> CBI pleased government now engaging with employers but say guidance ‘still raises more questions than it answers’
> System won’t be fully operational until 2020, with delay described by sector leaders as ‘pragmatic’ and ‘reducing risk’
> Mandatory cash fees for over 98 per cent of employers to proceed, leaving sector leaders fearful ‘we will lose them’

The government today kept its promise to publish more details of the apprenticeship levy operating model — but sector leaders warned it raised “more questions than it answers”.

The online document was criticised for lacking detail by the Confederation of British Industry (CBI) and Association of Colleges (AoC).

The guidance published on April 21, which had been promised in last month’s budget, also revealed the levy system due for introduction in April 2017 would not be fully operational until 2020.

And a confirmation that 98 per cent of employers would pay mandatory cash fees, caused Association of Employment and Learning Providers chief executive Mark Dawe to warn the government needed “to think very carefully” about its impact on smaller employers.

He said: “If the financial contribution they have to make is too high and the payment system is too complex, we will lose them.”

Neil Carberry, CBI director for Employment and Skills, thought the guidance showed the government was “now engaging with employers”.

But he said: “We think it still raises more questions than it answers.”
AoC chief executive Martin Doel agreed, telling FE Week there was “still much that needs to be clarified”.

The operating model also warned that the Digital Apprenticeship System would not be fully operational for all small employers until 2020.

Mr Doel said phased introduction for smaller employers “seems pragmatic”, considering “the obvious risks associated with introducing complex IT systems that will underwrite the digital apprenticeship service.”

Mr Dawe responded: “If delay means that the system will work, we would rather have that.

But there is no doubt that providers with both levy paying and non-levy paying employers will be managing potentially very complex arrangements for the next two or three years and the road to delivering 3 million apprenticeships will not be a straightforward one.”

And David Hughes, who used to be responsible for funding and contracting of all apprenticeship programmes at the Skills Funding Agency and now leads the Learning and Work Institute, agreed.

He told FE Week: “It’s good the government has realised it needs to phase implementation. The current system will be thrown out and current employers will be disaffected by all of this. So in some ways it’s a good realisation of potential risk.”

But Shadow Skills Minister Gordon Marsden warned “even a three year phased launch sounds ambitious to say the least”.

The levy, first announced by the government in July, is set at 0.5 per cent of an employer’s paybill.

As outlined in the new guidance, all employers will receive a £15,000 allowance to offset against the levy. This means only businesses with a paybill of more than £3m will pay.

The money raised will be ring-fenced, so it can only be spent on training apprentices and all levy-paying companies will receive a 10 per cent top up on monthly levy contributions.

The new guidance promised further information in June, for example on the provisional level of government support for non-levy payers’ training costs.

It added “full, draft funding and eligibility rules” would be published in October, with “final detailed funding and eligibility rules” and guidance on “how to calculate and pay” the levy due in December.

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Editorial: Pushing for a pilot

The latest apprenticeship levy operational guidance is almost totally geared at explaining how it will work for the employers forced to pay it.

This is welcome, although 5,000 words on a single government web page seems a little rushed and half-hearted.

But colleges and independent training providers remain largely in the dark about how it will affect their funding from April next year.

There is promise of ‘provisional’ detail next month, but this is a poor state of affairs when you consider the change kicks in for all new apprenticeship starts four months before the end of the 2016/17 academic year.

Despite the admission there will be a phased implementation it strikes me that everyone, civil servants included, will wonder whether switching to the levy from April 2017 is over ambitious.

Few large scale government IT projects involving multiple departments start with a national roll-out, for good reason.

So let’s hope there is a plan B, which (whisper it) might even include the not so radical idea of undertaking a pilot…

Nick Linford

A leaked government report has warned that plans to close the Department for Business, Innovation and Skills’ (BIS) office in Sheffield and move it to London could cost rather than save money.

The document marked “official sensitive”, which has been shown to FE Week, stated that while potential savings through rent, rates and maintenance, rail travel, and hotel stays stood at £1.5m, the additional London salary costs could run to £1.6m per annum.

This means that the plans, which sector leaders say would cause an “FE brain drain” if up to 240 people with specialist knowledge of skills training lose their jobs, would result in a net loss of £100,000 for the department.

