Finance and General Purposes Committee Minutes 5 October 2022
Finance and General Purposes Committee Minutes 5 October 2022
Corporation and Committee Minutes- Finance and General Purposes Committee Minutes 5 October 2022
Minutes of a meeting of the board of Leicester College corporation: Finance and general purposes committee
Held on 5 October 2022
Present: Danielle Gillett (Chair), Jonathan Kerry, Verity Hancock, Lee Soden, Nicola Gonsalves, Caroline Tote*, Chan Kataria
In Attendance: Louise Hazel - Director of Governance and Policy, Shabir Ismail - Deputy Principal/CEO, Della Sewell - Director of HR, Charles Buchanan Observer – ETF/IOD external board reviewer
*Joined meeting online via Teams
Declaration of interest
Verity Hancock, Louise Hazel and Shabir Ismail declared an interest in item 13.
Chan Kataria declared an interest in item 13 (EMH referenced); Shabir Ismail
had become a member of the Board of EMH. Jonathan Kerry declared an
interest in any items relating to Higher Education as a board member of De
Montfort University.
Apologies for absence.
2.1 Apologies for absence were received from Ed Marsh.
Minutes of previous meeting and matters arising
3.1 The minutes of the meeting held on 22 June 2022 were received and
agreed.
3.2 The confidential minutes of the meeting held 22 June 2022 were received
and agreed.
Enrolment update
4.1 The Principal gave an update on enrolment showing data in the Matrix. The
following points were highlighted.
4.1.1 16-18 was at 102% of plan with 3,412 against a target of 3,334,
excluding supported learning students. This was an improvement on
the previous year. There would be attrition and a ‘swap don’t drop’
campaign was being run to promote retention. There were lower
numbers in hair and media. There were a lot of late enrolments which
appeared to be the case across the sector.
4.1.2 The new starts target for Apprenticeships had been met but there was
lower carry in from the previous year and so income would be down.
4.1.3 Adults were recruited throughout the year. 22% of the target had been
achieved so far, this was on par with 2018/19. The assumption of
103% achievement was challenging but there had been a good start.
Full-time adults were not recruiting as planned; this was probably a
result of the cost of living crisis. The College would need to look at its
full-time adult offer.
4.1.4 HE courses were still enrolling but were below target overall. Full-time
numbers were down but there was over recruitment on part-time
courses. Four courses had been suspended. DMU had not yet raised
its tariff. Subcontracting had ceased.
4.2 Governors asked a number of questions including:
4.2.1 Why was data missing from some columns? These were obsolete
codes.
4.2.2 Were there any capacity issues where there was high
recruitment? The College was not overstaffed so if people were off
sick or had left the College, there would be gaps but the plan covered
capacity. There had been more applications in some construction
courses but not sufficient numbers to make a business case to the
ESFA.
4.2.3 Were the planned numbers similar to pre-COVID numbers? They
were based on an assessment of what would be achievable looking at
previous recruitment and participation in open and experience days.
4.2.4 Were there many adults on part-time courses in the day? Most
would be in ESOL or skills for life. There were very few on evening
vocational courses.
4.2.5 Were any adults switching to apprenticeships? Not many.
4.2.6 To what extent was the cost of living crisis impacting on drop
out? It was a bit early to know but it was affecting recruitment
particularly for Access courses; people were prioritising work.
4.3 Governors noted the update.
Health and safety annual review 2021/22
5.1 The Deputy Principal presented the health and safety (H&S) review for
2021/22. The following points were highlighted.
5.1.1 Key developments during the year included the launch of a new
accident reporting system across the College; ongoing advice
following the pandemic; improved communication through SharePoint
webpages and new H&S noticeboards; the creation of a new H&S
student induction for 2022/23; reviews of Health and Safety policies;
and continuing with compliance with fire safety, risk management, and
accident information.
5.1.2 The number of accidents, 124, was higher than the previous year (59)
which was a Covid-19 disrupted year. It was difficult to draw any
conclusions on trends but the increase in accidents was believed to be
down to both better communication and the new accident reporting
system which was more user friendly.
5.1.3 More accidents were reported at Freemen’s Park which was usual
given the practical nature of the offer. The vast majority of accidents
were minor. There were no reportable events.
5.1.4 Completion of mandatory staff training was high at 95%. Instances of
non-completion were followed up by managers.
5.1.5 Student training was now reported; this showed 86% completion for
16-18s. Adult completion was lower.
5.1.6 There had been a spike in bike thefts; a gang had been operating and
it was a City-wide issue. Steps had been taken to re-site bike racks
and increase the campus warden presence.
5.1.7 There were more students at Abbey Park which accounted for more
incidents on that site; these included some low level unruly behaviour.
The wearing of lanyards was being promoted and there was better
compliance.
