Providers told to declare subcontracting fees by late April

The Education and Skills Funding Agency has finally sent providers long-delayed templates to let them declare their subcontracting fees.

Individual lead providers previously had to publish their annual figures by the end of every November every year. But the rules changed for 2016/17, and providers are now expected to inform the ESFA of their figures, which are then meant to be published centrally.

The agency came in for criticism as November passed last year, without any indication of when the templates would be sent out, or when the full figures would be revealed.

It has finally provided an update on the situation.

“All providers that ‘provision subcontracted’ last year have been contacted by email,” it said in its weekly bulletin.

“If you provision subcontracted for adult education last year, you need to submit the template that we sent to you to the ESFA fees and charges mailbox by 5pm on Friday, April 27.”

FE Week reported in January that the education select committee chair Robert Halfon had demanded action on what he described as “deeply worrying” delays.

He told the ESFA to collect the data “immediately” so it “can be collated and we can see them”, shortly after government admitted it would not publish the subcontracting fees in time for parliamentary inquiry hearings into concerns about the system, by both the Commons education and public accounts committees.

“The taxpayer should have the exact information readily available as soon as possible, as to how much money is being creamed off,” Mr Halfon insisted.

Subcontracting management fees have been a source of mounting controversy, reaching as much as 40 per cent, as was infamously levied in some cases by Learndirect.

Lead providers often claim the fees are needed to cover administrative costs, but many in the sector believe that too much money is being diverted from frontline learning. 

The ESFA said last night that subcontracting fees and charges would be reviewed to ensure government funding is being used for “recognised costs”.