The future of adult skills contracts for independent training providers is being “contemplated” by the Department for Education.
In a contract notice published this week, the department said it was considering its options for the future of the adult skills fund (ASF) for the shrinking non-devolved areas it serves.
The current £75 million contract was awarded to about 55 training providers, to start in 2023-24, and has since been extended until 2025-26.
The DfE’s update suggested any new procurement beyond July 2027 – the final extension date for the current contract – would be worth an estimated £30 million per year.
It said: “The department is contemplating whether it will procure to replace these contracts, or whether an alternative commissioning approach will be pursued.”
When asked what other approaches it could take, a DfE spokesperson did not rule out expanding a pilot being tested from August that involves local authorities commissioning adult education locally.
Some have interpreted the notice as an early indication that the government will extend the contract beyond the current end date of July 2026 to 2027, the final possible extension year.
Simon Ashworth, deputy chief executive of the Association of Employment and Learning Providers, said extending the contract was a “pragmatic move” that provided continuity and “avoids the disruption and lottery” of another procurement round.
He added: “Looking further ahead to a possible ‘alternative commissioning approach’, we have only just started to pilot additional funding being channelled through a number of strategic authorities. There have been teething problems which need ironing out before doubling down on this approach.”
Contract value to halve
The maximum value of the contract is likely to shrink to £30 million, less than half the current annual value, as adult education is increasingly devolved to regions.
In the next two years, the portion of adult education funding devolved to regions will grow from 60 per cent (£828 million) to at least 70 per cent.
Six new regions also joined the government’s “devolution priority programme” in February, with a view to taking over their adult education budgets after electing regional mayors next year.
Mark Dawe, chief executive of The Skills Network, which currently holds an ASF contract, said the contract notice was “helpful”.
He said: “Certainty of a reducing contract is better than no certainty of a contract staying the same.
“It’s just telling us what we know, that more and more money is going to the devolved authorities.”
Sue Pember, policy director at adult education provider body HOLEX, said the DfE appears to be “covering all bases” by signalling a potential contract extension to 2028 followed by a potential “shift in funding strategy”.
She added officials are “leaving enough ambiguity to adapt” based on other political commitments such as the immigration white paper, local growth plans and local skills improvement plans.
Procurement woes
The DfE has a chequered record in procuring national adult education contracts.
Tender outcomes have typically been delayed, giving successful providers little time to prepare.
Winners of the most recent procurement in 2023 were informed on July 5 that year, and were then subject to a 10-day standstill period for contracts to start that August.
The number of contractors was reduced from 208, to 88 to 55 over consecutive adult education procurement rounds.
Procurements can also spark costly legal challenges. Learning Curve Group settled its 18-month case against the DfE in January for an undisclosed sum after failing to win a contract in 2023.
The number of young people who are not in education, employment or training (NEET) remained “worryingly high” in the first quarter of this year, with about one in eight people believed to be either unemployed or economically inactive.
Office for National Statistics (ONS) estimates released today suggest that the total number of young people aged 16-24 classed as NEET between January and March this year fell to 930,000.
This is a drop of about 0.3 percentage points, or 57,000 young people, to 12.5 per cent compared to the previous quarter.
It is the first time youth NEET estimates have fallen since reaching a peak of 987,000 between October and December last year.
Sarah Yong, director of policy and external affairs at Youth Futures Foundation, said: “The latest ONS data shows the number of young people not earning or learning remains worryingly high for the beginning of 2025.
“Despite a small reduction in the overall number of young people not in employment, education or training, the youth unemployment and inactivity challenge continues to be a stubborn issue for the UK at 12.5 per cent, with approximately one in eight young people affected.”
The ONS said their estimates, which are classed as “official statistics in development”, should be treated with “additional caution” because their Labour Force Survey has seen lower response rates compared to pre-coronavirus pandemic levels.
Alongside the statistics, work and pensions secretary Liz Kendall visited Liverpool to celebrate the start of the government’s “trailblazer” programme to test out ways to prevent young people from falling out of education, employment or training through £5 million grants to eight regions across England and Wales.
Kendall said: “Young people are our future – and yet for too long they have been denied access to the opportunities and support they need.
