Metro mayors and local leaders will be allocated £283 million to “boost capacity in colleges” and offer more construction courses next year.
According to a government announcement last night, the funding will help colleges meet “surging demand” for homegrown skilled workers.
Around £100 million has been earmarked to “boost capacity specifically” in construction courses, while local leaders “will be given the power” to choose how to spend the remaining £183 million on college capacity for 16- and 17-year-olds.
Details in the announcement are limited, but the funding appears to be a second batch of post-16 capacity funding initially released to increase college places in Greater Manchester and Leeds.
The Department for Education (DfE) will also release £8.8 million in capital funding for “specialist” T Level teaching equipment and has confirmed the launch of the FE Teacher Industry Exchange pilot in January 2026.
Skills minister Jacqui Smith said: “Learning a trade opens doors to a brilliant career and a secure future, and trade workers are crucial to our mission to turbocharge economic growth.
“We’re making sure every young person who wants to become a builder, engineer or technician can get that opportunity.
“Our plan for national renewal gives young people the skills they need to get on in life while delivering the homes and infrastructure our country desperately needs.”
DfE press materials say the funding is aimed at addressing an expected 67,000 extra 16 and 17-year-olds in education by 2028, with allocations for each area due to be confirmed “in the new year”.
The government appears to be shifting control over how post-16 capacity funding is shared out to mayors and local leaders, rather than direct allocations to colleges.
It follows £20 million in capacity funding released to Andy Burnham’s Greater Manchester Combined Authority and Leeds City Council, which aims to open up an estimated 9,000 extra college places in coming years through a combination of small building refurbishments and the purchase of new properties for conversion into teaching space.
FE Week understands that a total of £375 million has been allocated to post-16 capacity until 2029-30, although details of how it will be distributed are yet to be confirmed.
In the most recent national capacity funding round, the department released about £230 million to colleges between 2021-22 and 2023-24.
Construction capacity crisis
It comes amid increasing doubts over whether the government is likely to achieve its promise of 1.5 million new homes by 2029.
According to an Association of Colleges post-enrolment survey carried out in October, 60 per cent of colleges reported limited or closed 16 to 18 enrolments for construction, higher than any other subject area.
Electrical (56 per cent), engineering (37 per cent) and education (28 per cent) also faced reported capacity issues.
Overall, 77 per cent of the 105 colleges, sixth forms and specialist colleges that responded reported a “significant increase” in demand from students.
The survey report said: “There have been persistent capacity constraints in high-demand sectors like construction and engineering where colleges face acute staffing and space shortages which have limited enrolment growth despite strong demand.
“Capacity issues are also affecting apprenticeship provision, especially in technical areas.”
Demographic change was the most frequently reported reason for increased enrolments, alongside GCSE grades, local job market health and availability of work-based training.
Pointless creating more spaces if they haven’t got teachers to actually teach students. Pay and retention in the FE sector is woeful.