As college bosses look on nervously while government funding cuts take hold, they must also think of ever more innovative ways to make ends meet. Verity Hancock suggests a review of how the FE loans pot can be used.
Back in 2012 the Skills Funding Agency (SFA) confirmed that Leicester College was in the top five colleges that would be most affected by the new 24+ advanced learning loans system.
Usually being in a list of top five is excellent news, but in this case somewhere considerably further down the list would have been preferable.
Nevertheless, recognising that loans were going to have a major impact, the college planned for their introduction with reviews of its offer, detailed communication plans, staff training, leaflets to over 100,000 homes and other marketing activities to potential learners and employers.
As a result, we have managed to secure loans for 250 learners totalling half of our facility — 46 per cent are taking level three diplomas, 42 per cent are taking access courses, with the remainder on A-levels and level four diplomas.
Operationally, the introduction of loans has been smooth — the Department for Business, Innovation and Skill, the Student Loans Company and the SFA have focussed on ensuring that the process works.
Restricting our access to funding on top of cuts to the main allocation limits our ability to innovate
While we entirely understand the rationale for seeking increased individual and employer investment, transferring more of the adult budget into a loans facility and separating that from the main allocation represents another hit on college finances.
Some colleges have been very successful in promoting the take-up of loans, but we have yet to convince enough people that taking out a loan that you only pay back when you can afford it, is a sensible proposition.
Leicester is primarily a low wage economy, so asking people to sign up to a system based on credit when all the national economic messages are about the perils of borrowing too much is bound to make them sceptical.
When we look at our funding statement, we can see the tantalising figure of our loans facility, next year’s figure even larger than this, but we know it is highly unlikely that we will be able to use it all.
Clearly any reduction in funding is difficult, but restricting our access to funding on top of cuts to the main allocation limits our ability to innovate and to develop and market the kinds of products for which people might be willing to take out loans.
The financing of education and training is different and so the products we offer must also look different.
Ultimately, it is our learners and the economy that stand to lose out.
If colleges cannot invest in future development, the stock of this country’s vocational education provision will be reduced.
Many colleges have commissioned analysis which demonstrates the substantial contributions they make to local economies.
While we may not be the ‘makers’ Chancellor George Osborne mentioned in his Budget speech, we do generate significant economic value — and failure to acknowledge this is a huge oversight.
All governments are very keen to promote the knowledge economy.
It would be a clever move to support this section of the economy by unlocking access to the funding set aside for loans so that we can get as many people into high quality training as possible.
This could be by ring-fencing some loan funds for design, development and marketing, or allowing 19 to 23-year-olds, who are currently disadvantaged in this respect, to access loans.
Whatever is decided, our experience is that a different approach is going to be critical in enabling us to maximise the potential that loans offer.
Verity Hancock, principal, Leicester College