The Education Act 2011 has been widely heralded as a positive move for the FE sector, providing colleges with significant new freedoms to develop and deliver more learner-focused services.

But, like any new legislation, the Act has brought with it a range of new challenges. Elizabeth Delaney, associate at business law firm DWF, looks at how to make the most of the Act’s new freedoms.

Greater autonomy
With the government seeking to put FE and sixth-form colleges on a similar footing to charities operating within the independent / private sector, the Act has reduced the financial restrictions and controls faced by FE institutions. This financial autonomy will allow colleges to be more creative in how they initiate new training schemes to meet the needs of employers and learners. Direct central government oversight will also be reduced, allowing colleges to dedicate more time and resources to supporting learners.

By exempting high performing colleges from routine Ofsted inspections, for example, the Act will allow teachers to focus on the needs of their students, rather than on meeting targets.
Constitutional reform. The Act will allow colleges to change their constitutional structures and governance procedures. They now have the right to modify and replace their constitutional instruments and articles without seeking permission.

This will allow them to introduce more flexible structures and develop more effective ways of working. They can dissolve and move to more flexible legal forms if considered appropriate. This is a major step, and will allow FE institutions to look at adopting innovative business structures – such as social enterprise models or joint venture companies – or to develop strategic alliances with other educational institutions so that they can share best practice.

A bright future
The changes have been introduced to create a more transparent marketplace in which colleges are accountable directly to their stakeholders – their learners and local community – rather than central government. This will be reinforced by the introduction of student funding streams which are easier to access, and to find out about.

Stakeholder engagement will take on a new level of importance as colleges strive to use their increased powers to develop new and better services. As recent Department of Business, Innovation and Skills draft regulation has made clear, the government intends for stakeholder consultation to be a central element in implementing structural and / or constitutional changes.

The government’s ultimate ambition is that the changes to FE will help to support a virtuous circle, where colleges compete to attract learners by developing more innovative services and delivery methods that meet local demand and improve quality. This, in turn, is expected to create a more diverse sector.

Getting on board
The immediate impact of the Act will differ between institutions. Some colleges will feel that their existing structures do not prevent them from achieving their objectives, while others may feel that they can deliver better results if they implement a radically new business model. However, before coming to any conclusions on which path to take, decision-makers – governors or chief executives – need to review their institution’s existing constitutional documents and consider whether or not they provide the flexibility needed to deliver the college’s strategic objectives.

It is important not to go through the upheaval of changing legal form purely because of the apparent attractiveness of alternative models; in many cases colleges may well be able to achieve their aims through much more subtle methods. Partnerships are likely to become a more important aspect of the FE sector as accountability is devolved to local stakeholders. Colleges may find that the most effective way to support their learners and wider community is to work with a local academy, university or employer.

International partnerships are vital to bring out the best in FE, says Amarjit Basi, Principal of New College Nottingham, in a comment on a recent speech by the chief inspector Sir Michael Wilshaw

Sir Michael’s advice that colleges should “worry more about Deptford not Delhi” have provoked a diverse range of views. As an FE college that is sponsoring a new venture in Delhi, it inspires us to explain how international partnerships enable us to link to our community diaspora, and to extend educational opportunity to our students.

Like Delhi, Nottingham is young, ambitious, innovative and cosmopolitan. Once famous for lace and other manufacturing, it is now 84 per cent service-based, re-creating itself around the international knowledge. And some of
Nottingham’s fastest growing and most successful small businesses come from our Indian community.

Delhi, the largest commercial centre in northern India, has economic growth of about 11 per cent a year. Like Nottingham, it has a strong dependency on the service sector, and a shared recognition that advanced
manufacturing, clean technologies and entrepreneurship underpin further and sustainable future growth.

Report after report from major research organisations, such as the OECD, the McKinsey Institute, the World Economic Forum (WEF) and the Institute for Public Policy Research (IPPR), focus on the changing profile of international research and development (R&D), education, training and learning. The WEF, for example, expect that within five years, about 30 per cent of multinational companies will locate more than a quarter of their R&D in emerging economies.

As China, India and Brazil flex their R&D muscles, and innovative approaches to learning gather pace, such as mobile learning technologies and new Internet strategies, not being involved in international vocational developments risks cutting off the flow of ideas from some of the most dynamic economies in the world.

It is these economies that in 20 years will be recognised as setting the standard for educational innovation and R&D. According to a report from McKinsey, India and China alone are expected to swell the global graduate workforce by a net 184 million over the next two decades, providing two-thirds of the world’s increase in science and engineering graduates – with India, in particular, likely to produce a surplus of high-skill workers.

So we must look outward. International initiatives need to bring the best of educational practice within reach of each college’s local community, and enhance their capacity to deliver high quality outcomes for their learners and communities.

Indeed, current and planned reforms of our educational system stress that for too long we have been inward-looking, and that standards that do not take account of international benchmarks sell our young people short.

The IPPR report ‘Oceans of Innovation: The Atlantic, the Pacific, Global Leadership and the Future of Education’ (2012) offers a way forward. It argues that the pace of worldwide innovation is now such that in the future ‘everyone has to think like an entrepreneur’. This crucially links trends in worldwide R&D and the accompanying innovation spin-offs with the need for entrepreneurial learning.

We must seek out the best educational practice across the world, with a conscious strategy of cross-fertilisation of ideas and innovation. The race to the top for our students depends upon academic and vocational excellence, but will be differentiated by those individuals, communities and economies that demonstrate entrepreneurial mindsets. Only through this will our students benefit from the best ideas from across the world, and be supported to compete in the world market for skilled labour.

Curiosity, creativity and connectivity are king in a world where innovation and enterprise have become watchwords for economic success.

As a founding member of the Gazelle Colleges Group, we are committed to playing a pivotal role connecting to global labour markets and innovation networks. In our case, this means working in partnership with local employers and entrepreneurs – many with global presence (Experian, Alliance Boots, Speedo, Rolls-Royce and Capital One) – to support our students to realise their personal aspirations and to prosper when they emerge into a global labour market.

We are planning to open a vocational centre in Delhi to support the much-needed development of intermediate and higher level vocational and technical skills in India’s rapidly growing construction and service economy. It will also allow us to improve teaching, learning and training in Nottingham and to better prepare learners for the global marketplace.

We must actively interact with and measure ourselves against the rest of the world to enable this nation’s students to win ‘the race to the top’. In this way, we believe that we will enhance our students’ transition to meaningful employment, support business growth and contribute to community well-being.

The race to the top is as critical in Deptford as it is in Delhi.