Apprenticeship employers were among the latest round of offenders named and shamed for failing to pay the national minimum wage.

Business Minister Jo Swinson (pictured) named 70 employers who had failed to pay the minimum wage. They owed workers a total of more than £157,000 and have been hit with more than £70,000 in financial penalties.

A BIS spokesperson told FE Week that “some of the employee underpayment cases did involve apprentices” but she declined to identify individuals or each of the firms.

It brings the total number of companies identified as minimum wage offenders to 162 since the naming and shaming regime came into force in October two years ago.

Ms Swinson said: “Naming and shaming gives a clear warning to employers who ignore the rules, that they will face reputational consequences as well as financial penalties.”

She added “We are helping workers recover the hundreds of thousands of pounds in pay owed to them as well as raising awareness to make sure workers are paid fairly in the first place.”

The government has also announced a £3m increase in HM Revenue & Customs’ £9.2m minimum wage enforcement budget to help fund more than 70 extra compliance officers.

A proposed 2.6 per cent rise in the National Minimum Wage for apprentices has been branded “measly” by National Union of Students (NUS) vice president for FE Joe Vinson (pictured below)

The Low Pay Commission (LPC) has put a £2.80 an-hour minimum to the government while rejecting Business Secretary Vince Cable’s proposal to shift apprentices up onto a par with the 16 and 17-year-olds’ rate — currently at £3.79 an-hour.

The LPC argued that such a move could affect 200,000 apprentices with the cost to employers hitting at least £160m each year, possibly “much more”.

Mr Vinson said: “A measly 2.6 per cent increase from £2.73 to £2.80 an-hour for apprentices in their first year and those aged 16 to 18 will do nothing to help the cost of living crisis that apprentices are currently facing.

“It’s appalling to see a rejection of raising the apprentice minimum wage to the 16 to 17-year-old rate. The fact the LPC admits that a rise would benefit nearly 200,000 apprentices is an overwhelming reason to do it.”

Just days before the LPC recommendations were released the NUS had already issued a damning report on the issue of apprentice pay, labelling the current minimum wage of £2.73 an-hour “exploitative”.

The 21-page Forget Me Not report (pictured below right) painted a bleak picture of apprentice finances and called for the scrapping of the apprentice minimum wage, arguing that learners “should be entitled to at least the national minimum wage for their age”.

It also recommended, among other things, free transport for all 16 to 19-year-oldsand extending the bursaries available to students in FE to apprentices. Mr Vinson said: “Paying apprentices such an exploitative wage has led to the situation we are in at the moment, where apprentices are forced to work in the evening to make enough to live and run up huge credit card debts because they’re excluded from student bank accounts.”

With the Apprentice Pay Survey 2014 having showed how younger apprentices were being hit hardest by minimum wage non-compliance as nearly a quarter were underpaid, the LPC said it had been asked by Dr Cable to consider whether the structure of the apprentice rate could be simplified in “order to improve compliance”.

It agreed with the Business Secretary that higher-level apprentices should earn the ‘normal’ worker national minimum wage, for which a 20p rise to £6.70 was recommended, but said there were “significant risks” in merging the apprentice rate with that 16 and 17-year-olds.

“It would mean an unprecedentedly large increase in the value of the rate, of between 39 and 88 per cent,” said the report.

It added: “The cost to employers would be at least £160m each year and could be much more. That would be around half the total cost of the recommended increase in the adult rate, and at a time when there are other funding pressures on employers in England from possible mandatory cash contributions to training.”

The Department for Business, Innovation and Skills said it had “gone all out to support apprentices”.

A spokesperson said: “The government will now consider the LPC’s recommendations and respond in March. Once the government has responded, the regulations to change the rates will be debated in Parliament before the new rates are introduced on October 1.”

Shadow Skills Minister Liam Byrne has pledged a Labour Government would not raid the 16 to 19 budget to pay for early years’ or schools provision.

Labour had promised to include 16 to 19 provision within an education budget ringfence, which currently ends at 16, but had not previously committed to protecting it from being raided for other provision.

However, at the City & Guilds’ Skills Debate For Prosperity and Growth at London’s Mansion House on Wednesday (February 26), Mr Byrne went one step further, saying the 16 to 19 budget would be protected within the ringfence.

He told FE Week Labour “would not” take from the 16 to 19 budget to fund other learning within the same ringfence, adding the party’s policy was “about an £8bn spend on FE 16 to 19 provision”.

