Education Reform Act 1988

Designation of certain institutions for funding by the Polytechnics and Colleges Funding Council, etc.

129 Designation of institutions

(1) The Secretary of State may by order designate as an institution eligible to receive support from funds administered by the Polytechnics and Colleges Funding Council established under section 132 of this Act—

(a) any institution other than a university which appears to him to fall within subsection (2) or (3) below; and

(b) any institution which is or is to be conducted by a successor company to a higher education corporation.

(2) An institution falls within this subsection if—

(a) its full-time equivalent enrolment number for courses of higher education exceeds 55 per cent. of its total full-time equivalent enrolment number; and

(b) it is either—

(i) an institution assisted by a local education authority; or

(ii) an institution which is grant-aided or eligible to receive aid by way of grant.

(3) An institution falls within this subsection if—

(a) its full-time equivalent enrolment number for courses of advanced further education on 1st November 1985 exceeded 55 per cent. of its total full-time equivalent enrolment number on that date; and

(b) it was on that date either—

(i) an institution assisted by a local education authority; or

(ii) a grant-aided institution.

(4) An order under this section designating an institution as falling within subsection (3) above may not be made after the end of the period of twelve months beginning with the date on which this section comes into force.

(5) For the purposes of subsection (1)(b) above, a company is a successor company to a higher education corporation if—

(a) it is a company limited by a guarantee formed and registered under the [1985 c. 6.] Companies Act 1985;

(b) at the time when it was formed the persons participating in its formation were all members of a higher education corporation and constituted a majority of the members of that corporation;

(c) its objects—

(i) are exclusively charitable according to the law of England and Wales; and

(ii) include the conduct of the institution which was at that time conducted by that corporation;

(d) its memorandum and articles of association have been approved by the Secretary of State; and

(e) an order has been made under section 128 of this Act dissolving the corporation and transferring the property, rights and liabilities of the corporation to the company (whether or not that order has taken effect before the order under this section is made).

130 Transfer of property, etc., to certain designated institutions

(1) This section applies to an institution designated under section 129 of this Act in any case where—

(a) the order designating the institution under that section so provides; and

(b) immediately before the date on which the designation takes effect (referred to below in this section, in relation to such an institution, as the designation date) the institution is an institution assisted by a local education authority (referred to below in this section as the former assisting authority).

(2) Subject to subsection (4) below and section 198 of this Act, on the designation date in relation to any institution to which this section applies the property, rights and liabilities mentioned in subsection (3) below shall be transferred to, and by virtue of this Act vest in, the appropriate transferee.

(3) The property, rights and liabilities referred to in subsection (2) above are—

(a) all land or other property which, immediately before that date, was property of the former assisting authority used or held for the purposes of that institution; and

(b) all rights and liabilities of that authority subsisting immediately before that date which were acquired or incurred for those purposes.

(4) Subsection (2) above shall not apply to—

(a) any liability of the former assisting authority in respect of the principal of, or any interest on, any loan; or

(b) any liability of that authority in respect of compensation for premature retirement of any person formerly employed by them.

(5) In subsection (2) above, “the appropriate transferee” means—

(a) in relation to an institution conducted by a body corporate, that body; and

(b) in relation to an institution not so conducted, any persons specified in the order designating the institution as persons appearing to the Secretary of State to be trustees holding property for the purposes of that institution.

(6) Subject to subsection (7) below, where any persons so specified are the appropriate transferee for the purposes of subsection (2) above—

(a) any land or other property or rights transferred to them under this section shall be held by them on the trusts applicable under such trust deed relating to or regulating that institution (if any) as may be so specified or, if no such trust deed is so specified, on trust for the purposes of the institution; and

(b) they shall incur no personal liability by virtue of any liability so transferred, but may apply any property held by them on trust for the purposes of the institution in meeting any such liability.

(7) Subsection (6)(a) above shall not apply in relation to any land or other property or rights which immediately before the designation date in relation to the institution concerned were vested in the former assisting authority as trustees for any particular purposes or (as the case may be) for the general purposes of the institution.

(8) In this Act, “transfer date” means, in relation to an institution to which this section applies, the designation date in relation to that institution.