Aspirations to ramp up degree apprenticeships in England will be stifled unless the government raises the profile of the courses, universities have warned.   

FE and HE minister Michelle Donelan told universities this week to set “ambitious targets” to boost the proportion of students studying degree apprenticeships, as part of an order to rewrite their plans around access and participation.   

Universities will need their plans signed off by the Office for Students’ new director for fair access and participation, John Blake, in order to be able to charge higher fees.   

The degree apprenticeship targets will be decided upon in conjunction with the OfS, although there will not be a one size fits all approach, the Department for Education confirmed.   

University representative bodies have welcomed the move, but warn of several challenges that could hinder the ambition.   

Rachel Hewitt, chief executive of MillionPlus, told FE Week a key issue for her members surrounds “a relative lack of student demand” for degree apprenticeships.   

“To address this, perhaps the place for the government to start would be on helping to raise the profile of these courses,” she said.   

“Moves to make the courses less bureaucratic, particularly around the end-point assessment, would also go some way to make degree apprenticeships more appealing to providers.”   

A spokesperson for Universities Alliance said: “To help ensure people access the provision that is right for them, the government should commit to practical initiatives in partnership with employers, apprenticeship providers and post-16 providers to raise the profile and benefits of higher and degree apprenticeships.”   

They added that the process for setting targets must acknowledge that apprenticeships are an employer-led system and take account of the local context, including current and future demand for higher-level skills in different sectors.   

“Targets should also not be set in a policy vacuum ̶ many universities will be delivering at least some of their apprenticeship provision at a loss, and several questions remain on apprenticeship funding, as well as the demand and financing for higher technical qualifications,” the spokesperson told FE Week.   

Degree apprenticeships’ popularity has soared since their launch in 2015. Data published by parliament shows there were around 1,000 starts recorded in that year, which increased to over 13,500 in 2018/19. This is, however, still much smaller than the number of undergraduates in England which stood at 455,000 at the time.   

Education select committee chair Robert Halfon challenged Donelan on the DfE’s work in this area during an accountability hearing last month, during which he said there should be a target of having 50 per cent of students doing degree apprenticeships.   

In response, Donelan said: “I share your passion on degree apprenticeships. We have come a long way but there is a long way to go. If we look at the stats, degree apprenticeships increased by 80 per cent despite the pandemic but it is not good enough. I want every university to be holding degree apprenticeships, not one or two.”   

She went on to say that her department was exploring whether to introduce financial incentives to entice more universities to offer degree apprenticeships.   

Cash incentives are absent from this week’s announcement, but Donelan insisted that all plans to widen participation in areas like degree apprenticeships must be drawn up with “needless complexity and bureaucracy cut out”.   

A Russell Group university spokesperson said over half of their members already deliver higher and degree apprenticeships and they “look forward to building on their existing work with colleges and businesses, offering a range of options to young people and supporting them through university and into the world of work”.   

Professor Steve West, president of Universities UK and vice-chancellor of UWE Bristol, added: “It is positive to see a focus on part-time courses, higher technical qualifications and degree apprenticeships and we look forward to working with government to boost demand for more diverse and flexible ways of learning.” 

The Education and Skills Funding Agency (ESFA) has published its annual report and accounts for the last financial year. 

The organisation, an arms-length body of the Department for Education, was responsible for distributing £65 billion of funding to the education sector in the year to March 31 2022. 

Here’s what you need to know…

1. Incentive payments flagged for fraud

The government’s own internal audit service served the agency with a “limited assurance” for two of the 17 reviews it conducted. One was for the ESFA’s oversight of its own cyber-security, but the other was for the employer incentive payments for apprenticeships scheme. 

The Government Internal Audit Agency gave this, the lowest achievable, after “highlighting the need for the fraud prevention measures to be appropriate and proportionate”. The recommendations are being “addressed” by the DfE, not the agency, as they now hold responsibility for apprenticeships following the recent arms-length-bodies review. 

2. £5m fraud found in incentive payments and Covid-19 funds

The agency managed two rounds of employer incentive payments for apprenticeships and traineeships during the financial year, with 108,000 claims totalling £315 million. £219 million had been paid by year-end.

Both rounds of the apprenticeships incentives scheme were flagged for in-depth Cabinet Office fraud risk assessments, alongside the traineeships incentive payments and the Covid-19 provider relief scheme. This was because funding was going to providers outside of the usual funding rules. 

The ESFA reports that across all of those funds, £5 million worth of fraud was detected to date, with £4.5 million of that recovered in the financial year. A further £2.2 million of fraud was reportedly prevented.

The agency can’t report how much fraud was detected and recovered per fund because the data was “captured as part of consolidated data returns”. 

3. Nearly £1.5m lost to overpaid providers

Three “overpaid grant recoveries” were written off this financial year, totalling nearly £1.5 million. Overpayments which can’t be clawed back, either because the provider fails or the ESFA decides to abandon the claim, are written off. Those amounting to more than £300,000 are recorded in the accounts:

• CCP Graduate School Ltd: £317,000
• Ingeus UK Limited: £731,000
• SCL Security Limited: £429,000

This is much less than the £9.5 million lost last year.

4. Late tax submission cost £2.5m

A late submission of a VAT reclaim for “contracted out services” meant ESFA lost £2.5 million. It “reviewed controls” to prevent this happening again. 

The government will sometimes waive debts owed by providers as part of mergers, or to support closures.

