Latest news from FE Week

FE providers face a further cut of almost four per cent to their non-apprenticeship funding in 2015/16, the Skills Funding Agency (SFA) has confirmed.

In a letter to the sector, SFA chief executive Peter Lauener has announced the 3.9 per cent cut to adult skills budget (ASB) and discretionary learner support allocations, which is being made in response to £450m of in-year savings required of the Department for Business, Innovation and Skills (BIS).

Additionally, the SFA will attempt to save money by withdrawing all funding for mandated English for speakers of other languages (Esol) provision for the 2015/16 funding year.

In his letter, Mr Lauener explained that the 3.9 per cent cut would be made across the board to non-apprenticeship allocations received by providers in March, which were already subjected to cuts of up to 24 per cent.

He said: “In February, I wrote to you about the context for funding allocations for 2015 to 2016. My letter focused on the reduction in the ASB and the likely impact of this on your funding allocation.

“Since I wrote that letter, a new government has been elected and, on July 8, they set out their summer budget. This included details of the proposed savings within the 2015 to 2016 financial year across all government departments, including BIS.

“Naturally, as part of BIS, the Skills Funding Agency (SFA) has to contribute to the savings required.”

He said BIS and the SFA had spent weeks assessing options to “make savings in such a way as to minimise their impact on the FE sector”.

He added: “Ministers have now agreed the options, which include savings from both nonparticipation and participation budgets.

“These changes affect most colleges and other training organisations. So that you can see what this means for you, we will issue updated funding statements through the Hub later this week. Your updated funding statement will include a covering letter clearly summarising any changes to your allocation.”

In an update on the delayed growth requests Mr Launer confirmed the agency would fund apprenticeship over delivery up until March 2015 and that the agency will consider credible growth requests beyond March 2015.

However no timescales have been given for when the delayed growth requests will be reviewed, other than it will follow the confirmation of the new reduced ASB allocations.

The letter goes on to extend the deadline for colleges to submit their financial plans from July 31 to September 30, in light of “unique circumstances”.

Mr Lauener said: “Colleges only need to submit updated plans where they consider that there is a material impact on their financial position that is not reflected adequately in the submission made in July.”

Julian Gravatt, assistant chief executive of the Association of Colleges (AoC), said the further cut would have a “devastating impact” on the work colleges do in educating and training adults.

He added: “Without this funding, adult education will be decimated meaning an end to vital courses which provide skilled employees for the workforce.

“Not only are these substantial funding cuts but colleges have only had two weeks’ notice that they will take place. Like universities and schools with sixth forms, colleges have a recruitment cycle for full-time students, which runs for at least six months before courses start.

“Good decision-making about education options and future careers takes time and involves legally binding offers. Last minute decisions by the government, like this one, put this at risk.”

David Hughes, chief executive of the National Institute of Adult Continuing Education, said: “The 3.9 per cent cut comes after multi-year cuts which have greatly reduced chances for people to learn.

“The cuts are also the first of potentially three to FE colleges, with 16-19 and higher education still unclear. These further cuts come on the same day as the NAO report which set out the very real financial challenges colleges are facing, and of course this only increases the pressure.

“The further cut to the ASB, in the form of £45m taken out of Esol funding is extremely disappointing, given that it will hit people who are working hard to gain the language skills they need to participate in work and in our society.

“It seems ironic, that this budget was to support unemployed people, a major priority for this government.”

Stewart Segal, the chief executive of the Association of Employment and Learning Providers, said: “Clearly it is positive that the SFA will be funding all delivery and growth cases for apprenticeships in 2014-15.

“However this unnecessary delay has caused a lot of issues for employers, learners and providers and will take some time to resolve.

“The reduction in the non-apprenticeship ASB budget is another short term decision that will create further problems for providers who have to cope with yet another in-year decision.”

Large-scale mergers may be needed among sixth form colleges (SFCs) to cope with looming funding problems, Sixth Form Commissioner Peter Mucklow has warned.

Mr Mucklow warned, in a letter to every SFC in the country on Thursday (July 16), that “the tough funding climate” will continue to “present challenges to many sixth-form colleges over the next few years”.

He said that a number of governing bodies and principals “will wish to explore” structural changes to avoid financial difficulties, which could include shared services, federations or mergers.

