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Elmfield Training founder slapped with six-year ban for £1m withdrawal

The founder of a scandal-hit apprenticeship provider has been disqualified from acting as a director for six years after investigators found he paid himself nearly £1 million while his firm slid into administration.

Elmfield Training – one of the country’s largest providers of apprenticeships that received more than £100m in public money – was wound up in 2013 owing 180 companies more than £11m.

It followed extensive investigations from FE Week that revealed alleged malpractices at the firm – founded by Gerard Syddall – leading to a Skills Funding Agency (SFA) investigation.

But Mr Syddall finds himself embroiled in a fresh controversy this week after insolvency investigators found he personally benefited from the company to the tune of nearly £1 million – just months before it went into administration.

Mr Syddall clearly put his own interests ahead of those of the company

The Insolvency Service found the firm was experiencing cashflow difficulties at the time in March 2013 and Mr Syddall had given an undertaking to the board of directors he would not use company funds for his own benefit.

But investigators found that Mr Syddall, and people and companies connected to him, went on to receive nearly £954,000 from Elmfield.

By the time it went into administration in October that year, Mr Syddall owed the company £2.6 million.

In a scathing investigation report, released yesterday, investigator Robert Clarke said: “Mr Syddall clearly put his own interests ahead of those of the company.

“To make matters worse, this was after he had vowed to the company’s board that he would not do this.

“Directors of companies should know that this type of conduct is not acceptable and, in such circumstances, the Insolvency Service will take action against them.”

Mr Syddall has been disqualified from acting as a director until February 2022. He was adjudged as bankrupt in April 2015.

Mr Syddall was hauled infront of a Business, Innovation and Skills (BIS) select committee in 2012 and accused of a “rip off” over high profits.

He was questioned about the £12m profit made by his company in 2010, all from government funding – first revealed by FE Week. A total of £3m of that went directly to Mr Syddall as a dividend.

After FE Week revealed the firm’s “appalling” pass rate, it was given a grade four rating from Ofsted leading to Mr Syddall’s resignation as chief executive.

A BBC investigation – supported by information from FE Week – then revealed employees were “routinely asked to alter forms to claim funding for staff who never wanted to do an apprenticeship”.

The firm went into liquidation. A later SFA investigation cleared the company of falsely claiming for learners, but found “weakness in their controls that were not good practice”.

HOW FE WEEK EXPOSED IT ALL – A FULL TIMELINE OF THE SAGA:

June 2011: FE Week’s first pilot edition reveals Elmfield’s “eye-watering” pre-tax profit of £12.3 million.

June 2011: Our newspaper’s second pilot edition reveals details of Elmfield’s 18,000 six-month adult apprenticeships in level 2 retail with Morrisons.

March 2012: Ged Sydall faces select committee grilling – where he is accused by an MP of a “rip off” over the firm’s high profit margins generated from the public purse.

April 2012: Elmfield features as part of a Panorama investigation titled “The Great Apprentice Scandal”.

November 2012: Interim FE Week editor Nick Linford – editor of FE Week at the time – spoke about Elmfield’s profits as a witness to the BIS Select Committee. (Par 210 here.)

February 2013: Morrisons announces its three-year contract with Elmfield will end this year. It had an overall success rate of 58.5 per cent for the previous year.

May 2013: FE Week reveals Elmfield’s “appalling” pass rate – with just 47.5 per cent of leavers in 2011/12 walking away with an apprenticeship certificate.

July 2013: Mr Syddall resigns after 10 years as chief executive after Ofsted inspectors gave Elmfield a grade four inspection result having come across “unacceptably low” results.

Ofsted found the number of learners who completed their qualification in the expected time “continues to decline” and reached an “unacceptable low” 23 per cent in retail apprenticeships, which make up the majority of Elmfield’s provision.

Skills Minister Matt Hancock promised to take “tough and urgent action on failings providers”.

