NAO report critical of BIS and SFA bureaucracy reform

Government efforts to reduce bureaucracy in further education (FE) lack clarity and the complete picture, according to a report released today.

Issued by the National Audit Office (NAO), ‘Reducing bureaucracy in further education in England’ is critical of the Department for Business, Innovation and Skills (BIS) and Skills Funding Agency (SFA) approach to reform.

It highlights a lack of indication of how much the new system should cost, the impact of the reductions proposed and of the changes made by others.

Although admitting that providers welcome changes, the NAO say they “do not have confidence the simplification of the system of administration will be sustained”.

It also reveals the cost of bureaucracy in FE is around £180 million a year to colleges – rising to £250 million including other providers – for administration of funding, qualification and assurance systems, equating to £150 per student.

BIS and SFA have the ambition to make changes to simplify the system, but they must get to grips with the issues we have raised in order to achieve value for money and prevent colleges being embroiled in red tape.”

The NAO recognises the work being undertaken by BIS and the SFA to pursue initiatives to simplify these processes, but declares they are not “well coordinated” and “they do not know the scale of the problem faced” by FE colleges and providers.

Therefore, BIS and SFA, say the NAO, should set “a clear, ambitious target for the scale of the burden reduction they are seeking” to provide more impetus to change.

Amyas Morse, head of the NAO, said: “Our estimates show that substantial savings can be made by reducing bureaucracy in FE and demonstrate the need for focused and systematic management of these costs to drive sustained improvements in efficiency.

“BIS and SFA have the ambition to make changes to simplify the system, but they must get to grips with the issues we have raised in order to achieve value for money and prevent colleges being embroiled in red tape.”

Although welcoming the report, the SFA is on the defensive, saying they “take a different view” on the approach used by the NAO.

A statement from the Agency said: “FE providers have been given almost complete freedom to respond to the demands of employers, communities and learners.

“This inevitably creates opportunities to reduce burdens, but these are a result of policy changes rather than their driver, as the NAO approach seems to presume.

“The report also has not sought to distinguish between administrative requirements essential for good stewardship of public money and those that may be unnecessary.

“Finally, while we agree we must ensure no unnecessary burdens remain as we undertake this radical change, the estimates made by the NAO of the potential burden cost savings are at best speculative as they are not grounded in sufficiently robust evidence to be reliable.”

FE and Skills Minister John Hayes said the government will “fast-track” further work to measure the impact of reforms on colleges.

He added: “This report illustrates the considerable progress the government has already made in reducing bureaucracy in FE, identifies the scale of the challenge we inherited and highlights the urgency of our task.

“We are moving at pace to cut red tape and empower the sector to respond more flexibly to the needs of learners and businesses, and many of these reforms have been effective since the NAO undertook its research earlier this year.”

Martin Doel, Association of Colleges chief executive, said there are three main causes for “excessive bureaucracy” in FE.

He described them as “multiple agencies and departments overseeing the sector’s work, rapid policy changes which have led to the layering of incremental regulation and an inherent complexity” driven by wide range of courses, providers and students.

However, Mr Doel added: “While applauding the NAO’s sentiment we must at the same time reflect the healthy scepticism of our members, who have witnessed the unveiling of a number of bureaucracy-busting initiatives since incorporation that have sadly withered on the vine.

“We should also be wary of cuts in front-line funding that are presented as efforts to reduce red tape.

“We sincerely hope that this Government’s strong emphasis on institutional autonomy will ensure that reforms of funding, qualification and assurance systems lead to sustainable cost-savings for colleges and UK plc, while at the same time continuing to support high quality college courses and ensuring the most effective and responsible stewardship of the public purse.”

(Read our interview with Chris Shapcott, National Audit Office director of regulatory reform, here)

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  1. I don’t get why this only concentrated on BIS? Surely one of the main problems we have is BIS asking for one thing and DfE for something else? Come 13/14 this is going to become ridiculous for providers that deal with all learners…
    Mind you, “it costs a lot of money so we must be able to save some” is a rather poor hypothesis isn’t it? 3.6% of funding used to make sure the funding’s been spent properly seems like a reasonable overhead to me?

  2. But will the Government listen? Cutting red tape is good. Slashing the numbers of people whose job it is to ensure quality and value for money is entirely different.

    Where is the value for money, for example, in the National Apprenticeship Service matching service which does nothing for quality of delivery that couldn’t be done for a fraction of the price by the private sector?

  3. Roger Miller

    I wonder if the Learner Registration Service and the Unique Learner Number was within the NAO remit? There is only a passing mention of the ULN. I see that in 13/14 there is a proposal to introduce validation of names between the ILR and the LRS. That should be fun!