A Skills Funding Agency (SFA) decision not to introduce a reduced funding rate for online learning has been welcomed by the sector.

The SFA had been looking into online learning following the publication of the Further Education Learning Technology Action Group (Feltag) report in March 2014.

But speaking as a member of the audience during a talk at the Bett education technology show in London on January 20, Stephen Nichols, policy implementation manager at the SFA, said that online learning was not “the cheap option”.

“We’ve taken a lot of feedback on online funding rates,” said Mr Nichols.

“The Skills Funding Agency isn’t going to implement a cheap rate for online learning. I think we all appreciate that it’s not the cheap option,” he added.

Paul Rolfe, director of technology and innovation at Highbury College, Portsmouth, was part of the Feltag group. He said Mr Nichols’ announcement was “very much welcomed”.

He said: “Developing high quality online courses with interactive and engaging resources is incredibly time consuming and therefore expensive.”

The SFA’s acknowledgement of this “will enable innovative providers such as Highbury College to continue to invest in new delivery models which will respond to the changing needs of learners and employers,” he said.

A spokesperson for the Association of Colleges said the SFA was “right” that “developing and delivering high-quality online courses is not cheaper” than face-to-face learning.

“Colleges, and other providers, which choose to provide both types of course should receive funding that is accurate and commensurate with the type of content and means of delivery for specific courses,” she said.

Feltag also recommended that all publicly-funded learning programmes should have a minimum of 10 per cent online content from 2015/16.

In its Feltag progress report in February last year, the government said it had reviewed this recommendation “in the light of concerns raised about setting a target without first testing the impact”.

As a result, it said, the SFA would be undertaking “information gathering” to “baseline current activity”, as well as running a number of pilots and asking the sector to complete a “temperature check” survey.

Another Feltag member, learning technology adviser Bob Harrison, said: “What’s really encouraging, from an FE point of view, is that they are now actively looking to remove the barriers in the funding mechanism, which will allow teachers and FE providers to use technology in an innovative way.”

A spokesperson for the SFA said that the evidence they had seen showed that “there are a wide range of variables involved” in setting an online funding rate.

“Final recommendations on an online funding rate will be made when our online learning report is published in due course,” she said.