ABSTRACT
The 1992 Further and Higher Education Act significantly changed the status of post-16 colleges by making them corporate bodiesfreestanding, autonomous institutions responsible for their own affairs. As business organisations they have their own legal identity with the power to manage their assets and resources, employ staff, contract to provide services, engage in consultancies and join in cooperative enterprises with other companies. With a combined teaching and non-teaching staff of several hundred, and annual budgets of several million, the colleges fall into the category of medium-sized businesses. They have charitable status which enables them to benefit from donations, and exempts them from paying tax on earnings and rates on property. However, they cannot, as LEAs did, recover VAT payments.
