Uncertainty continues to hang over the future of K College, which is being broken up following a “failed merger”, after the tendering process was delayed.
Invitations to tender (ITT) were due to be sent out by the Skills Funding Agency between July and September to organisations interested in taking over the college’s provision.
An email sent to interested bodies said: “In order to allow organisations to better prepare their tenders, rather than requiring work to be done over the summer, when many organisations are closed as the academic year ends, we have moved the launch of the ITT to early October.”
Short-listed organisations are now due give presentations and attend interviews on their bids in October, with contracts being awarded the following two months.
The provision and estates of the college are expected to be split up and sold off after the college, formed by a merger between West Kent College and South Kent College in 2010, ran into multi-million pound debts.
The college was issued with a notice of concern by the agency, which it owes £15m.
The agency declined to say whether the debts would be transferred to the winning bidder.
It also declined to say how many providers had expressed an interest in taking over the college’s provision.
“While a procurement is running, we are not in a position to disclose any details with regard to applications,” said an agency spokesperson.
The delay in the tendering process should not prevent contracts from being awarded on time, she said, adding: “Contracts will continue to be awarded in line with the indicative timetable we have set out.”
Seven parts of the college’s provision are on offer, including 16 to 19 provision in Dover, Folkestone or Ashford, Tonbridge and Tunbridge Wells grouped together and 19+ provision in these three areas.
Higher Education Funding Council for England (HEFCE) directly-funded provision at Ashford and Tonbridge is also up for grabs.
College principal Phil Frier said: “There is a lot of interest from other colleges, training providers and universities in bidding for the work currently operating across all five towns.
“This is great news and ensures the continuation of the college’s provision for the foreseeable future.”
Details of the sell-off were listed in a sales prospectus from the agency, Education Funding Agency and HEFCE.
Two open days were held on May 22 and 23, at two of the college’s five campuses, for interested parties to find out more about the college and its provision. Fifty providers registered to attend.
Proposals to reform the apprenticeship funding system have been welcomed by former Dragons’ Den investor Doug Richard, nine months after his own review called for tax breaks for employers.
Three funding ‘models’ have been proposed by the Department for Business, Innovation and Skills, the first of which is for a direct payment model where businesses register apprentices and claim government funding online.
The second is for a PAYE payment model in which businesses register apprentices online and then recover government funding through their PAYE return.
The third option, although all could be amended as part of the consultation, is a provider payment model where government funding continues to be paid to training providers, but it can only be drawn down when the employer’s financial contribution towards training has been received.
They are part of a ten-week government consultation ending on October 1 and come around nine months after the Richard Review looked at how apprenticeships in England could meet the needs of the economy.
It concluded the National Insurance or tax credit system should be used to give employers breaks as payment for training. Mr Richard said at the time such changes should be “at the heart” of apprenticeship reform.
“The funding models put forward by the Department for Business, Innovation and Skills (BIS) is precisely the steps needed to encourage more businesses to take on apprenticeships and view young people as the valuable resource they are,” said Mr Richard.
“By giving more power to employers, the new schemes will help businesses big and small have more of a say on the training their employees receive, meaning more efficient businesses and better training for apprentices.”
Neil Carberry, CBI director of education and skills, said: “This could be a watershed moment for apprenticeships, putting employers genuinely in the driving seat for the first time.
“A radical overhaul is long overdue and business has been arguing loudly for targeting funding directly through employers.
“The new system must keep red tape to a minimum if we want more firms to take on apprentices. A skills tax credit is by far the best option on paper, but needs detailed piloting to ensure the transition is smooth.”
However, there were words of caution from John Allan, the Federation of Small Businesses’ national chairman; Martin Doel, the Association of Colleges chief executive; and also Stewart Segal, the Association of Employment and Learning Providers’ chief executive.
“Getting any change to do with funding, or wider issues around apprenticeships, right is crucial,” said Mr Allan, adding: “Therefore we strongly urge government to take its time with any reforms so that they get it right first time to create a system that will last for decades to come.”
Mr Doel said: “I question the need to make further significant changes to apprenticeship funding in the middle of a recession with youth unemployment at an all-time high.”
And Mr Segal said: “We have considerable doubts over whether the PAYE proposal would actually bring more employers into the apprenticeship programme.
“In fact, it might put smaller businesses off. The co-funding option [model 3] might have merit if it properly recognises the contributions which employers make towards an apprentice’s framework achievement.”
