Troubled Government hotel the Stonington Beach is to be transferred from the care of Bermuda College to the Ministry of Tourism, it was revealed in the House of Assembly yesterday.

Education and Development Minister Paula Cox said, in a bid to free Bermuda College of unnecessary responsibility, she felt the Ministry of Tourism was best suited to take care of the hotel, which has been running at a loss for years.

She said Bermuda College hospitality students who work at the hotel will still receive the same high standard of training, but said the college governing board will no longer have to make decisions as to how the Stonington Beach operated.

The news comes just two weeks after Government announced it planned to pay off the college's $2.2 million debt associated with the hotel.

Ms. Cox said: "Unfortunately, the college started the year with a large deficit because of losses from Stonington Beach Hotel.

"While the hotel has been of great value for 21 years in training many Bermudians for the hospitality industry, its operating losses have been a drain on the college.

"Thus, we propose a fresh new direction that will allow the college to avoid transfers of cash to the hotel in the future. We therefore propose to transfer Stonington Beach Hotel from the Bermuda College to the Ministry of Tourism."

She said in the past, the hotel had been a drain on finances, but the transfer would mean that from now on, the college board need only concentrate on student achievement.

"When I broached the idea initially to the Minister of Tourism, I welcomed his response, which though measured, he was prepared to entertain the idea," she said.

"I thought this was progressive and welcomed. This will achieve many purposes. Importantly, it will allow the board of Bermuda College to focus on the provision of quality tertiary education, its core functions - rather than on issues related to the running of a hotel.

"Bermuda College must be allowed to focus on their students - they must be the priority of Bermuda's only tertiary college," she said.

"It was not realistic to expect the voluntary board of Bermuda College to be responsible for the management of a hotel."

Ms Cox continued: "This was not practical and it was not within their remit of expertise.

"The board has been distracted for several years with the operation and management of the hotel, which has been losing money for at least the past five years.

"It was not considered that the board was the best entity to oversee the management and operation of a hotel."

However, she said the process had already started to put the management of the hotel out to tender. She said it will be in the form of a lease with the business risk transferred to the lessee.

She said the college had already submitted its shortlist of recommendations, but she wanted to ensure that there was experienced and objective vetting of the proposals before any decisions were taken.

And Ms Cox said an independent consultant will be brought in on a short-term basis to assist.

The Minister added: "It should be noted that given the intended structure of a management contract, the Ministry of Tourism will not be involved in the running of the hotel.

She said there would be a board set up under the remit of the Ministry of Tourism to oversee the hotel, which will involve the Ministry of Education and Development to safeguard the student training component.

Ms Cox added: "There are very good reasons for transferring the hotel and we are now working through the details of the new arrangement.

"It is intended that this new structure will assist in putting the hotel on a more secure footing and will extricate the Bermuda College from having to meet its debts. There are details to be finalised, but we are seeking to have the matter addressed as an urgent priority."

President of Bermuda College Dr. Michael Orenduff last night welcomed the move to transfer the hotel to the Ministry of Tourism, and said it would give the board and the management team more time to spend on the students. He said: "I have spent a great deal of my attention, and the board has spent a great deal of its attention, on the hotel.

"It will now be good to focus only on the college. I think the hotel made a great deal of sense when they first started the institution, but with the numbers in hospitality declining, it's almost a case of the tail wagging the dog.

"I really like Stonington, and I love the staff over there. It's a wonderful facility, so I would never call it a headache, but, in point of fact, the demands involved in running a large beachfront resort is more than the board or I have time or expertise for. And, of course, the funding issue was a big factor.

"I'm an educator not a hotelier. In an ideal world, it would have been nice, but now I think someone else can get on and make the hotel work, and we can get on and make the college work."