“We are investing £45 million – including almost £5 million here in Liverpool – to deliver our Youth Guarantee, so every young person across England gets the chance to earn or learn, as we boost living standards and get Britain working under the Plan for Change.
The trailblazer programme was announced last year in the Get Britain Working whitepaper – planned measures include enhanced tracking of young people aged 17-19, paid work experience programmes, and specialist multi-agency support teams.
Within the stats
Today’s ONS statistics show a 1 percentage point decrease in the number of young men classed as NEET, and a 0.3 percentage point increase of young women.
The overall NEET group is split between 354,000 unemployed young people, about two thirds men, and 569,000 “inactive” young people, shared more evenly between men and women.
The statistics body defines unemployment as someone without a job who has been actively seeking work within the last four weeks or is available to start work within two weeks.
Economically inactive is defined as not seeking work or unable to start work within the same respective time frames.
The Youth Futures Foundation, which has access to more detailed ONS NEET data, has found that about one in four young people have been seeking work for over a year, highlightly the “persistent nature” of the challenge.
Yong said: “Among this group, one in five lack any formal qualifications – double the rate seen across the wider youth population.
“Unlike the post-financial crisis period, the recent rise in NEET levels since 2021 has also been driven in part by growing economic inactivity.
“Notably, the latest data reveals that around 52% of economic inactivity over the past three years is due to ill health, with a large proportion relating to mental ill health.”
But Susannah Hardyman, chief executive officer at youth education and employment funding charity Impetus, called the Labour Force Survey a “blunt tool for a sharp problem” that fails to capture combined factors that mean certain groups of young people are at an “acutely high risk” of being NEET.
She added: “Our Youth Jobs Gap research fills this looming data gap, revealing how uncontrollable factors – like socioeconomic background, special educational needs, and location – combine to make certain groups acutely high risk of being NEET.
“For example, a young person from a disadvantaged background growing up with low qualifications and special educational needs in Hartlepool is more likely to be NEET than not – an inexcusable reality”.
For individuals and the economy
Experts warn that failing to reduce youth NEET numbers will have a “long-term scarring effect” both on individual people and the national economy.
Laura-Jane Rawlings, chief executive officer at Youth Employment UK, said: “The cost of inaction or at least slow delivery is far greater than the investment needed to create meaningful pathways for young people.”
Hardyman and Yong called for a greater government effort to target “precise barriers” that hold young people back “based on evidence of what works”.
Yong cited the Netherlands as successfully achieving the lowest NEET rate out of 38 countries in the Organisation for Economic Cooperation and Development (OECD).
Achieving the Netherlands’ NEET rate of around four per cent would be worth £69 billion to the UK economy and would mean “approximately 500,000 more young people earning or learning”, she claimed.
FE college teachers could walk out over low pay and high workloads if crunch motions at this weekend’s UCU congress are passed.
Members of the University and College Union will gather for their annual congress in Liverpool to debate motions on industrial action, tackling “excessive” college executive pay, abolishing Ofsted and a potential emergency motion of no confidence in the union’s general secretary Jo Grady.
The union’s further education committee has submitted a motion demanding a national ballot over pay and workload, which comes as teaching and support staff unions prepare to negotiate pay rise recommendations with the Association of Colleges next month.
But due to the large number of motions lodged over the three-day conference, and the union’s experiment to make the congress ‘hybrid’ for the first time, it’s unlikely all motions will be heard.
Member apathy has been floated as a reason for the switch to a hybrid format, where people can take part remotely, insiders say. A motion has even been tabled to discuss the timing of this year’s congress during half term and a bank holiday, which has been “difficult” for working parents.
Others allege that certain motions that are contentious for UCU leadership – such as those supporting UCU staff in dispute with the union and another challenging Grady – might be pushed so far down the agenda that they go unheard.
Here’s the key motions to look out for:
National strike ballot
Several college UCU branches, as well as the union’s FE committee, want congress to back a national ballot for industrial action in the next academic year.
The union has been hesitant to back a national ballot, FE Week understands, due to uncertainty it will reach the legal turnout threshold. Labour’s employment rights bill, currently in the House of Lords, will remove the 50 per cent turnout threshold introduced by the Conservatives.
UCU branches from Bolton College, City of Bristol College, Merton College, South and City College Birmingham and Bradford College are also bringing motions calling for ballots for co-ordinated national industrial action.