He suggested that such collaboration may need to be between groups of more than two colleges, stating that “structural change on a small-scale or on a single institution-to-institution basis may be insufficient or sub-optimal in the longer term”.

However, Sixth Form Colleges’ Association (SFCA) chief executive David Igoe History warned that “history suggests that mergers and re-organisation rarely achieve the efficiencies and improvements hoped for”.

He added: “Sadly, some high performing colleges are at risk simply because of their size and the fundamental inadequacy of the funding rate available to do the job.

“The SFCA will strive to both argue for appropriate funding and to support measures to minimise the impact of any further reductions which may be just over the horizon.”

He added that the SFCA is “working constructively” with the Education Funding Agency (EFA) to help secure the futures of SFCs.

“It is welcome, therefore, that some support is being offered to help colleges explore and consider structural changes as a way of maintaining the excellent work they do for their communities,” said Mr Igoe.

The Sixth Form Commissioner also said, in his letter, that EFA has a small fund available to support SFCs that are “intending to act to prevent intervention and support the longer term financial viability of the college.

“Sixth-form colleges are invited to apply to the EFA for a contribution of up to £10,000 towards… internal cost-cutting reviews/improving financial control, investigation of structural options to increase financial stability, and consideration of future strategic/organisational changes”.

He added that “should the bid cover collaborative activity between more than one sixth-form college, a higher amount may be considered”.

The letter added that “in one college [understood to be Totton CSC, in Southampton] formal intervention was not able to secure either college-led financial recovery or the necessary educational improvement.

“While a future for locally-needed provision has now been secured, this is not an experience we want repeated elsewhere given the resultant costs and the impact on the college’s community”.

FE Week revealed on June 22 that 1,700-learner Totton will “join with “crime prevention charity Nacro from November.

The decision was made after Mr Mucklow warned that Totton could no function alone, having been placed under Financial Notice to Improve by the EFA.

Mr Mucklow praised the overall performance of SFCs, in his letter, for continuing “to be successful and resilient overall”.

“This is good news for young people. Ofsted’s official statistics report the proportion of sixth-form colleges rated as good or outstanding overall stands at 83 per cent. For 2015 to 2016 allocations, total student numbers and funding per student both grew slightly,” he added.

The EFA was unable to comment on contents of the letter before publication.

Protestors led by National Union of Students (NUS) vice president for FE Shakira Martin were dispersed by police after staging an overnight protest at Lewisham Southwark College.

They were objecting to a vote taken by governors on Tuesday (July 14) to sell-off the campus and a separate proposal by Southwark Council, published this month, to take over the parts of the buildings that formed Southwark College before it merged with Lewisham in 2012.

The group of around 12 protestors, including students, local residents and union activists, entered the Camberwell campus at around 10pm last night.

They stayed overnight before police moved them on at around 9.30am, as they were judged to be posing a disruption to a class for trainee security guards.

However, a number of activists continued their protest until after lunchtime outside the campus, which mainly offers English for Speakers of Other Languages (Esol) provision.

Ms Martin, who was involved in the protest outside her role as NUS vice president, warned closing the campus would restrict options for the Southwark community, ahead of a public meeting held by the protestors at the Camberwell campus this evening.

She said: “On a personal level, this college is my home, it’s the place that got me to where I am today as well as being in my job remit.

“The majority of the learners are black women and international students who often need the ESOL courses to help them with their language and the closure of the site would mean that the course would not be as accessible to as many people.

“Many would have to travel outside their borough, which will be difficult as many of them have childcare responsibilities.”

Lewisham and Southwark College was formed in 2012 as a result of a merger between Lewisham and Southwark College.

Following two inadequate Ofsted gradings in a row, a visit from the FE commissioner and ongoing area review of provision in south London, Southwark Council published plans to take back control of the Southwark portion of the college’s provision.

The proposal, which has been submitted to the commission, suggests closing the college’s Camberwell and Waterloo sites, and reopening with subcontracted provision from September 2016.

However, protestors say the council failed to consult with anyone but local employers while drawing up their plans.

Ms Martin said: “The focus in the proposal is on apprenticeships — how would the learners who currently use the college in Southwark be able to do an apprenticeship if they don’t even know how to fill out the form because they can’t read or write?

“They’re taking away what is needed within the community and replacing it with an alternative that is not the first point of education for many of these learners. It’s impacting some of the most marginalised people in society.”

