Clawback ‘possible’ on £91m overpayment

Providers who shared in a £91m Skills Funding Agency overpayment could yet be asked to hand back some of the cash while current allocations could also be reduced, FE Week can reveal.

The agency published details this month of providers who received funding for education in the 2011/12 academic year that they had not delivered.

The overall figure totted up to £91m and the agency said it was looking at cutting 2012/13 allocations — but it has since said it was also “in discussions” separately with a view to seeking clawback.

An agency spokesperson said: “The agency published figures for the end-of-year performance position for colleges and training organisations for the academic year 2011/12 in December 2012.

“Where the published data shows that a college or training organisation has funds against which it has not delivered, the agency is in discussions with each provider about the use or return of any funding not delivered.

“The agency continues to ensure funding is used for the direct benefit of learners and employers.”

The agency declined to name the providers affected and those who could be asked to pay money back.

Learndirect, Newcastle College and South Thames College topped the list of overpaid providers.

Learndirect delivered £117,132,144 of education, but was paid a further £5,333,722.

An agency spokesperson said it had been in talks with the Sheffield-based firm and that its funding was now assessed differently with it having turned private. It was bought from the Ufi Charitable Trust in 2011 by LDC for around £40m.

“While Learndirect is now a private provider, this did not apply to the whole of the academic year 2011/12,” she said.

“Discussions are taking place with Learndirect, as with all providers, about the use of or return of funding not delivered.

“Learndirect now operates under new terms and conditions and is paid like all other private training organisations on actual delivery.”

A Learndirect spokesperson said they “discuss regularly with the SFA the use of funding,” adding: “We have offered to use funding from last year to help support the current demand for Learndirect provision.”

Newcastle College received £38,197,511 of agency cash, £4,731,682 more than the value of the education it delivered.

A spokesperson said the overpayment was “a national issue and most FE providers did not fully meet their contracts, mainly due to a late change in the rules by the agency about who was eligible for fully-funded courses.”

He added: “We had the largest contract of any FE provider nationally, so naturally we also had one of the largest surpluses. However, when looked at as a proportion of our contract, the overpayment is 14 per cent, which puts us 44th in the table [based on percentage overpaid].”

However, he said it was “not appropriate us to comment further at this stage [on potentially paying the agency back].”

South Thames College was paid £19,297,14, £2,447,968 more than the value of education it delivered.

A spokesperson said it had nothing to add to its initial statement on the overpayment itself, which read: “Despite the college delivering 98 per cent of the adult standard learner numbers in 2011/12, it achieved some £2.4m less funding for the same volume of work compared with 2010/11.

“The reduced funding resulted from changes introduced by the agency for 2011/12, in particular the changes regarding benefits categories.”

Inspection ‘delight’

The principal of an FE provider said she led her centre to an outstanding Ofsted inspection result by focusing on teaching and learning.

Maria Gilling, 52, principal at Walsall Adult and Community College (WACC) (pictured right), said she was “delighted and really proud” of her staff for achieving grade 1 — outstanding — in 23 out of 24 Ofsted category areas.

The local authority provision centre which caters for around 8,000 learners and employs around 160 staff was inspected in December.

“I feel most proud of our teaching and learning results and delighted for our students and staff,” said Ms Gilling who oversaw a merger between of Walsall Community College and the College of Continuing Education which created WACC in 2009.

The centre was last inspected by the education watchdog in 2010 when it was deemed grade 2 — good.

“Because we were inspected in 2010 we were truly not expecting this. Obviously under the new inspection framework there is such a short notice period so what Ofsted see is truly what happens every day.

“During our previous inspection teaching and learning was deemed satisfactory but that’s not what we’re about so we focused on effectively shifting two grades in that area.”

She said her passion came from her own teaching background after working for a number of years as an English, communications and media teacher.

“I sent out the message really clearly that every day of every week the student comes first and I tried to develop a real pride in our teachers, recognising they have a really demanding job to do. I’ve invested in their support, training and development.

