CONNEXIONS, the education and employment advice service for young people in Warrington and Cheshire, has gone into administration.
Administrators PKF Accountants, say the company will continue to trade to ensure an orderly transfer of its operations to the three local authorities which jointly own it – Warrington, Cheshire East and Cheshire West and Chester.
This should mean the continued employment of the company’s 210 employees, they say.
Connexions Cheshire and Warrington is wholly owned by the three councils and has provided a wide range of youth services since 2001.
Joint administrator Kerry Bailey, a partner in PKF’s corporate recovery team, said: “Connexions has experienced great uncertainty and turbulence due to significant ongoing funding reductions since summer 2010.
“There was a change in leadership when George Miller was appointed as chairman and Norma Guest as chief executive in March 2011, at which point the company was asked by its local authority owners to work with them on a plan to come out of their ownership by April 2012.
“Despite every effort made by the company to make this happen through significant downsizing of the organisation, and serious reduction of liabilities, the board of directors has, with regret, taken the decision to appoint administrators.
“Prior to our appointment, we had been engaged by the company to assess its financial position and advise the directors of their options.”
Connexions chairman George Miller said: “We did not anticipate or want to have to take this course of action, but due to the local authority owners’ decision to take the services in-house, the company has no alternative.
“Whilst the administration will ensure that the already planned transfer of some services into the three local authorities takes place by the end of March, there is still uncertainty about other non-local authority funded services. This should become clearer over the next few days.
“It has been very painful to see services to young people affected in this way, and it is a testament to all the staff that they have managed to keep quality services going despite all of these difficulties.”
The aim is for the three councils to take over youth services by the end of March, maintaining standards at the levels which were previously provided by Connexions.
Kerry Bailey added: “It is the intention of the administrators that the company will continue to trade and continue to provide services in the usual manner until then. We will be in touch with individual employees, schools and clients across the course of the next few days.”
Just over a year ago, Connexions announced job cuts as a result of a 24 per cent cut in council funding. Warrington and the two other councils agreed to cover redundancy costs providing there was ongoing dialogue on the level of service provided by the company.
Cost of redundancy payments at that time was about £1.2 million – enough for the company to become insolvent.
Warrington owns 25 per cent of Connexions, which means the two Cheshire authorities have the majority holding.
All three councils funded the company through government grants which were cut by 24 per cent.
CONNEXIONS, the education and employment advice service for young people
in Warrington and Cheshire, has gone into administration.
Youth advice service in administration
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Gary Skentelbery
Experienced journalist for more than 40 years. Managing Director of magazine publishing group with three in-house titles and on-line daily newspaper for Warrington. Experienced writer, photographer, PR consultant and media expert having written for local, regional and national newspapers. Specialties: PR, media, social networking, photographer, networking, advertising, sales, media crisis management. Chair of Warrington Healthwatch Director Warrington Chamber of Commerce Patron Tim Parry Johnathan Ball Foundation for Peace. Trustee Warrington Disability Partnership. Former Chairman of Warrington Town FC.