Thursday’s announcement of a 4 per cent pay rise for schools, coupled with £160 million for staff recruitment and retention in colleges, may diffuse strike demands.
However, FE unions have demanded a 10 per cent pay rise in their annual pay claim for next month’s negotiations with the AoC.
Rein in executive salaries
Delegates from Ealing, Hammersmith and West London College will argue for a clampdown on senior manager salaries in colleges.
Their motion claims senior manager pay rises “significantly outpace” those of teaching and support staff, and need reining in.
It says: “This disparity undermines morale, devalues classroom expertise and diverts vital funds from frontline education. We believe this constitutes a systemic failure of governance and resource allocation”.
If passed, the motion will call on the education secretary to launch an independent probe into all publicly funded FE colleges to publish salary bands, performance-related bonuses and expense claims. The motion also demands clear, transparent pay ratios between senior management and teaching/support staff.
Abolish Ofsted
The UCU could back the National Education Union’s “abolish Ofsted” campaign.
Delegates from Luminate Education Group argue inspections cause “unequalled stress for leadership and members”, they “focus on data over teaching quality” and are “unrealistic” because of “window dressing” by leaders.
The motion will call for increased scrutiny of Ofsted, including risk assessing inspections, and a programme of “national events to highlight the negatives of Ofsted inspections”.
A UCU report last year recommended replacing the inspectorate with a “valued and trusted peer improvement model”.
Protect staff from student AI abuse
Bolton College delegates will call for the AoC and government to provide training and resources for teachers on “the alarming rise of inappropriate behaviour” due to students’ use of mobile phones and artificial intelligence.
Their motion says there is “increasing misuse” of mobile phones by students, including malicious recording and AI-manipulated content which threatens staff safety and welfare.
It notes “the lack of clear, nationally set guidelines on the use of mobile phones and AI” and calls on the UCU to campaign for “stricter institutional policies” with “consequences for students who engage in inappropriate conduct or misuse technology to target staff”.
UCU transparency
Some motions will be heard in a private session, meaning journalists will not be able to hear UCU members discuss and defend motions, nor witness the vote results.
One of these, proposed by the National Executive Committee (NEC), seeks to impose a progressive increase in subscription rates, effective from September 1.
The progressive increase refers to imposing a higher subscription rate on UCU members receiving larger salaries.
Meanwhile, the University of Bath UCU branch is calling for the union to “routinely publish” information it holds and to agree on a publication scheme with the NEC.
This would be a rare and unusual move for a union, which is not classed as a public authority, but would force it to act as if it was covered by the Freedom of Information Act.
UCU general secretary Jo Grady
Members will also vote to urge UCU leaders to resolve the current dispute with UCU Unite, the staff union, “as a matter of urgency”.
Vote for no confidence in Grady?
Possibly the most contentious debate could be an emergency motion lodged by Bournemouth University which will call for a vote on members’ confidence in general secretary Jo Grady.
The motion, seen by FE Week, said the union’s reported use of non-disclosure agreements and its dispute against its own staff “brings the union into disrepute” along with a call for Grady to consider her position.
Susan Acland-Hood has admitted giving false evidence to MPs about probes into FE providers.
The Department for Education permanent secretary wrote to the chair of the Public Accounts Committee to “correct an inaccuracy” she gave about the department’s policy on publishing findings of financial investigations.
Earlier this year, in a letter defending her department’s apparent lack of transparency, she claimed the Education and Skills Funding Agency’s (ESFA) policy on publishing investigations “only” applied to academy trusts.
But the publication policy covers any organisation receiving ESFA funding – including colleges and independent training providers.
The majority of the ESFA’s probes concern claims related to the £10 billion in public funding that is spent on FE each year, through 16-19 education, apprenticeships, adult education and skills bootcamps.
The DfE had made the incorrect claim to FE Week on two previous occasions, contradicting its own publication policies dating back to at least 2014, which are archived online.
A departmental spokesperson refused to engage with questions on the accuracy of her statement until we raised concerns directly with Acland-Hood and the committee last month.
The permanent secretary said the ESFA had “focused” on publishing details of investigations into academy trusts, following concerns raised by the committee in 2019.
