BREAKING: Procurement paused for apprenticeships with smaller employers

The decision over funding allocations for apprenticeship provision for non-levy-paying employers has been be paused by the government, to allow time a careful review.

The Education and Skills Funding Agency today revealed that the recent procurement process had been significantly oversubscribed, due to overwhelming interest from the training provider market in the apprenticeship reforms.

It said pausing the competition would allow it to “review our approach to ensure that we achieve the right balance between stability of supply and promoting competition and choice for employers”.

READ MORE: ESFA pause was the right thing to do

The announcement acknowledged that “it is important that we fully consider how best to achieve these outcomes in a way that achieves the best value for employers and apprentices, as we move to a fully employer-led system”.

In the interim period, the ESFA will extend existing contracts held by all current providers until the end of December 2017.

Current providers with extended contracts will be able to undertake new starts on those contracts provided they are on the Register of Apprenticeship Training Providers.

It comes after FE Week revealed last month that allocations worth up to £440 million, for delivering apprenticeship training to non-levy employers, had been delayed by the government.

A key meeting that the former Skills Funding Agency was supposed to hold on March 8, to reach final decisions on which providers would be allocated a non-levy employer funding allocation, was also cancelled.

Mark Dawe

The ESFA said today it would notify providers of specific arrangements shortly, to make sure amended contracts are in place ahead of May 1, and confirmed that provision for existing learners would not be affected.

It also said it intends to engage further with the market to about its approach to the procurement process, to ensure it “meets the government’s wider objectives of securing stability in the market, good sectoral and geographical coverage of provision, and a market which meets the skills needs of employers”.

FE Week understands that further guidance will be issued “shortly”.

READ MORE: Why the pause will destroy good specialist providers

In response to the ESFA’s announcement, Association of Employment and Learning Providers chief executive Mark Dawe said: “AELP fully supports the government’s welcome announcement which is right for the sector and right for the apprenticeship programme.

“It clearly shows that the government is as serious about the quality of the programme and the social mobility benefits of apprenticeships as it is about hitting the 3 million target.”

He added: “The decision also gives the new providers on the register [of apprenticeship providers] more time to prepare their offer for non-levy paying employers but more importantly, existing providers can continue to support their employers and start new apprentices while a more considered review of anticipated programme demand takes place in the context of the Industrial Strategy and the skills implications of Brexit.

“We recognise that some providers who invested a great deal of effort into last autumn’s procurement will be frustrated by the announcement but the programme’s reputation will be better served by this rethink of the government’s approach.”

David Hughes

David Hughes, chief executive at the Association of Colleges, said: “I am pleased that the pause on the apprenticeship procurement process has been announced by the ESFA. It is a sensible and helpful recognition of the scale and complexity of change which is happening at the moment.

“This provides welcome stability to colleges and providers as well as to employers and apprentices through the coming months; this will give more time to get the procurement process right.”

He added: “We know that there are many new providers wanting to enter the apprenticeship market, but the government needs to find a way to ensure that their introduction does not inadvertently undermine current high quality, trusted colleges and providers that have built strong employer relationships over many years and for which apprenticeships are a key opportunity for progression for their students.”

On March 14, FE Week reported that the allocations, worth up to £440 million for delivering apprenticeship training to non-levy employers, had been delayed by the funding agency.

A message was sent out to non-levy funding applicants via the government’s ‘Bravo’ e-tendering portal – seen by FE Week – which confirmed that the announcement of the allocations would be postponed.

The update stated that “the timetable for communication of results to applicants” had been “amended”, and further advice would be revealed “as soon as we are able”.

Previously on March 8, FE Week had also reported that a key funding agency meeting which was supposed to decide which providers would receive a non-levy employer funding allocation and how much they would get had been cancelled.

 

 

 



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24 Comments

  1. Anne-marie Morris

    The whole process felt too rushed so this is great news! Apprenticeships and employers deserve quality providers to support them and for the system to be stable and not in crisis as it has appeared to be of late.