“If you protect it in real terms, that means you grow the 16 to 19 budget by £400m over the course of the next parliament,” he said.

The Liberal Democrats were the first to announce a plan to include 16 to 19 provision in the education budget ringfence but stopped short of pledging specific protection within the ringfence, although in June a spokesperson said that to move large amounts of money from one end of the wider age group to the other was not “consistent with the policy”.

Education Secretary Nicky Morgan has said the Conservatives would maintain the ringfence for five to 16-year-olds earlier, but did not commit to protection for early years or FE budgets.

Mr Byrne’s comments followed a Question Time-style panel debate, which also included Skills Minister Nick Boles, Liberal Democrat Sal Brinton, Confederation of British Industry director general John Cridland, Trades’ Union Congress general secretary Frances O’Grady, and was chaired by journalist Andrew Neil.

The debate, in front of an audience of around 150, focussed on how to solve the skills gap — an issue which Mr Neil said was “vital to our future and our economy”.

On the eve of the release of the skills funding letter [see front], many audience members raised questions about how the FE sector would continue to deliver the training needed to boost UK skills in the face of predicted cuts.

Although the contents of the letter had not yet been revealed, Mr Boles said: “I don’t suppose it’ll surprise anyone to learn that there are some biggish cuts to everything except apprenticeships.”

However, he pointed to government protection and growth of apprenticeships.

He said: “If you are in the business of providing FE, and you moved into apprenticeships in a big way, then you have moved into a fuller stream of government funding, but if you have stayed traditional full time FE and not diversified then you will have had to make some very difficult cuts in budgets.”

Mr Cridland also called for changes to full time vocational qualifications and to GCSEs.

He said: “If the participation age is being raised to 18, what is the point of having terminal exams at 16?

“We should abolish GCSEs and rebrand high quality vocational qualifications as vocational A-levels — they are a recognised gold standard.”

Ms O’Grady said there had been too much change in the system under successive governments saying skills problems were “deep-rooted and long-running but the last thing many of us want is another rearranging of the deck chairs”.

However, Mr Boles argued there had been “a certain amount of consensus and continuity” between recent governments.

“The most important element of that is on the increasing importance of English and maths, without which nothing else works,” he said.

“David Blunkett years ago started his review focussing on English and maths and we’ve carried out reviews and we’re insisting everyone continuing English and maths until they reach a certain standard.”

Lady Brinton told FE Week a focus on literacy should include English for Speakers of Other Languages (Esol) provision, but said the funding should be directed through Local Enterprise Partnerships.

“Then the funding can respond to local needs — there’s no point in providing the same level of Esol in Cornwall and Devon as there is in inner-city Birmingham,” she said.

Ms O’Grady also called for employers to be made to offer more workplace training.

“A third of employers don’t train at all,” she said.

“We need to recognise that the voluntary approach to investment in skills has failed.

“The picture on employer investment has not shifted substantially and in fact is getting worse so we need to tackle the idea that if left to the market there will be a rescue because frankly there isn’t.”

Professor Alison Wolf has called for more to be done to involve employers in college assessment and delivery after the government reported for the last time on progress in implementing reforms in her 2011 review of vocational education.

She also stood by her study programmes recommendation, which has prompted a rise in the number of learners taking up English and maths in an effort to gain at least a C grade GCSE or equivalent.

One of Professor Wolf’s recommendations for colleges was that the “assessment and awarding processes used for vocational awards should involve local employers on a regular basis”.

But, she told FE Week: “I’m not sure what else government could have done because our bizarre system it is to a large extent up to the awarding bodies and after that to Ofsted, but I don’t feel we have made as much progress as I would have liked in getting employers really involved in the assessment and delivery in 16 to 18 vocational education in colleges.

“I want us to get to a place, as in say Denmark or indeed France, that when you are doing your final exams on a level two or three vocational, occupational qualification, it is routine that employers are involved, not at the national level, but the local level.”

Professor Wolf defended study programmes, which were implemented last August and have seen the number of learners aged 16 to 19 requiring additional English and maths tuition rocket, adding: “I certainly didn’t expect learners to be put in for four GCSE resits in the course of two years, but I think that’s right.”

Of the 27 recommendations made by Professor Wolf in 2011, the government claims 20 are in place, another is partly enacted, while six are in the process of implementation.

