The number of young people not in education, employment or training (Neet) fell by almost 10 per cent in the last three months of last year compared to same period in 2013.

Figures for the period from October to December were released today by the Office for National Statistics (ONS) showing that 963,000 16 to 24-year-olds in the UK were considered to be Neet.

The figure was 8 per cent down on the 1,041,000 Neets recorded for October to December 2013. However, the 2014 figure represented a 1 per cent increase on the 954,000 Neets recorded the previous three months.

There were 59,000 16 to 17-year-old Neets recorded between October and December last year, down 8,000 (7 per cent) from the same period in 2013 but up 3,000 (5 per cent) from July to September last year.

There were 905,000 Neets aged 18 to 24 during the final quarter of 2014, down 70,000 (7 per cent) from a year earlier but up 6,000 (1 per cent) from the third quarter of 2014.

The next ONS Neet statistics are due to be released on May 21.

Colleges and independent learning providers are set for a national funding cut of up to 24 per cent next academic year, FE Week can exclusively reveal.

The Department for Business, Innovation and Skills (BIS) this morning released details of its 2015-16 (financial year) adult FE and skills funding budget, which will fall 5 per cent overall to £3.91bn — in line with indicative plans published in February last year.

However, alongside the letter from BIS, FE Week has seen a letter from Skills Funding Agency (SFA) chief executive Peter Lauener (pictured right) to providers, who are expecting their allocations in just over a fortnight, outlining how this will apply to the 2015/16 academic year.

He warned that the adult skills budget line in the SFA grant was being cut by 11 per cent, translating to a 17 per cent cut to the 2015/16 academic year. This, he said, would mean after protecting apprenticeship funding there would be cuts to provider allocations of up to a quarter — even bigger than last year’s 15 per cent cut.

He said: “At headline level, our initial modelling suggests that the total skills budget that we have available for allocation for the 2015 to 2016 funding year will be around 17 per cent less than in 2014 to 2015.

“Within this, the allocation budget for apprenticeships will initially be set at £770m and we will continue to work to ensure that every high quality apprenticeship opportunity can be funded.

“As a result of this continuing commitment to apprenticeships, the primary impact of the reduction is on the funds available for allocation as non-apprenticeship (other) adult skills which we estimate could reduce by around 24 per cent.

“The overall impact of our funding allocations will vary significantly between individual colleges and training organisations, depending on the mix of training provision delivered.

“Reductions will be higher where colleges and training organisations deliver low numbers of apprenticeships, traineeships, English and maths.”

The cut was attacked by the Association of Colleges (AoC) and the Association of Employment and Learning Providers (AELP).

Martin Doel, AoC chief executive, said: “The Government cannot continue to reduce this provision and at the same time expect adults to have sufficient opportunity to retrain for new or future job opportunities.

“By 2020, if the next Government continue to cut at this rate, adult FE will be effectively a thing of the past.”

He added: “This situation is now urgent. This could be the end of this essential education in every city, town and community in England and the consequences will be felt by individuals and the economy for years to come.”

Stewart Segal, AELP chief executive, said: “This is another major cut in budgets for the employment and skills sector while the funding for higher education continues to increase. This is the wrong focus while we are trying to give vocational learning the status it deserves.”

 

Nearly 100 providers issued with a shock clawback warning that caused “sleepless nights” for their staff over Christmas will be asked to repay 2013/14 funding.

The remaining 601 providers contacted by Una Bennett (pictured inset above), deputy director for funding systems for the SFA, late last year telling them they might have to repay against “provision that has been incorrectly claimed” will not face a reclaim.

Providers were later emailed by funding and programmes director Keith Smith (pictured right), who apologised for the “premature” warning and asked them to go over submitted ILR data and tell the SFA before the end of last month if they needed to make any repayments.

The apology saw the SFA come under fire once more on Feconnect, an online forum administered by the SFA, where one user complained that she had suffered “sleepless nights” over the issue.

However, the SFA has now revealed that a total of £500,00 from 98 providers could be reclaimed over mistakes over the minimum length of 16 to 18 and 19+ apprenticeships and eligibility for 24+ advanced learning loans.

It also said the work to find out how much should be reclaimed “highlighted the need for simplifying the system”.

A total of 699 colleges and independent learning providers (ILPs) had been warned about potential issues in their ILR data.

“Over the last couple of months, we have received responses from those who received a letter and have resolved the identified issues with the majority (601) of college and training organisations,” said an SFA spokesperson.

“We have written to these to notify them that no further action is needed and to thank them for their cooperation.