She called for learners and residents to be consulted on any plans for a sell off or split, and for the governors to retract their decision to sell.

A Metropolitan Police spokesperson confirmed police were called to the site just after midnight and 8am.

He said that no arrests had been made, but enquiries were ongoing.

A Lewisham Southwark College spokesperson said: “Protesters exited peacefully although there was damage to college property.”

She added security at the college had been increased.

College principal Carole Kitching said: “It is highly regrettable that a small group of individuals unconnected to the College chose to illegally occupy our campus overnight causing disruption to staff and students as they arrived for classes on Monday morning.”

Protesters denied they were aware the college would be in use this morning.

Ms Martin said: “I’m not deterred by the fact the occupation ended so quickly — to occupy a college is something phenomenal and we knew going in it would be really hard to maintain it, but the fact that we started that conversation and that’s developing is a real encouragement to me.

“Now it’s just about how we move forward to bring the community in and get them to understand how this can directly affect them.”

Southwark Council declined to comment.

A report out this morning by the National Audit Office (NAO) has criticised the Skills Funding Agency (SFA) for being too slow to spot problems with colleges’ finances because of failures to check the “realism” of “over-optimistic” forecasting by colleges.

The report, called Overseeing financial sustainability in the FE sector, said that some colleges’ forecasting had been “over-optimistic, meaning they have not identified problems until a late stage”.

It added: “In recent years, the SFA has used the financial forecasts produced by colleges without always testing their realism, and as a result has not detected some problems until a late stage.”

The NAO document also said that the SFA’s formal interventions, once it finds that a college’s financial health is ‘inadequate’, “has often lacked sufficient impact”.

It recommended that the Department for Business, Innovation and Skills (BIS), working with the Department for Education (DfE), should “consider whether the existing college-by-college approach to intervention will address the more fundamental structural problems faced by the FE sector”.

“The SFA and FE Commissioner intervene in individual colleges, but the scale of challenge may require more joined-up decisions to be made at a regional or sector-wide level,” the report said.

It comes amid warnings, in the report, that the decline in the financial health of the sector has been “quicker than indicated by colleges’ plans, and current forecasts suggest that the number of colleges under strain is set to rise rapidly”.

“In particular, the SFA anticipates that the number of colleges it rates as financially inadequate will continue to grow. On current trends, it could be around 70 colleges by the end of 2015/16, based on the SFA’s modelling in May 2015 of the sector as a whole rather than forecasts for individual colleges,” it added.

The report warned that the financial health of the FE college sector has been declining since 2010/11 and “in 2013/14, the sector was in deficit for the first time and 110 colleges recorded an operating deficit, up from 52 in 2010/11.

It added: “In the same period, the number of colleges assessed by the SFA to have ‘inadequate’ financial health rose from 12 colleges (5 per cent of colleges) to 29 colleges (12 per cent).”

The report said that as independent organisations, colleges are responsible for identifying and managing their own risks.

But it said: “Some colleges have been consistently optimistic in their financial forecasts, particularly colleges with weaker financial health.”

In 2013/14, the report said, the financial health of 41 per cent of all colleges was worse than those colleges had forecast two years earlier.

“Among the colleges with weaker financial health in the previous four years, 51 per cent had financial health that was worse than they had forecast two years earlier,” it added.

The report also said that “common failings that the FE Commissioner has identified” suggested that management capability in parts of the sector is not good enough to fully address emerging risks.

It criticised the SFA for not checking college financial forecasts more rigorously in the past, but recognised improvements to the process.

It said: “In mid-2014, the SFA began developing a broader approach to examining financial and other risks.

“It looks beyond current financial health to consider trends, and includes wider measures of education quality and governance. This should allow the SFA to better prioritise its efforts towards those colleges and other providers most likely to be at risk.”

“There is more that BIS and the SFA could do to better support colleges considered at risk, while respecting their independence.”

The report added that the financial support that the SFA offers to struggling colleges has increased substantially since 2010, but “most has not yet been repaid”.

It said: “The outstanding balance, including new advances, stood at £45 million by February 2015, relating to 13 colleges,” it said.

“The number of colleges experiencing financial difficulty is expected to rise rapidly.