It comes after the chairs of the BIS and Public Accounts Committees (PAC) urged Martin Donnelly, Permanent Secretary at BIS, to provide proof of government claims that the Sheffield closure would result in savings.

Iain Wright, chair of the BIS Committee, and Meg Hillier, who leads the PAC, asked for information on the department’s estimate of the costs of closure in Sheffield and transfer of posts to London.

Their letter sent on April 20 also stated that information previously provided by Mr Donnelly, relating to the reorganisation of the department, had been “wholly unsatisfactory” with answers in oral evidence “obfuscatory, if not misleading”.

Mr Donnelly responded with a letter of his own that explained: “The proposal to move policy roles to London forms part of a wider strategic case to enable us to deliver £350m of savings and be more effective in delivering ministerial priorities.

“They were not formed on the basis of any individual business case for a single location and our consultation is continuing.”

Lois Austin, the PCS full-time official for BIS covering the Sheffield office, told FE Week in March that widespread opposition to the plans had forced BIS to delay its consultation on them by two months.

She said: “They told us back when all this was first announced [in January] that the consultation should be completed by the start of March.

“But we’ve now been told that it will be May 2, which shows how shaken up they are by the scale of opposition to this.”

Sheffield Central MP Paul Blomfield lodged a parliamentary question to BIS requesting information on the annual cost per employee of rent, rates and maintenance for its office at St Paul’s Place, Sheffield, and Victoria Street, London.

The response, which he shared with FE Week and we asked BIS to comment on, indicated the London office was far more expensive.

It stated: “The annual cost per employee at St Paul’s Place is £3,190 and at Victoria Street is £9,750.”

A BIS spokesperson told FE Week: “We do not comment on leaked documents.

“We have a responsibility to the taxpayer to ensure as much of the department’s funding as possible is focused on front line services.

“We have deliberately set ourselves challenging savings targets consistent with the spending review and we will continue to explore options in detail before making decisions.”

Last weekend saw more than 1,800 athletes from 137 different colleges travel to Tyne and Wear for the 38th AoC Sport National Championships. The pinnacle event in the sporting calendar for AoC Sport member colleges inspired many passionate and high quality performances at first-rate venues, as FE Week reporter and football and golf fanatic Billy Camden found

Making my way up to Newcastle on Friday, I pondered how I could possibly get around to see everything that the AoC Sport National Championships had on show.

Spread across Tyne and Wear this year’s national championships featured 15 different sports, and being a keen sports fan myself I wanted to see them all.

To cater for the breadth of games, they were spread across 10 venues, with some nearly 25 miles apart from each other.

Nevertheless, with a hire car at hand I hit the road.

First up was the cricket — the first time in the national championships history that the sport had been included.

The first thing that hit me was the impressiveness of the venue.

With a first-class clubhouse and beautifully cut pitch, the college competitors were certainly being spoiled at the South Northumberland Cricket Club.

The games themselves were however being played on the equally impressive facilities inside — just as well with the cold, wet and sometimes snowy weather we experienced over the weekend.

I watched a handful of games and got talking with some of the events partners, who told me that this ground was not a one-off and I would continually be impressed with all of the venues across the weekend. They weren’t wrong.

After a quick stop at the volleyball, I was looking forward to the much talked about opening ceremony at Northumbria University.

After arriving at the venue, I was met with a sea of college students and staff who had travelled from all over England, Scotland and Wales.

As I entered the hall, I was taken aback by the sheer noise and electric atmosphere bouncing from wall to wall.

With huge inflatable balls bobbing around and spectators banging their hand clappers, this was definitely something special.

The evening’s compere, Great British gymnast Craig Heap, got proceedings underway.

Among a selfie and then flag design competition — won by the east — were inspiring speeches from England international footballer, Jill Scott, and Great British long jumper, Chris Tomlinson.

They drove home messages of team work, determination and competitiveness that struck a chord with the aspiring athletes.

After emulating the Olympics with the reading of the AoC Sport oaths, Richard Atkins, chair of AoC Sport, declared the event open.