October 2013: Former chief executive Ged Syddall quits as director during Newsnight probe into alleged malpractice – supported with information uncovered by FE Week. However he still remained the majority shareholder.

The investigation found staff were “routinely asked to alter forms to claim funding for staff who never wanted to do an apprenticeship”.

October 2013: Elmfield bosses confirms they are taking steps to put the company into administration owing £11m to more than 180 firms.

November, 2013: 300 jobs are saved after EQL Solutions agreed a £1.5m to buy the majority of Elmfield’s assets.

April, 2014: A Skills Funding Agency clears Elmfield of falsely claiming for learners on the Morrisons apprentice scheme after a six-month investigation.

However it did find “some of the actions taken by Elmfield indicate weaknesses in their controls and were not good practice”.

Refugee Abel on track with long distance running

From humble beginnings, refugee Abel Tsegay is on track to become a world renowned athlete thanks to help from Canterbury College, writes Billy Camden.

Teenage refugee Abel Tsegay credits Canterbury College with helping him race towards his dream of emulating Britain’s greatest ever distance runner Mo Farah.

Feature3web — Great Britain’s Mo Farah celebrates winning the Mens 3000m Final of the Sainsbury’s Anniversary Games

The 19-year-old BTec level two sport learner, who only arrived in the UK as a refugee from his native Eritrea two years ago, is Kent Cross Country Champion and recently took part in an international competition in Belgium.

Much like his idol, double-Olympic gold medal winner and World Champion Farah, who came to the UK from Somalia speaking very little English at a young age, Abel has had a lot to overcome while pursuing a career in athletics.

He told FE Week that moving to the UK was a “scary experience”, as he struggled to communicate while training with other athletes and in the classroom, but credited his teachers at the college for helping improve his grasp of English since he began studying there in September 2014.

Abel, who trains at the college and with Invicta East Kent Athletics Club, travelled to Brussels in December to compete in the international Lotto Cross where he finished in ninth position.

He also retained the Canterbury 10 mile title on Sunday, completing the distance in 51 minutes and 36 seconds, which beat his winning time from the previous year by 27 seconds.

The teenager, who plans to complete his college qualifications and study sport science at university, also won the 2014 Liverpool Cross Country Challenge and last year’s Kent Cross Country Championship.

Reflecting on the difference that attending college has made to his life, he said: “It is good for me to study here. It means I can improve my language and my sport skills and I can learn a lot and different kinds of activities.

“I was always good at running and when I saw my idol Mo Farah at the world championships on TV, I knew that is what I wanted to do,” Abel added.

“My dream is to become an Olympic athlete and to break world records.”

Abel’s tutor, Dain Lewis, said: “Abel has embraced his new life in the UK and is already giving back to the community.

“His social life revolves around running and when it comes to his studies, Abel’s developing all the time, including his English skills.”

Sport lecturer Jemma Cullen said: “On a personal level, Abel has never been afraid to take on new challenges.

“For example, we recently took Abel canoeing and it didn’t faze him, despite the fact that he can’t swim.

“There was a point when he had to capsize himself, but it didn’t bother him at all. That is the attitude he takes to all new challenges.

“We’re very proud of him. Despite his success, he’s got decorum and poise. He’s a really well-mannered and kind young man.”

And Ms Cullen believes Abel, who felt too uncomfortable to talk about his past ordeals and instead wants to focus on the future, can go all the way to achieving his dream of becoming an Olympic athlete.

“I wouldn’t put anything past him, to be honest. If Abel carries on the way he has been, I’m sure he will.”

Main pic: Abel Tsegay at Canterbury College

Former government apprenticeships adviser Doug Richard cleared of child sex charges

Former government apprenticeship adviser Doug Richard has today been cleared of child sex charges after a week-long trial at the Old Bailey in London.

The 57-year-old American multimillionaire, whose 2012 Richard Review of Apprenticeships led to ongoing reforms, had been accused of having sex with a 13-year-old girl after meeting her via a ‘sugar daddy’ website, as reported by FE Week earlier this week.

