Independent learning providers are calling for an end to a dual funding system that sees them denied overpayments while colleges get to keep cash despite underdelivering on education.
Graham Hoyle (pictured), chief executive at the Association of Employment and Learning Providers (AELP), said he wanted to see the system changed so that either his members could also keep overpayment or that both colleges and his members couldn’t keep overpayment.
“The big problem is not with colleges getting overpayments, it’s with there being two different systems — one for colleges and one independent learning providers,” he said.
An AELP spokesperson said the issue had come to the fore with recent funding changes meaning AELP members were getting paid more — but thereby reaching their Skills Funding Agency allocation sooner than expected.
The clash of two incompatible funding systems has come to the fore.”
He said a number of AELP members were “having to turn demand away, and even reduce capacity — including making front-line staff redundant — as the otherwise welcome retrospective funding for functional skills, etc, has placed them in an overspend position”.
Mr Hoyle said he wanted college funding, where excess is identified, to also be considered for redistribution among his members.
“The clash of two incompatible funding systems has come to the fore, with employers and the unemployed losing out as the providers have to turn them away, and even contemplate closing their delivery doors for good,” he said.
“Despite their support and goodwill, I do not believe the agency has the tools to get the money quickly to where it is needed. We will be writing to the FE Minister to engage his help.”
It comes just weeks after the agency revealed it had allowed underdelivering colleges to keep around £85m of taxpayers’ money for which no education had been delivered.
Mr Hoyle added: “The agency is totally sympathetic and anxious to do whatever it can to move money around from providers with unused cash.
“This is routinely done between independent providers who have always argued for in-year reconciliations as the only way to make a reality of demand-led responsiveness.
“Sadly the annual grant system used for colleges denies independent learning providers this flexibility — until the next funding year.”
A spokesperson for the agency said: “We published figures for the end-of-year performance position for colleges and training organisations for the academic year 2011/12 in December.
“Where the published data shows that a college or training organisation has funds against which it has not delivered, the agency is in discussions with each provider about the use or return of any funding not delivered.
“The agency continues to ensure funding is used for the direct benefit of learners and employers.”
The agency has said it could be asking for some of the overall overpayment last year to be handed back.