Sue Dutton: Our four million students should be thrown into the dragons' den

Colleges are dragons' dens. This is not a slur on the students or staff, or a reference to the canteen curry; I'm referring, of course, to the collegiate spirit of enterprise and the TV show.

Further education is the natural incubator for new business. The majority of lecturers have industry experience, and between one-third and half of them have run their own businesses.

Many students already know which career path they will take – whether they are going to be a plumber, an engineer or a jeweller – so the steps towards setting up a new business are that much smaller. Also, FE students tend to be from more diverse backgrounds, so colleges have the potential to make progress in addressing what is called an enterprise deficit among women and in some ethnic minority and socioeconomic groups.

In last year's Budget, Gordon Brown announced £180m of investment over three years to continue funding for enterprise education in the UK. As yet, it is unclear how that money will be spent – previously it has been restricted to schools.

We would like a clear policy commitment to investment in enterprise so that, across our 400 colleges, four million students have the chance to experience enterprise education.

Government is right when it declares that enterprise education is a sound investment. More than half of our workforce runs, or is employed by, a small business. In industries such as agriculture, forestry and fishing, this figure tops 90 per cent. Enterprise boosts productivity, increases competition and innovation, creates employment and prosperity and revitalises communities. In parallel (and possibly as a result of TV series such as Dragons' Den), attitudes towards entrepreneurship are improving; the proportion of young people aged 16-24 considering going into business has risen, reaching 18 per cent in 2005.

We get a good return on our investment with FE, as a pilot project in the North of England has recently shown. A total of 32 colleges were given seed-corn grants of £9,000, which led to specially trained staff introducing enterprise initiatives across the region.

Successes saw City of Sunderland College students creating a portable nail-bar, technology experts at Dearne Valley College launching an IT company after receiving advice from a panel of local business people; and Hull College hairdressing apprentices setting up their own salons. At Lancaster and Morecombe College, students manage a profitable patisserie; Leeds College of Art and Design students have created their own clothing label, now stocked in several city boutiques; and the bright lights of South Tyneside College created a candle factory. In all, 16,000 students were involved in the projects, learning business start-up skills and fostering innovation and social enterprise.

These projects are testimony to the can-do culture in colleges. Now we would like to see the northern enterprise project replicated across the country, and sustained political and financial support for enterprise in FE, so that many more students are given the opportunity to brave the dragons' den.

The author is acting chief executive of the Association of Colleges

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