Mr Richard told jurors that at the time he believed she was an experienced 17-year-old and insisted he would never “knowingly” have sex with a child.

“I feel terrible. I feel terrible for her and I feel terrible about myself. I feel terrible for my wife and children,” he said in court.

A jury of eight women and four men deliberated for four hours and 15 minutes before finding Mr Richard, of Islington, north London, not guilty of three counts of sexual activity with a child, one of causing or inciting a child to engage in sexual activity and a charge of paying for sexual services.

The Richard Review of Apprenticeships, which recommended giving employers control over apprenticeship funding, has continued to impact on the FE sector since its publication in 2012.

As well as apprenticeships, he worked closely with the government as a member of the Small Business Task Force, which advised Chancellor George Osborne and Prime Minister David Cameron.

Copy and image credit: Press Association

Survey helps us deal with skills gap

The UKCES Employer Skills Survey is one of the largest of its kind in the world. More than 91,000 employers across the UK are interviewed to draw together the data contained within the report, creating a comprehensive insight into the ways employers train and develop staff, as well as their experiences of where skills are lacking, and what those skills may be.

The results of the 2015 survey show us that employers are seeing a return to growth. There were a total of 928,000 vacancies reported in the 2015 survey – a 42 per cent increase from 2013 and the equivalent to almost 300,000 more opportunities for those hunting for work. This is a continuation of a trend seen since 2011, following recovery from the recession.

But although vacancies have risen, skill-shortage vacancies – where employers are unable to fill a vacancy due a lack of applicants with the right skills – have also grown. Employers are having difficulty finding the skilled people they need. In fact, skill-shortage vacancies have risen by a massive 130 per cent since 2011.

Skills issues are also not just tied to recruiting new employees, as many UK employers also face challenges in relation to getting the most out of their existing workforce. The Employer Skills Survey found that 14 per cent of establishments reported having staff who were not fully proficient in their role – a total of around 1.4 million.

More significantly, the survey also reveals that more employers who report having skills gaps have noticed an impact as a result. This is also particularly felt among smaller businesses – a concerning issue given that employers with less than five employees make up around half of all UK employers.

These figures show that the skills landscape in the UK is an increasingly complex one. On the one hand we have a surge in opportunities – fantastic news for those still desperate to get a strong foothold on the career ladder. Yet, on the other hand, it is clear that a major disconnect still exists between what employers desperately want, and the skills that people really have.

Clearly, there is a crucial role for the FE sector to play in resolving this, and better understanding the problem undoubtedly goes a significant way to helping create an effective solution. Delving deeper into our data can offer further insights into just what skills employers are so desperate to see.

In terms of the skills lacking in applicants, problem solving and analytical skills were both cited more frequently than reading, writing and numerical skills. When asked about skills which were present, but in need of improving, time management and customer handling skills dominated the responses.

A similar picture is also seen among existing employees, with over half of employers reporting time management and team working skills as being in need of improvement. Problem solving skills were again among the most absent among existing employees, while once more literacy, numeracy and IT skills were far easier to come across.

This clear shift towards softer personal and people skills presents new challenges for the FE sector. Employers are increasingly looking for far more than technical competency when recruiting, with recruits needing to be able to demonstrate experience in more pastoral capabilities that underpin good management.

But challenges bring with them opportunities, and using robust labour market intelligence – such as the Employer Skills Survey – to help shape training, courses and curricula and wider working practices to better develop and utilise people’s skills to meet employers’ needs.

Such intelligence can also provide high quality careers information, about jobs and what employers require, enabling young people to make effective, long term career choices based on the demands of employers in a particular sector or geography.

Lesley Giles is deputy director at the UK Commission for Employment and Skills. For more information on the Employer Skills Survey, and to view the findings in full, visit www.gov.uk/ukces

Editors comment: Honesty is the best policy

Take a moment to empathise with the Central Delivery Service (CDS) advisers at the Skills Funding Agency.

