 Felly, welcome to the 18th meeting of the Public Audit and Post-Legislative Scrytiny Committee in 2018. Can I ask everyone to please turn off or switch their electronic devices to silent so that they do not affect the committee's work this morning? We have apologies today from Colin Beattie and Kenneth Gibson. MSP is attending in his place. Item 1, Decision on taking business in private. We have already agreed to take ydych chi'n ddigonwch ar y cyffredinol yn awrfyrddol yn unig, mae'n ein bod yn ddigonwch, yn ddigonwch ar y cyffredinol yn yr awrfyrddol yn unig. Ar y cwm, yr awrfyrddol yn 2016-17 oedyn nhw'n gyllid y Lannuqshaar. Ar y cyfnodau ni, dr Linna McTavish, CBE, y Chair of Lannuqshaar Regional Board, Martyn Maguire, y Princefll ac yr gyfrifiad, Ian Clark, y viceprincefll, resources, Derek Small. Is that how I pronounce it? Smael, sorry. Vice principal, strategy and corporate performance from new college Lanarkshire and Dr John Kemp, interim chief executive of the Scottish Funding Council. Dr Linda McTavish will make an opening statement, please. I thank the committee for taking the opportunity to invite us here for us to provide you with more evidence. We are a region across Lanarkshire, south Lanarkshire, north Lanarkshire and eastern Bartonshire that has consistently met our credit target since Merger. We are a very large region, I've already stated three local authorities, and a large population including a significant rural base. We have a very positive relationship with the SFC and it's been very, very constructive and helpful to us. We are in financial difficulties and when those difficulties came to light, we immediately examined the reasons and took steps that we could make savings and we delivered savings in 2016-17 and I think we see that in the evidence. We accept those difficulties for partly poor planning, but I would like to put in the record that our Merger was a complicated one. It was the only two plus one Merger in Scotland. It was viewed and assessed by the Funding Council and herself as being successful, but there were post-merger issues that I think we're maybe going to explore this morning and how we dealt with those post-merger issues. We welcome your scrutiny and again we'll try to answer as best we can but we'll supply you with any further information if necessary. Thank you, convener. Thank you, Dr McTavish. I'm going to ask Alec Neill to open questioning for the committee. Good morning. Linda, as you said, the challenge here and the remit of this committee is to look behind the financial challenges and to understand why they have existed and what can be done to sort them. Obviously, there are three, I think, related big issues, strategic issues. One is the amount of credit that you get because that determines your income as well as other income. There is also the cost structure as well as any additional grant income that you can get from the ASFC and so on. Can I concentrate just on the cost structure? I've been looking at the organisational structure of the college and what I see is seven layers of management. Correct me if I'm wrong. The principal, Martin. Three vice principals. Seven assistant principals. Umteen managers in business development alone. The information I have is that you've got 14 managers in business development alone. Then you've got six heads of faculty, at least six assistant heads of faculty. I think it's over 30 curriculum and quality leaders and then the lecturers who are not obviously a tier of management. So I count seven tiers of management. If you look at business development, I just picked business development, which is one of the departments under an assistant principal. My understanding is that there's four teams in that. There is the commercial business development, a total of six people with three managers. So an average of one person per manager. The regional development team has 22 people with three managers. The external funding team has six people with three managers, again a ratio on average of one to one, and then catering and conferencing and accommodation, 45 people with five managers. Is this not we top heavy in terms of management, especially when some of the people who have been made redundant or taken severance are lecturers? At the end of the day, the principal job of the college is the teaching aspect of its remit. Martin, do you want to answer that? Martin McGuire. The structure of the college pretty much was agreed at Merger. That went through a process whereby the board looked at the structure and the structure. We were the last of the colleges to Merger, so the structure was based on other structures in other colleges. I think what's important to remember is the size and the scale of the organisation. When you're talking about the European team there, our Erasmus contract for European exchange is the biggest in the UK. It's 1.6 million over the next two years, and not only is it the biggest in the UK, we actually send more students to Europe than the whole of Wales. There's a scale there that people have to understand. We have to remember as well that we inherited through Merger a lot of staff. It's not as if we've brought in a whole load of new staff. We inherited staff, and some of them were on consolidated posts and fitted into the structures. It's an operation that has a turnover of £55 million across a wide geographic layer. I've given an example of the scale. On our business side, our modern apprentices, there was a stat that came across my desk last week, our fire and security students won an award down south. Obviously, it hit the press because of the Grenfell being in the news at the moment, but our fire and security department—again, it's an example of our modern apprentices—we train more fire and security modern apprentices than the whole of England. I think that people have to understand the scale of the organisation. In response to some questions that have been raised about this, when you previously discussed the new college of Lanarkshire 6 in 22, we compared the six colleges with around £50 million turnover in Scotland for the management structures. There are, as I said, several colleges roughly the same size in terms of turnover as new college of Lanarkshire. New college of Lanarkshire is about average for the senior management team and the proportion of staff who are earning above £60,000. Clearly, the way that a college organises the grades, but these six, £60,000 will vary. Many of those people will be teaching as well as managers and so on, but we can give some reassurance that new college of Lanarkshire pretty much has the same level of senior management as any other college of the same size. I will be over managed in terms of the layers of management. I do not think that that is a very good excuse. I mean, I know a lot of organisations with turnover far in excess of £55 million, with far fewer layers of management than this. I mean, for example, what do the assistant heads of faculty do? We teach for a start, but also because we have six faculties spread across a wide area. They are required at times to be the head of faculty as well when the head of faculty is not there on campus. Again, it is the size of the organisation. Some of our faculties are bigger than other colleges in Scotland. You referred specifically to the management of Erasmus. That is the external funding department team. The external funding team has only got six people, which is obviously enough to run Erasmus and the other activities that it is doing, presumably. It has got three managers, an average of one manager per person. It is seriously telling me that that is efficient. The whole point here is that you have to look at this from your cost structure. You are facing a major deficit situation, clearly in the evidence from the union side. Reading the evidence from management and union is like reading about two entirely different colleges, because neither the twain shall meet in terms of your perception of things and their perception of things. If people are being made redundant—I believe that the curriculum and quality leaders have been downgraded recently—it seems to me that they are pretty crucial to the quality of the delivery. It is no justification to come to the committee and say that seven layers of management are okay because everybody else does it. We see streams of college reports, and a lot of them are in financial difficulty. I have to say that the funding council has a role in that. Maybe you need to take a more critical look at how much the overhead cost is and the relationship between the overhead cost and the actual resources that are going into actual teaching. As Martin knows, I was dealing with that in an individual case recently when we discovered that in one class there was no lecturer for eight weeks. How often does that happen? Mr Neil, is that a question to Mr McGuire? Both, because both Mark and John. That