“We also have high expectations of our students,” she said.

Another area of which she feels exceptionally proud is equality and diversity which has also shifted from satisfactory to outstanding.  WACC is located in some of the most deprived areas of the country, she said and the borough of Walsall has one of the highest rates of unemployment. The number of people claiming out of work benefits is one third above average.

“We have dealt with this by cultivating a culture of inclusion,” she said.

“This college is for its community and reflects the community. We wanted to reach out to those with the least opportunity of success in the past, many of whom are adults not in education, employment or training (NEET).

“These individuals do not respond to newspaper adverts and posh brochures — they respond to human connection.”

She said they reached out to this group by working with eight partners across the borough such as local and social housing groups and drop-in centres and fostered a “very good” partnership with Job Centre Plus.

Under a new common inspection framework (CIF) introduced by Ofsted in September, at the time of going to press, no general FE college has been graded outstanding.

Let’s make the FE Guild representative

As the FE Guild goes through its early stages of formulation Robin Landman OBE considers an opportunity for the group to create a representative FE workforce.

As we approach the beginning of the brief consultation period for the proposed FE Guild we need to give some serious collective thought to what this new FE formation is for, and what it will actually do.

In his foreword to the guild prospectus, John Hayes referred to ‘.. a modern guild – an employer-led partnership, which brings together key sector interests including employee representatives’. He goes on to say, ‘it is crucial that the guild is truly of the sector, by the sector and for the sector’. A jaundiced observer might pose the question, if the latter statement is true, why did the call for the guild come from the minister of state, rather than from members of the sector?

However, since it is clear that the guild is now the only show in town, we must give substance to the former minister’s aspirations, rise to the challenge and ensure that the guild is fit for its eventual purpose.

Members of the Race Equality Workforce Action Group (REWAG) — a cross-sector group working towards an ethnically representative workforce — have been discussing the challenges inherent in working to achieve its goal at a time of massive budget cuts.

The recently-published census has graphically confirmed that Britain has changed more rapidly than most of us had anticipated, and this makes the development of a representative workforce vital, to reflect modern Britain and to recognise the fact that nearly a quarter of our students are from BME communities or from the rapidly growing ‘mixed’ category. Counter-intuitively, though, the FE workforce is, according to LSIS data, becoming less diverse, with the largest growth coming from the white British category, probably as a result of more redundancies amongst BME community groups.

It was an oversight to have an all-white, all-male panel presenting the bid”

The FE sector has a great story to tell the other education sectors. After the report of the Commission for Black Staff in FE, the Black Leadership Initiative (BLI) was created, and its work, initially alongside and subsequently as part of the Network for Black Professionals (NBP), led to a major improvement in representation at the most senior level. From four black principals in 2002, the number peaked at 16 in 2011, and is now 14. This makes FE leadership the most representative of all education phases, achieved primarily because the BLI was such a successful, and cost effective, positive action intervention, its consistent and high impact recently recognised by the Queen’s Diamond Jubilee Award for Volunteering.

REWAG believes that this issue is a crucial one for the sector, and that it offers an important opportunity for those developing the guild to ensure that it is firmly on its development agenda. This would give substance to the vision for the guild that it is ‘ an employer-led partnership drawing in employee representatives organisations and sector bodies concerned with workforce development’.

As well as the longer-term, REWAG members were concerned about short-term considerations. LSIS will wind up in March, and the earliest date for the guild to become operational is August, so there is a risk that the implied hiatus could have serious implications for the BLI. REWAG members seek assurances that some bridging funding is earmarked for what could be a prolonged period of uncertainty.

We also want to see representation of the whole spectrum of FE membership organisations involved in the development of the guild. It was an oversight to have an all-white, all-male panel presenting the bid consortium at the AoC conference, and that needs to be corrected by the inclusion of the Women’s Leadership Network and the NBP in future discussions, so our sector is seen to be serious about a modern conception of professionalism.