Over the course of Saturday, we got to cover nine different sports including golf, cross country, basketball, netball, squash, swimming, badminton, table tennis and trampolining.

The spectacular venues continued, with my particular favourite being the Close House golf course, where students spotted football legend Alan Shearer the day before (I wasn’t jealous, promise).

What also struck me after watching each sport was the high level of quality on show.

The competitors qualified for the National Championships through regional tournaments, so these players were the best the country’s colleges has to offer.

The whole spirit of the event was brilliant to not only witness, but be a part of.

The banter, competitiveness, sighs of despair, and cheers of victory showed just how much of an impact this competition has on students.

Sunday promised to be another day of sporting brilliance, but with a lot of tension. It was the final day where most gold, silver and bronze medals would be decided.

We got round to the last four sports — football, hockey, rugby and tennis — before heading to the closing ceremony where the last medals were handed out, including the prestigious Wilkinson Sword trophy.

As well as competing in their chosen sport, students battled for points for their region.

The region whose teams and individuals accumulated the most points won the Trophy.

In third place was the West Midlands, in second was the South East, and for the third year in a row the South West were crowned champions.

Thunderous cheers and applause were a fitting way to end a great weekend.

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A ‘phenomenal and inspiring’ event

College leaders have spoken of the wider benefits to students’ health and aspirations as a result of investing in sport.

John Evans, principal of Yeovil College, said he believed the wellbeing of learners improved as they engaged in more sport and healthy activities, which also help break down social barriers that can sometimes separate students.

He was speaking to FE Week at the 38th AoC Sport national championships in Tyne and Wear, which students qualified for through regional qualifiers in the autumn term.

Mr Evans, who attended the national championships for the first time this year, said: “It was certainly an eye opener for me to see the sheer scale of it all.

“Seeing students meeting each other from all across the country and competing against the best in the country, I thought was phenomenal and inspiring.”

AoC Sport is a membership organisation launched 18 months ago which campaigns for every college student to participate regularly in sport or physical activity.

Mr Evans said that sport was the single biggest influencer in creating a “well-rounded” student.

“Sport is a big driver in engaging with learning,” he said. “I think that competitiveness and team bonding is extremely strong at my college and nothing has built that better than the sport curriculum.

“It engages people in learning, sets standards and gives them excellent employability skills. The whole thing comes together for me in sport.”

He also said that sporting tournaments, such as this flagship event, are a great way to encourage “all inclusion”.

Richard Atkins, chair of AoC Sport and former principal of Exeter College, said he had students competing in the national championships who had never left their own cities or regions before, “which illustrated the wider social benefits of the sport offer in colleges”.

Mr Evans added: “One of the great things about the FE sector is that we are great for all-inclusion, and I think tournaments like this breaks social barriers.

“I was watching the cross country and you would not know who was coming from what social class.

“Everybody was in it together. The camaraderie between the students was brilliant and the atmosphere was fantastic.

“It gives the students high aspirations and the chance to travel and experience new things.”

Emma Seawood-Adams, team leader for sport at Truro and Penwith College, which recently celebrated after it was the first to be rated ‘outstanding’ by Ofsted since the introduction of the Common Inspection Framework, agreed with Mr Evans that sport was an effective tool in developing students.

“Career-wise for the students, for them looking outside, it is really important to share and meet new people, so it is the extra skills they get from it to come away for a weekend like this,” she said.

Ms Seawood-Adams also said the national championships covered a breadth of sports that are not typically on offer at every college.

“Locally, where we come from in Cornwall, there is good sporting performance, but not necessarily in every sport. AoC Sport gives us the chance for the golfers, the swimmers, the cross country runners to compete like for like.”

Lynne Gardner, head of college sport and enrichment at Peter Symonds College, Winchester, added that investing in sport, and being a member of AoC Sport, had enabled the college to “raise our participation levels brilliantly”.

“We have a college sports maker through being a member and they get everyone involved. We’ve got our top teams and then our development or recreational squads,” she said.

“We’re a college of 4,000 people, and last year actively involved with recreational physical activity we had 951 students participating on an ongoing basis, which is really great.”