incident that you are talking about was certainly something that was a surprise to me, and we have reviewed that. Obviously, we have made it—the faculty is aware that that is not what we would expect. Can you speak up there, Mark? It is a surprise to use the principle that all the layers of management—and no-one came to tell you—were running for that period of time without a lecturer. In other words, despite all the management, it has not been managed. I think that the circumstances in that particular case were unique, to be honest. There was cover. I do not think that they went for eight weeks without a lecturer. There was cover. There was a specific incident. I do not know that it is appropriate for us to get into the dialogues of it here just now. You made a point there about the curriculum quality leaders being downgraded. That is not the case. What has happened is that, as part of national bargaining, all of the posts have to be levelled. You are talking about the assistant heads of faculty, and I think that the last time you mentioned their salary. What happened is that they have come in at level 3, and that is the appropriate level under national bargaining. That goes to an independent panel who looks at that. The curriculum quality leaders that you are referring to, the four-tiodd of them, have also attempted to be levelled at level 3. Unfortunately, the panel, the judgment there, as far as they were concerned, was that they would remain at level 2, and that is the level at the moment. They have not been downgraded. They have been levelled at the level that they are at at the moment through the national bargaining panel. Dr Mike Tavish? The national bargaining panel consists of both union and management with an independent chair, and we went and presented there. The union might not like the result of that decision, but that is the decision under national bargaining. We have gone through the correct procedures. They are upset about this, but the evidence was presented by both sides, and a conclusion was reached that their levelling should be 2. I can supply you the information that the panel gave in relation to those both, if you need it. Can I ask, then, just in terms of this layer of management and the number of people in management? I said that 14 managers, according to my information, are in one of the assistant principal's empires. There are another six assistant principals, so in total, how many managers are there reporting to the assistant principal's? I am not talking about including the heads of faculty, actual managers, on the same basis as the managers that I have mentioned in business development. What is the total? I cannot figure off the top of my head, but we can supply the structure. Roughly. I cannot give you an accurate figure of that. Would the other departments have more or less than 14 each? It depends what the activity is in that particular department. If the others have roughly 12 or 14 each and you multiply that by seven, there must be nearly 100 folk at that level alone who are managers. There are more than 1,000 staff in the college, spread across a wide geographic area. If you add all this up, including the assistant heads and all the rest of it, you are saying that about 15 per cent at least are managers. If you look at performance, all those managers are not delivering performance compared to South Lanarkshire. If you look at the three constituent colleges that emerged, we have less managers now from the senior team than was originally there. That is not the point. If you look at the performance, for example, in the outcomes for FE and recognised qualifications full-time, New College Lanarkshire is 59.4 per cent. South Lanarkshire College is much smaller college with nothing like the layers and layers of management. You have got 70.2 per cent. Outcome totals for FE and recognised qualifications part-time is 73 per cent for New College Lanarkshire and 81.4 per cent for South Lanarkshire College. There are other KPIs, but that is an example. My point is that the environment— It is just like Mr Neil finished. The two things that, as a Parliament, we are interested in are management and cost structure and what it is achieving. I realise the problems with merger. I think that we are all aware of those, but that is now some time away. Obviously, what we are talking about and want to concentrate on is the future rather than the past. Looking to the future, how do you improve your performance and improve your cost structure and get more people into teaching and fewer people pushing? If we look at the two colleges, because they both come under our board, South Lanarkshire has, in terms of regionalisation, stayed as themselves. They operate from one site in East Kilbride. That is their major site. In terms of the benefits of regionalisation that we have made together, we have been able to put more resource into South Lanarkshire College. If we look at the performance, we recognise in our plan that we are working with the funding council that a key measure is in retention of students. That is a critical measure for us. If we can retain more students, it is a trigger for the other performance measures to go up. In this year, the statistics are not verified by the funding council yet, but indications are that we have improved retention. In terms of the overall results, if we view the total background of both sets of students from South Lanarkshire and from New College Lanarkshire, the profile is different. We are taking more from the postcodes that have leased access into education. That is a big thing, and maybe Martin could come in and give you further information. Can you address that point briefly and then I will move on to the next question? There is a high deprivation that New College Lanarkshire is serving as well above what the Scottish average is. Mr Neil, I will come back to you if you have further questions. I am not sure whether it was Dalton MacTavish who mentioned the plan that has been worked on with the funding council. I wanted to ask a little more about that, but prior to that, there was some talk of the impact of national pay bargaining. One of the points that the Auditor General's report makes is that the college did not budget any contingency for the impact of bargaining, and I would like to ask why. Iain Clark The budget that you are referring to, Mr Gray, refers to the 2015-16 budget, which was a particularly challenging budget to achieve. It arrived at a point of the budget where we managed to have a balanced and careful consideration that was given to the presentation of that budget. I presented it to the Finance Committee as a balanced budget with an overriding criteria done in sensitive analysis that anything else included in this budget would put us into deficit. The Finance Committee was reluctant to increase income targets any further, cut expenditure any further, so it was put in as a point of emphasis to the Board of Management in the report that went to the Board of Management to explain that this was a balanced budget, but we had a point of emphasis to the Board of Management that any increase for national bargaining would tip us into deficit. The Board made the decision not to present a deficit budget, but to present a balanced budget that was heavily caveated by a point of emphasis, and that was presented to Colleges Scotland and the Funding Council. So just to be clear, what you are saying is that the Board approved a budget that was balanced knowing that there was a cost pressure, which was inevitably going to fall on it and throw it into deficit, but they decided to ignore that for presentational reasons. That doesn't sound like sound budgeting. In terms of the Board's involvement and agreement with this, we asked our Ian if this was acceptable in the way that we were presenting the information. In other words, we put in the budget to the Funding Council, and Ian will give you the technical name, a point of emphasis, and seemingly that is a way forward for you when you are finding it difficult to balance your budget at this time. We also, and I've got the letter with us, this is at the point in time where we are agreeing to national bargaining, and we actually wrote in agreeing that we would take part in national bargaining, and that was in, I think, the letters June 2015, and we point out to the management side that we had difficulties in actually balancing the budget and difficulties in terms of the amount of money that we could support by our own means without the College of Scotland putting cases to Government and the Funding Council of the cost pressures that colleges were under. The Auditor General says that, as it turned out, the cost in that budget year of national bargaining was £400,000, and that's not an insignificant factor in creating the financial position of which the College is now trying to recover. What additional funding the College received