9 things we learned from the DfE's annual report and accounts 2017-18

The Department for Education has this morning published its annual report, revealing payoffs, various bonuses and millions in unrecoverable debt.

The accounts sets out the expenditure and performance of the department over the period April 1, 2017 to March 31, 2018.

FE Week has the main findings:

 

1. Hinds’ ministerial direction ‘demonstrated strong commitment’ to T-levels

The accounts take note of the education secretary’s rare ministerial direction on the implementation of the new technical qualifications.

On May 17 Jonathan Slater drew attention to the ambitious timetable and the challenge in ensuring that the first three T-levels would be ready to be taught from 2020 and beyond to a consistently high standard.

But education secretary Damian Hinds, having “considered the advice in detail”, was “convinced of the case to press ahead”. The direction “demonstrated the government’s strong commitment to the future success of the T-level programme,” according to the accounts.

 

2. Justine Greening was handed a £16k payoff

The former education secretary was given a £16,876 severance payment when she left the department in January.

Damian Hinds replaced her and he was paid £15,425 salary until the end of the year.

Former skills minister Robert Halfon received no pay-off when he was sacked in June. But he did pick up £7,000 including pension on top of his MPs salary for his time as a skills minister that year.

Anne Milton joined on June 12 and received £25,432 until the end of the year. The overall salary for a skills minister has not changed, and sits at £31,680 for a full year.

 

3. Bonuses for senior staff

Three DfE directors received bonuses in 2017-18. Peter Lauener, the former chief executive of the Education and Skills Funding Agency received between £20,000 and £25,000 despite numerous torubles before he left, including two procurement fiascos and the Learndirect scandal.

Andrew McCully, the director general for infrastructure and funding, got between £10,000 and £15,000, and Paul Kett, director general for education standards, received between £5,000 and £10,000.

 

4. Presidents Club organiser Meller was paid £27k

Apprenticeships ambassador and businessman David Meller resigned as a non-executive board member at the DfE in January following revelations about the controversial Presidents Club charity dinner.

He set up the Meller Educational Trust, which runs four schools and a university technical college, and served as chair of the National Apprenticeship Ambassador Network and the Apprenticeship Delivery Board.

But he was also the co-chair of the charity set up to run the dinner, which was rocked by allegations of sexual harassment by guests following a Financial Times investigation.

Most non-executive board members are unpaid. However, DfE accounts show Meller was one of three to receive remuneration, paid £15,000 in 2016-17 and £12,500 in 2017-18.

The same payments were also made to board member Marion Plant, while Baroness McGregor Smith received £17,500 in 2016-17 and £15,000 in 2017-18.

 

5. Over £60m lost because of poor colleges and failed UTCs

As revealed in the ESFA’s annual accounts last week, the DfE waived huge amounts owing to its exceptional financial support for colleges.

The college with the biggest amount waived was Hull, where the ESFA abandoned £21,267,000. The second was Central Sussex College with £12,098,000, followed by Bournville College, which had £10.5 million waived.

Three failed University Technical Colleges – Daventry, Greater Manchester, and Lancashire – had a combined total of £3,137,000 written off as a result of closure.

 

6. Staff costs increased and spending on consultants and temporary staff on the rise

In 2017-18 the DfE spent £535 million on paying wages, up from £473 million the previous year.

The DfE meanwhile spent £9 million on consultancy in 2017-18, up from £6 million last year and £3.5 million in 2015-16.

Spending on temporary staff also rose to £27.2 million, up from £22.5 million last year.

 

7. The DfE employs 127 people ‘off-payroll’

The department and its various agencies is paying 127 staff off-payroll – something the Treasury isn’t too keen on because it means staff could use it as a tax dodge to pay a lower rate of tax.

These employees are paid more than £245 a day.

This includes 32 at the department itself, 54 at the ESFA and 21 at the Standards and Testing Agency.

Of the 127 arrangements, 27 have been in place for less than a year, 46 have been in place for between one and two years, 20 for between two and three years, nine between three and four years and 25 for more than four years.

 

8. 35 colleges in formal intervention

As at August 31, 2017, there were 35 colleges in intervention due to poor financial health. This was a decrease from the 40 at the same point in 2016.

Colleges that are in inadequate financial health can be referred to the FE Commissioner, who will conduct an intervention assessment.

 

9. Research spending has doubled in two years

In 2017-18, the DfE spent £22.6 million on research, compared to £16.7 million in 2016-17 and £11.1 million in 2015-16.

However, during that time, the DfE has grown in size, having taken on responsibility for adult skills and higher education in 2016.

None of its “key research strands” were for FE.