The Department for Education (DfE) has “lost its last line of defence” in dismissing sixth form colleges’ pleas to be exempt from VAT with a policy change on academy borrowing, it has been claimed.

While all providers receive the same funding per learner for those aged 16 to 19, the government has previously said sixth form colleges pay VAT because they can borrow money, whereas academies don’t have to pay VAT with the trade-off that they can’t borrow money.

But Sixth Form Colleges’ Association (SFCA) deputy chief executive James Kewin told FE Week that a recent DfE move to allow academies to borrow from its condition improvement fund (CIF) meant sixth form colleges no longer received the special treatment that supposedly justified the VAT requirement.

He therefore thinks the change in academies policy on borrowing should be met with a change in sixth form college policy on VAT.

“The government’s last line of defence on the VAT argument has been to point to the borrowing powers of sixth form colleges and suggest that this offsets the range of funding inequalities between us and academies,” said Mr Kewin.

“The government’s position has always been shaky, but this latest development means it is now completely indefensible.”

In a briefing paper on the policy change, the DfE said: “Academies are currently not permitted to take out loans without the permission of the Secretary of State, which is rarely granted.

“However, this year, through the CIF, academies and colleges can take out a loan for all or part of the project costs to demonstrate their commitment to the proposed scheme. Academies and colleges can choose the size of loan they want to take, and the timescale (up to a maximum of 10 years) over which they want to repay it.

“Repayments – made through a reduction of the revenue funding paid to the academy or college – will be recycled back into capital budgets to maximise the impact of the available funding in the long run. There is no obligation to take out a loan as part of the overall funding package; applicants should consider carefully what is most appropriate for their academy or college, and the consequences and affordability of any loan.”

For more, see edition 117 of FE Week, dated Monday, November 10.

A senior civil servant has defended a government policy not to enforce the raising of the participation age during a grilling from MPs.

Since September 2013, it has been a legal requirement for young people to remain in education, employment or training until the end of the year in which they turn 17. The age of participation will rise again to 18 next September.

In the law which brought about the change, the government was given the power to fine employers which take on 16 and 17-year-olds without them being enrolled in training. It can also technically take action against young people and their parents through local councils, but has so far declined to do so.

But in a hearing of the House of Commons public accounts committee, the first in a series about 16 to 18-year-old participation in education and training, Department for Education Permanent Secretary Chris Wormald was pressed on why that enforcement was not taking place.

He said: “We didn’t activate one clause of the legislation. The view that was taken on that was that we wanted the main focus of raising participation to be voluntary.”

But he was interrupted by committee chair Margaret Hodge, who cited evidence from a recent National Audit Office report which showed the policy was yielding favourable results.

She said: “I understand that, but what [the report] says is that the new legislation includes powers to enforce the raising of the participation age, however, the government has decided not to bring this part of the law into force.

“So the very thing which, looking at the report, looks as if it has had the greatest impact on participation, you then take a decision not to enforce what appears to us to be the most effective bit.”

Mr Wormald replied: “We wanted the focus of activity in this area to be voluntary because we would rather people participated by choice, rather than by enforcement.

“We were seeing really quite good evidence straight away of participation rates rising without enforcement, so I think the question of why we would want to enforce when what we wanted to see was happening anyway was pertinent.”

For a full report, see edition 117 of FE Week.

Employers and training providers have been invited to enter their apprentice teams for the 2015 Brathay Challenge — a gruelling annual test of mental and physical stamina.

The competition, now in its fourth year, tests teambuilding, leadership, fundraising, logistical and communications skills through a series of work-related challenges.

Regional heats will be held from January to April before eight teams of apprentices are picked to compete in the final at the Brathay Trust’s headquarters by Lake Windermere, in the Lake District, from July 6 to 8.

Applications opened today (November 3) and will close on December 12.

Teams of nine apprentices can be made up from a single employer, a group of small businesses, an industry sector or training providers.

Godfrey Owen, chief executive of the Brathay Trust, said: “The challenge provides apprentices with the opportunity to develop a huge range of skills with previous competitors reporting improved teambuilding, leadership, logistical and communications skills.

“Employers [who previously entered teams] reported that they saw improved skills among the competing apprentices and increased local profile of their organisations through positive publicity and corporate social responsibility opportunities.

“We look forward to both apprentices and employers reaping these benefits in the 2015 search for the apprentice team of the year.”

More than 110 teams and 1,000 apprentices entered the 2014 challenge.

They raised £30,000 for charities, visited more than 360 schools to talk about the benefits of apprenticeships, delivered 60 community projects, and secured commitments from more than 50 new businesses to start offering apprenticeships.

Eight teams from across the country descended on the Lake District to complete a series of tests of their problem solving and physical abilities for the final in June.

They were timed completing problem-solving challenges, including an event which involved working as a team to identify a series of shapes while blindfolded.

Physical tests included orienteering around 10km up Loughrigg Mountain, canoeing, balancing on metal chords suspended 20ft above the ground and rowing 16km across Lake Windermere in whaler boats.

It was won by a team of level two to five apprentices, based at offices and factories across the midlands and north of England, from food and soft drinks firm PepsiCo. A team from Innovia Films, Cumbria, won the competition the year before.

Sue Husband, director of the National Apprenticeship Service, said: “The quality of work from the teams that take part in the challenge shows employers and the wider community the impressive work apprentices can achieve.

“It is important that employers recognise opportunities like the Brathay Challenge as a chance to let their great apprentices shine.”

Visit Brathay.org.uk/challenge to enter.

 

Main pic from left: PepsiCo team members Sam Kelly, Leigh Bell, Jonathan Baxendale, and Daniel Stenburg pictured in the whaling boat