from the Scottish Government once national bargaining had reached an agreement? The additional funding for national bargaining, and the distinction needs to be drawn between the cost of living elements, which are now nationally negotiated, and the harmonisation elements of moving everyone on to the one scale. The harmonisation elements have been funded by the Scottish Government, but that kicks in later on for 2017, 18, 18, 19 and 20. There's a three-year period in which that is phased in. What that means for Lanarkshire, for example, is that there's going to be a 10 per cent increase in funding to Lanarkshire for 18, 19, which is a large chunk of that built up from looking at what the costs of harmonisation are and the colleges in Lanarkshire and the Government fully funding that costs. The subsequent year of that is dependent on the spending review, but we have the costs estimated for that, which will be confirmed later. So the harmonisation element is in effect fully funded. Sorry, just to stop you there. So this £400,000 gap in the budget, has that been covered by additional funding from the Government or not? No, this was before the harmonisation element kicked in. This was in a period, and remember this was back in 2015-16, when national bargaining was in its very, very early days. There was an intention to move towards it. The mechanism wasn't fully in place, and colleges were used to setting budgets based on what they could afford for staffing that negotiated locally. They were moving towards a system where it was negotiated nationally, and it was harder to predict what the cost of living increase would be as part of that. At that stage, nobody knew what the harmonisation deal would be either, because that hadn't then been negotiated. So this was in a period when national bargaining was in its fairly early days, and I can accept that when the budget was set, the college didn't know how much national bargaining would cost, but surely it would also be reasonable to say that the assumption that it would cost nothing at all was an unlikely one. So are you saying, Dr Kim, that you accepted from the college a budget which made no provision whatsoever for the national pay bargaining that everybody knew was coming? The budget for the college is a matter for the board, not for the funding council. We get a financial forecast from the college, which we look at, and it's part of our assessment of how well the college is doing, and we engage with the college on it. However, the approval of the budget is for the board rather than us. At that time, and the financial forecasts of all kinds of assumptions in them, at that time it was very hard to predict where national bargaining would go, and clearly it wasn't going to be zero. That's fiction of the budget included, was it? It would be zero. With a heavy caveat, yes. Can I move to the business plan? We're told that, just over a year ago, May last year, a process was begun of creating a business scenario plan between the college and the funding council. We're also told that that has not been finally agreed, that it's been through, I think, five iterations, so that doesn't sound like a process that we can have much confidence in if it's taken what, 13 months, not to reach agreement. Our engagement with the college on the financial difficulties and then laterally on the business plan has been going on for almost two years, and the reason it's taken so long is that we have been very keen, and the college has been very keen as well, that we understand exactly what the issues are and come up with a long-term solution that's based on real information on what would make a difference, rather than just leaping to some kind of balanced budget, which produces exactly the kind of problems that we've talked about earlier. We've been working quite closely with the college over that time. I would stress, though, that, while the business scenario plan has not been finally signed off and we're anticipating that it will be done in the next couple of months, quite a lot of the actions that are within it have already been taken. There have been significant cost savings through a VS, for example, that have already kicked in and the deficit is coming down. We're keen that when that plan is finalised, it's one that is fully owned by both the college and by the funding council and that the auditors have looked at it and everyone's happy, but we've not been allowing the search for perfection in that plan to hold up on actually taking some of the actions. In the terms of ownership of the plan and everyone being happy, the evidence submitted from the college EIS branch would seem to imply that staff, or at least staff representatives of the trade unions, don't feel that they've been involved or have ownership of the plan, so perhaps I could ask Mr McGuire how the staff have been involved in developing the iterations of the plan. The iterations of the plan, just to clarify, as Dr Kemp mentioned there, is misleading to suggest that there has not been agreement. There has been no final sign-off. However, there have been stages where there has been unauthorised VS process and so on and so forth. There has been engagement across the college with many managers, for example, and many staff involved in specific areas for calculations and for modelling. However, at the stage of going through the process, there have been many external changes that we have had to look at. For example, the definition of what funding will be made on an annual basis to then extrapolate over a period of five years, and some of the impact assessment, etc., are quite significant. Therefore, the judgment going forward is to make sure that we get this right. We have worked very, very closely with colleagues of the Scottish Funding Council, very, very closely with members of the Board of Management in iterating and taking this forward. Again, the final version of this to be signed off, which will be the long-term five-year plan, is yet to be finalised. At certain points where it will be appropriate, there will be opportunity for wider discussion and consultation. However, this is an iterative process that has been going according to Dr Kemp for two years in the course of which a number of actions, for example, more than one voluntary severance scheme, have taken place. Surely that negotiation with the wider staff body should have been happening throughout that process. I would say that there is one process within that planning element. As far as consultation with staff, there has been, as is described there, specific consultation, as far as that is concerned. Sorry, just to stop you, what you said there was that staff had been involved in producing information, but that is not the same as a consultation on the plan towards sustainability. That is a different thing. No, as far as the overall long-term plan, the actual timing of that and the ability or the appropriateness of the consultation and that timeline has not been reached at that point. So you are going to finalise the plan with the board of management and with the funding council and then you are going to talk to staff about it, is that not? Well, it would not necessarily be that. It will be an iterative process. But it has been two years of iteration already. Well, one year, as far as the business development plan is concerned, the load of discussions, as Dr Kent mentioned, have been longer lying there. For example, the requirement to align the plan, for example, with the financial forecast return, is now a requirement. Therefore, the actual potential sign-off or closing and accuracy of that plan must reconcile exactly with that. That deadline is now September, so that puts a different timescale on it. Now, between the time of now and December, obviously there needs to be a plan of how that process of consultation finalisation will take place. So when the staff say that they have not been consulted or involved in the process of the development of the plan, that is true? In terms of their representatives? In a broad sense, if you are talking about all staff, the widest possible, yes. At this stage. Mr Smeal, who is in charge of relationships with staff and unions in that consultation process? Whose remit does that fall under? Normally, primarily, it would be the advice principle organizational development that takes on that. Is that you? No. Who is that? That would normally be Brian Gilchrist, who is the assistant principal organizational development who takes care of human resource and industrial relations. Okay, so Mr McGuire as principal, how comfortable are you with the fact that that consultation with staff and unions has not happened? I think that given the complexity of the plan and being aware of some of the iterations, I think that there has been a need for people just to be getting down and working on it. I think that once we get to a stage whereby it is ready to go