered students from as far afield as China as Halton became the most successful college in the country to attract franchises.

"Halton grew very rapidly and accumulated large reserves through franchised work," said Mr Bolton.

He said the growth followed incorporation in 1993 when all 450 further education colleges were encouraged to compete and seek commercial work.

"Halton was very skillful and very successful. We were told to go out and compete against each other in the market place and run as a business.

"The fund guidance from the FEFC was very vague. We maximised Halton's position under our interpretation of the guidance."

However, he said, since the new Labour government came in, education policies were changed overnight.

"They replaced competition with collaboration at a stroke. The new government's priorities are about widening participation, social inclusion and local community provision.

"They have cut franchises by one-third last year and by a further one-third this year. This hits colleges like Halton very hard."

Unions have joined forces to condemn the job cuts.

Keith Bradley, acting regional officer of UNISON, said: "College staff are angry that they are in effect being asked to pay for "mistakes" made by senior management.

"The college balance sheets previously showed quite astonishing profits later exposed by investigations to be incorrect and reclaimable.

"We understand the college has to pay back millions as a result of misclaiming funds. We are dismayed at what has taken place.

"The senior management and the board are the same people who have been there throughout this whole business. We have no confidence in them."

NATFHE's full-time North West official Colin Gledhill said: "This so-called business is going to have to pay back a huge amount of money to the Government's funding agency - unofficial reports suggest anything from five to £10 million - in reparation for its damnable behaviour.

"The major establishment for the Halton community over-reaches itself to the point of breakdown; students and unemployed adults in a large area of Cheshire find their opportunities restricted; up to 60 workers and their families have their lives blighted by their employers' negligence and incompetence and the unelected governing body which was happy to pay Mr Jenkins more than any other college principal in the land, is legally responsible for the whole disgraceful affair yet remains in office conducting business as usual.

"I want to emphasise that acting principal John Bolton is not to blame for having to clear up the mess.

"NATFHE will be offering to help him make a special plea to the funding council for extra financial help to avoid redundancies."

Tony Thompson, PAT's professional officer said: "Our members are shocked and distressed by the announcement.

"The current financial crisis at the college results from the way it has been managed."

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