As if what must feel like annual restructures at the Agency were not stressful enough, they represent the front line in communications with embattled providers.

On the 23 December last year they dutifully emailed colleges and training providers to “confirm the outcome of any 16-18 growth requests” would occur as planned, by 8 January.

Yet as FE Week went to press, nearly a month later, there remains little to no news about when or whether the apprenticeship growth requests will be granted.

What we now know is an unrelated budget mess at the DfE is to blame.

Do civil servants at the DfE know what damage this does to the relations between providers and their SFA CDS adviser?

And even if they do, will they even care?

History has shown that these growth requests are granted in the end, but at what cost to the very human relationship between funder and provider?

Communication is key, and a DfE claiming to be committed to transparency should practice what they preach.

Click here to read our story on the chaos of 16-18 apprenticeship growth funding requests

Employer Skills Survey in limbo after funding cut

Questions remain over the future of the UK’s largest employer skills survey, with indications that responsibility for labour market information could fall to local enterprise partnerships (LEPs) in the future.

The Employer Skills Survey (ESS), published every two years by the UK Commission for Employment and Skills, examines the skills challenges facing employers and is based on interviews with around 90,000 UK businesses.

Its future has been in question since the government’s spending review in November, when it was announced that the UKCES would have its budget cut. Earlier this month the Skills Minister, Nick Boles confirmed that the government would be withdrawing funding during 2016-17.

No announcement about the future of the survey has been made. When asked by FE Week if this year’s UK-wide survey would be the last one, a UKCES spokesperson said discussions were still ongoing.

Speaking at a parliamentary evidence session on Monday, Mr Boles said it was the “obvious role” for LEPs to have responsibility for labour market information.

“Who should take responsibility for knowing more about the labour market at which level?” he was asked by Neil Carmichael, joint chair of the sub-committee on education, skills and the economy.

“It always seemed to me at least that it’s the absolutely obvious role for a local economic partnership to be gathering the data and then translating it into various conclusions,” Mr Boles replied.

“I would have thought it was a good use of their time and their budget,” he added.

David Hughes, chief executive of Learning and Work Institute, warned that it would be a “backward step” if the ESS did not continue to be UK-wide.

“As devolution quickens, the need for a single, consistent, comparable set of data about the labour market heightens,” he said.

Jo Lappin, chief executive of the Northamptonshire Enterprise Partnership, agreed with Mr Boles.

“Having a really good handle on both growth and replacement demand will mean that LEPs, working with their education and training providers, will be able to collectively deliver properly planned provision,” she said.

Ann Limb, chair of the South East Midlands LEP, agreed that it would “make sense” for LEPs to take over responsibility for gathering data on the local labour market.

“All LEPs base their strategic economic plans on evidence drawn from local labour market intelligence and so it would make sense for us to continue and develop this practise in the future,” she said.

The ESS 2015, published on Thursday, said vacancies that go unfilled because employers can’t find workers with the right skills are a “growing challenge” to UK businesses.

It found that 23 per cent of vacancies went unfilled because of skills shortages – a proportion that has not changed since 2013, despite 42 per cent growth in the number of vacancies in the UK overall.

Companies in the electricity, gas and water sector had the biggest shortage of skilled workers, the survey found, with 36 per cent vacancies last year, up from 23 per cent in 2013 (see table, right).

The 243-page report, made up of interviews with businesses across all sectors of the UK, revealed that jobs in skilled trades, machine operating and professional roles were most affected. Reading, writing and numeracy were among the skills the employers said prospective employees were lacking, with around 25 per cent of applicants falling short in those areas.

The skills gap within employment has fallen since 2013, but 14 per cent of employers still report that they have employees who don’t have all the skills they need to do their job. The survey also revealed “over two-thirds of employers that had difficulty filling their vacancies solely as a result of skill shortages had experienced a direct financial impact through either loss of business to competitors, or increased operating costs.”