The report also recommended that “BIS, working with the DfE, should ensure that there is capacity to deal with the expected increase in the number of colleges requiring support. Cost-effective intervention will rely on the ability of the oversight bodies to take effective action quickly”.

A BIS Spokesperson said: “We are committed to developing a further education system which creates a productive, innovative and competitive workforce for the 21st century.

“The NAO report correctly highlights where we have already taken action to provide young people with the skills they need and to deliver greater value for money within the sector.

“Furthermore, we are already implementing many of the report’s recommendations and will be going even further to strengthen the system by giving local areas a greater say over how and what young people are taught.

“These ongoing reforms are focused on achieving the best return on investment and we will provide an additional £25m this financial year to help support the creation of 3m apprenticeships by 2020. Only by providing businesses with the skilled workforce they need can we boost economic growth and drive productivity and prosperity for the whole country.”

It comes after BIS  this morning published a report Reviewing post-16 education and training institutions, which sets out plans for a national programme of area-based reviews.

The document expresses the “need” to move towards “fewer, often larger, more resilient and efficient providers”.

The SFA and DfE are yet to comment.

The government has announced a national review of post-16 education and training, and admitted the number of general FE and sixth form colleges in England will decrease. Here, FE Week outlines the ten main points in the government document, and what it might mean for the FE and skills sector.

1. Colleges are going to merge and close

The report highlights the “need” to move towards “fewer, often larger, more resilient and efficient providers”. The government expects this to “enable greater specialisation”, creating institutions that are “genuine centres of expertise”, able to support progression to a high level in professional and technical disciplines.

It continues: “This will need to be done while maintaining broad universal access to high quality education and training from age 16 upwards for students of all abilities including those with special educational needs and disabilities.”

 

2. Excellence in the sector isn’t going to be enough to stop the cull

While the government accepts there are “many excellent FE colleges”, it says “substantial change” is required to deliver its productivity objectives while maintaining “tight fiscal discipline”.

The report says: “The work of the FE and sixth form college commissioners has identified there is significant scope for greater efficiency in the sector, in a way that frees up resources to deliver high quality education and training which supports economic growth.”

 

3. The government’s reviews will be carried out area by area, and they’re going to happen quickly

The report announces that the Department for Education and Department for Business, Innovation and Skills will facilitate “a programme of area-based reviews to review 16+ provision in every area, and do so quickly”.

It adds: “These reviews will provide an opportunity for institutions and localities to restructure their provision to ensure it is tailored to the changing context and designed to achieve maximum impact.”

 

4. The reviews must factor in local needs, national policy, and funding issues

The government has put together a helpful tick-list so those conducting reviews leave no stone un-turned…

• Local economic objectives and labour market needs and any local outcome agreements in place
• National government policy, including the national expansion of the apprenticeship programme, creation of clear high quality professional and technical routes to employment, the desire for specialisation, including the identification and establishment of centres of excellence such as Institutes of Technology and the need for high quality English and maths provision
• Access to appropriate good quality provision within reasonable travel distances, particularly for 16-19 year olds and students with special educational needs and disabilities
• Funding, including the need for 16+ providers to operate as efficiently as possible within a tight fiscal environment
• Effective support for the unemployed to return to work
• Legal duties relating to the provision of education, including but not limited to section 15A of the Education Act 1996 and section 86 of the Apprenticeships, Skills, Children and Learning Act 2009.

 

5. General FE and sixth form colleges will be the focus of the reviews, which makes them “fundamentally flawed”, according to one sector leader

The report says: “Our focus will be on FE and sixth-form colleges, although the availability and quality of all post-16 academic and work-based provision in each area will also be taken into account.”

It goes on to say that although each review will usually cover both FE and sixth form colleges, they will be able to include other providers where they agree.

The availability and quality of wider 16+ provision including school sixth forms and higher education institutions will “also be considered during the analysis phase”.

James Kewin, deputy chief executive of the Sixth Form Colleges Association, isn’t happy about this.

He told FE Week: “A genuine process of area based reviews would be extremely welcome, as it would scrutinise the performance and viability of all 16 to 19 providers – including school and academy sixth forms.

“The process outlined this morning is fundamentally flawed as it only focuses on FE and sixth form colleges. It feels very much like ministers do not want to address under-performance in schools and academies, and – ironically – intervention is being focused on providers that are supposed to have the most autonomy in the system.”