5.1.8 Objectives for the coming year were outlined.
5.2 Governors asked a number of questions including:
5.2.1 There were usually lots of people without lanyards including
those coming for the restaurant. Yes, although it was generally
clear where members of the public were in College for the restaurant
or salons.
5.2.2 Did the instances of drug taking involve mainly soft drugs? They
did.
5.2.3 What was the College’s relationship with the HSE? There was little
contact with the HSE although advice was sought on specific issues
on occasion.
5.2.4 Would investment in measures to promote health and safety be a
challenge given financial constraints? The College would always
prioritise measures needed for safeguarding and health and safety. It
had invested in a new CCTV system and in an additional campus
warden. The number of buildings that now had card access entry had
been increased in response to student feedback.
5.2.5 Were first aiders paid and were there enough of them? They were
paid. There were not enough and the pandemic had made it more
difficult to encourage people to take on the role.
5.2.6 What was being done to increase take up of training by adult
students? The priority was 16-18 and full-time students. Many adults
would be on short courses and so might be reluctant to do any training
but all would receive basic information on evacuation procedures and
health and safety as it related to their course.
5.2.7 It would be useful to provide more comparative data to show how
figures compared to previous years. It would also be helpful to
know how the number of accidents and incidents compared to
the student population. Also, it was unclear whether the figures
on staff training were good or not. Noted. Comparison with the
previous year had not felt to be helpful but comparative data would be
included in future reports.
5.2.8 It would also be helpful to include some information on lessons
learned. Noted. Some of this would also be covered at the Health
and Safety Committee
5.3 Governors noted the report and requested a mid-year Health and Safety
update.
Finance report (Period 12)
6.1 The Deputy Principal presented the finance report (period 12). The following
points were highlighted.
6.1.1 The year end result was an operating deficit after restructuring costs of
£1,080k compared to the budgeted deficit of £1,063k.
6.1.2 The latest data return showed that the College had not achieved its
16-19 learner responsive number and funding target.
6.1.3 It had also fallen short of the AEB target and would achieve around
82% of the allocation. Adult enrolment been impacted by the slow
return of adult learners following COVID-19. There would be a
clawback and this had been factored into the management accounts
and cashflow forecast.
6.1.4 Apprenticeship income was below the summer reforecast figure
excluding employer incentives and would outturn at £3.9m. The
impact of COVID-19 on new starts in 2020/21 had resulted in fewer
carry-ins for this year.
6.1.5 Overall, HE income was in line with the summer reforecast target.
6.1.6 Use of the tuition fund had been higher than predicted at around
£840k.
6.1.7 The position for the year had been helped by the Lennartz claim but
this was a one-off item.
6.1.8 The cash position was relatively healthy but would dip in March of
each of the next two years.
6.1.9 The College had met its bank covenants and achieved a ‘requires
improvement’ financial health rating, based on the draft year end
accounts at 150 points. Work continued on the draft accounts and the
final position was subject to the external audit review. The bank would
continue to treat COVID-19 influenced factors as exceptional items for
this year
6.2 Governors asked a number of questions including:
6.2.1 Whether the predicted deficit included the COVID-19 exceptional
item. It did not, this would be included. An initial conversation had
already taken place with the bank about the covenants going forward.
6.2.2 What would the point score need to be to fall into ‘inadequate’?
This would be 110 points and a deficit of £3-3.5 million. 130 points
was the previous benchmark for intervention.
6.2.3 Had any exceptional items been identified during the audit? Not
so far although work was still underway and auditors were doing
rigorous checks around going concern.
6.2.4 The position reflected the summer reforecast but what would
happen next? The autumn reforecast would be started after the R03
return. The impact of enrolment on funding would be reviewed and
plans for efficiencies would be developed.
6.2.5 The budget had been set before some of the current pressures
were known. It included some big assumptions particularly
around adult recruitment. What was being done to look at the
impact of these? Withdrawals would be the main concern; after the
42 day deadline had been reached there would be greater certainty.
There was also more pressure around pay even though the College
had already made a pay award for the year. Other colleges were still
negotiating their awards and this might raise expectations. However,
there were good relationships with the unions and they were well
informed about the College’s financial position. SLT had already
started to look at where there might be savings. All big cash spends
were being reviewed. No new capital projects would be considered
because of the need to match fund. There had not been a collapse in
any curriculum areas and so curriculum efficiencies were likely to be at
course level.
6.2.6 What would be the impact of the energy cap for businesses? This
was being reviewed at the moment. The use of the estate was also
being reviewed to see if any buildings or rooms could be mothballed or
repurposed.
6.3 Governors noted the period 12 finance report. Governors also noted that
an additional discussion would take place to review R03 data in early
November, to provide early insight into financial pressures on this year’s
budget.
Treasury management
7.1 The Deputy Principal presented the Treasury Management Report. The
following points were highlighted.
