Lead provider ‘top-slice’ amounts published by SFA

A spreadsheet published by the Skills Funding Agency (SFA) has revealed how much money lead providers are handing over to subcontractors.

The data shows a wide range of ‘top-slice’ amounts taken by prime contractors, ranging from 99 per cent to minus 185 per cent.

The SFA said the figures detail the costs and responsibilities taken on by a lead provider, rather than an administrative fee.

“The data collected has identified a diverse range of costs recorded and reported by lead providers,” a spokesperson for the SFA said.

“When reviewing this information it is clear that the amount retained reflects the direct costs incurred by lead providers.

“Examples include where lead providers retain responsibility for assessor support, collection and processing of data, quality assurance, and registration.

“These costs do not appear to be simply a management fee retained by the lead provider.”

The head of a subcontractor told FE Week how the management fees used by some FE colleges were a “rip off”.

It follows a 30 per cent management fee advertised by City of Bristol College for adult apprenticeships.

The spreadsheet was created using the 2011/12 Declaration of Subcontractors forms submitted by lead providers.

The SFA said they were working with the External Advisory Group, as well as the Association of Employment and Learning Providers (AELP) and Association of Colleges (AoC) to develop a more accurate way of reporting how funding is being used in the sector.

(Are  you concerned about the management fees used by some prime/lead providers? Comment on the article below, or email your thoughts to nick.summers@feweek.co.uk)