Professor Wolf said: “I would not have expected, from my knowledge of government, that so many of my recommendations would have been put through with thought, and care and speed, and they were.”

Deborah Ribchester, senior 14 to 19 curriculum policy manager at the Association of Colleges (AoC), said study programmes had presented colleges with a “major challenge” in finding extra teachers and exam facilities, but that she recognised “the benefit it will bring to students”. She said: “Continuous professional development for maths teachers, also recommended by Professor Wolf, means staff will be better able to support these students.”

Association of Colleges chief executive Martin Doel (pictured) has told of his fears that more job losses could be about to sweep away FE and skills staff after it was announced provider budgets would be slashed by up to 24 per cent.

He said that with the average college having made 105 redundancies since 2009/10, he feared for the workforce as providers sought to balance their budgets in light of the latest government cut to FE and skills funding.

The Adult Skills Budget (ASB) is to fall 11 per cent next financial year, it was revealed on Thursday (February 26), and Skills Funding Agency (SFA) chief executive Peter Lauener has predicted this will translate to a 17 per cent cut next academic year.

But with £770m of apprenticeship money protected, and traineeship and English and maths funding prioritised, those who offer little or none of this provision could see their allocation, due out in just over a fortnight, fall by up to a quarter — even bigger than last year’s 15 per cent cut.

Mr Doel said the cuts were a “further blow to colleges and their current and future students”.

He said: “An additional major concern is how colleges, after suffering such considerable cuts, can continue to attract and retain the best staff. It is worth noting that the average college has made 105 redundancies since 2009/10 and we fear this figure will grow.”

The comments were echoed by Malcolm Trobe, deputy general secretary of the Association of School and College Leaders, who said: “The effect on colleges is potentially devastating. This sector has already suffered massive real terms cuts in funding and this announcement will put it under even greater financial pressure. It threatens the very financial stability of some colleges.”

Stewart Segal, chief executive of the Association of Employment and Learning Providers, said that with the apprenticeship protected “we need to see growth during the year if we are to meet employer demand”.

Some providers, he said, are at an early stage of developing their traineeship programmes and therefore their “carry-over will mean that they will require a higher budget for next year”. He further warned there would be “huge pressure on the rest of the budgets” with English and maths also prioritised, “inevitably resulting in some groups of learners not being able to access funding and this could include high priority groups such as the unemployed”.

Shadow Skills Minister Liam Byrne meanwhile accused the Conservatives of “hollowing out” the ASB, while University and College Union (UCU) general secretary Sally Hunt described the cuts as an “act of wilful vandalism that will decimate FE as we know it today.”

David Hughes, chief executive of the National Institute of Adult Continuing Education (Niace), said: “It is staggering that there is not more outcry about this drastic and sustained reduction in funding particularly given the clear consensus about the genuine threat that crippling skills gaps and shortages pose for UK economic growth.”

And Dr Mary Bousted, general secretary of the Association of Teachers and Lecturers (ATL), said the cut “looked like nothing less than a deliberate attempt to destroy the sector”. “It has already been battered by excessive cuts,” she said.

Joe Vinson, National Union of Students’ vice president for FE, said: “It’s appalling the government wants to reduce investment in skills when we need to stimulate the economy and give people the opportunity to gain work.”

Dr Lynne Sedgmore CBE, executive director of the 157 Group, said the predicted cuts meant she was looking at “new forms of social investment to sustain the future of high quality and accessible skills training for all”.

“We are working with the government to ascertain where legislative change may be needed in order to achieve this vision and to support the simplification of processes that may currently prevent innovation,” she said.

A spokesperson for the Department for Business, Innovation and Skills conceded the cuts would be “challenging for the sector”.

But, she said: “The sector was made aware at the time of the last spending review that government funding was reducing and of the need to look to generate other income streams, creating sustainable business models for the future. Private investment in skills training is high so government funding — although important — is not the only
funding available.”

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Editor’s comment

There was no real surprise in the 5 per cent overall budget cut and little shock at the 11 per cent fall in the next financial year’s adult skills budget.

The SFA said this would look like translating into a 17 per cent cut to academic year allocations — but apprenticeships, traineeships and English and maths are the government order of the day so if you provide little or none of these expect your funding to fall by up to a quarter.

And while some question why these are prioritised, others question why higher education appears relatively unscathed and others still ask why older learners under BIS’s care aren’t afforded the same funding protection as that enjoyed by (some) DfE learners.

