Agency's cash flow hits obstacles

Raising cash is already a problem for higher education's quality watchdog, just a month after it was set up.

Delays in the transfer of resources to the Quality Assurance Agency could mean its subscriptions will have to be raised by the Higher Education Quality Council, which was scheduled to be wound up.

Diana Warwick, chief executive of the Committee of Vice Chancellors and Principals, said either HEQC or representative bodies of institutions could raise the money The CVCP is due to consider the problem at its council meeting today.

Half of the QAA's running costs were meant to be covered by taking over the HEQC's assets and business. But it is running behind on plans to meet Transfer of Undertakings Protection of Employment rules for transfer of staff, and to gain charitable status to receive HEQC resources.

The agency, which is supposed to be taking on the former functions of HEQC and entering into contracts with the funding councils to provide quality assessment, originally planned to be in business by last month.

But Ms Warwick said the transfer of staff and cash is now not expected to be fully complete until the end of July and could slip back to September. In the meantime the agency will have to find the money from institutions and the funding councils to pay its officials, including chief executive, John Randall.

If it has to wait longer to gain charitable status, the HEQC may have to continue to raise subscriptions for it, a scenario which would cause political tension.

The alternative would be for the representative bodies of institutions to raise the cash. But this could prove complicated since many higher education colleges are not members of these bodies, while other institutions are members of more than one.

It might also mean the HEQC would have to continue carrying out audit and research services under contract with the agency, raising the risk of VAT being applied to costs.