1. Governors’ Briefing Coleg Gwent, Ystrad Mynach College and University of Wales, Newport July 2010 Education ADVISORY

2. © 2009 KPMG LLP, a UK limited liability partnership, is a subsidiary of KPMG Europe LLP and a member firm of the KPMG network of independent member firms affiliated with KPMG International, a Swiss cooperative. All rights reserved. This document is confidential and its circulation and use are restricted. KPMG and the KPMG logo are registered trademarks of KPMG International, a Swiss cooperative. 1 The project scope Option 1Retain the Status Quo Option 2Merger of all three institutions Option 3Merger of the two FE colleges with enhanced links to the University of Wales Newport Option 4 A strategic alliance between the three which falls short of merger but which may involve shared services and/or a joint venture Option 5 Any other option which is in line with national and international best practice

3. © 2009 KPMG LLP, a UK limited liability partnership, is a subsidiary of KPMG Europe LLP and a member firm of the KPMG network of independent member firms affiliated with KPMG International, a Swiss cooperative. All rights reserved. This document is confidential and its circulation and use are restricted. KPMG and the KPMG logo are registered trademarks of KPMG International, a Swiss cooperative. 2 OptionBenefit/RiskEffectiveness/EfficiencyResponsiveness Status QuoBenefit  Business relationships and delivery points are well established.  avoids set up costs of merger, on-going costs of a strategic alliance Risk  Dis-connection between progression routes  Duplication continues  Economies of scale limited to institutional level  More dynamic providers may emerge to fill gaps in provision at a further loss of coherence and consistency across SE Wales limited to each institution’s ability and will within its own “patch”  Current levels of resource may restrict ability of individual iinstitutions to grow and meet the needs of the area

4. © 2009 KPMG LLP, a UK limited liability partnership, is a subsidiary of KPMG Europe LLP and a member firm of the KPMG network of independent member firms affiliated with KPMG International, a Swiss cooperative. All rights reserved. This document is confidential and its circulation and use are restricted. KPMG and the KPMG logo are registered trademarks of KPMG International, a Swiss cooperative. 3 OptionBenefit/RiskEffectiveness/EfficiencyResponsiveness Merger of all three Benefit  Curriculum cohesion across FE/HE provision  Removal of duplication  Large financial base on which to attract further external investment  Clearer Pathways from FE to HE with consistency of approaches across the whole organisation  Retain local identity on each site  Clearer links with UHOVI  One stop shop for learners, communities and employers  A greater visibility locally, regionally, nationally and internationally. Risk  Complexities of Co- ordination of Management and Quality assurance arrangement across a single organisation spanning FE and HE  HE core provision may be diluted by the volume and needs of the FE provision and vice versa i.e UWN may lose University status

5. © 2009 KPMG LLP, a UK limited liability partnership, is a subsidiary of KPMG Europe LLP and a member firm of the KPMG network of independent member firms affiliated with KPMG International, a Swiss cooperative. All rights reserved. This document is confidential and its circulation and use are restricted. KPMG and the KPMG logo are registered trademarks of KPMG International, a Swiss cooperative. 4 OptionBenefit/RiskEffectiveness/EfficiencyResponsiveness Merger of two FE Colleges with enhanced links to UWN Benefit Clearer Pathways from FE to HE Curriculum cohesion across FE provision - removal of FE duplication Large financial capacity to invest and develop improved facilities for a wider range of learners Significant cost savings Brings the strengths of each FE organisation together across the whole area  Clearer FE Focus to attract more learners  Clearer HE Focus to bring HE into the communities  Simpler links from FE to HE for learners  Retain local identity of each site but economies of scale from merging admin etc so release more money to the front line Risk  Transition issues across FE and HE through a “ looser” link with UWN so will need to be formalised which would have a cost element dilution of current culture in each organisation too large to be responsive – so organisational structure and strong leadership essential

6. © 2009 KPMG LLP, a UK limited liability partnership, is a subsidiary of KPMG Europe LLP and a member firm of the KPMG network of independent member firms affiliated with KPMG International, a Swiss cooperative. All rights reserved. This document is confidential and its circulation and use are restricted. KPMG and the KPMG logo are registered trademarks of KPMG International, a Swiss cooperative. 5 OptionBenefit/RiskEffectiveness/EfficiencyResponsiveness Strategic Alliance which falls short of a merger but may share services/joint venture Benefit  Co-ordination of provision  Clearer Pathways from FE to HE with consistency of approaches across organisations  Removal of some duplication (but dependent on will of partners)  Speed of legal process to implement Responsiveness limited to areas of co-operation Risk  Stability of the strategic alliance  Requires just as much work as a merger to be effective  The costs of maintaining the alliance without the benefits of the efficiencies gained through merger  Shared service opportunities are limited  Lacks the potential of merger for external investment  dependent on the will of the partners and the development of a response protocol  Potential barriers to agreeing long-term external partnerships with stakeholders