AEB underspent by £63 million, minister claims

AEB underspent by £63 million, minister claims

FE providers failed to spend £63 million of the adult education budget during the last academic year alone, the skills minister has admitted.

Not everyone agrees with Anne Milton, however: the Association of Employment and Learning Providers, has insisted that the true figure is likely to be much higher.

Ms Milton’s admission came in answer to John Mann, the chair of the Commons treasury sub-committee, who asked what estimate had been “made of the underspend against the AEB in the academic year 2016/17”.

“The underspend against the mainstream participation element of the AEB for the 2016 to 2017 academic year was £63 million,” the minister replied. This is “less than five per cent of the total contracted value”, she claimed.

The underspend against the mainstream participation element of the AEB for the 2016 to 2017 academic year was £63 million

“A portion of the underspend was reallocated within the further education sector, providing the opportunity for providers to expand provision through growth bids, funding over delivery in providers who exceeded their delivery aims, and support other provision.”

This excludes “growth deals and other funding support” because these programmes are “managed on a financial-year basis”.

The AELP boss Mark Dawe believes the announcement was misleading, however, as not all elements of the AEB have been accounted for.

It is “really disappointing” that the written answer only referred to “the mainstream participation element of the budget”, he said.

“The bottom line is that revenue budget was wasted on bailing out failed institutions not supporting learners.

“Any underspend should be reallocated to support the participation of learners by effective providers,” Mr Dawe added. “The AEB procurement demonstrated the unmet demand.”

Private providers were forced last year to tender for a slice of just £110 million in a much-cricitised AEB procurement exercise.

Their competitors, notably colleges and councils, were exempt.

The total sum of tender applications is understood to have been six times larger than £110 million.

FE Week reported last September that a total of £200 million was unspent in 2016/17, a figure which angered many private providers who missed out in the AEB tender.

Multiple sources confirmed at the time that around 13 per cent of the total £1.5 billion AEB budget had not been used.

Shadow skills minister Gordon Marsden said this was part of a “systemic set of problems that we are seeing all the way through to the dispersing of adult funding” and insisted that the government needs to “urgently review the whole process”.