The outgoing Training and Enterprise Councils left a surplus of over £40 million for the incoming Learning and Skills Council, Baroness Blackstone announced today.

The money, which is termed 'legacy funding', is being paid back from liquid assets retained by the TECs over the next year, and will go to fund the LSC's 'Local Initiative Fund' aimed at supporting education-business links and improving general provision for community education.

The actual figure of money left in the TEC reserves is much higher than this - a further £127 million has been passed over to fund Individual Learning Accounts and Business Link projects. Tessa Blackstone added that "The Learning and Skills Council will also for the first time be able to use £10 million of the raising standards fund available for 2001-02 to support LSC funded work-based learning nationally. The Council will be able to look at work-based learning across the board and invest in raising standards where the need is greatest. This is an important step towards creating a more consistent approach to post-16 learning. I am encouraging local LSCs to use their 'TEC legacy' money to test out new ideas and ensure that the needs of local people are met."

Meanwhile, the Guardian reports that the Council seems to be having problems passing the funds through to training providers. Confusions surrounding the new funding set-up and staff shortages at the LSC headquarters has lead to delays in payments being processed, says the paper.