out and be evaluated, I think that is the appropriate time. I think that if we kept going back and forward with the iterations, because some of them have been quite complex, particularly the impact assessments on them. I will give you an example. One of the things that we were asked to do was look at how we could improve efficiencies in the classroom and how we could effectively do that on our biggest campus or motherhood campus. The motherhood campus was built 10 years ago on a plan that had smaller room sizes for good pedagogy. One of the things that we had to explore then was around how we could maximise efficiencies and effectively improve the amount of students that would be in those rooms. Do you want to consult staff as you are looking at that? Well, the first thing that we were required to do was to look at what it would cost to maximise the size of the room. We were required to go and look at a capital estate plan. After that had been agreed, the funding councillor at that point said that that was not to be the case. I am just quite baffled that this business planning process takes two years and still is not signed off yet. At no point along that road has there been a proper consultation done with staff and unions who may have good ideas on cost savings and all the things that they are looking at. Are you comfortable with that, Dr McTavish, as chair of the board that has taken two years? The two years—when John mentioned two years—the first year was clarifying where we were. There was no scenario plans developed in that time. That takes a year to work out. In terms of the complexities of the college and the other things that were happening to us, in terms of what we looked at in national bargaining, other costs were coming in at that time that we were having to deal with. In that first year—and we were in contact with the funding council at all times in that year—as well as making savings on the ground as we went forward. That was discussed at Martin's meetings. It seems to me to be moving at a snail's pace, Dr McTavish. Will you agree? I would love it to be agreed so that we can move forward. What are the barriers to that? The plan has to be deliverable for everybody—absolutely deliverable. If we look at past plans that have maybe gone in, some of those plans for other parts of the public sector did not deliver what they were aiming to deliver. So you need more time on top of the two years to make it deliverable? No, I am very sorry. I would say that we have worked one year in looking at different scenarios. We have looked at increasing class room size, but in some of those scenarios we would have caused the staff major difficulties. We had to work our way through what would be meant by that. That took a year? The variations are quite— Dr McTavish, it is our job in the Public Audit Committee to follow the public pound and check that we are getting value for money. Frankly, what you are telling us today about the pace of this business planning that ultimately is designed to bring down your deficit and get value for the public purse—frankly, I am baffled at the timescale that your board has taken. I am going to bring in Liam Kerr. Just briefly on the point that Ian Gray is making and the points being raised, one of the ways that it seems to me that it is identified to make the savings is a voluntary severance scheme. I think that Mr Smeal has said that there has been one as part of this programme. The voluntary severance scheme is happening before this plan has been finalised. The voluntary severance scheme by definition loses staff it will get if we like efficiencies in the system. By extension, that puts more pressure on the staff that are remaining. It has a potentially negative impact on the student experience, but you have not finalised the plan that says why you are doing all of this in the first place, and you have not even consulted with the staff who are going to be taking voluntary severance as part of this plan so that they understand what is going on and what the ultimate end game is. Is that right? The voluntary severance scheme was about posts, and our analysis of the posts that were still critical for us. It was not about people. No, it was about driving efficiencies. It was driving efficiencies as part of a plan that has not been finalised yet. In that, it was the first part of the agreement with the funding council in going forward to have a voluntary severance scheme. The board was reported to the board that it was phase 1 of where we were going. Can I pass, please? As part of a plan that has not been finalised yet and which the conveners pointed out, did not merit full consultation with the actual people who were impacted by this? Is that correct? The thinking was that, when we get further down, full consultation could take place. Some of the scenarios would have been, they are like scenarios looking at if we did this. Is it feasible? Those things that were being suggested to us were not feasible and would have caused problems. Do you not run the risk of doing two years of work and then putting it to the people who are delivering the teaching in your college and they completely reject it? Is it not better to take them along with you as you go? We would always take staff along. So why didn't you consult them throughout this process? Our view was that we would consult towards the end of the process. We may have that very wrong. I accept that. Dr Kemp, you oversee all colleges in Scotland. There will be other colleges that have done similar business planning. Is this a reasonable timescale to years and is this a reasonable model not to consult as you go? The issue of the timing—ideally, we would have reached an agreed plan more quickly, and that has happened in some cases. However, there are other examples of colleges where issues have been identified. We have lept very quickly to a plan and it has not worked. A year later we are back coming up with another one. We were keen that that did not happen. We have learned some of the lessons from Edinburgh College, which was the other section 22 that you considered a few weeks ago, which is on a successful trajectory. Part of the reason that that one has been so successful is that we did spend some time, not as much time as this, but we did spend some time getting an agreed plan so that the funding council and the college were in exactly the same place and we got auditors to check the plan so that we weren't going back six months into it, everyone saying, oh, that isn't what I thought we'd agreed because we had actually been there previously with Edinburgh. We were concerned that it was important to get an agreed plan. The issue of whether elements of it were implemented before it was finally agreed comes back to your point about urgency. There was a very significant deficit in the college. That is already coming down as a result of some of the actions that have been taken as part of the plan or the not fully agreed plan. However, I think that it is important that we did that so that we weren't just waiting for two years while the situation got worse. Iain Gray I just wanted to pick up on the point that you made there, Dr Kent, that all of this that we're discussing is because of the college's financial position and the deficit that they're trying to resolve to create financial sustainability. An alternative explanation from all the others that we're exploring, of course, would be that the college simply doesn't have enough money to do its job and that comes down to the funding council, so can I ask how you decide and how confident you are that the allocation that's been made to the college is correct and adequate? We fund colleges on the basis of credits, on the amount of activity they do and we pay a particular amount per credit. We take into account rurality, deprivation and a few other premiums as well, but we essentially fund all colleges on the same basis for the same amount of activity we will fund. We are not funding on the size of their deficit, we are funding on the basis of what they deliver. The college that we're discussing serves, we've already heard areas of significant deprivation and, I think, if my geography serves me correctly, some quite rural areas as well. So, are you satisfied that that's reflected in the allocation that the college receives? I think every single college in Scotland, whether to ask whether the funding was adequate would argue that it probably isn't, but they're all funded on the same basis and we have to do that in a fair way. Now, for the next couple of years, as national bargaining is implemented, we will be moving to a system of funding the cost of national bargaining, but we will need to transition back to one that's based simply funding on volume of activity. In the case of Lanarkshire, we are fairly confident that we are funding them fairly and on the same basis as every other college. We are open to