  2. Am I missing something here? Both the Richard Review and OfSTED have both identified the current Apprenticeship provision wasn’t fit for purpose – this is the driver (allegedly) behind all of these changes. So it is difficult to understand the responses from AELP and AoC above.
    Would it be cynical to suggest that these delays are more about trying to protect those Coleges and Primes that didn’t make RoATP rather than anything else? While there are apparently a large number of new entrants we must not forget that most are already providing Apprenticeships as sub-contractors – so the apparent rise might be more applicable to over-bidding from current primes seeking to maintain their CV rather than any additional capacity.
    This is starting to look like a “fiasco” that will force many smaller providers either to pull out of the market or potentially go bust. There will also be providers who have invested substantial money and resource getting ready for 1 May 2107 – only to find that their efforts are completely wasted – as is their investment!
    This is not a good day for the industry – and is most definitely not a welcome development despite the assertions above.

    • Having this held over us as a small provider, currently working as a Sub Contractor, the real question is will we be able to deliver under the new terms published! as from 1st May sub contracting requirements also change, this will affect the so called continue as normal statement.
      As with you a wasted investment of time and money in an already tight environment, small employers need the right level of support, as do the Apprentices taking positions with them.

  3. Roger Wigman

    Surely the SFA could have predicted these outcomes?? I find it staggering that the people in charge of this farcical process are still employed.

    The whole thing is a joke in my opinion. Combine this with the ludicrous new funding rules and you have a recipe for disaster.

    Isn’t it time for Keith Smith and his cronies to fall on their swords?

  4. I’m astonished that AELP supports this. It shows how out of touch they are with what’s happening on the ground. Hundreds of sub-contractors have invested time (and money in consultancy)to get onto RoATP in order to secure a contract through the ITT. In many cases Providers will also be unable to obtain contracts to deliver loan funded qualifications as they don’t have an apprenticeship contract. Whilst they may be able to secure sub-contracts for apprenticeships this won’t be the case for loans. Let’s open a book on what the next shambles will be that causes them to backtrack – my money is on the 20% Off-the-job time.

  5. It Looks to me like it’s saying For Levy Paying Employers, the Process will go ahead as planned from 1st May they will pay for their apprentices via their Levy Pot. For Non-levy paying Employers will be able to keep them on the old funding route. This would mean you wouldn’t have to worry about invoicing Employers directly for their (10%) contribution Straight way or recording when payments are received. Awaiting details on what happens for Levy paying employers who use up or don’t have a big enough levy pot to cover the cost.

    It looks like they are saying old system will being extended for non-levy paying until the end of the year, which raises the possibility (My own hope) that the Apprenticeship Service system will be able to handle the employer payments.(Possible this is a long shot)

    I’m eagerly awaiting technical Guidance from the ESFA.

  6. This amounts to a cock-up of monumental proportions, either that or they’ve come under significant political pressure to ‘fix’ their mistake (or rather complacent providers’ mistakes who did not take RoATP seriously).

    Senior managers at the ESFA should be considering their position not least because of the wasted time, resource and money expended by providers in preparation.

  7. Further to the comment about the Birmingham FECs it is not clear in the statement if it is only Attempt 1 RoATP joiners who will be allowed to extend or any providers that subsequently are allowed on the Register say at Attempt 2 which has just closed. If that is a No then all those who failed first time will still not be allowed new starts – or have I got that wrong?

  8. Is this the continuum of something that is unravelling? The whole premise is that employers were in the driving seat, but also it now appears control is being waged by Civil Servents and memberships groups. There is clear evidence of meddling within both the development by employer groups of new Standards and associated Assessment Plans by membership groups to sway Government into changing its guidance and now it’s commissioning trajectory to suit. The promise of an employer voice is now being further pushed back and weakened in potential favour of organisations who clearly did not meet the tendering requirements, but via strong lobbying by the membership groups have now gained traction for the Government to think again its reform strategy. Employers will no doubt be perplexed by the on-going changes in advice being provided by business development or Levy implementation teams, who will only be able to shrug their shoulders in realising their development plans. Combined, there is real fear that the sector will implode at the expense of what it has been asked to achieve, namely the increase of productivity for employers.