 

6. Institutions themselves will be able to initiate the reviews, unless the government has concerns or wants to act quickly

The report says the reviews can either be “proactively initiated by a group of institutions”, or by government where it “sees a need to progress rapidly”, and where concerns about “quality of the provision, capacity, or financial sustainability of individual institutions” exist.

It continues: “We will shortly issue detailed guidance on carrying out these reviews following a period of consultation. In the meantime, the rest of this document sets out the proposed high level approach.”

 

7. The government has already carried out reviews in at least two areas

The government says areas will be expected to conduct their reviews according to a “national framework”, which will “reflect experience” from the early reviews already conducted in part of Norfolk and Suffolk and in the city of Nottingham.

 

8. The reviews will be led by steering groups

The government has announced that each review will be led by a steering group composed of a “range of stakeholders within the area”, including…

• Chairs of governors of each institution
• The FE and sixth form college commissioners
• Councils
• Local enterprise partnerships
• Regional schools commissioners

 

9. The government still wants the FE sector to be “independent”

In the report, the government claims it retains a “strong interest” in the sector’s success.

It says: “It is critical to our ambitions on productivity, and 16+ providers receive substantial levels of public funding. The government has responsibility for protecting the interests of students when colleges fail.

“We already have some very strong providers, others who are already proactively making changes to strengthen their institutions, and still more who are able and willing to do so but have not started yet.

“There are also providers who will find transformation challenging, including the increasing number of institutions entering intervention for financial reasons.

“For that reason, government involvement in these reviews will be proportionate to the level of risk and the ambition to establish access to higher skills and specialised learning.”

 

10. There are concerns not everyone will benefit from the reviews

David Hughes, chief executive of the National Institute of Adult Continuing Education (Niace), told FE Week: “I fear that the focus as set out today might mean people with low skills levels will miss out, and those on low pay will fail to get the support they need to progress in work.

“Both of these are vital if the UK us going to improve productivity in a range of industries including retail, care and hospitality, where low level skills need to improve.

“We also need to ensure that people in work can achieve higher level skills with flexible and accessible provision outside of the apprenticeship programme, which should be about new labour market entrants.

“The government accurately describes the extreme financial challenges facing colleges, supported by today’s NAO report. I hope that area-based reviews will uncover the challenges local people face in accessing the training they need to increase their earnings.”

The government could cut the number of general FE and sixth form colleges in England in a bid to bring “greater efficiency” to the sector, an official document has revealed.

The Department for Business, Innovation and Skills (BIS) has published its report Reviewing post-16 education and training institutions, which sets out plans for a national programme of area-based reviews.

The document expresses the “need” to move towards “fewer, often larger, more resilient and efficient providers”.

It continues: “We expect this to enable greater specialisation, creating institutions that are genuine centres of expertise, able to support progression up to a high level in professional and technical disciplines, while also supporting institutions that achieve excellence in teaching essential basic skills – such as English and maths.

“This will need to be done while maintaining broad universal access to high quality education and training from age 16 upwards for students of all abilities including those with special educational needs and disabilities.

“We know from experience of structure and prospects appraisals and early area based reviews that restructuring can help to improve opportunities and outcomes for students and secure operational and financial efficiencies.

“We are therefore announcing that the Departments for Education and Business, Innovation and Skills will facilitate a programme of area-based reviews to review 16+ provision in every area, and do so quickly.”

The first area review will be launched in Birmingham this month, with guidance on the reviews themselves expected to be published in August.

The first wave of reviews will then begin in September, with five further waves beginning every three months until December 2016.

Email howard.bines@bis.gsi.gov.uk to let the government know your opinion on the reviews process.

Gateshead College has shot up two Ofsted grades to outstanding while Weymouth College is making “significant” improvements as it rebuilds from an inadequate rating.

Gateshead was visited by the education watchdog last month and inspectors found a dramatic turnaround since it was deemed to require improvement three years ago.

Meanwhile, Weymouth was monitored for progress in four areas and achieved “significant progress” in three and “reasonable progress” in the fourth.

Weymouth’s report came out today — the same day as Gateshead’s, which listed outstanding ratings across the headline fields.

Inspectors praised the 19,000-learner college’s record on helping students move into further study or work.

The report said: “Learners develop first-rate personal, social and employability skills, leading to very high rates of progression to further study, employment and/or training.”

