ICSM Business Education News: shock as drama school Read College is set to close as more colleges struggle plus a list education sector firms that have gone bust
By Harry Mottram: news that the famous drama school Read College is set to shut this summer has reminded the sector that education establishments can go bust. Every year colleges do go out of business in the UK although in recent years the numbers have increased as fewer students enrol.
Unlike state schools, colleges and universities are private institutions even though they are regulated and in many cases subsidised by the state. There are numerous small colleges in the UK and these are most at risk of falling into administration or simply closing with a long list of unpaid bills. In the past there have been examples of colleges shutting their doors having banked their students’ fees which are not refunded.
Read College made a statement saying they were ‘heartbroken’ but Ian Carrotte of ICSM said those words would be of little comfort if they left a long list of creditors out of pocket. The college follows the collapse of other drama schools including CPA Studios and the Merchant Taylors’ School and the The Academy of Live & Recorded Arts last year.
The news of the college’s closure means that it will join the likes of CPA Studios, which closed in 2018, and the MTA and ALRA, which both closed in 2022.
Further Education Week reported today (Thursday, March 9, 2023) that St Mary’s College in Blackburn has gone bust owing around £8 million pounds. Barclays bank are in hock for nearly £3m while The Department for Education is owed £62,000.
The publications said: “The Catholic-run college, which had been open for almost 100 years, became financially unsustainable due to repeated years of falling student numbers, and has been propped up by emergency government funding since 2020. Accounting firm RSM UK has been appointed to handle the insolvency and published its first report on the process last month.
A “statement of affairs” revealed that the college owes £8.2 million to six creditors. The Local Government Pension Scheme is owed most of the debt – £5 million – while Barclays Bank is owed £2.8 million. The Department for Education is also one of the creditors, owed £62,000.
Hadlow College collapsed last year which led to claims of financial irregularities which led to investigations while another Further Education College went to the wall when Hadlow’s sister college West Kent and Ashford College hit the rocks with unpaid invoices hitting the £150 figure.
Ian Carrotte of ICSM said colleges will have a huge range of creditors as they buy anything from printed brochures and prospectus’ plus books, computers, food and drink, and a hundred and one items needed to run a college. “There’s also the heating and energy costs,” he said, “as colleges have multiple rooms to service – like hotels – but if the numbers of students drop then their viability collapses. My advice is to be careful when supplying colleges as they will use the old line that they cannot fail. That is clearly not the case.”
Below are a list of recent firms in the education sector that have collapsed:
EDUCATION: COLLEGES, SCHOOLS, TRAINING
ADMINISTRATORS APPOINTED
AVENUE B COACHING & CONSULTANCY LTD 11782814
ADMINISTRATION CREDITORS MEETING
LEAN EDUCATION AND DEVELOPMENT LTD 04095839
CREDITORS’ VOLUNTARY LIQUIDATION DEEMED IN CONSENT MEETINGS
B-TEC UK DRIVING SCHOOL LIMITED 10384733
CATHERINE'S LITTLE ANGELS LTD 11617092
HSM DRIVER TRAINING LTD 11573474
MARK EDUCATION LIMITED 03495297
WEST LONDON SKILLS TRAINING LIMITED 08780267
LIQUIDATORS APPOINTED
ABBEY CARE AND EDUCATION LTD 13829090
ASHBROOKE HOUSE SCHOOL & PRE-SCHOOL LIMITED 10726672
CENTRAL TRAINING GROUP LIMITED 11712792
DD TUTORS LIMITED 12096160
REDWOOD SCHOLARS SCHOOLS LIMITED 10835899
SCHOOL NOTICES LIMITED 08244221
THE MUSICAL THEATRE ACADEMY LONDON 08145904
MEMBERS VOLUNTARY LIQUIDATIONS
PARIS PERSONAL TRAINING LTD 04977833
PETITIONS TO WIND UP
FUTUREH LIMITED 11449017
TRUE TECH TRAINING LTD 10106990
IT SERVICES FOR EDUCATION LIMITED 04385339
WINDING UP ORDERS
LEADERSHIP CHALLENGES INTERNATIONAL C.I.C. 10158002
++++++++++++++++++++++++++++++++
ICSM CREDIT
For information on ICSM visit www.icsmcredit.com or call 0844 854 1850.
ICSM, The Exchange, Express Park, Bristol Road, Bridgwater, Somerset TA6 4RR. Tel: 0844 854 1850. www.icsmcredit.com. Ian.carrotte@icsmcredit.com
About ICSM Credit
ICSM Credit has more than four decades of experience as a credit intelligence group whose members gain inside information about firms in trouble allowing them to avoid bad debts and rogue traders. To join costs less than a tank of fuel - while at the moment there's a special free temporary membership offer during the Covid-19 crisis which gives access to free legal letters. ICSM also has an effective debt collecting service which has a global reach - ask for details from Paul.
For details about ICSM Credit call 0844 854 1850 or visit the website www.icsmcredit.com or email Ian at Ian.carrotte@icsmcredit.com on how to subscribe and to join the UK’s credit intelligence network to avoid bad debts and late payers. Follow ICSM Credit on FaceBook, Twitter and YouTube and Ian Carrotte on LinkedIn.
To keep up to date subscribe to the FREE ICSM Credit Newsletter to hear all the latest insolvency news and to see who has gone out of business click on the orange panel on the top left of the home page of the website www.icsmcredit.com or send an email to Ian.carrotte@icsmcredit.com
For details for the work of the journalist Harry Mottram visit www.harrymottram.co.uk