Bidding has opened for the next round of adult education budget (AEB) procurement by the Education and Skills Funding Agency (ESFA).
Up to £63 million has been made available for qualification based AEB for 2023/24 with a further £12 million up for grabs for the free courses for jobs scheme (FCFJ), both serving non-devolved areas of England.
Tender documents state that contracts can, at the ESFA’s discretion, be extended annually by up to the three years.
As with previous procurements, most bidders will be subjected to checks on their financial health. Colleges must have a financial health rating of at least ‘requires improvement’ and other providers must be rated at least ‘satisfactory’.
The Agency has said procurement outcomes will be communicated to providers in mid-June ahead of the service start date of August 1.
Overall maximum annual contract values have been reduced in this tender round.
The lowest amount that will be awarded will be £150,000, but the maximum contract value has been reduced from £3 million to £2.5 million for existing providers.
Four of the 88 successful bidders in the last procurement round secured contracts worth more than £2.5 million.
The tender cap for existing sub-contractors has been reduced from £2 million to £1.5 million and the cap for new providers is now £750,000, down from £1 million.
Another key difference is that the delivery of non-qualification provision will not be included in the AEB contract.
Successful contractors will be subjected to “more robust contract management”, according to ESFA tender documents, seen by FE Week.
This includes a “new mechanism” which could see the Agency remove or reallocate funding from an under-performing provider mid-year.
Delivery performance forms part of ten key performance indicators monitored by the agency, with measures in the contract covering expenditure, courses delivered and unique learner starts.
Monitoring of a new “social value” measure will be more subjective.
Bidders will be asked to provide their own social value statement on “tackling economic inequality” which will be worth up to 10 per cent of their overall bid score.
They will also need to suggest their own method for measuring social value, which will in turn form part of their contractual KPIs the Agency will measure.
Past procurement controversy
The last procurement round took place in 2021 and was steeped in controversy.
Delays mired the process and bid results were only released to providers two weeks before contracts were due to start.
An FE Week freedom of information request revealed that, of the 581 providers that submitted bids, only 88 were awarded contracts – a 60 per cent decrease in the number of contracted providers at that time.
Providers accused the agency of a ‘hidden agenda’ to shrink the market because of the drastic reduction in the number of providers awarded contracts. FE Week heard numerous criticisms of “infuriating” reasons for bid rejections from some long-standing AEB providers.
Bidders have until 10am on March 6 to submit their tenders.