FE welcomes £270m cash injection

FE welcomes £270m cash injection

The Chancellor’s Autumn Statement, which announced £270m of new capital money for FE, has been celebrated as a “big win” for ministers and FE.

The pledge of extra capital funding, when added to existing resources in 2014-15, will deliver a total of £550m for college buildings over the next two years, according to the Department for Business, Innovation and Skills (BIS).

The figures, especially in times of austerity, are “a clear demonstration of the clout that both the Secretary of State, Vince Cable, and Minister for Skills, Matthew Hancock, have across Whitehall”, according to sources close to the government.

The source added: “The news was a big win for BIS and for FE.”

The future of the Skills Funding Agency (SFA) also appeared secure, despite earlier suggestions the government would transfer its budget to the Local Enterprise Partnerships (LEPs), as recommended in Lord Heseltine’s Plan for Growth.

While the agency will maintain management for the majority of the skills budget, it was confirmed that LEPs will take a leading role in managing the Employer Ownership Pilot and priorities for European Social Funding.

On releasing the Skills Funding Statement 2012 – 2015, the Skills Minister told FE Week: “The SFA will continue — as it says in the document.”

And he said of the National Apprenticeship Service (NAS), which was not mentioned in the funding statement: “They will continue to have a very important role.”
The Association of Colleges (AoC) welcomed George Osborne’s speech as a “clear note of confidence in colleges”.

Chief executive Martin Doel, said: “The Autumn Statement recognises the importance of the sector to the economy, the local communities each college serves and, most importantly, to the students educated each year.

“This investment will allow colleges to continue to update their estates, helping them to deliver continuing high standards to their students, communities and industry partners.”

Responding to the Skills Funding Strategy, David Hughes, chief executive of NIACE, said: “The news that, overall, the revenue funding has not been cut further than planned is welcome. The new injection of capital into FE colleges will have a quick and direct benefit to learners across the country, as will the funding of modern equipment.”

Lynne Sedgmore, executive director of the 157 Group, welcomed the increased influence of LEPs. Commenting on the recommendation that colleges should be represented on LEP boards, she said: “Many of our colleges are already closely involved with LEPs and, if anything, it would have been good to see the relationship firmed up as more than a recommendation.”

Our key points and plans from the Skills Funding Statement 2012-2015 

  • Total teaching and learning budget £3.236bn in 2012-13, £3.155 bn in 2013-14 and an indicative £3.202 bn in 2014-15
  • Extra £270m capital funding (new money), making £550m for college projects operational by September 2015
  • Local Enterprise Partnerships  will be able to bring employers together to bid for Employer Ownership Pilot  funding and  with SFA set priorities for ESF funding
  • Consult on the introduction of Chartered Status for providers   proposal is that colleges would need to demonstrate that they have reflect LEP/S priorities in their plans
  • Work with the DWP on measuring job outcomes, with a view to future  incentive funding schemes
  • Lead a review of the post 19 Qualification and Credit Framework
  • Employer Ownership Pilot now £340m extended to 2015/16, following £90m redirected from elsewhere
  • FE course outcomes to be available through the Key Information Sets (like universities)
  • Publish course /vocational/sector  data based on how much learners might earn when they qualify
  • Work with UKCES on a review of the National Occupational Standards
  • Subject to the pilot outcome, introduce skills gain (distance travelled)  for English and Maths  funding in 2014/15
  • Plans to publish proposals for a Traineeship model of pre-employment training ‘shortly’

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A relatively good day

The Autumn Statement could have gone either way.

FE’s new minister was formerly an adviser to the Chancellor so would he help swing the axe or use his relationship to soften the blow?

When the Treasury announced £270m of new money, and an overall 2.8 per cent increase in total Government spending on further education and skills, we had our answer.

This capital investment is a vote of confidence in our colleges, and for that the new minister should be commended.

I know FE and Skills is still having to swallow the deficit reduction pill, with a top line real term reduction in funding of 25.1 per cent by 2014-15.

Ok sure, the extra £270m does not anywhere near meet past capital budget plans for FE.

And the new strategic role of Local Enterprise Partnerships will present challenges (although it’s better than Heseltine’s proposal to just hand them the funding and systems).

But all-in-all, in the current climate, it was a relatively good day for FE and skills.  Nick Linford, editor