In addition, the BLI Strategy Group – a powerful and representative reference panel, met last week and was clear in its view that the BLI model works well, that it needs to be retained and indeed there is clear scope for the approach to be utilised by the sector, with appropriate adaptation, in the other equality strands.

Robin Landman OBE, chief executive of the Network for Black Professionals (NBP)

Providers ‘anxious’ over growth cash

Training providers said they could be left thousands of pounds “out-of-pocket” after the government unexpectedly doubled functional skills rates.

The Association of Employment Learning and Providers (AELP) is currently in talks with the Skills Funding Agency (SFA) about the impact English and maths rates more than doubling has had upon growth requests from providers to the agency for the first quarter of the year (Q1).

SFA issues providers contracts and at each quarter assesses how they’re performing. If they’re underperforming they can deduct money and if they’re over-performing providers can put in a case for growth to get more money — a growth request.

Paul Warner, director of employment and skills at AELP, said many providers had expressed “anxiety and confusion” because the functional skills rate rose after Q1 growth requests had been submitted, meaning many providers had now “topped out their contracts”. This has led to some having to turn away apprentices with the loss of thousands of pounds.

Matt Garvey, managing director of West Berkshire Training Consortium, told FE Week the functional skills rates increase was welcomed but the “unintended consequence” was his not-for-profit organisation would have to use money from reserves so they didn’t have to turn away learners.

“We’ve got one group of 12 unemployed adults starting this week and we didn’t feel we could cancel them so we have paid out of our own pocket,” he said.

“We cannot put any additional starts on.

“We’re now having to remove learners from our contracts and having to find providers who are underperforming to see if they’ll take them off us which is giving us a competitive disadvantage,” he said.

“It feels uncomfortable but our priority is that the learner can continue.”

He said the issue would cost his organisation between £7,000 and £10,000 per group.

“So far we’ve had to pay £30,000 delivery that we can’t fund in the pipeline,” he said.

Mr Warner said: “We have had a good deal of anxiety and confusion over Q1 growth requests. Many providers have run out of their contracts faster than they thought they would. Some are now in a situation where because they’ve topped out their contract value they cannot afford to start further starts because there’s no guarantee they’ll get further growth in Q2.”

“We’re trying to work with SFA to figure out how to make the Q2 growth process get over this issue. Through no fault of their own some providers were caught out by a rates rise that they weren’t able to factor into their growth requests.”

The SFA said in their publication Performance Management of the Sector for Quarter Two 2012/13: “The agency will look at funding needed to support changes introduced for English and Maths. Then, where funding allows, we will continue to expand the offer to the unemployed and provide growth for Apprenticeships where there is clear employer demand.”

An SFA spokesperson said: “The updated allocation/maximum contract values will be published at the end of January.

“Following the quarter 2 review the agency will publish the updated allocations/maximum contract values during April.”

Audit exposes ‘£40m’ ESF error

European funding could be at risk after a government audit uncovered “potentially” £40m-worth of errors over money dished out by the Skills Funding Agency, FE Week understands.

The situation was described as “significant and potentially damaging” to the reputation of the UK government and the agency, according to correspondence leaked to FE Week.

Errors were said to have been recorded against more than 25 providers in a sample audit of applications for European Social Fund (ESF) money.

More than 80 per cent of the errors relate to just five of the providers.

“The collective error from this, of more than 7 per cent, represents a potential £40m error, of which the agency must cover £20m,” according to the agency correspondence.

“This is therefore a significant issue and might lead to a suspension of payments to the UK and damage to the UK government’s and agency’s reputations.”

It is understood a number of errors were clerical and agency officials have been told to go back to providers before a final audit report is produced.

“We may have an opportunity to affect the final report, and reduce the impact, by finding further evidence at these providers and reducing their errors if this is done quickly,” it is added in the correspondence.

And an agency spokesperson said it would take action against providers who could not “produce the necessary evidence and paperwork to support an ESF claim for funding”.

