Former audit commission chair says problems could have been mitigated if actions were taken earlier and recommends measures to help recover confidence in £2.3bn programme

The crisis in the government’s £2.3bn colleges programme, which has seen 144 projects put on hold until at least September, was “predictable and probably avoidable”. This is the message from former audit commission chair Sir Andrew Foster, who has published his damning report into the handling of the Learning and Skills Council-managed scheme.

Foster said there were “warnings of overheating” in the programme as early as February last year but there was delay and confusion in addressing the issues. The full extent of the crisis was not recognised until the end of 2008, when a three-month freeze on the programme was implemented, and there were “further failures” in how the problems were communicated to the sector, he added.

He said: "I have been forced to conclude that the crisis was predictable and probably avoidable. Certainly, it could have been mitigated if action had been taken earlier. The final confusion in communication made a bad situation worse.”

Foster said he was recommending a range of measures to help recover confidence in the capital programme, including improved consultation between the Department for Innovation, Universities & Skills, the Learning and Skills Council and the college sector.

He said: “Talks should be held with HM Treasury to reinforce the importance of skills development in the context of national economic recovery, and global competitiveness, and to review resourcing for the continuing capital programme. It is essential that a robust recovery plan is demonstrated. Future development must take place in the context of a comprehensive and competent financial strategy that supports needs-related planning.”