discussion on some of these issues and, in the case of New College Lanarkshire, the way that what used to be called extended learning support now called access and inclusion funding was being used in the college. We did vary the amount upwards by 750,000 quite recently because we'd looked at what they were doing and how we were funding it, but the key point is that we fund colleges on the same basis wherever they are, taking account of rurality and other things, and New College Lanarkshire is funded on the same basis as every other college in Scotland. Willie Coffey I want to pick up some of the issues in the way that they miss it in terms of the audit report, but firstly I wanted to ask Dr Kemp just to clarify something that he said earlier about the harmonisation provision. You said that the harmonisation elements were funded by the Scottish Government. Has that applied to all the colleges in Scotland? Yes, we have worked with Collegy Scotland to identify what the costs of moving from what each college's individual position is with wages, hours, holidays and so on, and over the transition period, and we are now heading into year 2, we have put in the funding and year 1 is identified for year 2, year 3 is dependent on the spending of you. Every college in Scotland got a harmonisation uplift to pay for the harmonisation salaries that they were facing before their mergers? No, this is the national bargaining harmonisation that is happening at the moment. There was regional harmonisation in some places as part of the mergers, that is a different process. Ah, that is what I am asking. Were all colleges funded to meet that cost? No, some colleges were given some funding as part of the merger process, but that was not long-term funding in the way that the national bargaining funding is at the moment. Dr McTallies, you are saying that you met the Southgate really harmonised at the point of merger, because that was important that the staff who were working with us received the same salary that we did that locally, and we met the costs of that ourselves. Right, okay. Can I turn to the Wileybusset in general order to report? I mean, it is quite a damning report, isn't it? It is a very damning report. When we were, as the Board of Management, finding out and getting reports of the information that was coming in, this is post-merger. This was not discovered by auditors, but it was us getting letters or rits on us, etc. At the audit committee of the board we determined that it was likely better to get an overview of this, and we wondered, well, why was this not in the due diligence reports that we received just prior to the merger of Coatbridge with New College Lanarkshire? We were very disappointed that it wasn't in, because less cash came with the merger too, Mr Coffey, and there were these extra costs that started to identify. Costs that, when you add them up, are very, very considerable. But can I pass over to our principal and he can speak a wee bit further about them? If you've been amazed, can you ask the questions? I'm sorry, Mr Coffey. It's all right. I mean, what it says in the internal audit report there that there was a budget forecast of a surplus of £21,000, which turned into a deficit of a million, despite an injection of cash by the funding council of nearly £1 million. Some of the issues that are raised in the audit report, for example, there's an ERDF clawback mentioned as well that cost you over £200,000. There was a failure to provide funds to manage the end of the lease arrangement for Dewart House that cost you £88,000. There was a failure to even know what the terms of the exit conditions were in the lease for the property. There was a failure to manage the contract renewal process at the Green Hills Industrial Estate complex. The contract specified that there was termination conditions and renovations required, but it was not provided for it. It cost you another £75,000. There's a mention in the audit report of a relationship with Chinese universities that was described as financially disastrous in this audit report, and not to mention the excessive exceptional staff costs that were forecast to be £300,000, which turned out to be £1.7 million. It's an absolute catalogue of disaster, so why does it take an internal audit function to find this kind of stuff out that you guys should already be aware of in the management of the whole college? Because it wasn't identified at due diligence? That's purely in relation to Bridge College coming in to the merger. This was not identified through the due diligence process. So all these managers and layers that Alan Neil mentioned earlier, nobody knew any of this was going on? It's process. Scotland Griefer, I think, is that it? Ian Clark. The financial due diligence in Anderson's referenda, the legal due diligence. Alex Neil. I could get that information to you. Can you send it to us? Clearly, given the mistakes they made, you should be claiming your money back from them. Dr McTavish. We actually tried to do that. What we've not given you is the due diligence report that we got at the point that Co-Pridge came in to the college. That's not the report that you're looking at. This is the thing that happened when we were into the merger. One of the difficulties, and you see it, and one of the reasons why we decided to do this, it was to get a complete record. It was in this year, 2015, when we were trying to drill down and understand all the finances and see where we could make savings. Like the students who were, I know that you're very interested, and we all are passionately interested in the quality of learning and teaching. If we looked at where the motor vehicle students were, you wouldn't wish students to be learning there from your other students in great facilities. So it was about getting them in. When we took away the leases, it meant that moan money could go back straight in to the yearly budget of the college. Thank you. Mr Coffey? I do appreciate that, Dr McTavish. Fundamentally, to not even be aware of or know the impact of exit clauses at the end of lease arrangements for properties and premises is just astonishing. It's a standard business practice that if you leave a premise, there's always a condition in the lease that asks you to make good any repairs. That's quite common, but for us to be recurring throughout this audit report, it's quite astonishing that nobody knew that, and it was only flagged up by the internal audit report here. I mean, management should know this, surely, to goodness. The reason that the internal audit report was sought was management were becoming aware of these and wanted to have it all clarified in this report. The issue is whether, at the time of the merger, it was clear enough in what was reported by Coffey Bridge. John, you said earlier as well that the funding council's role is to oversee reports and financial plans, and so on, but surely, to goodness, there has to be an engagement with the funding. When you're throwing money at this here, it's a college that buried its head in the sand in terms of reporting the staff costs that were required, but earlier, you gave them another million pounds to address that. Surely that means you've got an interest and you must look in detail in depth at the plans at the College of Louise. Let this be clear. At the time of merger, we were working very closely with what was then the three separate colleges. This committee, or its predecessor, has already considered some of the issues that were about Coffey Bridge's entry into that merger and how difficult it was, and what you're seeing here is a reflection of that. You've said that you're giving them another 10 per cent for Lanarkshire in 1819. You're scrutinising what their plans are to make sure that that's a justifiable award. Did they just ask for the money and you give them? No, no, let's be clear. That is not the way it works, so that was my point. Have you done any diligence in the... Dr Ken Pans. The increase in funding to Lanarkshire is not based on the business plan or the deficit, it is based on the fact that the costs of national bargaining will account for a large chunk of that, and there's also some increases in childcare, some increases in various bits of provision, and there's an uplift in the unit of resource for all colleges. That increase of about 10 per cent in funding to Lanarkshire is not based on the business transformation plan, it's based on a normal funding method plus the additional for national bargaining. Okay, I'll have the colleagues come in. Bill Bowman. Going back to more general matters, I don't know if I've seen a formalised response to the Auditor General's report from you. You've given us some papers today, one head of human resources, one new college Lanarkshire, one selection of learning and teaching highlights, and the internal audit report. Can you tell me what is the status of those documents? They