University governors resign after false funds claims

Chairman among victims at London Metropolitan after £36m scandal

Governors at the troubled London Metropolitan University have resigned in the wake of its financial troubles, university sources said last night.

The majority of its lay governors will be out of office by the summer, they added. The governors have been under immense pressure to quit following a warning from the Higher Education Funding Council for England (Hefce), the body responsible for funding universities, that urged them to "consider their position".

This came after it emerged that the university had falsely claimed £36m worth of government funds for students who had not sat their end-of-year assessments – as exclusively revealed in The Independent on 23 November.

The Hefce's comment were widely interpreted as being an indication that it would refuse to continue funding the university if the governors stayed in post – effectively forcing the university to close.

An agreement was drawn up before a governing body meeting on Tuesday night that the chairman, Peter Anwyl, would leave by the end of March.

The rest of the lay members associated with its audit sub-committee – charged with overseeing accounts – would leave by the summer. A new audit committee is expected to be in place by next April.

The agreement, between Sir Alan Langlands, chief executive of the Hefce, and Mr Anwyl had been expected to be published yesterday. Last night a spokeswoman for London Metropolitan University said it hoped to publish it today, "slightly revised". The revisions are likely to be about the timetable of departures.

At the meeting on Tuesday, a statement from staff governor, Kay Dudman, was read out. It said: "It is clear that London Metropolitan University's future and safety is at stake. Hefce has made apparent that there is a clear and immediate risk that funding will be withdrawn unless it is convinced that its financial support of the university with public funds is safeguarded to its satisfaction.

"London Met cannot survive without public funds. The honourable, and indeed the only, course of action is for members of the board who were serving during the period in question to resign and the executive should follow suit."

Sally Hunt, general secretary of the University and College Union, said last night: "Those who are responsible for the mess at London Met should go immediately. Delaying the inevitable does absolutely nothing to help the university, staff or students.

"Why burden the new vice-chancellor with people whose inadequacies have been brutally exposed? What has happened at London Met must act as a wake-up call to all universities and their governing bodies."

In a letter to the university, Sir Alan said: "We have been concerned that the university is unable to safeguard public funds.

"Given the criticism of the board and the senior management team, I do not believe confidence can be restored until action is taken to consider the position of board members and senior staff who are criticised in the report and new governance and managements arrangements are put in place."

The incoming vice-chancellor, Professor Malcolm Gillies, joins the university in late January.