UEL scraps overseas examinations venture

The University of East London faces a £600,000 loss from the collapse of an overseas examinations venture, the latest in a series of blows to the institution.

University of East London Global Examinations Board, a subsidiary company of UEL, has been wound up after losing £324,000 in one year, compared with a forecast loss of just £50,000.

UEL governors have been warned of possible “reputational risk to our university” as a result of the company’s failure.

UEL Global Examinations was set up in August 2011, when former vice-chancellor Patrick McGhee was still in charge of the university.

Professor McGhee left UEL on health grounds in January this year during a period of turmoil for the institution over Christmas and the new year.

John Shaw, UEL’s pro vice-chancellor international, and Nirmal Borkhataria, pro vice-chancellor and director of finance, also resigned between the end of December and the end of January.

In April, it emerged that UEL was closing its Cyprus campus after recruiting just 17 students in the first six months of operation.

The campus had a projected cost of £1.3 million.

Following the Cyprus debacle, UEL commissioned Sir David Melville, former vice-chancellor of Kent and Middlesex universities and current chairman of Pearson Education, to undertake a confidential review of the university’s international activities.

It seems likely that Sir David’s report also covered the exam company. However, a UEL spokeswoman would only say that the report is “confidential and is not available externally…to protect the university’s commercial interests”.

The spokeswoman added that the company was set up “to explore the option of an examination board being developed and managed by the University of East London. The decision to wind up the company earlier this year was taken as the university refocused its international business activity.”

UEL Global Examinations’ accounts state that its directors agreed to wind up the company on 23 January.

“After a year of trading it has become clear that the company’s activities will not generate a significant return for the foreseeable future,” the accounts state.

The company had its own chief executive, Jeremy Hanshaw, who had previously been international development director at UEL.

His appointment as a UEL Global Examinations director was terminated on 29 January, along with that of Mr Shaw, who was also a director, according to the organisation’s entry at Companies House.

They were replaced by members of UEL’s senior management.

A loss of £324,000 in 2011-12 is recorded in the UEL Global Examinations accounts.

Minutes from a UEL governors’ meeting on 19 March state that this loss compared with “a business plan based upon an operating loss of £50,000”.

There is “a forecast liability of £600,000”, the minutes state, adding that UEL’s chief accountant is “confident that these losses could be absorbed into our current budget”.

The “reputational risk to our university had also been considered in dealing with the wind-up activities”, the governors’ minutes add.

john.morgan@tsleducation.com