“We are working with the smaller number of college and training organisations (98) where data errors have been identified and have not been resolved to advise of the next steps.

“This includes college and training organisations having the opportunity to provide further information. Where errors cannot be rectified we will seek to reclaim funds.

“We will agree a suitable repayment schedule with individual college and training organisations. We estimate the total amount of funds to be reclaimed is £500,000, subject to final contractual discussions with these college and training organisations.”

She added: “We would like to thank the sector for working with us to ensure that ILR data submitted is accurate. This is important to ensure that any funds incorrectly claimed in error can be recycled back into the system, under our performance management processes, to ensure all public funds are maximised.

“We continue to work with the sector to seek feedback on our funding rules, to ensure they are as clear as possible so that colleges and training organisations have a full understanding of our rules which are a contractual requirement.

“This work has also highlighted the need for simplifying the system further and we will be working with the sector to do this.”

 

Apprentices look set for a 7p rise in their national minimum wage of £2.73 an-hour while proposals to shift them up onto a par with 16 and 17-year-olds have been rejected as too expensive for businesses by the Low Pay Commission (LPC).

The call to increase the minimum wage by 2.6 per cent to £2.80 came with an LPC rejection of Business Secretary Vince Cable’s proposal to give apprentices a pay rise of more than £1.

He suggested the apprentice minimum wage be brought into line with the non-apprenticeship minimum for 16 and 17-year-olds, currently at £3.79 per hour.

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

But the LPC agreed with Mr Cable that higher-level apprentices should earn the ‘normal’ worker national minimum wage, which is set to rise from £6.50 to £6.70, from October.

In its report to Dr Cable (pictured), the LPC said: “You asked us to consider this option as part of a broader review to see whether the structure of the apprentice rate could be simplified in order to improve compliance, and also to consider whether the apprentice rate should continue to be applied to higher levels of apprenticeship.

“We recommend that the apprentice rate should not apply to higher apprenticeships. But in terms of other possible structural changes, we believe there would be significant risks in a merger with the 16 to 17-year-old rate.

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

“It would affect over 90,000 and possibly as many as 200,000 apprentices — up to a quarter of all apprentices — with significant impact in low-paying sectors that provide many apprenticeships and are of particular value to low-skilled 16 to 17-year-olds.

“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. We discuss these and other concerns in our main report.

“As you requested, we have considered phased introduction, but it would not remedy these issues.”

A BIS spokesperson said: “The government will now consider the LPC’s recommendations and respond next month. 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.”

 

The process for establishing new FE colleges could be out of date, the government has warned after reviewing the first general FE college incorporation in more than 20 years.

The Department for Business, Innovation and Skills (BIS) has published a report outlining how Essex-based independent learning provider Prospects Learning Foundation (PLF) became Prospects College of Advanced Technology (PROCAT), in August last year.

It was the first college incorporation since 1992 and FE Week exclusively revealed how the process was under way just over a year before it concluded.

Nevertheless, in the BIS report, which sets out the requirements the PLF had to meet in order to become a college, including a good or outstanding Ofsted judgement, a business plan and a satisfactory provider financial assurance audit review, BIS said the current system for incorporation, which dates back to the early 1990s, might not be “appropriate” for future projects.

The report said: “An important element of the project was to identify, address and learn lessons from the processes, recognising that the legislation and regulations under which they were being conducted were from a different time and were not designed to support the establishment of a new, specialist technical college within the FE sector. 

“This project was a first in the sector for over 20 years and so as the project developed we were clarifying legislation, regulations, policy and processes internally with PLF and in relation to obtaining ministerial approval.

“The project was also completed within a very short timescale (from the first Project Board meeting to incorporation was 10 months). The process has highlighted lessons learnt in two key areas: the process undertaken and the policy and legislation in place.

“The process currently in place for new incorporations and entrant funding may no longer be appropriate. This is being reviewed as part of a wider project assessing the longer term implications of government policy reform for the FE/skills provider market.”

BIS said the report also served to clarify the criteria for applications for incorporations, and concluded that this project had succeeded due to a “shared commitment to achieving the project outcomes and overcoming obstacles” and said the policy and processes for a new college wanting to incorporate from scratch were now “much clearer”.

 

 

Most of Professor Alison Wolf’s recommendations for reform of 14 to 19 vocational education have been implemented, the government has claimed.

The Department for Education has issued its final progress report on Professor Wolf’s 27 recommendations, which were initially outlined in her landmark 2011 Review of Vocational Education, claiming 20 of the points have become government policy, with six in the process of implementation and one having been implemented in-part.