Cheadle and Marple Sixth Form College, which merged with Trafford College in May 2021, had debts of £2.2 million waived, according to the ESFA accounts.

£1.9 million was written off across three University Technical Colleges.

5. Only three colleges in FE Commissioner intervention 

Only three intervention assessment were carried out by the FE commissioner. However alongside these were 33 visits to “a reducing number” of colleges in intervention. 

Intervention reports that were published over the 2021-22 financial year included City College Southampton, Kingston Maurward College and City Lit. 

6. £2.1m paid to wrong recipient

The ESFA admitted that in December 2021, £2.1 million was “erroneously paid to a wrong vendor” in an “unexpected issue”. 

It happened when a new vendor was added to the system using an incorrect reference number.

But the money was full recovered and re-issued to the correct payee and ESFA has made improvements to the process to help prevent errors. 

7. At least £30k in ESFA exec bonuses

Ten executive staff members received a bonus, meaning at least £30,000 was handed out, about half of the total value of payouts in the previous years.

Warwick Sharp, who served as director of academies and maintained schools during the time period, received a bonus of between £10,000 and £15,000. Four others were given between £5,000 to £10,000 each.

John Edwards, the ESFA’s interim chief executive officer, was paid a salary of between £135,000 and £140,000. This is below the salary of previous CEO Eileen Milner who was on £150,000 to £155,000.

David Withey was appointed as permanent CEO in August 2022, so his pay is not in these accounts.

The Department for Education has been reprimanded over a “serious breach” of data protection law which allowed a firm providing age-verification for gambling companies access to the personal information of millions young people.

But the department has avoided a fine of over £10 million from the information watchdog, despite a warning over “woeful” data protection practices.

An Information Commissioner’s Office investigation into data shared from the learning record service (LRS) found “prolonged misuse of the personal information of up to 28 million children”.

The LRS holds data on pupils and learners over 14 for 66 years, and is only supposed to be accessed for education purposes.

But the Sunday Times revealed in 2020 that employment screening firm Trustopia had used the data to provide age verification serves to the GB Group, to help gambling companies confirm customers were over 18.

The ICO launched its investigation after it was notified by the DfE, which only became aware of the breach because of the national news story.

Screening firm looked up 22k learners

According to the watchdog, Trustopia had access to the LRS database for over a year from September 2018 to January 2020, and carried out searches on 22,000 learners.

The ICO ruled today that the data was shared “without appropriate control or oversight”, and that the DfE “failed to protect against the unauthorised processing by third parties of data held on the LRS database for reasons other than the provision of educational services”.

Data subjects were also “unaware of the processing and could not object or otherwise withdraw from this processing”. The DfE “failed to process personal data fairly, lawfully and transparently”, breaching the general data protection regulations (GDPR).

“No-one needs persuading that a database of pupils’ learning records being used to help gambling companies is unacceptable,” said information commissioner John Edwards.

“Our investigation found that the processes put in place by the Department for Education were woeful.”

DfE dodges £10m fine for data failures

The ICO said it “considered” issuing a fine of just over £10 million, which would have been “effective, proportionate and dissuasive”.

However, due to a “revised approach” by the ICO to public sector organisations, the watchdog settled for a formal reprimand.

“This was a serious breach of the law, and one that would have warranted a £10 million fine in this specific case,” said Edwards. But he chose “not to issue that fine, as any money paid in fines is returned to government, and so the impact would have been minimal”.

“But that should not detract from how serious the errors we have highlighted were.”

The DfE had continued to grant Trustopia access to the database after it advised officials it was the new trading name for Edududes Ltd, which had been a training provider.

But Trustopia “was in fact a screening company and used the database for age verification, a service they offered to companies including GB Group, which helped gambling companies confirm customers were over 18”.

“This data sharing meant the information was not being used for its original purpose. This is against data protection law.”

DfE revokes access for a fifth of organisations

The ICO said that at the time of the breach, 12,600 organisations had access to the LRS database, “including schools, colleges, higher education institutions, and other education providers”.

These organisations get access so they can “verify a number of functions including the academic qualifications of potential students or check if they are eligible for funding”.

Since the incident, the DfE has removed access from 2,600 organisations.

It follows a damning audit of the DfE’s broader data processing activities by the ICO in 2020, which also found the DfE broke data protection laws in how it handled pupil data.

The DfE still hasn’t met its pledge to publish the full audit report, and now also faces potential legal action from data privacy campaign group Defend Digital Me over the way it handles data.

A DfE spokesperson said the department takes the security of data “we hold extremely seriously”, adding that it will publish a full response to the ICO’s letter by the end of the year, setting out “detailed progress in respect of all the actions identified”.

No regulation for dissolved firm Trustopia

The ICO said today that it had conducted a simultaneous investigation into Trustopia, “during which the company confirmed it no longer had access to the database and the cache of data held in temporary files had been deleted”.

The firm has since been dissolved, meaning regulatory action was “not available”.

It comes after FE Week revealed in 2020 that Trustopia co-founder Ronan Smith had previously run a private provider called Edudo, which was investigated by the Education and Skills Funding Agency in 2017.

The agency subsequently terminated the firm’s contracts, which were used to deliver courses funded through advanced learner loans.

Smith then transferred Edudo’s assets to a new company called Learning Republic and went bust. Hundreds of learners were subsequently left thousands of pounds in debt with no qualifications to show for it.

Smith was approached for comment, as was the GB Group.