A spokesperson for the Department for Business, Innovation and Skills (BIS) said: “We are discussing the future of the valued Employer Skills Survey with UKCES and other stakeholders, including other government departments, devolved administrations and LEPs.”

Should LEPs be responsible for the ESS in future?

YES

Jo-Lappinweb — Jo Lappin, chief executive, Northamptonshire Enterprise Partnership

“The availability of a skilled workforce is essential to the economy, with almost every employer seeing skills as one of the most important issues for the continued growth of their business.

“LEPs therefore really need to understand what is happening in their labour market and make sure that the education and training system is delivering the skills needed by businesses and the wider economy.

David-Hughes-cutoutweb — David Hughes, chief executive, Learning and Work Institute

“The Employer Skills Survey provides a rich set of data which is invaluable to all sorts of organisations and people across the UK. It provides good evidence to policy makers and commissioners about what’s needed from public investment to support employer and individual investment.

“We are keen that this research continues in the future, whatever that future holds for UKCES. A national survey, carried out once every two years and accessed by hundreds of organisations is a very efficient way to gather this intelligence and it would be a backward step if it did not continue in some form.

“As devolution quickens, the need for a single, consistent, comparable set of data about the labour market heightens.”

Robot hands out canapés

Oscar the robot helped host the official unveiling of £2m-worth of hi-tech engineering facilities at Nelson and Colne College.

The new department features a subsonic wind tunnel, along with workshops equipped with the latest technology and software, such as computerised numerical control machinery.

It is aimed at helping the college’s engineering students learn the skills needed to help them get jobs in Lancashire’s manufacturing sector.

On the launch night, interactive robot Oscar spent time talking to guests about apprenticeships and giving out canapés from the college’s restaurant and bistro.

Nelson and Colne College’s assistant principal for enterprise and engagement, Alison Rushton, said: “This is such an exciting time for the college, and we are looking forward to seeing school, college and adult learners, as well as employers, benefit from this outstanding skills facility.

“Manufacturing forms the largest private sector employment for Pendle, so there really is no better time for students to get ready for their future with Nelson and Colne College.”

Main pic: Oscar the robot hands out canapés to principal of Nelson and Colne College Amanda Melton

Passing road accident test

Public services learners at Suffolk New College had their leadership skills put to the test when they were tasked to deal with the aftermath of a serious road accident.

The group were given different roles in the simulation which tested the knowledge learned on their level three course.

Some students played the part of those injured in the “accident”, while others took on the role of paramedics, police, journalists and members of the public.

Tutor Martin Memory said: “The students attended a scenario where the driver of a car suffered a heart attack and crashed into two pedestrians.

“They each had various roles to play and the purpose of the simulation was to learn how to deal with a serious situation.”

Mr Memory, who previously served as a sergeant with Suffolk Police, said the exercise was useful for the students who are likely to use their qualifications to pursue careers in the emergency services.

“Exercises such as this bring the classroom to life,” he added. “It’s always important to learn by doing and using role play helps students to put their skills into practice.”

Main pic: Public services students deal with the aftermath of the road accident simulation

In the frame with photo agency

Photography learners at Central College Nottingham have launched their own commercial photo-agency.

The young snappers will run Focus Central out of the college’s photography department and will give up to 20 students on the photography foundation degree course real-life work experience of how a business operates.

Central-College-Nottingham2web — A shot of Newark Castle in Nottingham which the college snappers were commissioned for

Students will take on assignments such as family portraits, weddings and events including PR and product launches.

“We are really confident that we are going to be able to deliver a professional service,” said 21-year-old foundation degree learner Samantha Dawn. “We have already got two weddings booked even though we officially launch next month, which is really great for us.

“Everyone hopes that the business will build up and we want to be doing as many jobs as possible.”

The money the learners generate through any bookings is put back into the agency to fund student trips to see other creatives’ work and put on future exhibitions.

Main pic: From left: Central College Nottingham photography learners Klaudia Tomiak, aged 20, Samantha Dawn, 21, and Aaron Greco, 20