The audit on agency ESF spending by the Department for Work and Pensions (DWP), which has overall responsibility for managing England’s pot of ESF cash, took place last year.

Allocations from the ESF, according to the DWP website, are “based on regional employment and skills needs — for example, the numbers of people not in work and who do not have good qualifications”.

The current ESF programme covers a five-year period from 2007.

It is distributed through public agencies such as the agency, the DWP itself and the National Offender Management Service.

The agency match-funds ESF money, from the European Commission, at 25 per cent and would therefore be responsible for, FE Week understands, £10m of the possible overall error.

An agency spokesperson said: “The programme, like all programmes, is subject to a cycle of regular and routine auditing.

“These audits ensure providers have the necessary controls and evidence in place to support claims made for funding.

“The ESF programme is also audited by the DWP on behalf of the European Commission.

“If as part of one of these audits a provider cannot produce the necessary evidence and paperwork to support an ESF claim for funding, the agency will take action to recover those funds as part of our routine controls and procedures.”

Union strike threat over new dismissals

A bitter dispute over the sacking of lecturers at a Midlands college looks set to worsen.

The University and College Union (UCU) balloted members at Halesowen College, near Birmingham, on strike action on Friday over the dismissal of three lecturers — all active UCU members.

The union had already staged one protest when just before Christmas maths teacher and the union’s branch secretary David Muritu was “unfairly” dismissed from his job.

Union bosses said Mr Muritu was told he was sacked due to students’ results, but they say they are above the national average and the college was to blame for any poor results.

Nick Varney of UCU said: “This is the first time in all my years’ experience where a disciplinary procedure has been used to dismiss people over national benchmarking.”

He said all four teachers had good records and it was the college’s failings such as refusal to pay for specialist cover for long-term sickness and lecturers expected to teach two different classes in two different rooms at the same time, that were instead to blame.

He added that groups of students were being pushed together even though they are supposed to be studying different material, non-specialist staff regularly covered maths sessions and there was failure to provide teaching for students in the run-up to exams.

“Selective use of information” is what allowed Halesown to get rid of the staff, according to the union.

Mr Varney added: “There is now a question over whether teachers in FE colleges can be dismissed purely on students’ attainment making it a national issue.”

Halesowen College denied it acted improperly and said action to address concerns about performance was not “undertaken lightly”.

Principal Keith Bate said it would not be appropriate to comment on the details of the situation but that they “completely refuted” “allegations of improper conduct being made against the college which appear to be associated with this situation”.

“The college will not condone consistent failure to deliver expected standards of performance including the need to be accountable for outcomes in accordance with established values and codes of conduct,” he said.

“Where there are any exceptions to a picture of strong performance being maintained across the college, it is vital that action plans are put in place with additional support and resources in order to prepare students to achieve expected levels of attainment.

“I wish to make clear to all staff that action to address concerns about performance and attainment is not undertaken lightly.  In any such case, the college is committed to a
detailed investigation of the position including reference to performance data and individual meetings with the staff involved and managers who have worked with the relevant team; that is the approach that was taken in this case.”

Record breaker raises organ donor awareness

A teenager is set to compete in the World Transplant Games after a rare genetic disorder sparked a life-saving liver transplant operation.

Adam Wall, 17, from Broadstairs, in Kent, is a sports student at Canterbury College who has been selected to represent Great Britain and Northern Ireland in Durban, South Africa, in July.

The keen sportsman is now urging others to sign up as organ donors after he survived Alagille Syndrome as a result of a six-hour transplant operation when he was just two-and-a-half years old. The life-saving procedure was able to go ahead only because an 18-year-old signed up to the organ donors’ list. The young man died in a car crash but his actions ensured Adam’s life was saved.

“Thanks to my donor I’ve been able to live a perfectly healthy life,” said Adam who has done athletics training twice a week at the Thanet Roadrunners sports club for the past five years.