It’s not as if current funding levels are having no effect — just ask retiring157 Group executive director Dr Lynne Sedgmore to tell you about the rumour of 50 colleges in financial turmoil.

Jobs and provision might offer uncomfortable savings, but just how much more can be cut?

FE and skills has long been trying to shake off the Cinderella sector cliché, but what the government is instead discarding without the sector’s consent is its proud position as the ‘second chance’ saloon for adults to get on in life.

Chris Henwood

chris.henwood@feweek.co.uk

Labour should use extra funding pledged to reduce university tuition fees to help support the FE sector, Association of Colleges (AoC) chief executive Martin Doel has said.

Responding to Labour leader Ed Miliband’s announcement today that his party would reduce the cap on tuition fees charged by higher education institutions from £9,000 to £6,000 a-year, Mr Doel welcomed assurances from Labour that FE funding would not be diverted to fund the cut, a possibility the AoC has warned of before.

But Mr Doel said Labour should go further by using extra cash to support the FE sector. His comments come after FE Week exclusively revealed providers faced a budget cut of up to 24 per cent in 2015/16.

Mr Doel said: “All young people should be supported on whatever pathway they choose post-16 and this is why we would like to see the extra money that the party is finding to support a traditional university education equally used to benefit the higher professional and technical education that equips people with the skills for the workplace.

“We previously had concerns about where the new money would be found to fund a cut in university fees and we’re pleased that they will not be taking it away from FE which has already seen massive cuts in the past few years.”

Announcing the tuition fee policy, Mr Miliband said: “These are fair choices, fair choices that allow a better future for our young people, a better future for Britain. Britain must not penalise the young, if we’re going to prosper in the future. Our economy and our country can’t afford to waste the talent of any young person.

“Let me say to Britain’s young people: I made you a promise on tuition fees. I will keep my promise. I don’t simply want to build your faith in Labour, I want to restore your faith that change can be believed. I owe it to you. We owe it to our country.”

Labour has said the £2.7bn cost of the cap change will be funded by reducing tax relief for people on very high incomes paying into pension schemes so it is set at the same rate as for basic rate taxpayers, capping the total eligible for tax relief in a lifetime at £1m and limiting the annual sum eligible for tax relief at £30,000.

Dr Lynne Sedgmore today announced plans to retire from her executive director’s role at the 157 Group later this year.

She has served in the role for seven years and her retirement will bring to an end 35 years working in the FE sector.

She told FE Week: “I have loved my 35 years in the sector and have never wanted to be anywhere else.

“The work that FE colleges do for a huge cross spectrum of students is totally amazing, we truly transform lives for the better.

“I will miss colleagues and professional friends but in my 60th year, it feels time for a new and different life. I have plenty of things I want to do, places to go and adventures still to be had.”

Before leading the 157 Group, Dr Sedgmore was chief executive of the Centre for Excellence in Leadership between 2004 and 2008 and has also served as principal of Guildford College, vice principal of Croydon College and head of Croydon Business School.

She was award a CBE in 2004 and this year was  featured on the Debrett’s list of the UK’s 500 most influential people.

She is also a fellow of the Royal Society of Arts, the Institute of Directors and is a Chartered Marketer and the University of Surrey.

Sarah Robinson, 157 Group chair and principal of Stoke on Trent College, said: “Under Lynne’s leadership, the 157 Group has become established as a major organisation in the sector, an influential body fulfilling Sir Andrew Foster’s vision that principals of large, successful colleges should play a greater role in policymaking.

“Lynne has been instrumental in helping to raise the profile of further education, highlighting the social and economic mission of FE colleges and the important role they play in collaborating with employers and others to develop local economies.

“She has stimulated debate, supported research and facilitated the sharing of effective practice across the sector, especially in teaching and learning.”

Dr Sedgmore is expected to step down once a chief executive has been appointed to replace her.

“Her contribution to the 157 Group, and to the wider further education and skills system, has been enormous,” said Ms Robinson.

“Part of her legacy will surely be the increasingly positive light in which further education is viewed as an alternative gateway to sustained employment and a successful life.”

You can read FE Week’s profile of Dr Sedgmore here.

Visit here to take part in the 2015 survey.

It’s that time again!

The second annual FE Week survey launches today with the aim of taking the sector’s pulse and delivering the results just in time for the general election on May 7.

And just like last year you could win an iPad Air and an FE Week subscription just for taking part.

