A former Kent college principal will be fined a staggering £250,000 if he ever works in education again.

Paul Hannan was the man at the helm of Hadlow College when it collapsed in financial disarray four years ago.

Now he’s been told he cannot work in the sector again – and if he does he’ll have to pay a quarter of a million pounds.

The college group had expanded from its traditional Hadlow base to take over the running of both West Kent College in Tonbridge and Ashford College.

But all were plunged into crisis in 2019 when they became the first in the country to go into what is known as ‘education administration’.

Mr Hannan was suspended and remained on sick leave until the end of May 2019, while his deputy, Mark Lumsdon-Taylor, resigned.

According to a report in FE Week, debts in Hadlow College had toppled £40 million, while WKAC (the corporation managing West Kent and Ashford colleges) were in excess of £100 million.

The Department for Education was forced to step in, with the stricken colleges taken over by established other groups.

A major investigation was then conducted by the Insolvency Service into just what went wrong.

After three years, it declared no further action would be taken against any of the college group’s officials.

But BDO, the company now handling the liquidation of the company, launched its own investigation and came to a different conclusion.

It took over from the Insolvency Service in 2022 after it moved from education administration into the liquidation phase. This is when all value is extracted from the company’s assets in a bid to settle with outstanding creditors.

In a progress report filed as part of the winding-up process it revealed deals had been reached with both Paul Hannan and Mark Lumsdon-Taylor.

In documents filed, BDO said: “In accordance with our reports in the education administration, we investigated the conduct of certain relevant individuals of the corporation. These investigations have been concluded.

“The joint liquidators undertook detailed investigations for over three years and intimated claims against Mr Lumsdon-Taylor in a letter before action.

“[He] strenuously disputed all liability regarding the claims and without prejudice negotiations took place.

“A full and final settlement of the claims was reached on commercially acceptable grounds without any admission of specific liability or admission of any wrongdoing.

“The settlement requires an initial nominal payment of £5,000 [which has been received] and Mr Lumsdon-Taylor has given an undertaking to the joint liquidators which is subject to confidentiality provisions between the parties. In the event of a breach, he will pay compensation and on that basis, the joint liquidators have withdrawn all the claims in full.”

A similar series of negotiations took place with Mr Hannan who also “disputed liability regarding the claims”.

He reached an agreement – again without any admission of specific liability – which requires a “nominal initial payment” which has not been revealed, but has been paid.

But his deal includes “a further payment of £250,000 in the event of breach of Mr Hannan’s personal undertaking not to take a position in the education sector as a trustee, director, principal, manager, consultant and/or employee”.

FE Week was unable to contact Paul Hannan for comment.

A statement from Mark Lumsdon-Taylor’s office said: “The Hadlow College compulsory liquidation notice confirms that the joint liquidators have withdrawn all claims against Mark J Lumsdon-Taylor unequivocally and in full. This reconfirms our position that there was no case to answer for any 'claims' reported or otherwise stated. This matter is concluded.”

Following Hadlow College’s collapse, North Kent College took over the reins of West Kent College and Hadlow College, while East Kent College Group took over Ashford College.