City & Guilds Privatisation Triggers Charity Commission Investigation
In October 2025, the historic vocational training charity City & Guilds sold its training and accreditations business to the private firm PeopleCert for a substantial sum of £166 million. This transaction, however, has ignited significant controversy within the education sector, leading to a formal inquiry by the Charity Commission. The probe focuses on allegations of exorbitant fee increases and substantial executive bonuses that followed the sale.
Fee Hikes Shock Training Providers
Electrician Charlie Butler, who runs a training school in Essex offering City & Guilds-affiliated courses, experienced a stark example of the changes. In autumn 2025, he was contacted by a City & Guilds representative expecting a minor fee adjustment. Instead, he was informed that annual fees would surge from £2,000 to £5,000, and per-person charges would jump from £18 to £60. Butler described the increases as "ludicrous" and noted that the justification provided was vague, citing only "changes in the company." He later discovered that the fee hikes coincided with the sale and that executives had received large bonuses.
Executive Bonuses and Leadership Turmoil
Following the sale, it was revealed that Kirstie Donnelly, the former chief executive of City & Guilds who transitioned to the privatised entity, received a bonus of £1.7 million, alongside a salary increase of £100,000, bringing her annual pay to approximately £430,000. Finance director Abid Ismail was awarded £1.2 million, with his base salary rising by 30% to £300,000. In total, the compensation for the top six executives more than tripled post-deal. This sparked public outcry and contributed to the Charity Commission's decision to launch a statutory inquiry in January 2026.
The inquiry examines the sale process and the bonuses awarded to executives. Shortly after, Donnelly and Ismail were suspended by PeopleCert for an internal investigation, which later revealed they had left the company without any financial settlement. Their lawyers indicated plans for litigation against City & Guilds Limited, adding to the ongoing legal complexities.
Historical Context and Public Interest Concerns
Founded in 1878 by the City of London and livery companies, City & Guilds has a storied history as a public-interest body, providing technical education and qualifications in fields from engineering to hairdressing. Notable alumni include chefs Jamie Oliver and Gordon Ramsay, as well as former England football manager Gareth Southgate. The brand, owned under the charity City & Guilds London Institute (CGLI), relied on government funding for about 60% of its income, raising fears that the privatisation to PeopleCert might shift priorities from education to profit.
Initially, the deal was portrayed positively by then-chair Dame Ann Limb and Donnelly as a "landmark deal" aimed at securing the charity's legacy. However, documents later surfaced showing PeopleCert's plans to cut £22 million in costs, including £13 million from personnel, by replacing UK staff with cheaper overseas hires. This contrasted sharply with the brand's royal charter granted by Queen Victoria in 1900.
Unanswered Questions and Industry Fallout
The sale has left many in the vocational training sector questioning the motivations behind it. City & Guilds' accounts to August 2025 showed income of £174.8 million against expenditures of £182.4 million, suggesting financial distress was not a primary driver. Internal records indicate that trustees considered five options over 30 months, but some allege that information was "weighted" toward recommending a sale. Competing proposals for the charity to retain the business after a transformation plan were reportedly not seriously evaluated.
As the Charity Commission and PeopleCert investigations continue, training providers like Butler are reconsidering their affiliations. Butler plans to explore alternative awarding bodies, citing lower costs and higher quality. The case highlights broader issues in vocational education, including governance, transparency, and the balance between charitable missions and commercial interests.
