The Careers and Enterprise Company will continue to be reliant on government handouts after ministers dropped their ambition for the quango to become self-sustaining.
Announcing the creation of the company in 2014, former education secretary Nicky Morgan, said that “in the longer term the company will sustain itself”.
But CEC’s new sustainability plan, seen by FE Week, revealed the government has ditched this ambition.
Ongoing government support will ensure continued rapid progress in line with its careers strategy
We can also reveal government grants handed to the firm, which runs mentoring programmes in schools and a network of “enterprise advisers” to boost careers education, rocketed by nearly two-thirds, up from £18.8 million in 2017-18, to £30.2 million in 2018-19.
Although the grant funding dropped to £24.3 million this year, the company has now received more than £95 million from the public purse.
The company’s original sustainability plan, published in 2016, said the CEC was “on track to achieve 50 per cent of alternative sources of income by 2017-2018”. The idea was to sell the company’s products to employers and make use of other funding sources.
However the new plan, obtained by FE Week under the freedom of information act, shows CEC and the government “no longer envisage replacing government funding with alternative sources of income in the way that was originally intended when government set up the CEC”.
This is because the nature of the CEC’s work has “expanded significantly” to deliver the government’s careers strategy.
The plan added there was “significant value to DfE continuing to fund the CEC”. However, the DfE expects the company to “continue to leverage additional funding to deliver its objectives”, including through match funding.
Since the CEC was launched, the company claims to have also “leveraged” £16.5 million from “other sources”. This includes £6.5 million from Local Enterprise Partnerships, which are themselves part-publicly funded, and £6.5 million came from investment funds.
The disclosure comes amid increasing pressure in recent years for CEC to prove its value for money.
In May last year, CEC chief executive Claudia Harris (pictured) and chair Christine Hodgson were quizzed by MPs about the company’s £2 million research budget, its staffing structure and a lack of evidence that the organisation is making a difference.
Supporters of the company were subsequently urged to tweet their backing for the under-fire organisation after MPs raised questions about its impact and transparency.
The organisation was further criticised in November, when the House of Commons youth select committee urged the government to commission an independent review into whether the CEC is doing a good job helping poorer students get work experience.
And later that month, the company was blasted for spending more than £200,000 on two conferences, with MPs demanding to know why private sponsorship was not sought.
In January FE Week revealed the Department for Education had been criticised for spending tens of thousands of pounds on apprenticeship advisers, as the CEC said its own consultants were not “experts” on the subject.
Reacting to the decision about the CEC’s future funding, Harris said: “That the government is continuing to invest in careers support for young people is enormously welcome.
“Ongoing government support will ensure continued rapid progress in line with its careers strategy and make sure all young people receive the vital opportunities and inspiration they need.”