It added: “Learners receive excellent careers advice and guidance which makes sure they are assiduously prepared for their progression.”

Inspectors also said maths and English had been “skilfully embedded” into all provision and praised the college’s partnerships with employers.

It added: “A dynamic and inspirational principal, ably supported by a highly skilled senior team and governors, has successfully developed and delivered a clear and ambitious vision for learners leading to significant improvements in provision.”

The college, which has a £8.6m contract with the Skills Funding Agency (SFA), is only the second FE college to be awarded the top grade by Ofsted this year, following Somerset’s Strode College achieving the feat in October.

Gateshead principal Judith Doyle (pictured above), who took up the role in August 2013, described the result as “fantastic”.

She said: “I am very proud of this outstanding achievement. Our focus is to put our students in the best possible position to secure work when they leave us and I’m thrilled this has been recognised by Ofsted.

“Our strategy to work closely with the business community has been praised and acknowledged, recognising that it not only ensures our learners have the very best opportunities for work experience leading to high quality job outcomes, but also that employers have the highly skilled workforce they need to be successful.”

Governors’ board chair Robin Mackie said the grading was “the result of a fantastic team effort led by Judith”.

He added: “I am thankful to every single partner and colleague that has worked very hard to achieve such a great result.

“I am delighted Ofsted acknowledged the outstanding partnerships the college has with employers.”

Weymouth College also impressed inspectors during a second monitoring visit last month.

The 4000-learner college, with an SFA contract of £3m, was branded inadequate overall by Ofsted in January over the handling of its finances by former principal Liz Myles, despite getting a good grading for its learner outcomes and teaching learning and assessment. Ms Myles resigned in February having served three months of a suspension.

Nevertheless, today’s monitoring visit report found “significant improvement” in the college’s leadership of finance, governor expertise on finance and business planning, and “reasonable progress” on areas of the curriculum, such as maths and English, where inspectors had identified weak performance.

Acting principal Nigel Evans said: “We are delighted with the judgements made in the recent Ofsted monitoring visit.

“These judgements represent an impartial view on the honest and transparent progress we have made as an institution since the beginning of the New Year.

“It is of note that while we have made significant and positive progress against our financial position, we have maintained very high levels of academic performance, continuing to give our students a great experience.”

Shadow Education Minister for Young People John Woodcock has warned the government against “churning out numbers at the expense of quality” as it targets 3m apprenticeship starts by 2020.

Mr Woodcock (pictured above) was part of a panel of FE and skills experts who spoke at a House of Commons event last night hosted by the Young Fabians Education Network (YFEN) about the prospects for England’s apprenticeship system over the five-year lifetime of the newly-elected Conservative government.

He said that he had “grave misgivings” about the 3m target spelled out in the Conservative Party’s General Election manifesto.

“We [the last Labour government] were battered over what we can now admit was an overly targeted approach to, for example, health service reform,” he said.

“It did in some cases skew the system towards churning out numbers at the expense of quality and that is [now] a huge concern for apprenticeships.

“If those apprenticeships do not genuinely embed people in the world of work and set them up for a future profession, then we are doing a disservice to those young people coming into them.”

Another panellist at the event, which had around 50 audience members and was entitled ‘Beyond 3m: A successful apprenticeships system for the UK’, was director of early careers at Barclays Bank, Mike Thompson (pictured right).

He agreed that “systemically, there is a challenge with quality of apprenticeships, with people who are using the title but are genuinely not apprenticeships”.

He said many of the young people that Barclays had recruited as apprentices had already “been through very short apprenticeships, dangled a carrot of opportunity, and let go at month 11 or at the end” elsewhere.

“It has taken us three years to deliver a programme [since it was launched in April 2012] that can take apprentices from level two right up degree level,” he added.

He also thought that apprenticeships should be made “more accessible for all people”.

“Most companies require you to have A to C in maths and English, which discounts nearly half the young people in this country who don’t have that,” he said, with Barclays Bank apprenticeships advertised with “maths and English GCSE grades C and above or equivalent desirable but not essential”.

“We don’t have an academic criteria for our apprenticeships. It is not a problem for the government. It’s a problem for businesses as their human resources departments set the qualification criteria.”