seem to have arrived to us but I don't know what particular points you're making on them. We selected some documents for you to give you further information about what we were doing and also looking at the transcript, some of the areas that you were interested in. I apologise if we've not produced a paper that you were expecting from us, which is a response, and we can do that, a response to section 22. I'm not asking for that specifically, I was wondering, first of all, if you'd had a response, because as a board or as a college I presume you would have a reaction to it, whether you agreed or disagreed. The information in here, is this all information that's already been made available to the auditor general? The information that we've sent to you, we had never released the due diligence report to anyone, it's come to you, it's been redacted because we had to check that legally it was okay to put it in. The paper in relation to the impact of national bargaining on the staffing was written as an analysis of what had happened and also an analysis of who had taken up the offer of voluntary severance because you had some debate about whether there were, it was all teachers that was going and I think we've let you see who actually was going and in the period that we've been, new college, Lanarkshire, we've actually increased the amount of teaching staff that we've got, so we've tried to select some papers to help you. Thank you, Bill Bowman. Well I think it would have been helpful just to see exactly what you were responding to, I'm sure it's to valid points, although I didn't realise the internal audit report was the first time it had surfaced and reference to the due diligence report that has been teased out here might be interesting for the auditor general to have sight of those and to give a reaction to that because it seems a fairly serious matter. If these reports were shared with the auditor general, do we know? Dr McTavish, you're shaking your head, is that the audit report that you don't know or you don't share? I'm sorry, convener, the audit report was shared with the audit committee of the college and in the discussions with the funding council and with the auditor general there was thinking that your view of the old Cochbridge College was complete with your other work and what I said was that was only part of the story because we weren't, we had to start the college to make it better and we didn't always want to go back but we still let you see the volume of stuff that came in and you did have discussion at your session about the extra costs that we faced when Cochbridge College came in that had not been identified in due due diligence report at the time we merged. Thank you. Mr McGuire, can you add to that briefly? I'm sure that Audit Scotland are aware of that report because some of the quotes in the last session they did refer to some of the issues and I'm pretty sure that they've had that. You're referring to the Cochbridge report, aren't you? Yes. Yes, okay, well we can perhaps check that in due course. Thank you Mr Bowman. Kenneth Gibson. Thank you convener, I mean page 17 of the annual audit report considers performance management and says and I quote, overall student outcomes identify mixed picture in some areas remain a cause for concern for example a percentage of further education students in rural and full-time recognised qualifications has shown a downward trend for early and further withdrawals over the three-year period and in addition the 2016-17 early and further withdrawal rates have continued to increase and remain higher than the national average. Why is that? I would ask also the funding council given the fact that you made it clear that you know the funding relies on outcomes and credits what impact that's likely to have on the further sustainability of a college. Firstly on the financial impact clearly we pay for students that are retained so they'd have to stay for 25, so if you've got an early drop out rate problem there that will affect your funding from us because there won't be credits you can claim. So clearly if a college has a significant issue with early retention that does affect the income to the college so more importantly than that though and what we want through our outcome agreements with colleges and with regions is to make sure that they are adequately serving that region and that the students are being well served and are completing successfully. We are aware that New College Lanarkshire has had an issue with this and the college is aware of that and has been addressing it, it's been part of the government's improvement programme on retention and as Linda said earlier the early indications on that are that it is improving things. So this is very much one of the issues that will be part of the discussion between the funding council and Lanarkshire as part of the outcome agreement arrangements. It does have an impact financially in that you won't get funded for students who are not there but the key thing about this is it's about serving students well and making sure they are successful so that's why we push that on the outcome agreement. Can I just say that the college has grown? It's been one of the few colleges that has grown and that's part of the widening access agenda and as I was saying earlier on we're serving areas of high deprivation so we're actually attracting more students who are furthest removed from FE, that makes it harder to retain. The simple thing to do, we've not been to grow and not to take those students because that would have increased or at least helped our PIs but the right thing to do is to work with those students and work in those areas of high deprivation so with that comes a challenge and that's a challenge that we're up for making and we're starting to make inroads to but it's really really important that we understand the environment that the college is working in. Yeah I mean I think if we do understand that perfectly well I mean but if we actually look at work for example EIS and Feller saying they're saying that the impact of financial difficulties on the daily operations created an extremely stressful working environment and has led to strange relationships at all levels teaching what loads are unmanageable in conflicts and eyes daily over job roles and related tasks staff absences often due to stress lead to illness can lead to further stress remaining staff and they've also said that you've consistently Mr Maguire refused to provide any details of the deficit which would show in the accounts for 2016 or 2017 or the budget for 2017-18 so one of the reasons why there might be a reduction in outcomes and therefore the ability of the college to attract funding for its credits is because of this financial situation we're in and the impact on staff morale not just deprivation in relation to the areas in which you recruit your students from. Yeah I mean I think morale is affected there's no doubt about it I think there's a whole load of rumours going about about the campuses closing and whatever you know and I had to put an email out last week to assure staff that there were no campus closure so I think there is there is a fear among staff when the college is going to deficit and they look at other organisations that are looking at compulsory redundancy and whatever so we've tried to assure staff that that certainly won't be the case in our situation and I think it's also important to remember that the deficit has come down to less than 1% of turnover and I think that's that's important that whilst the half a million deficit is not anything that we would want it has been a marked improvement. As far as what load is concerned yeah I think right across the board in a merged college where staff have left we'll have now have lost about 130 staff and what loads have increased right across the board there's absolutely no doubt about it so it is about it is about communicating it is about trying to keep people motivated but it's been very very difficult and one of the other factors around motivation and morale going down has been around national bargaining as well. We have seen strikes in the sector for the first time in 20 years and that has caused division in staff rooms there's no doubt about it because some staff went out and some didn't go out and that that becomes a long a long term difficulty among staff so it's a difficult environment that the sector's in at the moment it's a difficult environment when we have a model whereby we have through the employers association we have a system whereby across the living rise is agreed and then whether we can afford it or not we have to find the money for it and that's a difficult environment to be in because at the moment when we are looking to cut costs 70% of our costs are wage related costs and the other 30% I think have pretty much cut to the bone so the only other option is to start to