The Education and Skills Funding Agency has announced a one-year increase to the threshold for over-delivery of the national adult education budget.
Colleges and training providers will be paid for any over-delivery up to 110 per cent of their contract value for 2021/22 – up from the usual threshold of 103 per cent.
The ESFA said this is “in recognition of providers’ efforts to focus on delivery following the coronavirus pandemic and accommodating additional eligible learners recently resettled from other countries including Ukraine and Afghanistan”.
Julian Gravatt, deputy chief executive of the Association of Colleges, said this is the seventh year in a row that the core adult education budget has been fixed in cash terms, so it is “helpful that DfE is providing money for those colleges who are exceeding their 2021-22 targets”.
But, he added, it is important to explain that these funds are being taken from other colleges which have missed targets by more than 3 per cent.
Jane Hickie, chief executive of the Association of Employment and Learning Providers, said she was “delighted” that the over-delivery threshold will apply to all providers, and not just those that receive grant-funding.
She added that by providing notice a month before the year-end, this will offer “some head room for additional adult learner starts, that might have otherwise had to be pushed into next year due to capped funding”.
The ESFA also confirmed today that the threshold for under-delivery has reverted to 97 per cent following two years of lower thresholds – 68 per cent in 2019/20 and 90 per cent in 2020/21 – prompted by the coronavirus pandemic and associated lockdowns.
In an update to the sector, the agency said: “We recognise the challenges providers have faced because of the pandemic. But we also know that many providers have been able to continue deliver successfully and have adapted the way that they teach.
“We consider the time is now right to return to the pre-pandemic reconciliation threshold.”
Gravatt said the AoC was “disappointed” that the ESFA is sticking to the 97 per cent threshold, first announced 12 months ago, because this will “compound the financial difficulties facing colleges”.
“Covid lockdowns and uncertainty resulted in £60 million being taken from college budgets in the 2020-21 academic year,” he added. “While things are tentatively more normal today, this wasn’t the case last September or even in January.”
Sue Pember, the policy director at adult education provider network HOLEX, welcomed the over-delivery increase but took issue with the return to a 97 per cent under-delivery threshold.
She said: “Many providers are disappointed the ESFA hasn’t recognised that Covid has continued to impact on attendance and participation.”
“There is a cost to keeping open and providing classes for small numbers,” she told FE Week, adding that she is keen to hear what support the agency is going to offer to “overcome financial hardship”.
The over-delivery threshold increase applies to the national AEB administered by the ESFA only. In areas where the AEB has been devolved, mayoral combined authorities or the Greater London Authority set their own thresholds.
London’s over-delivery has been brought in line with the ESFA’s normal threshold of 103 per cent for the first time this year, for example.