Elmfield investigation ‘frustrates’ MP

An ongoing official investigation into defunct provider Elmfield Training has “frustrated” Business, Innovation and Skills Select Committee chair Adrian Bailey, who said he was waiting to probe the firm’s dealings.

The Skills Funding Agency (SFA) had been looking into the provider’s business even before it went into administration in November owing £11m.

It went under amid allegations of apprenticeship malpractice, with Mr Bailey having already revealed plans to call former Elmfield director Ged Syddall and SFA finance director Paul McGuire for a “no-holds-barred” grilling by the committee.

However, he told FE Week his inquiry was being delayed by the wait for the conclusion of the SFA investigation — but he warned he may yet push ahead regardless.

“I am quite irritated and frustrated by the lack of progress by the SFA with this and if necessary the committee will now consider going ahead before publication of the report,” he said.

It would be the second time Mr Syddall has appeared before Mr Bailey’s committee. He gave evidence in April 2012, when he said Elmfield’s entire income of £30m in 2011/12 came from public funds. He also defended his own £3m company dividend. But a BBC Newsnight probe screened in October last year, supported with information uncovered by FE Week, put Elmfield back in the spotlight, over its dealings with workers at supermarket giant Morrisons.

It was alleged Elmfield signed Morrisons staff up to apprenticeship programmes they had declined, enabling the provider to claim public funding for training. A separate probe into the allegations was launched around three months ago by the SFA, but it was still unable to confirm a date for when its findings would be published.

An SFA spokesperson said: “Our investigation into Elmfield is due to be finalised imminently and the results can be shared shortly, once we have formally considered the final report.”

Following administration, the majority of Elmfield’s business and assets were sold to EQL Solutions Ltd, which is 100 per cent owned by CareTech Holdings plc. The deal is understood to have saved 300 jobs. A CareTech spokesperson said the acquisition was completed as part of a “pre-pack insolvency” of Elmfield for a total “cash consideration” of £1.5m. The Morrisons contract was sold to NCG (formerly Newcastle College Group), which saved the remaining 50 jobs at the company.

A statement of the company’s affairs later submitted to the High Court of Justice revealed it owed £11m. It was in debt to more than 180 firms, including provider Skillsfirst Awards which was set up by Mr Syddall and owed £863,550.

A spokesperson for the company said Mr Syddall no longer had any involvement in either the running or day-to-day finances of Skillsfirst and hadn’t for some time.

Alan Clay, from provider A14 Training which was owed £8,720, said: “We have been working well with EQL since they took over the contract and they have been extremely co-operative, but the original Elmfield debt is still outstanding.”

The SFA spokesperson said: “We took action to respond to the situation as soon as it was notified that Elmfield Training was in administration. It would not have been appropriate for the agency to take action prior to the provider’s declaration of insolvency.

“A provider that contracts directly with the agency retains ultimate responsibility for all aspects of provision it is contracted to deliver, including elements that it chooses to sub-contract.”