look at how we cut and save on staff related costs in that. Yes thanks convener but Mr Maguire a lot of what we've talked about this morning seems to be about things like for example the lack of consultation the fail to take staff with you the fact that people you know as Dr McTavish said oh we'll talk to folk once we've actually agreed the plan so to speak and yet what they're actually what Fel and EIS are actually saying is there were concerns about the level of consultation in relation to proposed new structure and they go on to say there's a perception now among academic staff that faculty management are not interested in staff and that the curriculum and quality leadership position is a buffer between election staff and management. Now are you going to get the best possible outcomes for your students if you have that kind of relationship actually in the college surely that must be impacting on your outcomes and as outcomes lead to crety lead to you know increase income. I agree entirely I think. I've said all along that the you know happy staff, staff that are content, staff that are secure make for good students and you know I've been a principal for 12 years and appointed in four different colleges so I know what it means to have good staff relationships and I know at the minute it is difficult but there are a whole load of circumstances that are making that difficult. Mr McGuire you said in your previous answer to Mr Gibson you find it difficult to motivate staff why is that? I think for some staff at the minute it doesn't matter how many times I'll tell them that there will be no compulsory redundancies, that no campuses are closing, I think there is a rumour mill, I think there are people who are actively seeking to do damage within the organisation and upset people and I think that that culture is difficult and I think that's something that we're seeing right across the sector just now because of the turmoil and the churn and the change that's happening, I think there's no doubt about that. Okay Mr Gibson. Yeah, I was going to say that the Scottish funding council provided advance funding of 1.9 million to the college in July of last year in a condition that the college developed a business scenario plan, is that something that the Scottish funding council does routinely? It makes advances of that scale, that would be quite unusual, we have done it in the past as a way of smoothing cash flow in colleges, it's a fairly unusual step and it was clearly as part of our engagement with the college on creating a plan that would help them to get into a better place. And in a criteria in which that money was advanced have it been fulfilled? Well the advance was until the end of this academic year, we are currently. You're shaking your head, yes? The advance was paid back in one month, it was a cash flow and Ian maybe can further but it was paid back within one month so it's not like what we weren't given that money. Is that all right? We received 1.9 million from the funding council in July 19, 2017 as an advance of our 1718 grant so in effect with no liability within 13 days. Clearly the scale of which we assist at the college with cash flow won't need to be resolved as part of finalising the business plan, there is a continuing need to help the college with cash flow and we will do that. We welcome our school scrutiny and also the board scrutiny and senior management scrutiny and the staff scrutiny of the PIs. The PIs are part and parcel of where we can make improvements especially in the key one of retention. If you look at your table that's got the strongest pink in the table. In terms of positive destination and I contacted Audit Scotland, one of the reasons why- Dr McTavish, I'm not sure this directly answers Kenneth Gibson's question. Just one final point, convener, because you give me a lot of leeway and I appreciate that. What would have happened if you hadn't advanced this 1.9 million? Dr Kemp, can you move your microphone slightly closer to you, just so we can catch it? If you can say that again. Clearly the college would have been in a very serious cash position at that time, had we not done it and that's why we did it. Can I ask Martin, in your last answer to Kenny Gibson, you said that there were people within the college who are deliberately undermining the college or what's to that effect? What evidence do you have for that? I think that if people are putting rumours out that they were closing campuses in spite of the fact that I continually say that they were not, then somebody's obviously starting those rumours. But that sounded more serious, she sounded as though there was more of an organised undermining of the college. It was a pretty incendiary statement you made to be honest, Martin. I can only draw that conclusion though, Alec. If I continue to say to people that we are not closing campuses, we are not reducing the amount of faculties and still those rumours exist and still people say that that's happening, then somebody must be making it up and somebody must be putting it out there. I think there's a big jump from saying somebody is engaging in rumour mongering to saying they're deliberately undermining the college. Well, I think that it does because it creates real anxiety, it creates real worry, it creates stress in the staff rooms, it absolutely does and it's very very difficult. And could that not be a symptom of the kind of industrial relation situation that's been described here in the written evidence that we have from the unions, where basically they're saying you're refusing to involve them. Some of what they're saying, as Kenny Gibson has already pointed out, I mean just take one sentence, many staff have little confidence that the organisation will get any better and do not feel valued. Now despite all these layers of management, this is not looking like a well managed college when the workers are feeling like that. Now this is both the EIS and the Further Education Lectures Association and clearly from the evidence from the union site, there is a clear message here that people are not being involved, you've already admitted, Linda's already admitted that you have not involved the staff in any meaningful way in the business development planning process. No wonder they feel alienated if they're not being informed and not involved, it's no wonder rumours start, surely? Yeah, I mean again I think you're taking it from one perspective there. No, I'm asking that question. I mean we do communicate, we do meet on a regular basis with the trade unions through formal GNCs, through the partnership committees that we have and informal meetings as well to take them through particular issues. I'll give you an example, there was a partnership meeting last week on communication, the support staff union were there but the EIS didn't turn up. So I'm not going to get into the nitty gritty of one particular meeting, but you're going to be talking about opportunities for people to engage. Yeah, let me rephrase it, what are you going to do at board level to address this very serious problem? Staff morale you've already said is low, you've already admitted you don't involve them in the business staff in the business development process etc etc, I mean you've more or less agreed in some respects or given certain credence to and validity to the points being made in the evidence from the trade union side. So what are you going to do about it? What we need is a secure sustainable funding model for the college moving forward, that's what we need, that will bring security, if people know that their jobs are safe then they will start to feel secure and that is the most difficult thing for staff at the moment because they don't feel secure within their jobs and that is a daily occurrence that is happening and that is why, as John Kemp says, we need to get this business plan done and dusted quickly, put to bed and get back to focusing on taking the college forward and that is about teaching and learning and skills and skills development. But it's a basic in any organisation that for a business plan to be successful it has to, from conception right through to execution, has to involve the people who have to make it successful. You've said you're not doing that, so how are you going to involve the ordinary lecturer, the ordinary CNAQ leader and so on with all these layers of management, how are you going to involve these people in the business planning process because if you don't do that the rumours will continue, the dissatisfaction and lo moral will continue and it might be the best business plan financially in the world where it will not be successful because the people who are expected to deliver it haven't been involved in it and therefore don't feel ownership of it. It's a basic of any management organisation that you involve people in these decisions. Mr McGuire. Yeah, I think, you know, we're getting to