The review sparked the introduction of new study programmes, a new drive for colleges to recruit learners from the age of 14 and per-learner funding, instead of the per-qualification funding which it was previously argued led to unfairness in the way FE colleges were funding compared to other 16 to 19 institutions.

In the progress report, the government said: “As a direct result of these recommendations, apprenticeships have been redesigned by employers to meet employers’ needs, DfE published approved lists of technical and vocational qualifications for 14 to 16 and 16 to 18-year-olds and will report only these qualifications in the performance tables.

“All 16 to 19 year olds in education are now offered a study programme based on their prior attainment, education and employment goals – nearly all students spend at least half their time studying one or more substantial qualifications such as A levels or technical and vocational qualifications which meet DfE’s requirements, alongside other activities such as tutorials or work-experience.

“Students who have not yet achieved an A*to C GCSE in English and maths by the age of 16 now continue to study these subjects as part of their 16-19 education. Sixth forms and FE colleges are funded, and have their performance reported, in the same way. Funding is on a ‘per student’ basis giving education providers the freedom to design programmes which best meets students’ needs and ambitions.

“Ofsted inspections, headline and progress measures in school and college performance table measures, minimum standards and destination measures have all been reformed to hold schools, colleges and other training providers to account for the provision of these reforms and provide transparent information to inform student choice of course and institution.”

Many of the key elements of the report have been implemented in the last six months, which has allowed the government to promote a much better position than the one announced about a year ago, when the review marked its third anniversary.

New study programmes, which require those under 19 without GCSEs in English and maths to work towards equivalent qualifications, became a condition of funding in August. A further 40 apprenticeship trailblazer standards were published, also in August, and a further 75 were published in October.

And last month, new 2014 key stage four performance tables, the first to reflect the Wolf recommendations, were published.

The National Union of Students (NUS) has issued a damning report on the issue of apprentice pay, branding the minimum wage of £2.73 an-hour “exploitative”.

The 21-page Forget Me Not (pictured above inset) report paints a bleak picture of apprentice finances backed by the evidence of several case studies, including a 17-year-old named Sam who earns £95.55 a-week in the first year of his healthcare apprenticeship but, despite living at home, is left with just £40.76 a-week after meeting his travel, food and course costs.

Joe Vinson (pictured above), NUS vice president for FE said: “This report shows that we could have a whole generation being shut out of vocational education because of financial constraints. I hope that our report will trigger a serious investigation in to the financial well-being of apprentices and lead all political parties to commit to making apprenticeships more accessible for all.

“Nobody is talking about the everyday reality for individual apprentices — it’s time we stopped talking about ‘the other 50 per cent’ and actually took action to fix the huge inequalities that exist between these types of education.

“Expansion of places just isn’t good enough, and it’s hiding the truth – we really need a new deal for apprentices.”

The report highlights how the three main political parties have voiced their support for apprenticeships in the run-up to the general election in May, how funding for the programme has increased in recent years and employers will be incentivised to take on apprenticeships from April next year by not having to pay National Insurance contributions.

But, it says: “While employers are encouraged to employ more apprentices and the Government is ploughing money in to funding them, what is the situation for the individual apprentice? What benefits and funding sources does an apprentice have access to?”

The report calls for the government to scrap the apprentice minimum wage, arguing that learners “should be entitled to at least the national minimum wage for their age”.

“The minimum wage for apprentices is exploitative and not enough to cover basic living expenses,” it says.

The recommendation is covered in a section on pay, and further areas in which recommendations are made are travel, sick pay, family budget, childcare, bursaries and bank accounts.

It also recommended free transport for all 16-19 year olds, extending the bursaries available to students in FE to apprentices and called for banks to be encouraged to offer special accounts for apprentices, similar to those available for undergraduates.

“Apprenticeships are often framed as a chance to ‘earn whilst you learn’. They supposedly offer a chance to gain a skill and a qualification whilst working in a ‘real’ job with a wage. Yet for many apprentices their low wages quickly disappear on travel, rent and food,” the report says.

“The NUS believes that apprentices need a better system of support in place in order for them to properly afford to complete their course. Without this apprentices are being forced to take on extra work, borrow money or drop out altogether.”

The NUS report comes two months after Apprenticeship Pay Survey 2014 showed how younger apprentices were being hit hardest by minimum wage non-compliance with nearly a quarter not getting the right pay levels last year.

It indicated that 24 per cent of apprentices aged 16 to 18 and learning at levels two and three were paid less than the apprentice minimum wage, which was £2.68 an-hour at the time of the survey, but rose 5p from October.

A spokesperson from the Department for Business, Innovation and Skills said it had “gone all out to support apprentices”.