Shadow Skills Minister Gordon Marsden said: “We will want to examine carefully all three options.
“What the government has proposed inevitably delays implementing Richard reforms and, depending which option they go for, could depart substantially from them.
“There are also no questions about the ability of small businesses to put money up front bearing in mind we need to expand their take-up of apprentices substantially.”
The first two funding models would both need the “time-consuming” construction of a new online system, but could be in place by 2016 “at the earliest”.
However, common to each is for “the employer and provider negotiating the content and price of eligible apprenticeship training”. It would replace a system of government-set national funding rates.
Skills Minister Matthew Hancock said: “By radically reforming the funding system we will allow employers to agree with training providers the content and price of training ensuring greater competition both on quality and on price.”
Responses to the consultation should be sent to apprenticeships.consultation@bis.gsi.gov.uk by October 1. Visit www.gov.uk/government/news/government-sets-out-radical-plans-to-shake-up-apprenticeship-funding for further details.
A Dorset college that was wrongly labelled as under-performing in official statistics has won an apology.
Kingston Maurward College, in Dorchester, was ordered to improve in May having apparently fallen below the Education Funding Agency’s (EFA) new minimum standards for key stage five.
The land-based college, according to the Department for Education (DfE), failed to get at least 40 per cent of students to achieve an average point score per entry higher than 194 for academic qualifications or 172 for vocational qualifications in the 2011/12 academic year.
Figures, now known to have been incorrect and since removed, indicated the 4,000-learner college hit a figure of just 12 per cent of learners — 18 out of 153 of those eligible.
The problem with the figures came to light after they had been reported, in good faith and based on official information, in FE Week.
“We were very shocked to see our college mentioned in the report as this bore no resemblance to our own data sets,” said a spokesperson for the college, which has a £4.6m EFA allocation for the current academic year along with one of £2.1m from the Skills Funding Agency.
“We have now received an update and an apology from the DfE confirming that there was a major error in the data published on its website.”
The error came from data supplied to the DfE by City & Guilds, where a spokesperson said: “In 2012 we supplied some incomplete candidate performance data for Kingston Maurward to the processing company for the DfE performance tables.
“Although we alerted the relevant department and processing organisation prior to the publication of performance tables, it was too late to correct the data.
“While this has not impacted any learners, this error has made it seem as if Kingston Maurward has not met the Education Funding Agency’s minimum standards for key stage five.
“As a global leader in skills education, we are committed to providing the highest quality of services to our customers.
“Unfortunately, on this occasion we haven’t met our own high standards and we are working with DfE and Ofsted to put things right.
“We remain committed to continually improving our processes and working with our customers to check their data to avoid this sort of situation in the future.”
A DfE spokesperson said: “As soon as we were aware of this error, we immediately removed the minimum standards measure from the college and have written to them to apologise for any distress caused.
“As a matter of course we do offer all schools and colleges a two-week period to check our results data before publication.
“All schools then have a further six weeks, once the results are published, to make any amendments. We would always encourage schools to use this opportunity to check this data and alert us to any errors.”
Kingston Maurward assistant principal Andy Daw (pictured above) said: “We are very pleased that the success of our students has now been recognised. The DfE has confirmed that our entry on the minimum standards table was inaccurate.
“We understand that all merit, distinction and distinction star grades of our level three students had been incorrectly registered as pass grades, therefore not recognising their achievements and considerably lowering the college’s overall position.
“Although City & Guilds has now supplied the correct data, the DfE will not be publishing this on its website, so there will be no entry for Kingston Maurward College for 2011/12.”
Moves to tackle poor provision by Elmfield were ordered personally by Skills Minister Matthew Hancock before its inadequate grading from Ofsted had even been published, FE Week can reveal.
The minister is understood to have been furious with the provider following success rates, as reported in FE Week two months ago, showing just 47.5 per cent of Elmfield’s 13,420 leavers in the retail and wholesale sector, aged 25+, walked away with an apprenticeship certificate in 2011/12.
He wanted action to protect learners, which resulted in the Skills Funding Agency issuing a notice of serious breach this month after the Ofsted report, and stopping Elmfield taking on new learners.
Ofsted found outcomes for learners were inadequate and the majority of apprentices did not complete their framework within the planned time.