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Click on the image for a larger version

You can read an expert piece from chair of AoC, Richard Atkins, about the National Championship here 

A sixth form in Liverpool has become the first school to opt in to a post-16 area review, and the Department for Business, Innovation and Skills (BIS) says it hopes others will be encouraged to do the same.

South Sefton College, a sixth form school, will be joining seven FE colleges and three sixth form colleges (SFCs) in the Liverpool City Region area review, BIS revealed on April 20.

The news comes after shadow education minister Nic Dakin called it “nonsense” that schools and academies were not included in the area reviews.

When asked by FE Week why it had joined the local area review, Frank McCann (pictured), principal of South Sefton College said: “Rather than have the area review be ‘done onto us’, we have been working with a number of local colleges to identify opportunities for future developments that would emphasise the distinctiveness of our individual offer and avoid duplication of new provision.”

A BIS spokesperson told FE Week that the department welcomed South Sefton College’s decision to opt in to the review, and hoped that others would be encouraged to consider whether it would be right for them to opt in.

South Sefton College is about three miles from Hugh Baird College and about six miles from City of Liverpool College, both of which are FE colleges.

The sixth form school, which has an Education Funding Agency allocation of £2.6m for 2015/16, was established in 2009 in partnership with Sefton local authority and seven local secondary schools, according to its website.

Department for Education (DfE) figures show there are 19 such ‘state-funded secondary’ schools that only cater for 16 to 18-year-olds, 12 of which are free schools.

Guidance published by BIS last September, and updated in March, stated that the “core scope” of the area reviews would “normally” only be general FE colleges and SFCs.

Other providers “can seek to opt in to the review process if they wish”, it added.

A BIS spokesperson confirmed that South Sefton College was the first 16-18 school to have opted in to date.

No university technical colleges (UTCs) or studio schools, for 14 to 19-year-olds, have yet opted in.

James Kewin, deputy chief executive of the Sixth Form Colleges’ Association (SFCA) said it was positive that South Sefton College had chosen to take part in the review, but reiterated the SFCA’s long-standing call for all school sixth forms to be included.

“Colleges have been forced to participate in area reviews while school and academies have the luxury of opting in to the process,” he said.

“Ministers should have the courage to tackle underperformance and inefficiency wherever it exists and insist that all sixth form providers participate in the area reviews on exactly the same terms.”

As reported by FE Week, Brighton and Hove City Council voted last October to carry out its own post-16 education review to ensure that school sixth forms and independent training providers were included.

Tom Bewick, chair of the council’s children, young people and skills committee, told FE Week: “It’s good to see other areas are now following our lead.”

“You can’t have a genuine strategic area review without looking at all post-16 school, sixth-form and college provision.”

Peter Dowd, MP for Bootle, which includes South Sefton College, told FE Week he was “all for” schools and colleges working closely together.

However, he added: “I’m a firm believer in leaving the school or the organisation to make the decision itself if they think it appropriate — for whatever reason — to take part.”

Malcolm Trobe, the interim general secretary of the Association of School and College Leaders said: “Whether or not to opt in is a matter for headteachers and governors as they are best placed to make this decision.”

Liverpool City Region is part of wave three of the area reviews, along with Cumbria, London South, London East, Black Country, Coventry and Warwickshire, and Hampshire.

A DfE spokesperson said that the BIS statement reflected its own view.

The National Union of Students has voted to keep its vice president for FE for a second term.

Shakira Martin, the NUS’ outspoken vice president for FE, will keep her role for another term after succeeding in an election at the NUS’ national conference 2016 in Brighton today.

She was uncontested for the post and was elected at stage one, with 152 votes compared to only 11 votes to re-open the nominations.

Speaking to the conference floor during her election speech, Ms Martin said: “FE stands for Free Education, Further Education, for everyone.”

This year she has been the champion of a new campaign to force the government to recognise the impact that post-16 area reviews are having on learners.

The #FEunplugged campaign was officially launched in January, with the aim of raising “the profile of area reviews and making sure the student voice is not ignored during the process”.

It led to Ms Martin appearing in the cartoon (see above left) for edition 162 of FE Week.

The NUS also elected a new president, Malia Bouattia (pictured right), at conference today.