the stage now where hopefully we'll get to the final draft solution that will then go to the board, we'll go for wider consultation and then go to our auditorium. Too late, too late, the final draft is far too late with him. You have to surely involve staff before you finalise your draft. That's the lesson. Yeah, I think it's there it was saying though that staff have been involved at various levels to provide some of the scenarios. That's not quite honest with you. Some of the impact assessments that we've had to produce as part of this have not been palatable and they would have actually have, I think, increased, you know, rumours and we've upset staff even more. So I think, you know, it's not being done to try and keep things from people, it's been done because we've been exploring what the issues are. Mr McGuire. When is the final iteration draft, whatever of this business plan, going to be ready? We met in May with the funding council and we felt that we were at the point where it was pretty much done and dusted and at that point there was an agreement that we would wait for the FFR guidance to come out. That came out the week before last, so that has now been plugged into the plan. So hopefully we're pretty much at a point where we can present a plan that has been worked through. Right, but when? What's the date for that, is it? The deadline is the end of September, but obviously we are in the midst of that. Drafts will be available a significant time before that. Right, and so Mr McGuire, as I understand in your answer to Mr Neil, what you're saying is that staff morale is low because they're worried about money and you need a sustainable funding settlement. Dr Kemp, are you saying, Mr McGuire, that if you get more money then staff will be happy? I think if people, no, I don't think money makes people. That's what you said in response to Mr Neil. I think that if we can get a sustainable model for the college moving forward, then absolutely, but to give staff, are you talking about giving staff more money or the college more money? No, you said that when a funding solution is in place then staff will feel more secure. Absolutely. So you're thinking that'll come off the back of this business plan? Absolutely. Right, Dr Kemp. My understanding of what Martin said was a sustainable funding model for the college, meaning the business plan, because sustainable funding for the college is delivered through the fairly significant increase in funding that will be going in 18, 19 and that, depending on future spending reviews, will be continued. The issue is how that is translated into something that works in the college and can demonstrate a balanced budget going forward. Okay, so if we call you, ask you back to committee later in the year, we expect that that business plan will be ready. I would anticipate that business plan will be ready soon after the recess is finished. Okay, Liam Kerr. Thank you. Just a few things to check back on, first of all. The Colbridge College business that we're looking at, and you were asked by Willie Coffey about the due diligence, can I just confirm for the record, so Scott Montcrieff and Anderson Stratharum were the professional advisers on that, and they produced due diligence reports, which didn't pick up around £1 million worth of liabilities. Is that correct? My understanding is correct. In terms of the financial accounts of Colbridge College, they were only completed in March 2015. At the creation of the business plan for Merger, the Colbridge College presentation was that it would make a break-even budget or so of about £21,000 surplus. When we finished the accounts in March 2015, a full year later, we discovered £1 million deficit over an eight-month period, which extrapolated goes to £1.5 million. So at the time, I don't think that Scott Montcrieff would underestimate that there would be a deficit of such an occurrence, because at the time that they were given this information and carried out their due diligence, there was only a forecast that was provided by Colbridge College. The accounts came in my presentation a year later. If I could just press you on that, Mr Clark, who dropped the ball? Who missed £1 million worth of liabilities? Because earlier on, it seemed to be Scott Montcrieff and Anderson Stratharum. Are you now saying that it was actually Colbridge College or someone else? Who at your end missed it? I would say that the Colbridge College accounts were not completed until March 2015, by which time there was a full understanding of the position of Colbridge. At the time, the due diligence was carried out in 2013-14. Information provided to, in this case, Scott Montcrieff would be based upon what was a budget, because the financial year figures had not yet been finished. I understand the Colbridge principle and board at the time were not completely solved on the idea of a merger, and there was a great deal of prevarication. Does that have an impact on the diligence that was done? No, I do not think so, because it is a process that you would look at. When we took up the issue with the auditors who had carried out their original due diligence, they said that they can only put in the reports what is highlighted to them. That information did not come from Colbridge at that time. It was Colbridge who failed to provide the information so that due diligence reports that you will have paid for, a significant amount of money did not ask the questions, but they would say that we were not given the information by the seller effectively. That is what they say, and our audit committee even challenged that. Because, as you say, we were concerned about the costs of all of the due diligence reports, the accuracy of the due diligence reports and the impact of the extra costs in the business model for the new college going forward. There was a part of the section 22 report that talked about that, during 2015-16, the college tried to manage its cash flow problems. It delayed payments to creditors and sought to receive quicker payments from debtors. That, to me, is extremely poor practice. As I understand it, it goes against everything that the Scottish Government says is appropriate. So, who took that decision? Mr Clark? The college, just in terms of clarity, what the college did was, previous to January 2017, were completing payment runs to suppliers twice a month. We moved from January 2017 to one payment a month, which was consistent with the SFC drawdown period and still consistent with our policy of standard 30 days. Because there was no change to the policy that we were working with in an existing policy, that was a decision for the senior finance team. It is not referred to the board of management under the scheme of delegation. As can be seen from the accounts, our standard creditor days are nine days. The average in the sector is 22, the highest being six, and the lowest being 39, so we sit quite comfortably within that framework, our average payment days of nine. I understand. The Auditor General's report says that the college delayed payments to creditors, but what you're telling Mr Clark is that that's not, that's semantics. Actually, he didn't delay payments to creditors. We moved from two payment runs a month to one, basically, from January 2017, so we still stayed within the 30 days. The auditors audited their accounts and the audited our creditor days has been nine days as well, so we don't have any issues in terms of delaying payments deliberately to suppliers. We just simply moved from two credit runs a month to one. I understand. For the avoidance of doubt, there's nothing to see here, is what you're telling me. What other options did you consider to manage the cash flow? Basically, it was only working cash management that we had to do at that time, so we did try and speak with our debtors to ensure that they would pay on time. And some debtors, large-scale debtors, we did ask if there's any chance of getting paid early, which was often not the case, if they would say yes to that. So it became. Mr McGuire, you said in your answer to Mr Neil that there are troublemakers amongst your staff. I was very concerned by that statement and the relationships that you will have to foster to take the college forward in difficult times. Are you really in a position to take staff forward and to take the college forward? I think that I am, and I think that some of the angst. I think that with people watching this just now, they'll be quite happy that I've said that, because I think that a lot of staff are getting fed up with the constant rumours and the constant undermining that's happening there. Yeah, absolutely. But I do think that what we need to do is to get a solid, sustainable financial model for the sector moving forward and for our college in particular. Can I thank you all very much indeed for your evidence this morning and I'll close the public session of the committee.