A spokesperson for the Department for Business, Innovation and Skills said: “We decided to invoke the right to impose additional conditions of funding within the breach notice and stopped Elmfield taking on any more learners.
“This underlines our tough approach to protect students and root out poor performance wherever it occurs.”
An agency spokesperson confirmed action against Elmfield, which delivers training for more than 11,000 learners, including apprentices at Barclays, UK Mail and Eon, had been agreed before the publication of the Ofsted report and discussed with the provider.
“Prior to the report being published and due to the serious nature of the concerns, the agency decided in advance to invoke its right to impose additional conditions of funding within the breach notice,” she said.
The agency spokesperson added: “We have instructed Elmfield that while under a notice of serious breach it will not take on any new learners, work with any new employers or be awarded growth, until we can be assured provision has improved to an acceptable standard.
“Failure to make satisfactory progress may lead to termination of the contract. An inadequate re-inspection would lead to contract termination.”
Despite the grading blow, Ofsted acknowledged Elmfield’s success rates in newer areas of provision, accounting for around 20 per cent of its delivery and including banking, were good, although some elements required improvement.
Barclays said it was standing by Elmfield, even though it would be unable to take on new apprentices.
A Barclays spokesperson said: “While these Ofsted results predate our programme, the Ofsted report itself is highly complimentary of the success rates Elmfield has achieved for Barclays.
“We therefore look forward to demonstrating the strong results that our programme is delivering in future inspections.”
UK Mail and Eon declined to comment.
A spokesperson for Elmfield, which has 413 staff, said: “Elmfield is continuing to work closely with the Skills Funding Agency and can confirm our contract allocation for 2013/14 is currently under review.
“This is due to our contract with Morrisons coming to an end later this month. A revision of our contract arrangements for the forthcoming year is expected shortly.”
An Essex-based charity is understood to be in talks to become the first independent training provider to be legally reclassified as a college.
Prospects Learning Foundation, which has two centres in Basildon, one in Southend-on-Sea and one in Canvey Island, is thought to be looking at the move.
The charity, which has around 250 staff, 2,000 students and a turnover of £11m, already calls itself Prospects College and has a current Skills Funding Agency (SFA) adult skills budget allocation of £200,650, a contract for 16 to 18 apprenticeships of £2,461,731 and an Education Funding Agency (EFA) allocation of £490,000.
News of the possible move towards college status comes after Skills Minister Matthew Hancock revealed last month, in an unrelated FE Week special report on college mergers, that his officials at the Department for Business, Innovation and Skills (BIS) were considering promoting the attainment of incorporated status.
“As part of encouraging greater diversity and innovation, the government is always keen to explore how new entrants might enter markets,” he wrote in FE Week.
“The Department for Business, Innovation and Skills is currently looking at whether there is a case for encouraging different types of provider to secure incorporated status in FE.”
However, Prospects chief executive Neil Bates declined to comment.
Colleges were incorporated in April 1993 primarily to remove funding from local government and keep down council tax bills while refocusing public-funded education on employer needs.
Joanna Forbes, senior associate solicitor in SGH Martineau’s education team, said it would “mean the provider would be eligible to be funded by the SFA/EFA on a directly-funded basis as a college, rather than as a private provider.”
“This would give access to more flexible recurrent funding, although recent funding reforms have reduced the impact of this, as well as to capital funding available to directly funded FE colleges,” she said.
“It would also provide greater stability of funding, which might be viewed more favourably by lenders and potential partners.
“On the downside, new colleges would be caught by legislation applicable to public bodies, such as the Freedom of Information Act, Human Rights Act and general equality duty, all of which will impact on its day-to-day operations.”
A spokesperson for the Association of Employment and Learning Providers said: “Independent training providers will make their own decisions on whether or not to incorporate, but incorporation should be an open and transparent process.
“In any event, all providers should be treated in line with common principles applied to all such as contracting and access to capital.”
A spokesperson for the Association of Colleges said: “FE and sixth form colleges are the most successful part of the education sector and so, where they meet new demonstrable demand, we would be delighted to see new colleges being established.
“Where new institutions are being considered it’s important that there is full and transparent consultation.
“Our membership is open to any college established under the Further & Higher Education Act 1992 therefore any new institution that meets the criteria would be welcome to join, just as Rochdale and Lowestoft sixth form colleges did in recent years.”