Previously the NUS’ black students’ officer, Ms Bouattia was elected in stage one of the count – by 372 votes to 328 for previous national president Megan Dunn.

She is the first black and minority ethnic woman to hold the role.

Ms Bouattia has recently caused some controversy over her religious and political views.

An open letter was reportedly sent to Ms Bouattia last week from protesters and heads of student Jewish societies asking: “Why do you see a large Jewish society as a problem?”

The letter was said to be a response to an article co-authored by Ms Bouattia in 2011, in which she said the University of Birmingham was “something of a Zionist outpost in British higher education”.

Ms Bouattia reportedly responded to the letter by saying that she was “deeply concerned” that her views had been misconstrued, and adding that she is dedicated to “liberation, equality and inclusion”.

The Department for Education’s financial statements lack “truth and fairness” according to the government’s audit watchdog.

The department (DfE) finally published its accounts for 2014/15 today, four months later than usual, after it used a statutory instrument to delay publication.

FE Week’s sister publication FE Week reported in January that the department had started getting its accounts in order after the National Audit Office (NAO) labelled them as “not acceptable on any level”.

The watchdog last year issued a rare “adverse opinion” on the department’s 2013/14 accounts after it discovered a £166 million overspend.

The issues stemmed from the department having to combine the accounts of more than 2,500 organisations – most of them academy trusts  – across different accounting periods.

Today’s publication of accounts has again been met with an “adverse opinion” from the NAO.

Comptroller and Auditor General (C&AG) Sir Amyas Morse branded the level of error and uncertainty in them as “material and pervasive”.

His probe into the department’s finances revealed it had exceeded three expenditure limits set by parliament.

Sir Amyas, head of the NAO, said: “Providing parliament with a clear view of academy trusts’ spending is a vital part of the DfE’s work – yet it is failing to do this.

“As a result, I have today provided an adverse opinion on the truth and fairness of its financial statements.

“The department will have to work hard in the coming months, if it is to present parliament with a better picture of academy trusts’ spending through the planned new Sector Account in 2017.”

A statement from the NAO said the department and the treasury were now working to develop an alternative approach to accounting for academy trusts.

The DfE is now planning to publish a separate report with accounts for academies, on an academic year basis.

Although the move falls outside the normal parliamentary spending control procedures, it considers the solution “attractive and appropriate”.

Neil Carmichael, chair of the education select committee, which questioned the department in March following the delay of its accounts, said of today’s judgement: “At a time of continued pressure on public spending, it is vital government departments file their accounts on time to enable proper, effective public scrutiny.

“We recently questioned senior civil servants at the DfE on financial management and we shall continue to keep a close eye on this area.

“In providing an adverse opinion on the DfE’s group financial statements, the C&AG has given us serious reason to question the DfE’s ability to manage its programme of educational reform.”

A DfE spokesperson said: “Academies are subject to a rigorous system of accountability and oversight, tougher and more transparent than maintained schools. This is reflected in the NAO’s finding that there are no material inaccuracies in individual academies’ statements. However, the consolidation of thousands of those accounts into the format required by parliament is one of the largest and most complex procedures of its kind.

“All of these accounts are published individually by trusts ensuring they can be held to account by the department and the public.”

The spokesperson said the department recognised the challenges with its current format and will introduce a new methodology for 2016/17.

“With the Education Funding Agency’s rigorous oversight of the academy system and the expanding role of the Regional School Commissioner we are confident that the accountability system for the expanding academies programme is robust and fit for purpose,” he added.

The chairs of the Business, Innovation and Skills and Public Accounts Committees have demanded to see key government documents relating to the cost of controversial planned closure of the Department for Business, Innovation and Skills Sheffield office.

The call was made in a letter sent today to Martin Donnelly, permanent Secretary at the Department for Business, Innovation and Skills (BIS).

It comes after BIS was accused of launching an “FE brain drain” when it unveiled plans in January to close its Sheffield office, which it is feared could lead to nearly 250 people with a wide variety of specialist knowledge of the sector losing their jobs.

Iain Wright, chair of the BIS Committee, and Meg Hillier, chair of the PAC, have now called in their letter for Mr Donnelly to release information on the department’s estimate of the costs of closure of the Sheffield office and the transfer of posts to London.

