Two independent training providers that used the same subcontractor have been hit with a combined £797,000 funding clawback after government investigators found multiple rule breaches in traineeship and 16 to 19 education provision. Acorn Training Consultants and Central YMCA both used Gateway Education (London) to deliver provision on their behalf. Almost £500,000 of the discovered overstatements relate to that shared subcontractor. The Department for Education’s investigations also found learners on traineeships subcontracted by Acorn Training Consultants to another provider called Learning for Futures, which now trades as Wise Origin, were placed at an independent school to clean rooms, wash pots, serve food and staff a tuck shop. The report said Acorn Training Consultants failed to demonstrate the placements met funding requirements for high-quality work experience. The DfE has recovered £276,840 from Central YMCA (CYMCA) and is recouping £520,234 from Acorn Training Consultants, according to two reports published on Wednesday. But publication was marred by a naming error. DfE initially identified Acorn Training Consultants as “Acorn Training Ltd”, which is a different training provider. Acorn Training Ltd was forced to publicly reassure its learners and stakeholders that it was not the subject of DfE’s investigation. Officials confirmed the correct identity to FE Week today, but the incorrectly named report remained live until 5pm this afternoon, more than 24 hours after the DfE was notified of the error. Learning Curve Group, which bought Acorn Training Consultants in 2020, said the investigated activity took place before it acquired the business from Babington. FE Week approached Babington and its owners, Knovia Group, for comment, but they declined. Neither Learning Curve Group nor Babington would confirm who was ultimately liable for the £520,000 clawback. Placements and progression The Acorn Training Consultants investigation began in July 2024 and examined traineeship and 16 to 19 study programme funding involving Gateway and Learning for Futures. Investigators identified £218,206 in overstatements relating to Gateway provision and £302,027 relating to Learning for Futures. For Gateway’s delivery, 19 learners were enrolled on qualifications they had already recently achieved. Acorn Training Consultants could not prove that repeating them represented progression. The provider could also not evidence attendance registers for 19 learners as required under the funding rules. For Learning for Futures’ delivery, records showed work placements for 33 learners took place at the same independent school, where their tasks included cleaning, washing pots and serving food. The DfE’s report said Acorn Training Consultants did not demonstrate these were high-quality placements. They took place at the same site as the learning, rather than with an external employer as per the rules at the time. Acorn Training Consultants also recorded 80 learners had progressed into further learning, but reviews of DfE learning records showed the progression had not taken place. A Learning for Futures spokesperson said: “In relation to this delivery, Learning for Futures had no direct contractual relationship with the department and our involvement was under the arrangements, instructions, control and direct management of the main provider [Acorn Training Consultants].” Before the takeover The DfE report points out that ownership of Acorn Training Consultants changed after subcontracting relationships with Gateway and Learning for Futures ended. Learning Curve Group acquired the Derbyshire-based business from Babington in 2020. A Learning Curve Group spokesperson said: “The matters highlighted in the DfE report relate to activity undertaken during the 2018-19 academic year, prior to Learning Curve Group’s acquisition of Acorn Training [Consultants] in September 2020. “Since acquiring Acorn [Training Consultants], it has operated under Learning Curve Group’s governance and compliance framework, and we remain focused on maintaining the highest standards across the group.” Learning Curve Group did not answer FE Week’s question about who would bear the cost of repaying the £520,234 overclaim, and Babington declined to comment. Ofsted rated Acorn ‘good’ in November 2021, following LCG’s acquisition. Inspectors said: “Processes to oversee the quality of the subcontracted provision are appropriate.” The subcontractors listed at that inspection were White Rose School of Beauty and Health, and Knights Training Academy. The investigations into Acorn Training Consultants and CYMCA both found the lead providers could not evidence required subcontracting checks including checking eligibility, observing delivery and making regular unannounced visits to subcontractors’ sites. Postcode problems The CYMCA investigation began in October 2024 and looked into traineeships delivered through Gateway. Investigators found the provider could not evidence high-quality work placements, and at least 100 hours of work experience or placements with an external provider. CYMCA also failed to evidence pre-placement preparation and meaningful written feedback from employers to help learners improve. Some learners were enrolled on funded qualifications with another provider at the same time as their CYMCA courses were taking place. Investigators also found “significantly different” planned employment, enrichment and pastoral hours for learners in the same cohort without a documented explanation. And they found CYMCA could not evidence the timetabled activity reported to DfE or that attendance registers had been signed correctly. CYMCA’s data returns recorded a central London delivery postcode, while learner evidence packs revealed delivery took place elsewhere. This meant area uplift funding was paid that the provider could not prove it was entitled to. The report did not specify how much of the £276,840 recovery related to the postcode error. Across CYMCA and Acorn Training Consultants, £495,047 in overstatements related to provision subcontracted to Gateway. The recoveries must be paid by lead providers who are accountable for subcontracted delivery. Gateway could not be reached for comment. An application to be struck off the Companies House register was filed on August 10 this year, followed by a first Gazette notice for voluntary strike-off on August 18. CYMCA was approached for comment. Nuts cracked over wrong Acorn Both investigation reports recommended stronger eligibility checks, attendance controls, data validation and subcontractor monitoring. Although traineeships were abolished in 2022 after years of low starts, the recommendations also covered 16-19 funding controls. Yesterday’s report drop alarmed staff and leaders at Acorn Training, a Stoke-on-Trent-based training provider, as it named “Acorn Training Ltd” as the subject of an investigation. A “clarification statement” published on its website, said: “Today, the Department for Education published a report on GOV.UK relating to an organisation named “Acorn Training Ltd. “Following a review by our executive team, concerns were raised directly with both the Department for Education and FE Week regarding the potential for confusion with Acorn Training Ltd. “We have since received confirmation from the Department for Education that the report does not relate to Acorn Training Ltd (UKPRN 10023489) and understand that steps are being taken to correct the published information.” The incorrectly named report remained on the DfE’s website until 5pm today, despite the department acknowledging yesterday the investigation related to Acorn Training Consultants. The department has not provided FE Week with an explanation for the error.