She said: “It was inaccurate to say the scope of the previous publishing policy related only to academy trusts; its scope covered all ESFA-funded institutions, but in practice the focus was on academy trusts, and publications of reports on other remits were rare.”
A review of its investigation publishing policy in 2023 also resulted in a “strengthened and clarified” commitment to publishing reports from December 2023 onwards, Acland-Hood added.
Although it failed to clarify this at the time, the DfE also decided to water down the format of reports from lengthy and detailed investigation findings to short “outcome” reports which briefly summarise “issues” in general terms, without explaining how failures occurred.
Foundation apprenticeships have been branded a “missed opportunity” after ministers excluded high-demand industries including hospitality and retail from the inaugural list.
The government was also criticised for setting an eight-month training duration for the new entry courses – a timeframe which experts fear “blurs the lines” with level 2 apprenticeships.
It includes three for the construction sector, two for digital, one for engineering and manufacturing and one for health and social care.
Maximum funding on offer to deliver the training ranges from £3,000 for health and social care, which one provider chief branded “laughable”, to £4,500 for engineering.
The programmes, expected to launch with starters in August, will be paid jobs. They are designed for 16 to 21 year olds but can be taken by a 22 to 24 year old if they have an education, health and care (EHC) plan, were in care or have been in prison.
A cash incentive of up to £2,000 is available to employers for each foundation apprentice they take on.
Rob West, head of education and skills at the Confederation of British Industry (CBI), said apprenticeships that can be done in under 12 months “appeal to employers” and financial bonuses for taking on and retaining foundation apprentices “could significantly boost interest”.
Tina McKenzie, policy chair at the Federation of Small Businesses (FSB), said it was “good to see” the government choose “appropriate standards” as the first foundation apprenticeships, including in “key areas such as digital, which small firms consider important for their business growth”.
She added that the £2,000 incentives should also mean “more SME apprenticeship starts”.
And Tim Balcon, CEO at the Construction Industry Training Board (CITB), said that while there was “no silver bullet to solve the skills shortage facing the construction industry right now”, he hoped foundation apprenticeships can be one of a “wide array of solutions” to address the issue.
Hospitality and retail snubbed
Employers and providers from the hospitality industry proposed a foundation apprenticeship but government officials rejected it on the grounds that hospitality is not deemed a “priority sector”.
This decision was “bitterly disappointing” for Kate Nicholls, chief executive of UKHospitality, who said her sector is the “largest employer of young people in the country and uniquely placed to deliver early career opportunities”.
“This is a real missed opportunity to further enhance the options available to young people,” she added.
Jill Whittaker, executive chair of hospitality apprenticeship provider HIT Training, told FE Week that employers from the industry were “falling over themselves” to get a foundation apprenticeship off the ground.
She said: “Volumes of people start their first career in hospitality. It doesn’t mean they’re necessarily going to stay in the industry, but it is the one sector where a fast-track course can give opportunity to an awful lot of people as that first stepping stone.”
Retail employers were equally frustrated.
Andrew Goodacre, CEO of Bira (British Independent Retailers Association), said: “It is disappointing to see retail overlooked. For many years retail has had a proud history of offering young people their first opportunity to work.
“Working in a shop offers lots of variety and helps young people learn a wide range of skills from technology to people. For some time apprenticeship schemes have not worked for the retail sector, which in itself is a frustration given how much the sector pays into the apprenticeship levy.”
Simon Ashworth, deputy CEO at the Association of Employment and Learning Providers, added: “Foundation apprenticeships are a welcome addition to the skills landscape. But to succeed, they should be sector-focused rather than tied to narrow occupational routes, and made available in high-demand areas like retail and hospitality where many young people first enter the labour market.”
Level 2 lines blurred
The DfE describes foundation apprenticeships as “jobs with training at level 2” which “provide a broad curriculum focusing on job-specific knowledge and skills, while also developing employability skills and behaviours to support the transition from education to work”.
Experts raised concern that an eight-month training duration was too long for an entry course.
Multiple level 2 apprenticeships are expected to be shortened to below 12 months when the government legislates to change the minimum duration – a move due to happen this year.
Whittaker said: “If a foundation apprenticeship is eight months why are you not just going to do a level 2? That is the long and short of it.”
“Four months is fast tracking, eight months feels like a lifetime when you’re 17,” she added.
