The Legal Status of the New College
A Charitable Company
The new college will be constituted as a Charitable Company. That is, it will be a Scottish Charity, registered with the Scottish Charity Regulator (OSCR), and it will be a Company Limited by Guarantee, registered with Companies House and governed by a memorandum and articles of association.
As a Charitable Company the new merged college will have no owners or shareholders and will be required to achieve its charitable objectives and meet the needs of its intended beneficiaries (students, learners and researchers).
An Assigned College
The new merged Shetland college will be an assigned college of the Regional Strategic Body for the Highlands and Islands (the University of the Highlands and Islands).
A Regional Strategic Body is a body set up by law to provide funding for and ensure the quality of college education within a defined area (Glasgow, Lanarkshire, or the Highlands and Islands). Each Regional Strategic Board has several colleges ‘assigned’ to it. (In most parts of Scotland responsibility for college education lies with a single regional college.)
The Regional Strategic Body for the Highlands and Islands is the University of the Highlands and Islands which delegates its Regional Strategic Body Functions to the UHI FE Regional Board.
A Non-incorporated College
The new merged Shetland college will not be an incorporated college, under the Further and Higher Education Scotland Act (1992).
Incorporated colleges generally operate only in the FE sector and are subject to significant restrictions as to how they can manage their finances. Based on legal and other advice received, and taking into account the proportions of FE/HE activity across the merging organisations, the Shetland Islands Council determined the new college should not be incorporated, a decision that was endorsed by the Shadow Board.
The new merged Shetland college will be governed by a Board of Directors under a single Chair. The board will have a legal responsibility to manage and conduct the affairs of the college in such a way that its staff deliver the required services. Board members will have the roles and responsibilities of both company directors and charity trustees.
Board members will be required to abide by the Code of Good Governance for Scotland’s Colleges (pdf) which describes their key duties and responsibilities.
As an assigned college of the University of the Highlands and Islands, the new merged Shetland college will be accountable to the University for all funding received from the Scottish Funding Council and will be required to monitor the financial health and compliance of the College in line with the Local Financial Memorandum agreed with UHI.
The new merged Shetland college will continue to be accountable to Scottish Funding Council and Education Scotland, through the Regional Strategic Body.
Members of the new college’s board of directors will be accountable to (amongst others):
- Scottish Ministers (‘the Government’)
- The Scottish Funding Council
- The Regional Strategic Body (the University of the Highlands and Islands)
- Employers and businesses that rely on the college to provide training and education.
- Partner bodies
The new college will also be accountable to a wide range of bodies that govern the accreditation of its courses and ensure that quality of the training provided meet their standards, including:
- Scottish Qualifications Authority
- Skills Development Scotland
- Accrediting bodies responsible for qualifications in specific subject areas
- Shadow Board Paper PB2019-22 (31st July 2019) - Legal Status of the New College (pdf).
- Merger Business Case, Appendix 2 - Legal Due Diligence (pdf).
- Code of Good Governance for Scotland’s Colleges (pdf).
- Guide for Board Members in the College Sector (pdf).