  9. Most apprentices up until this point have been supported by training providers obtaining funding via sub-contract arrangements many with FE colleges as the Prime. These providers have engaged positively the new proposed approach to funding apprentices and have now mostly succeeded on getting onto the ROATP. The previous sub-contract arrangements were therefore assumed to discontinue for starts after 1st May.
    How likely is it that new sub-contract arrangements can be secured to replace the funding gap to December 2017 especially given the changes to the sub-contract rules post May 1 and the required delivery involvement of Primes? How helpful was it to announce the need for this at Easter when most FE Colleges are inaccessible to the outside world?
    This could be disastrous for many of those ITP’s and certainly no cause for the news to be welcomed!
    Ironically, unless the 20% paid time off required to be given to adult apprentices is “refined”, then few SME employers will seek to engage in Apprenticeship programmes for these employees with the providers who have funding anyway!

  10. Most colleges and primes would have phased out sub contracting so those sub contractors who have applied for direct funding will be in big trouble as primes deliver all themselves. Also sub contractors must be aware that they have in the main been protected from audit and Ofsted so be careful what you wish for as entry into this mad world of FE is fraught with booby traps and you just have to take the RoATP debacle as evidence of gross incompetence. Many may lose jobs as a result so perhaps senior civil servants minister should do the honourable thing.

  11. Anne-marie Morris

    The procurement process has been “significantly oversubscribed” there were mistakes in judgements to answers provided on the first round of RoATP,there were mistakes with the “rigorous checks” which enabled some financially unstable inadequate providers on to the RoATP, training was rushed to be put in place to support inexperienced providers, so I feel time is needed to ensure a more considered review of the whole process can take place. I know how unfair this may seem to some and the difficulties the pause may cause, but we do need to get this mess sorted for the long term to ensure quality support and training is given to the Apprenticeships who are at the heart of all of this.

  12. I for one hope that the new funding regime for Non-Levy paying employers will still go ahead – given that this is what these smaller employers have been sold when considering new Apprenticeship Standards (i.e. expecting to pay 10% and not the somewhat larger percentage which they would pay on the old regime for a Trailblazer).
    Also, on the assumption that small independent training providers who have made it onto the RoATP will now be able to try to seek sub-contracting arrangements again, for the period up to December 2017, will the ESFA still push for the much greater level of involvement which is supposed to be required of a Prime delivering through a Sub-Contractor from 1st May?
    This could be a disaster, not just for smaller Providers, but also for the employers who procure their services. This situation is almost inevitably going to leave some Providers in the ridiculous position of being able to supply Apprenticeships to larger employers but not to smaller ones.
    Whilst AELP and AOC seem to think this is all great, a very large volume of RoATP Providers will continue to hold their breath until all of these factors are clarified.

  13. This is the right decision, and getting onto RoATP never meant that providers on there would be successful at the ITT. There was probably always going to be a large number of providers sat on RoATP unable to deliver the SME’s.
    This is the right decision for employers, but the SFA now need to review the rules around sub-contracting and extend current rules in line with this decision if they are serious about wanting continuity and choice for employers.

  14. I don’t know any FE Colleges that are inaccessible to the outside world over Easter – I have been in contact with several up until late tonight with no difficulties. I have to bite my tongue when I read some of the sweeping remarks being made. We (yes a college) have been supporting our long-standing sub-contractors in their efforts to go-it-alone giving them our best guidance to support them in getting onto the RoATP. All of them got on which is great. Most of them have no intention of delivering other than through the (sub-contractor) supported route – but needed to get onto the RoATP because of the size of their contracts. Alongside all of this, we put in place a Plan B for any of our sub-contractors that were unsuccessful. Fortunately it was not needed. All of our sub-contractors are planning to continue to work with us (yes we have plans to fulfil the new requirements for sub-contracting) as none of them feel yet ready to completely stand on their own two feet. They recognise and value the contributions that the college brings to the table particularly in terms of quality improvement, Ofsted readiness and funding and audit compliance. When they are ready, we will feel proud to have been a part of their development.

  15. As a small specialist provider of IT professional apprenticeships, we deployed huge resources (relative to our size) not only to secure a non levy payer contract but also to develop the new digital standards. Unless subcontracting rules are changed back to allow subcontractors to continue to service their specialist markets, our new standards based provision will be lost. An unnecessary loss of staff jobs and a community resource. What a pity!

  16. Very interesting views and comments. Can anyone please clarify or confirm if the government have relaxed the 10% payment contribution for the non levying employers. Thanks