7.1.1 Investment and loan activity were set out. Daily cash balances were
forecast to allow optimum investment of surplus balances.
7.1.2 Loan payments were made quarterly for the capital element and
monthly for interest.
7.1.3 The variable loan was due to mature on 13 October 2022 and it was
recommended that this arrangement was extended for three months
on the current terms and conditions while options going forward were
considered
7.2 In response to a question as to whether the revolving credit facility was being
used or was just a contingency, it was explained that at this stage it was just a
contingency. There would be a non -utilisation fee but it was felt sensible to
have this in place in advance of it being needed.
7.3 Governors noted the report and approved the extension of the variable
loan for three months.
Regularity self assessment
8.1 The Deputy Principal presented the draft regularity self-assessment
questionnaire. The following points were highlighted:
8.1.1 The completion of the questionnaire supplied by the ESFA was a
requirement of the end of year process.
8.1.2 The questionnaire had also been considered by the Audit Committee
which was content with the proposed responses.
8.2 Governors agreed to recommend signature of the regularity self-
assessment by the Chair and Principal.
Bad debt write-off
9.1 The Deputy Principal presented a paper requesting authority to write-off debts
that were considered uncollectable. The following points were highlighted:
9.1.1 The debts had been chased as far as possible and were now
considered to be uncollectable.
9.1.2 During the academic year to date, from 1 August 2022, there had been
no previous write offs. With this recommendation, the cumulative total
for the year will be £12,654.48
9.2 Governors asked a number of questions including:
9.2.1 How much did it cost to chase each debt? It was around £20.
9.2.2 Was debt chasing ever successful? It was although the College
would always take a view as to when and how far to chase debts.
9.2.3 What controls were in place to avoid students accumulating large
debts? Debts covered the cost of the course. In cases of large debts
such as that being written off, the student had indicated they would
take out a loan for the programme but where the loan did not
materialise, the College would need to invoice for the full amount.
9.2.4 Was the write-off an accounting treatment? No, the debts would
need to be written off but there was provision of around £100k
annually for bad debt write off.
9.3 Governors considered the paper and agreed to approve the write-off of
uncollectable debts totalling £12.654.48
HR KPS
10.1 The Director of HR presented a paper on HR KPIs. The following points were
highlighted.
10.1.1 Comparisons with previous years were difficult because of the
pandemic.
10.1.2 There had been an upward trend in headcount figures over the past
five years with 1,101 staff employed in 2022 compared with 1,063 in
2018. However, the FTE figure had decreased by 15.7 to 680.8 in the
same time period.
10.1.3 A census of the workforce was carried out earlier in the year to
encourage staff to share their protected characteristic data with the
College. There had been improvements in all areas although there
was still work to do in targeting the gaps. Large numbers of the
workforce had not declared their sexual identity (20%) or their religion
(25%). The data for ethnicity had improved with only 3.4% not
declared; 1.5% of those preferred not to say.
10.1.4 There had been little movement in the composition of the workforce by
protected characteristic. 67% were women; 33% non-white; 6.2% had
a declared a disability; 47% were 50 or older.
10.1.5 55% of the workforce had been with the College for more than five
years which was a positive retention indicator. Turnover continued to
increase following a more static period through the pandemic and was
2% higher at 14.1% than in the same period last year.
10.1.6 Sickness absence increased to 4.7 days per person from 4 days at the
same point last year. Sickness levels had been affected by the
pandemic which was a national trend.
10.1.7 Data showed that there continued to be a drop-off through the
recruitment process in applicants from non-white backgrounds,
predominantly Black rather than Asian applicants, with Black
applicants 50% less likely to be successful. This had been a consistent
finding over the past few years and was one of the reasons the
College had undertaken the project with ETF funding with the Black
Leadership Group.
10.1.8 Examples of HR case work were provided. A lot of work to support
staff mental health had been undertaken during the past two years.
10.2 Governors asked a number of questions including:
10.2.1 Noting that 55% of staff were long serving, was anything done to
re-induct them into College policies and procedures? There was
not a formal process although any changes to policies and procedures
were communicated to staff. There was an opportunity to do more
around reminding staff of the Employee Code of Conduct and
standards of behaviour.
10.2.2 It would be interesting to know what strategies were being
deployed to increase the application success rates of non-white
candidates. It was proposed to ensure better and more diverse
representation on interview panels, particularly for management roles.
10.2.3 The number of grievances given the number of staff in the
College suggested a well-managed team. Acknowledged.
10.3 Governors noted the HR KPIs and requested more information on the
work around staff wellbeing.
Pay Gaps
10.4 The Director of HR presented a paper on the gender pay gap. The followingpoints were highlighted.
10.4.1 The College was required to publish its gender pay gap. The mean
and median pay gaps had both narrowed to 8.3% and 5.6%
respectively. This was largely due to pay progression. The College
had tight pay scales.
