FE is ‘very different kettle of fish’
The fast-approaching FE loans policy has been labelled as “very complex to implement”, “difficult to market” and cause for “real worry” from key figures in the sector.
A roundtable debate, held at the FE Week office and attended by a representative from the Department for Business, Innovation and Skills (BIS), the University and College Union (UCU) and the National Union of Students (NUS), as well as the shadow minister for FE, among others, was used to discuss the sector’s growing concerns with the scheme.
Peter Pledger, chief executive of South London Business and chairman of the Confederation of Apprenticeship Training Agencies (COATA), criticised the government’s timetable for introducing the policy, emphasising that learners would need more time to think about applying for a loan.
“With all due respect, you need to get your act together,” he said.
The Department has revealed to FE Week that the new system has been renamed as “24+ Advanced Learning Loans”.
A BIS spokesperson told FE Week: “After carrying out testing with a sample of learners, we have chosen the name ‘24+ Advanced Learning Loans”’.
“This describes the loan offer which covers learners aged 24 and above studying at level 3 and above.”
Gordon Marsden, shadow minister for FE, skills and regional growth, emphasised at the roundtable debate that learners in FE are very different to those in HE, and should be treated accordingly by the Student Loans Company (SLC).
Mr Marsden said: “(The) government can say until its blue in the face that it will be done in the same way as HE loans.
“They may want to use the same instrument, the SLC, but it’s a very different kettle of fish, delivering loans across variable courses for variable lengths and at variable times of the year, to doing a sort of one size fits all with HE loans.”
Andrew King, the lead on FE loans at BIS, responded: “We have had to look at how the systems operate in relation to that, and ensure that there are systems in place so that it can be dealt with.”
Toni Pearce, vice president (FE) at the NUS, said the absence of UCAS in the further education sector would be another issue for the SLC.
She said: “For the SLC to only have to interface with UCAS is one thing, but to have to interface with a variety of different providers in the country?
“We could well be in a situation where students receive a loan and don’t get onto their course, or get onto their course and then don’t receive a loan because those two things have to interface separately.”
The FE loans scheme was first announced as part of the spending review in 2010.
The priority is to shift money towards young people in an age where we have millions of young people unemployed”
A budget was then set to introduce FE loans in 2013/14 (£129 million) and 2014/15 (£398 million), based on the current system used in higher education (HE).
It is understood that learners will make repayments on an income contingent basis, equivalent to nine per cent above the £21,000 threshold.
The Department held a consultation with the sector last summer, and has also published reports detailing the initial impact assessment and equalities screening impact assessment.
The final versions of these reports – alongside new market research which examines the potential impact of FE loans on learners – are expected to be published later this month.
Mr Marsden said he was waiting with “baited breath” to see how the research had been carried out.
“I think the whole picture that we’re building up is of concern, concern that people will be nudged away from FE and real, severe difficulties about the implementation period, and relative breakneck speed at which this is now proceeding,” Mr Marsden said.
“Yes, it was flagged up in 2010, but what has actually happened between 2010 and up to the last six months? The answer is very little.”
Kate Lomas, a lecturer at Greenwich Community College and member of UCU, said she knew teaching staff who were still unaware of the policy, and that it would be very difficult to sell the concept of a loan to learners in their local area.
“Teachers who are involved in enrolment and marketing, who have to promote the college, are going to find it very difficult to market,” she said.
“We’ve spent a lot of time trying to engage adult learners, over 24s, and particularly women in our community, and it’s going to be very difficult to sell that whole notion to them.”
Mr Pledger said he did, however, support the introduction of the FE loans system.
“It’s absolutely the right policy,” Mr Pledger said.
Kate Lomas, lecturer at Greenwich Community College and UCU member and Peter Pledger, chief executive of South London Business and chairman of COATA
“Will it hurt FE colleges? Yes. Will it hurt adult community colleges? Yes. But that’s not the priority. The priority is to shift money towards young people in an age where we have millions of young people unemployed and that’s where you want to shift money, and we support it.”
Mr Pledger added that the introduction of FE loans would also help create a “truer market” for learners aged 25 and above.
“They will choose the courses that truly will help them make more money,” he said.
The shadow minister for FE responded by saying the government should be worried about the effect the policy will have on the record number of new adult apprentices.
“I think the government should be concerned that their much flaunted expansion in post -24 apprenticeships could well fall off a cliff if this goes wrong, because you will get droves and droves of people not prepared to take a post 24 apprenticeship loan up on an individual basis,” he said.
Mr Pledger said that while he agreed the number of adult apprentices would drop following the implementation of the loans system, it would also ensure greater value for money and help eradicate ‘deadweight’.
“What I would like is – if we’ve got a limited amount of resource – is that resource is focused at those under 24 without a level two or level three qualification, and if we want people to up skill at a higher level, the employer either pays for it or the individuals get loans on qualifications that truly meet their needs,” Mr Pledger said.
Mr King said the Department had looked “very seriously” at apprenticeships, and argued that many apprentices would be happy to take out a loan once they understood the value of the qualification associated with their programme.
“Once they understand the offer of the loan that’s available to them, that’s when they’re willing and willing to cost taking that out,” Mr King said.
“(They) see the value of the loan offer that’s available, rather than just the increasing debt that it might otherwise be seen as.”
The Department will be using a paper based system with the SLC to manage the loan applications from April next year.
However, Maxine Room said the FE loans system should be deferred a year unless an online system was available instead.
“I’m driving an e-strategy in my college, and it seems incredible that you’re even thinking about it,” the principal of Lewisham College said.
“What will happen in colleges – and the psyche of college is something I know well – is you start with a paper based system, you then go to an online system, but staff keep their paper based system because they’re worried about the online system.”
Mr King was clear the Department was developing an online system simultaneously, which they hoped to implement at the earliest opportunity.
“It’s not that we’ve made the decision not to have an online system, but obviously (we’re doing) as much as we can to accelerate that process and potentially bring it forward,” he said.
Gordon Marsden, shadow minister for FE, Skills and Regional Growth, Maxine Room, principal, Lewisham College, Toni Perace, VP for FE, NUS and Andrew King, lead on FE loans at BIS
However, Ms Room said providers would also need time to trial the online system.
“We need to have our information this year, now, and the system up and running so we can trial it,” she said.
“We’ve had issues in our own organisation about trialling some of the system changes, and staff have been very negative when we’ve put systems in without actually piloting them.
“Now for you to come in and say the system is a paper based one, but you might have an online one, well for me is a no-no.”
The new name for FE loans, “24+ Advanced Learning Loans”, was also criticised during the roundtable debate.
“Well it could be simpler,” Ms Room said.
“It’s not a name; it’s a descriptor isn’t it?”
Mr Marsden added: “I think the name is potentially going to have the unintended consequence of turning quite a lot of people off.
“I’m sure that’s not what (BIS’) intention is, but I think the psychology hasn’t been thought about.”
Mr King said the new name was a result of a survey conducted with the sector.
“It wasn’t a name we put forward as part of the survey, but it was actually something that was suggested as part of the responses.
“So we gave three responses and people came back with ideas about Advanced Learning Loans, and 24 + Advanced Learning Loans. They felt there should certainly be an age related element to the title and that it should be referenced to the type of learning it was for.”