Whittaker argued the DfE has legally tied its hands to an eight-month duration because it has called the foundation courses an apprenticeship, which is a protected term.
She also said the health and social care foundation apprenticeship funding band of £3,000 was “frankly laughable” and “not going to happen” in terms of training costs.
Ashworth believes the proposed minimum duration of eight months “risks blurring the lines with level 2 apprenticeships”.
Instead, these programmes “should be six months long, giving employers a distinct option that can also serve as a stepping stone into full apprenticeship programmes at level 2 and above”.
But Alex Veitch, director of policy at the British Chambers of Commerce, said the eight-month duration is “important to maintain rigour” for a valued qualification like apprenticeships.
The St Martin’s Group, a membership body for the country’s largest apprenticeship providers, is due to publish research about foundation apprenticeships with Ipsos next month.
A spokesperson said the study shows “mixed views as to whether foundation apprenticeships will be used”.“They appear to have more appeal for smaller employers, with larger employers more certain not to or unlikely to use them,” they added. “Views on their suitability also vary across sectors, so their success will require a nuanced approach and further engagement to communicate their potential impact and benefits effectively.”
A new level 2 administration assistant apprenticeship standard has been assigned a provisional funding band of £6,000, the standard’s trailblazer group chairs have revealed.
Approval of the standard has been subject to a lengthy campaign after its popular predecessor business administration apprenticeship framework was switched off in 2020.
The Institute for Apprenticeships and Technical Education’s (IfATE) route panel and approvals committee have now approved the standard, its funding rate and end point assessment plan.
In an email to the trailblazer group this week, seen by FE Week, trailblazer group chairs Lisa Shepherdson, apprenticeship manager at Hull City Council, and Sharon Blyfield, head of early careers and apprenticeships at Coca Cola Europacific Partners, celebrated gaining “formal confirmation”.
They called the £6,000 funding rate “encouraging”, although this figure – which is higher than the £5,000 level 3 business administrator funding band – is indicative and may well be subject to change.
Apprentices start in September?
The group now hopes for final sign off by the education secretary within the next twelve weeks, in time for the start of the new academic year.
Speaking to FE Week, Bylfield said: “The reason why this is such a journey but so important is when we look at opportunities for those who haven’t been as academically strong, the original level 2 framework had a high volume of uptake.
“If you’re not academically strong and want to start a career or job role, you’ve got to be able to have a route that allows that.
“We all know apprenticeships are a great platform to build that foundation.”
Until now, IfATE has rejected the new level 2 standard, arguing that it failed to meet requirements about duration and quality, and it overlapped with its level 3 equivalent.
Byfield said the group worked to ensure the new standard was “absolutely clear” on its purpose, its knowledge, skills and behaviours, and that the separation with level 3 was unambiguous.
She added: “There were lots of different views, to get to this we had to do a lot of influencing with current and former IfATE colleagues to demonstrate its value.”
More than 900 private and public sector organisations took part in a survey informing the trailblazer group of the skills and behaviours needed from the standard and get it over the line, with 99 per cent supportive of its current form, FE Week understands.
Offenders in open prisons could get more opportunities to work or train on day release under proposals for prison sentencing reform.
The landmark Independent Sentencing Review, published this week, also recommended the use of artificial intelligence to help prisoners with employment, education and probation support, voluntary chemical castration for sex offenders, and an “earned progression model” that mimics US reforms.
The review, chaired by former Tory justice secretary David Gauke, included suggestions to replace more custodial sentences with punishment within the community in an attempt to shrink the prison population by around 9,800.
Gauke’s proposals would seek to reward offenders for complying with prison rules through an “earned progression” model, where they can progress from custody into the community.
Meanwhile, justice secretary Shabana Mahmood is poised to propose legislation that will “go further” than Gauke’s recommendations, including considering making chemical castration mandatory and putting offenders to work in the private sector where their salary would support victims.
The Independent Sentencing Review recommended “ increasing and tailoring” the use of open prisons where suitable, adding that eligible inmates with little time left on their sentences could spend some or most of the day on licence to carry out work, education, or other resettlement activities.
It said: “Open prisons can lead to better outcomes for offenders – there is research indicating that open prisons and temporary release schemes offered within the open estate can positively impact reoffending.”