She added: “Our reforms mean that companies are getting people with the skills they need. And those doing apprenticeships can earn while they learn with careers in TV producing, accountancy or engineering – available to a degree level.

“To support our hard-working apprentices we recently proposed that they should get an extra £1 an-hour. We are waiting for the Low Pay Commission to get back to us on this idea. In the meantime, apprentices are earning an average of £6.79 to £11.63 an hour depending on their level of apprenticeship.”

The Association of Colleges (AoC) has defended its members’ efforts to meet business needs for a digitally skilled workforce after a group of Peers said provision was “patchy, unresponsive and not meeting employer needs”.

Matt Dean, AoC technology policy manager, hit back at the House of Lords digital skills committee’s latest report, Make or Break: The UK’s digital future.

The report further said: “FE colleges need to move up a gear and provide industry-designed and endorsed short courses that are going to lead to a job.”

But Mr Dean said government and businesses needed to act to fill the skills gap, claiming colleges needed more resources and more input from employers.

He said: “The report rightly highlights that there is some excellent provision of education and services in colleges to help prepare young people and adults for the world of work.

“But for this to be more widespread, there needs to be more support from government, funding agencies, regulators and awarding bodies; for example, in streamlining the accreditation of new qualifications to meet the requirements of digital industries.

“Colleges already work with a large number of employers, because they recognise the importance of forging these links, and they would like to do more. However, this requires more businesses to be willing to develop staff training that reflects industry practice and that might be provided by, and within, the college.”

His insistence that colleges were working to fill the skills gap has been backed up by FE technology experts and sector leaders.

Bob Harrison, a member of the Further Education Learning Technology Action Group (Feltag), said: “I think the FE sector has already decided it needs to sort itself out, and it is nice to have the weight of the House of Lords behind it, but I would say that the time for reports has passed, and it is now time for action.”

Education Foundation co-founder Ian Fordham, who co-authored November’s Digital Colleges: The Journey So Far report, said: “A systemic challenge needs joined up solutions. As our report showed, far from colleges sitting in the trenches, many are now the ‘digital warriors’ — pioneering new approaches to learning and responding directly to industry needs.

“The authors have rightly laid the gauntlet down to colleges, but also aims its fire at schools, universities and government to take steps to turn Britain into a digital nation.”

Sixth Form Colleges’ Association chief executive David Igoe said: “Sixth form colleges, like schools have a critical role to play in developing the use of digital technology as a pedagogical tool and to encourage career pathways for both genders into engineering and the myriad of industries now highly dependent on digital — for example media and journalism.

“All this needs appropriate investment in IT and digital infrastructure and we would welcome any move to ensure colleges have the platforms and connectivity to respond to whatever new technology emerges in the coming years.”

Stewart Segal, chief executive of the Association of Employment and Learning Providers, said: “Apprenticeships in the digital sector were one of the first standards to be developed in the Trailblazers and training providers have been involved in the process.

“And with the taking forward of the Feltag report, we believe that there will be growth in the number and quality of apprenticeships in this sector at all ages over the next five years.”

However, David Hughes, chief executive of the National Institute of Adult Continuing Education, called for more recognition of the lifelong needs for digital skills rather than a “narrow focus on young people in schools, colleges and universities”.

The Department for Business, Innovation and Skills declined to comment.

Main pic:  from left, Matt Dean, Bob Harrison 

Click here for an expert piece by digital skills committee chair Lady Morgan

Key findings on FE and skills from the Lords committee

Further education will play a key role in developing high-level digital skills

Evidence showed that FE colleges were already well-placed to link local people with training and jobs, but provision is patchy, unresponsive and not meeting employer needs

There is an urgent requirement for comprehensive industry input into the further education system. The Government should encourage strong partnerships between industry and colleges. Training delivery must be revamped. Further education colleges need to move up a gear and provide industry-designed and endorsed short courses that are going to lead to a job

Skills funding is not presently targeted sufficiently to improve the capacity of the UK’s workforce and grow its economy. Provision is cumbersome and slow to adapt

Over recent years there has been a decline in the number of apprenticeships taken up across all subjects. In England apprenticeship starts across the board in 2013/14 had fallen by 13.7 per cent from the previous year. Apprenticeship starts in ICT fell from 19,520 in 2010/11 to 14,120 in 2012/13; and dropped again to 13,060 in 2013/14

There is no evidence that apprenticeship numbers are yet anywhere near meeting the ambitions of the scheme. In fact, witnesses agreed that the number of apprenticeships, particularly high-level apprenticeships, was far below what the economy needed