But fellow panellist Ashley McCaul (left), chief executive at London training provider Skills for Growth, replied: “I don’t necessarily agree with what has been said this evening about recruitment thresholds for young people. Few of our young people have this [English and maths] GCSE A to C and that is generally the case with other providers of our type.”

She added: “Not all young people want to progress through from level two to level five, some simply need support to secure a job and to get into the labour market and that is the role for many providers who do their jobs really well.”

Ms McCaul praised the German apprenticeship system which, she said “has an incredibly grown up way of managing quality improvement”.

“If there is an issue with quality, there is a very grown up conversation between the institution and the chamber of commerce about how they can improve, which is then acted on,” she added.

Tom Bewick (right), managing director at consultancy firm New Work Skills Ltd and chair of Brighton & Hove City Council’s children, young people and skills committee, backed the plan announced by George Osborne in last Wednesday’s budget for an apprenticeship levy for large employers.

However, the Labour councillor said: “The devil will be in the detail. If you look around the world, there are some very successful and very unsuccessful levy schemes.

“You can get employers paying the tax [the levy charge], without a change in culture, they don’t change the recruitment culture.

“France is a very good example, the system there doesn’t deliver the boost to apprenticeships that it is designed to do.”

City and Islington College and Westminster Kingsway College aim to become “the main force for FE in central London” through greater collaboration and a possible merger, it was announced today.

The colleges confirmed, through a joint statement released this morning, that their governing bodies had agreed “to explore the potential” for developing closer links.

It added that no decision had been made over the “specific form” this will take, but a group of governors from each college will now work with the two principals to “steer the initial phase”.

“They will develop options and consult widely to agree a ‘best fit’ model which would be adopted in the summer of 2016. It could involve anything from closer working relationships, to federation or merger,” it said.

Both colleges intend, the statement added, to retain their existing names and brands “for the foreseeable future, and possibly in perpetuity”.

They will also both continue to recruit students across 14-19, basic skills, apprenticeships, professional and technical and higher education programmes, as well as serving their local, regional and business communities, the statement added.

Andy Wilson (pictured right), principal of Westminster Kingsway College, which received a grade two Ofsted rating when it was last inspected in 2011, told FE Week: “The ambition is to be seen as the main force for FE in central London. It’s too early to go into much detail about how management or governing structures will work.

“However, we firmly believe that we can grow the number of students as a result of the collaboration, which would hopefully lead to the creation of more jobs rather than cutbacks.

“We are both successful colleges in stable financial positions, but believe that we will be even more successful together.”

Mr Wilson added that staff, students, governors, other London colleges, and local authorities would be consulted over the plans.

Sir Frank McLoughlin (pictured left), principal of City and Islington College, which received a grade one Ofsted rating when it was last inspected in 2008, told FE Week: “This is nothing to do with survival or cost cutting, it’s about ambition.

“Both colleges are looking at a number of options, but if it were to go to a merger, then that would only make us stronger.

“Our reach will now, whatever form the collaboration takes, cut right across a huge swathe of central London, which is very exciting. It will give us a stronger base to work with more employers and stakeholders and improve our provision.

“We would, of course, survive and I’m sure thrive if we carried on independently, but I think that we can be even better together.”

Ruth Duston (pictured below right), chair of governors at Westminster Kingsway College, which was allocated £17.1m by the Skills Funding Agency (SFA) for 2014/15 as of April and posted a £1.1m operating surplus for 2013/14, said: “The FE sector will be the focus for many changes over the next years.

“This potential alliance will mean two successful colleges are at the forefront in responding to the opportunities these changes will provide.”

Alastair Da Costa (pictured below left), chair of governors at City and Islington College, which was allocated £18.6m by the SFA for 2014/15 as of April and posted a £1.8m operating surplus for 2013/14, said: “Collaboration between our two colleges is a bold, strategic and sensible initiative to be considering.

“It has real potential to increase our impact and leverage further benefits for the communities we serve.”

The announcement was welcomed by councillor Danny Chalkley, cabinet member for children and young people at Westminster City Council.

He said: “We fully support this decision by City and Islington College and Westminster Kingsway College to move towards closer collaboration.

“We look forward to seeing their final model of working together which we expect will have a positive and long-lasting impact on the local community.”

Islington Council and the Department for Business, Innovation and Skills declined to comment. The SFA was unable to comment before publication.