“I had lumps all over my body and had turned yellow but my mum said the operation was a complete success.

“My entire liver was removed and a third of a liver was put into my body and then the rest of it grew back as the liver is the only organ that regenerates itself.”

Since recovering, he has gone on to win medals in the 2011 World Transplant Games – gold in the high jump with a record breaking (for his age) leap of 1.25 metres, and bronze in the 100m sprint and long jump.

Adam will now take part in the 100m, 200m and high jump if he can raise £4,000 to pay for flights and registration.

Adam’s college tutors have put him in touch with the Mary Edmondson Trust who donated £500 towards the £4,000 goal. Thanet Roadrunners sports club have also given £500 but he is still seeking sponsorship.

Adam said he thought the Transplant Games were a “great idea”.

“I have had the chance to meet others like me and it’s really built my confidence,” he said.

The South African Games hold a special significance for the student.

“The opening ceremony will be on the anniversary of my transplant so that will be a highlight for me,” he said.

“I’m looking forward to competing but the most important thing is letting people know that there is a shortage of organ donors and that they can help.”

Next year will be the first time he has competed in the 18 to 29 age category. He said: “I hope I can live up to past successes but it will be a lot harder. If
I can top my personal bests I’ll come home happy.”

His tutor, Jemma Cullen, said: “Adam has done amazingly well to be selected to represent Great Britain and Ireland in the World Transplant Games. We are very proud of his achievements and enthusiastic to help him raise the funds he needs.”

To donate to Adam online, go to uk.virginmoneygiving.com/adamwall2

College gets £2.2m funding immunity

A failing London college was allowed to sidestep official funding rules to keep a £2.2m overpayment as it merged with a neighbouring college.

Southwark College, which was graded inadequate following a December 2011 Ofsted inspection, merged with Lewisham College in a move welcomed as delivering “a stronger and more secure further education college”.

The merger with Lewisham College, which was graded satisfactory following Ofsted inspection last March, took place six months ago.

It had been on the cards for a year and the new, merged college is expected to be rebranded LeSoCo.

Local MP Simon Hughes, deputy leader of the Liberal Democrats, hailed the merger.

“At last a stronger and more secure further education college for Southwark has come into being,” he said.

But it came after Southwark College had avoided Skills Funding Agency rules on handing back money where education has not been delivered.

An agency spokesperson said it exempted the college from “normal year end rules,” to protect the interests of learners and employers.

The college had delivered £7,184,525 of 19+ SFA-funded education in the 2011/12 academic year — but was paid £9,386,395.

The agency at the time agreed to remove the College from the normal year end rules.”

The overpayment should not have been possible because of the difference between the amount of funding allocated to the college and the value of education it delivered.

The rules governing the issue — reconciliation rules — say that colleges can’t keep the overpayment if the amount allocated is more than 10 per cent above the value of delivery. The difference at Southwark College was above this 10 per cent.

An agency spokesperson said: “Southwark College merged with Lewisham College to address an inadequate offer of provision to learners and employers.

“To ensure the interests of learners and employers were protected, the agency at the time agreed to remove the College from the normal year end rules.

“The agency is ensuring that the merged college is able to meet its current financial obligations and deliver to its current funding agreement.”

A spokesperson for the merged college, which currently goes under the title Lewisham College incorporating Southwark College, said: “We have nothing further to add to the agency statement.”

The combined college, which has the rights to the Lesoco.net internet domain, is led by Lewisham College principal Maxine Room CBE.

Mr Hughes said after the merger last year: “It is a tribute to the two governing bodies, the Skills Funding Agency, the Department of Business, Innovation and Skills, and not least to the two principals of the two partner colleges, Ruth Gilbert and Maxine Room, that this merger has taken place.

“The next job is to build up the profile and range of courses provided by the new college to maximise the chance for local people of all ages to gain the skills and qualifications they need for the job market of today and tomorrow.”

Southwark College was dissolved and its assets and liabilities transferred to Lewisham College.