Sector leaders turn up heat on Skills Minister Matthew Hancock over controversial funding cut

An official impact assessment on the government’s controversial education funding rate cut for 18-year-olds has come under fire from sector leaders in a joint letter to Skills Minister Matthew Hancock.

Martin Doel, Association of Colleges chief executive, and David Igoe, Sixth Form Colleges Association chief executive, were two of the four to put their name to the hard-hitting correspondence.

Along with 157 Group chief executive Lynne Sedgmore and Principals’ Professional Council chair Mike Hopkins they told the minister the assessment confirmed fears about the policy “far from allaying” them.

They said the assessment showed how the policy, that will see 18-year-olds’ full-time education funded at a rate 17.5 per cent lower than learners aged 16 and 17 from next year, was “based on inadequate analysis and insufficient evidence”.

It shows that FE colleges will be among the worst-hit of all institutions — with an average reduction in funding of 3 per cent.

For land-based colleges it’s 2.5 per cent, for commercial and charitable providers it’s 1.5 per cent, and for sixth form colleges it’s 1.2 per cent.

But for school sixth forms it’s just 0.4 per cent. However, the report does not say how much cash the funding rate cut, due next academic year, is expected to save.

Mrs Sedgmore told FE Week: “The long-awaited impact assessment does not allay the many fears that this policy will disproportionately affect the most disadvantaged students, many of whom are served by large, urban further education colleges.

“The impact on colleges is more than seven times greater than the impact on school sixth forms. At a time when we should be promoting vocational routes to give our young people the skills they will need to contribute to economic growth, this disparity seems ill-advised.

“The data presented in the impact assessment is open to differing interpretations, and we believe this policy has been ill thought-through. It risks undermining the real progress that has been recently made in evening out the playing field between different providers of post-16 education.”

They also called for talks on “mitigation measures” with Education Secretary Michael Gove having said he would consider limiting the initial effect of the cut, although the impact assessment said such a move could not be decided upon until the end of next month at the earliest.

The new rate for 16 and 17-year-olds is expected to be announced in March, but at the current rate 18-year-olds would be funded at £3,300.

The cut has been the subject of widespread criticism and prompted the creation of an online petition against the move that could force a debate on the issue in the House of Commons if it is signed by at least 100,000 people. It has already been singed by nearly 2,500 people.

Nevertheless, the sector leaders’ letter further raised concerns about the fact the cut would be retrospectively applied to learners halfway through a course, meaning providers would be left with a funding shortfall.

“We remain especially concerned that the cut might apply to students who are part-way through a course they have begun legitimately believing they would be fully-funded until the end. Colleges will have to work hard to mitigate this unfair, and possibly unintended, consequence,” said Mrs Sedgmore.

The Education Funding Agency announced the funding rate cut on December 10 and said the Spending Review for 2015-16 meant that savings were required from the 16 to 19 participation budget that year.

It said those who were 18 at the start of the academic year “will already have benefited from two years of post-16 education and will not therefore need as much non-qualification provision within their study programmes as 16 and 17-year-olds”.

Mr Gove told the Education Select Committee last month: “It is a painful cut forced on us by, A, difficult economic circumstances and, B, the fact that there are some parts of the education budget that are protected and some parts that are not.

“We conducted an impact assessment which we can share with the committee. In short, of all the ways we looked at to reduce expenditure in the 16 to 18 area, this is the one we felt was the least worst. But I won’t say that it’s a good thing to reduce spending in this area. It’s a difficult decision.”

The Department for Education is yet to respond to the letter to Mr Hancock.