The review recommended the “creation of a new, separate open regime” for offenders with little time left, allowing the prison estate to focus on rehabilitating convicts with longer sentences.
Meanwhile, Gauke recommended the government collaborate with the tech industry to adopt AI assistants such as Sherlock AI, to offer “low-risk” prisoners personalised rehabilitation plans, and analyse compliance data to “predict breaches”.
The tool could also help with earlier intervention by connecting inmates with education and employment services or mental health support.
While no evaluation has been made yet on Sherlock AI, the tool gives access to job listings, educational resources and vocational training programmes, its website explains.
The review was commissioned to find answers to overcrowding, including alternatives to custodial sentences, after thousands of inmates were released early last year as an emergency measure.
Gauke said: “The scale of the crisis we are in cannot be understated. Overcrowded prisons are leading to dangerous conditions for staff and contributing to high levels of reoffending. We cannot build our way out of it.”
An extra £190 million will be funnelled into 16-19 education from September, the education secretary has announced.
Bridget Phillipson has said the funding, £160 million of which will be for colleges and other 16-19 providers, should be used for “strategic priorities, including [staff] recruitment and retention”. The remaining £30 million is for schools as part of a £615 million deal towards a 4 per cent pay award for schools, also announced this afternoon.
This funding comes on top of already planned increases to 16-19 funding rates of 3.78 per cent for 2025-26 announced in March. The Department for Education (DfE) promised to revise 16-19 allocations by June.
DfE will use the £160 million to increase per-student funding rates, programme cost weightings, English and maths delivery and disadvantage funding lines.
But their decision to route funds through 16-19 study programmes will once again disadvantage colleges and providers with larger cohorts of adult learners and apprentices.
In a lengthy written ministerial statement this afternoon accepting the School Teachers’ Review Body’s recommendation for a 4 per cent pay rise in 2025-26, Phillipson said: “Alongside this announcement for schools, I am pleased to be able to announce that we will also invest an additional £160 million in financial year 2025 to 2026 to support colleges and other 16 to 19 providers.
“This will power our growth mission and enable these institutions to address the immediate challenges they face in recruiting and retaining the expert teachers so essential to delivering our plan for change”.
Although it has no formal role in setting teacher pay in colleges, this was the first year the STRB was asked to provide the government with evidence about pay in colleges.
Colleges and unions have campaigned heavily for extra funding to close the growing pay gap favouring school teachers over college teachers.
Gap analysis
STRB’s report, published today, cited Institute for Fiscal Studies estimates that the pay gap stood at almost £7,000, or 18 per cent, in academic year 2024-25.
Further education college unions and the Association of Colleges (AoC) will begin negotiations for a pay recommendation for 2025-26 next month. Meanwhile, sixth form college leaders hope today’s funding announcement can stave off further strike action.
Alongside pay demands, colleges are also facing “unprecedented” growth in 16-19 student numbers due to a population bulge hitting the post-16 sector.
David Hughes, AoC chief executive, said the funding “aimed at supporting colleges to match the pay increase recommended for school teachers is great news and very welcome”.
Bill Watkin, chief executive of the Sixth Form Colleges Association, said:
“Colleges will be very pleased to receive this welcome funding boost. The decision to extend the funding uplift to colleges as well as schools reflects the principle established in the settlement of our recent legal action that schools and colleges will not be treated differently from each other in this regard.
“We hope this additional funding will enable us to reach a pay settlement for staff in sixth form colleges, and avoid the strike action that disrupted the education of so many young people earlier this year.”
But the extent to which the extra funding will be enough to match the 4 per cent school teacher pay award is contested.
UCU general secretary Jo Grady said: “As a bare minimum, college staff must be given the same uplift as school teachers as a step towards closing the pay gap between schools and colleges.
“The additional 16-19 funding is welcome, but will fall short of what the sector needs given an additional 60,000 16-19 yr old students are projected to enter the sector over the next two years.”
Gerry McDonald, who leads AoC’s pay negotiations with unions alongside running New City College was more positive.
He said: “Colleges work hard to recruit and retain great staff, and we want to pay our staff the wage they deserve. The funding announced today is a step towards being able to do just that: it means that the gap between school teachers’ pay and pay for college staff will not continue to increase,” he said.