A BIS spokesperson said: “As the minister wrote in June, as part of encouraging greater diversity and innovation, the government is always keen to explore how new
entrants might enter markets. At this stage the work is purely exploratory.”
A “radical” overhaul of apprenticeship funding has been outlined by the government in response to a review by former Dragons’ Den investor Doug Richard.
Mr Richard was tasked with looking at how apprenticeships in England could meet the needs of the economy. He said the National Insurance or tax credit system should be used to give employers breaks as payment for training and said such changes should be “at the heart” of apprenticeship reform.
The suggestion figures among those going out to a ten-week consultation (see table below).
Key difference between the models (table from page 18 of the consultation document)
The first of the proposals is for a direct payment model where businesses register apprentices claim government funding online.
The second is for a PAYE payment model in which businesses register apprentices online and then recover government funding through their PAYE return.
The third option, although all could be amended as part of the consultation, is a provider payment model where government funding continues to be paid to training providers, but it can only be drawn down when the employer’s financial contribution towards training has been received.
Business Secretary Vince Cable said: “Employers are the best people to judge what training is worth investing in. These radical reforms will mean just that.
“It gives them the power to train their staff to make sure their skills are relevant to the company, instead of having to rely on what courses are available in the local area.”
The government also revealed it was looking at funding 16 to 18s “more generously”.
“We must recognise that younger apprentices have less labour market experience, which means the costs of getting them to the industry standard are potentially higher,” it says in the consultation document.
The first two models would both need the “time-consuming” construction of a new online system, but could be in place by 2016 “at the earliest”.
However, common to each of the models is for “the employer and provider negotiating the content and price of eligible apprenticeship training”. It would replace a system of government-set national funding rates.
Skills Minister Matthew Hancock said: “By radically reforming the funding system we will allow employers to agree with training providers the content and price of training ensuring greater competition both on quality and on price.”
The proposal to use the tax system follows calls for reform from the UK Commission for Employment and Skills.
Its chief executive, Michael Davis, welcomed the consultation.
“The commission’s perspective is that we must return apprenticeships to their founding principle — a contract between the apprentice and the employer, valued and funded as such,” he said.
It sits alongside a review launched by Deputy Prime Minister Nick Clegg into the employment, education and training of 16 to 24-year-olds announced at a Confederation of British Industry dinner on Monday, July 15. The review is due out in the autumn.
However, the Association of Employment and Learning Providers’ chief executive, Stewart Segal, warned against the apprenticeship funding consultation’s PAYE model.
“We have considerable doubts over whether the PAYE proposal would actually bring more employers into the apprenticeship programme,” he said.
“In fact, it might put smaller businesses off. The co-funding option [model 3] might have merit if it properly recognises the contributions which employers make towards an apprentice’s framework achievement.”
The truly ‘radical’ element of the government’s apprenticeships consultation is not, as it might first appear, in the different funding mechanisms of the three suggested models.
Nor is it that the employer would ‘own’ the delivery.
What is radical is that, in each of proposals, the employer would have to make a cash contribution.
Public co-investment already stands at 50 per cent of full funding, yet anecdotal evidence is that few employers currently put their hand in their pocket at all.
This lack of a cash employer investment must restrict the quality of delivery, which in turn does little to encourage employers to invest.
It is a cycle of underinvestment that has seen the Skills Funding Agency battle declining quality evidenced by short programmes and Train to Gain-type assessment-only delivery models.
So I applaud the government for considering a funding system that requires employers, and I hope particularly large ones, to make a cash contribution.
However, the policy makers would be wise to dust off the Banks Review of Fees — an independent review commissioned by the previous government and published in July 2010.
Within the daunting 110-page document, Chris Banks’ first and central recommendation was for the government to “match co-investment contributions received from employers up to a published maximum contribution”.
Sound familiar?
It’s a policy calling for the employer’s cash contribution that is long overdue and, using the third proposed funding model set out today, it could be fairly easy to implement for 2014/15 using current systems and rates.
In many ways it could operate like loan fees for the 24+ Advanced Learning Loans, where providers are currently charging the Student Loans Company up to a published maximum.
There are however three extra questions I would like to see in the consultation.
1. How would the government avoid over-spending the limited funding pot?
2. Should the apprenticeship minimum duration policy continue to be applied?
3. Can you avoid setting national funding rates where 100 per cent government-funded (e.g. 16 to 18-year-olds)?
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