The state-of-the-nation survey, again just like last year, is a joint project with the Policy Consortium and is open for a fortnight, closing on March 17.

“With the General Election less than ten weeks away, how has the Coalition Government fared in its stewardship of the FE and skills sector?” said Ian Nash, Policy Consortium member, freelance writer and journalist.

“The second annual survey by the Policy Consortium and media partner FE Week, launched today, will provide some measure of what staff and managers at all levels and all types of institution think.”

The wide-ranging survey embraces issues of governance, funding, Ofsted, learners, curriculum, local enterprise partnerships and plenty more besides.

It is aimed at, but by no means limited to, support staff, lecturers, directors, principals, chief executives and beyond, including those who work in unions, professional bodies and agencies.

Chris Henwood, FE Week editor, said: “The astounding success of last year’s survey meant there was no option but to do it again this year, especially with the promise of being able to deliver the sector’s message to political parties ahead of the election.

“What better reason to determine the views, priorities and moods of those in our sector about what is happening to it, what really matters and, indeed, what keeps those who work within it up at night.”

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Survey offers opportunity for ‘considered critique of current policies and strategies’

The first survey, Taking the pulse of education — the Great FE and Skills Survey of 2014, drew attention to serious shortcomings and misgivings, writes Ian Nash.

People responding used it to give a considered critique of current policies and strategies, not as an opportunity for a whinge-fest.

It is, therefore, worth reminding FE Week readers of some key findings (reported in edition 100 of FE Week, dated April 28, 2014 — see right) in advance of the 2015 survey.

Three concerns stood out, in well over a thousand responses, as meriting serious attention.

First, there were extremely high levels of concern over institutional funding, notably among the most senior staff best placed to measure the impact of spending cuts.

With pre-16 budgets protected, universities funded through fees and apprenticeships a priority, the already least-well resourced FE and adult provision was taking the greatest hit.

Second, there was considerable concern over the pace of change, whether in funding mechanisms, curriculum content or institutional arrangements.

The survey revealed a picture of sheer frustration as staff said they had little or no opportunity to get on and do a good job before the rules were changed yet again.

Third, there were serious criticisms of the way funds were being switched away from colleges and other providers, partly as an effort to cut costs, apparently without due regard for the consequences. Notable among such concerns was the greater use of large contractors and a proposal to transfer apprenticeship funding to employers.

Providers echoed concerns expressed by national organisations over the impact on engagement of small and medium-sized enterprises.

Also, the shift of funding for learners with costly, high-level special needs from the colleges to local authorities was attacked for dismantling a system that was understood and worked reasonably well, in favour of one that threatened to destabilise provision and restrict opportunities for vulnerable learners.

Ofsted came in for criticism too, with many respondents sceptical that it was independent of government and damagingly inconsistent in its judgments at local level, despite the inspection framework.

Overall, FE staff did not see government changes to the sector as educationally legitimate, but rather as politically inspired.

Survey respondents talked frequently of political “interference” or “meddling”. They said that too often there wasn’t a partnership with other stakeholders but a sense that the sector was being “used” by politicians for their own, often short term ends.

Did ministers respond sufficiently to your criticisms 12 months ago? Government rowed back on some issues, such as direct funding of apprenticeships by employers.

But what of other issues such as the status of Local Enterprise Partnerships (Leps), the impact of academies and free schools on the sector, the state of careers guidance and the future role of digital technology following the recent House of Lords report? Let us know.

The survey will be conducted over the next two weeks — the closing date for responses is noon on Tuesday, March 17, and the findings will be reported in FE Week on Monday, April 27.

Visit here to take part in the 2015 survey.

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The FE and Skills Survey of 2015 has today (March 2) been launched and you’ve got a fortnight to have your say.

That’s also two weeks in which to make sure you’re in with a chance of winning a shiny new iPad Air and a year’s subscription to FE Week.

The 10-minute survey closes at noon on Monday, March 17, and the findings will be reported in FE Week on Monday, April 27.

Respondents can provide contact details within the survey in order to be in with a chance of winning.

Winners will be chosen at random and will be notified within a month of the survey results being reported in FE Week.

A detailed report by the Policy Consortium with full analysis will also subsequently be available online.

Those who opt to provide their contact details — so that either the Policy Consortium can email a copy of the analysis of the survey or to enter the FE Week prize draw — will have them treated in strict confidence. No-one will subsequently be contacted without their express permission.