Thursday, July 23, 2009

The NAO on the LSC: Train to Gain taking the strain

The recent select committee report on the Building Colleges for the Future programme received plenty of coverage in the media. The LSC escaped similar publicity following this week’s National Audit Office report on Train to Gain: Developing the skills of the workforce.

The NAO report concluded on the scheme’s value for money:

In our view, however, over its full lifetime the programme has not provided good value for money. Unrealistically ambitious initial targets and ineffective implementation have reduced the efficiency of the programme. While the rapid changes to the design of Train to Gain to gene rate employer demand have presented a considerable challenge for the LSC, inconsistent management and communication have led to confusion among employers, training providers and skills brokers, and have increased programme risks. Some providers have achieved high learner success rates, but for a minority success rates have been poor. Half of the employers whose employees received training would have arranged similar training without public subsidy, though it is possible that some of these learners (any not already qualified at level 2) were entitled as individuals to receive full public funding for such training.

In its recommendations the report went onto make a link with the Building Colleges for the Future crisis:

It is vital that Train to Gain avoids the pitfalls of the further education capital programme which became severely over-committed.

Perhaps it’s too late as many colleges face a financially and operationally difficult year as a result of their 2009/10 employer responsive funding allocations from the LSC.

Pandemic flu, absence rates and risk management

It now appears that the number of people off work due to coughs, colds and flu is three-times higher than normal for the time of year. What will happen when pandemic peaks? What if it comes back worse in the autumn?

What we do know is that many organisations risk management will be tested in the near future.

Over the last few years many people were disinterested in preparedness and tended to humour those of us were encouraged attention to the issue. I suspect this was, in part, due to the Year 2000 risk that never materialised. Hopefully next time people will look at the facts and assess the risks objectively.

Sunday, July 12, 2009

Telling Fritz: lessons for the public and third sectors?

This weekend’s FT reports on the resurrection of General Motors. I was interested to see that the GM Chief Executive Fritz Henderson is to have a Tell Fritz website where employees and consumers can voice their views and concerns.

Perhaps organisations in the public and third sectors could so something similar. Certainly one or two organisations have drifted out of touch with heir customers and other stakeholders. I would allow engagement, involvement etc for those without the time and/or inclination to attend meetings or fill in questionnaires.

I would be interested in any examples of where organisations delivering public services are imaginatively using blogs to open up communication channels.

Wednesday, July 08, 2009

Ethics – not expenses?

It now seems that the expenses furore has died down. Its effects will be legion. One effect will doubtless be in the audit plans that internal auditors propose and audit committees consider.

Thousands of internal audit days will be devoted to checking the processes for expenses as internal auditors and audit committees will have been unsettled by the Westminster expenses scandals. If anyone needed a reminder of the seriousness of reputational risks, they have had it. (It’s worth noting that the ripples of the expenses row have reached both the BBC and charities.)

Will those internal audit days be well-spent? Definitely, sometimes.

Where expenses policies are poorly worded, inadequately applied and widely disrespected, some lessons may be learned and culprits may be caught. However, I do wonder if elsewhere the internal audit resource might be better deployed looking more widely at the ethical environment of organisations.

How often do internal auditors look at:

1) How a culture of ethical responsibility is fostered across the organisation?

2) How well codes of ethics are agreed, communicated and bought-in to?

3) How responsibility for ethical matters, legal compliance and reputational risk is allocated?

4) How effectively are social, environmental and ethical risks integrated into risk management?

5) How does the board set itself ethical standards (along the lines of the IoD’s Standard for Directors)?

The answer is not very often and maybe not very well. There is a risk that these kind of reviews degenerate into empty tick-boxing.

I am aware that some housing associations have renamed their audit committees as audit and ethics committees. It will be interesting to see if that means more than a nod in the right direction.

Certainly audit committees do need to look at the wider ethical scene rather go searching for duck houses.

Monday, July 06, 2009

Independent advice: governor training

The Independent website is carrying an article from the Chair of the Association of Colleges announcing the setting-up of a Governors’ Council to provide support and guidance. The Council is a useful addition to the college sector landscape.

John Bingham notes both the value and the limits of institution-specific induction and training.

I would also suggest that college governors (and other board members) can get value from being briefed and challenged by an external trainer or facilitator. (I declare an interest.) Too often colleges exclusively rely on “insiders” (the college’s own managers and auditors) to provide training on how to monitor performance (of managers and auditors).

Sunday, July 05, 2009

A pre-election fix for the local government pension scheme?

This weekend’s FT reports that the government is thinking about allowing the local government pension scheme to have more relaxed funding levels than private sector schemes - as local government has “constitutional permanence” ie it does not have the same risk of going bust. This resolves a thorny problem – it makes the next actuarial valuation (and coverage of the funding black hole) in spring 2010 less of an issue in the run-up to an election.

What is less clear is how this would leave entities outside local government – notably some housing associations and all FE colleges – whose support staff are members of the local government pension scheme. These entities do not have the same permanent. Perhaps they will still face increased pension costs in 2010 and into the foreseeable future with implications for both their finances and their services.

Friday, July 03, 2009

Capital mistake: halving public investment

Amidst the arguments about cuts versus investment (and the unfortunate reference to “zero per cent” public spending rises by Gordon Brown), there is the undeniable fact that the government is winding down capital investment – the government plans to halve in the four years from 2009/10.

Earlier in the month Public Finance carried a useful survey of Capital Punishment - the implications of reduced capital spending. The college sector is already feeling the pain with dozens of rebuild projects being turned down for funding.