It stated: “We are asking for precise information about the work done, to estimate the cost in relation to different scenarios in relation to the closure of the Sheffield office and transfer of posts to London.”

It added information previously provided by Mr Donnelly relating to the reorganisation of the department had been “wholly unsatisfactory” with answers in oral evidence “obfuscatory, if not misleading”.

Iain Wright MP, chair of the BIS Committee, said the Permanent Secretary’s previous responses to MPs on this issue “simply isn’t good enough”.

“He is accountable for the use of public funds and needs to demonstrate the financial rationale and evidence-based business case for the decision to cut jobs in Sheffield and centralise policy making in London,” he added.

Meg Hillier MP (pictured above left), chair of the Public Accounts Committee (PAC), said: “The government must be held properly to account for its decisions and use of public money.

“In this case, effective scrutiny is being undermined by the department’s most senior civil servant. Taxpayers deserve better from those working on their behalf.”

“We expect the Permanent Secretary to respond swiftly and with clarity on the points of concern raised by our committees. Only then can the decision to close the BIS Sheffield office be properly scrutinised.”

Paul Blomfield, MP for Sheffield Central, also said: “It’s not just [a question of] how much Sheffield costs, but how much more expensive it will be to move those posts to London. I want the whole truth so that I can make my case to keep the jobs in Sheffield.”

It comes after Lois Austin (pictured above right), the PCS full-time official for BIS covering the Sheffield office, told FE Week in March that widespread opposition to the plans to centralise the department’s policy-making in London had forced BIS to delay its consultation by two months.

She said: “They told us back when all this was first announced that the consultation over the closure of the Sheffield office should be completed by the start of March.

“But we’ve now been told that it will be May 2, which shows how shaken up they are by the scale of opposition to this.

“They’re saying that centralising to London will save money and improve policy decisions.

“But we asked Martin Donnelly for evidence of the analysis they have done to prove this.”

BIS was unable to comment on the PAC and BIS committee letter ahead of publication.

However, a spokesperson for the department previously told FE Week: “There are ongoing discussions with staff members and their representatives to support staff affected, but any specifics would be confidential and so we can’t comment on anything individuals might have said.”

Mr Donnelly has previously said: “The decision to close Sheffield by 2018 has not been taken lightly. It is my top priority that all our staff are fully briefed and consulted on the process. We will provide comprehensive support to all those facing a potential change or loss of job.”

The government has today announced the employer time limit on using their levy funds, due for introduction in April 2017.

The news came in an updated guide to the apprenticeship levy and “how it will work” web page, published this afternoon.

An apprenticeship levy operating guide for employers, to be published in April, had been promised in last month’s budget.

The latest version of the guidance stated: “Funds will expire 18 months after they enter your digital account unless you spend them on apprenticeship training,”.

It continued: “Whenever a payment is taken from your digital account it will automatically use the funds that entered your account first. This will minimise the amount of expired funds.”

The apprenticeship levy, first announced by the government in July, is set at 0.5 per cent of an employer’s paybill.

As outlined in the new guidance, all employers will receive a £15,000 allowance to offset against the levy. This means that only businesses with a paybill of more than £3m – about 2 per cent of employers – will actually pay the levy.

The money raised by the apprenticeship levy will be ring-fenced, so it can only be spent on training apprentices.

All levy-paying companies will receive a 10 per cent top up on their monthly levy contributions, the government announced in the budget last month.

Details of the digital apprenticeship service (DAS) were first revealed by Keith Smith, director of levy implementation at BIS, at FE Week’s Annual Apprenticeship Conference in March.

Nadhim Zahawi, the co-chair of the apprenticeship delivery board and the Prime Minister’s apprenticeship adviser, revealed at the same conference that only levy paying businesses would have access to the DAS when it launches in April 2017.

Also speaking at the AAC, Iain Wright MP, chair of the Business, Innovation and Skills select committee, said that he didn’t see a “hope in hell” of the government’s hitting its 3m apprenticeships target.

He also criticised the government’s plans to make further announcements on the levy later in the year: “Further work will be outlined in April and further details in June. They are making this up as they go along!”

For more analysis see the next edition of FE Week