10.4.2 There remained a gap but this was a function of the College employing
a large number of women in lower paid roles and not outsourcing
lower paid roles.
10.4.3 The College compared well with other local colleges in terms of gender
pay gaps.
10.5 Governors commented that it was good to see the gap narrowing; the gap
was largely a factor of employing in house support staff.
10.6 The Director of HR then presented a paper on the ethnicity pay gap. The
following points were highlighted.
10.6.1 The race pay gap was not a legal requirement but was calculated
using the same methodology as for gender.
10.6.2 The race gap had increased over the past three years but there were
several factors behind this. The amount and accuracy of data
collected in the staff census had improved. 202 staff received an
increment during the year up to 31 March 2022 as a result of the
restructuring of the pay scales in 2018. 28% were non-white and 72%
were white. The white staff percentage was greater in all staff groups
but particularly Teaching and Support Staff. In addition, 28% of leavers
in the year were non-white and 37% of new starters were non-white;
new staff were usually placed at the bottom of the scale and reached
the top point after two and a half years.
10.6.3 The College looked at every opportunity to reduce pay gaps when
changes around pay were made.
10.7 Governors asked a number of questions including:
10.7.1 It was good to be ahead of the game in terms of producing this
data. The College should publicise the data, be accountable for it
and be clear that it wanted to improve. Noted.
10.7.2 It was concerning that the College had a workforce that did not
reflect the local community; it if was able to get that right, might
that help with pay gaps? There were some long standing cultural
issues which made it hard to recruit non-white staff in some areas
such as creative and performing arts and construction. This was
starting to work through the industries but it remained a wider issue.
10.7.3 What targets did the College have? The Strategic Plan included a
KPI to increase the number of non-white staff included.
10.7.4 What was being done with the data, what actions were planned?
The data gathered in previous years had prompted the College to
undertake the research project with the Black Leadership Group. A
leadership action plan was now in place and was being progressed by
the SLT.
10.8 Governors noted the gender and ethnicity pay gaps.
Holiday pay - Supreme court ruling
11.1 The Director of HR gave an update on the recent Supreme Court ruling on
holiday pay. The following points were highlighted.
11.1.1 The ruling had confirmed that all staff must have 5.6 weeks of paid
leave including bank holidays. It was possible to pro-rata hours in a
week but not weeks so someone working 18.5 hours per week should
have 5.6 weeks at 18.5 hours across the year.
11.1.2 Staff affected would be part time and sessional staff on continuous and
permanent contracts including term time only, part-time lecturers and
casual staff. Many colleges, schools and universities would face the
same issues
11.1.3 The calculation for holiday pay that many organisations used was
12.07% added to pay as a separate element; the College paid 12.02%
and had done for many years.
11.1.4 For staff working variable hours, average earnings excluding unpaid
weeks would need to be calculated.
11.1.5 Part-Time Lecturer was a misnomer and the College would need to
change the job title to sessional or variable hours.
11.1.6 The College would need to look at earnings and what staff should
have been paid and what they should be paid going forward. Staff
could claim unlawful deductions backdated for two years. There could
also be some equal pay issues.
11.1.7 The liability was currently being calculated. Unions would need to be
consulted and contracts would also need to be reviewed.
11.2 Governors asked a number of questions including:
11.2.1 What was the wording in the contract relating to bank holidays? It varied by contract.
11.2.2 Had this been factored into the budget? It had not.
11.3 Governors noted the update.
Committee self assessment
12.1 The Director of Governance and Policy presented the outcomes of the
Committee self-assessment. The following points were highlighted.
12.1.1 Overall, the self-assessment was very positive with impacts identified
and evidenced.
12.1.2 Areas for improvement and suggested actions included more briefings
and deep dives on specific issues. These would be planned in for the
year.
12.2 Governors noted the outcomes of the self-assessment report.
Verity Hancock, Louise Hazel and Shabir Ismail left the meeting.
Senior postholders salary review and remuneration annual report - CONFIDENTIAL
Any other business
There was no other business.
Waivers of financial regulations
15.1 Governors commented that tendering for some of those contracts covered by
waivers might have helped save money. Noted.
15.2 Governors received and noted the report on waivers of financial
regulations
Capital update: T level plans
16.1 In response to a question about why there was an expected overspend and
what was being done about it, it was explained that this was due to rising costs
of materials but the tender for the project was about to be issued and the
project would be scoped down if needed to keep within the project costs.
16.2 Governors received and noted the report on T Level capital plans.
Staff development activites report 2021/22
17.1 Governors received and noted the report on staff development activities.
Trade Union facilities time report
18.1 Governors received and noted the report on Trade Union Facilities Time.
Employment Tribunals
19.1 Governors received and noted the report on employment tribunals.
Dates of next meetings
1 December 2022
1 March 2023
3 May 2023
22 June 2023