Ministers have launched a voluntary exit payout scheme for Department for Education staff without the “skills the department needs for the future”, as it seeks to cut around 10 per cent of its workforce.

Staff were told about the “selective voluntary exit scheme” on Monday. In a message seen by FE Week’s sister publication Schools Week, the DfE said said it aimed to get staffing numbers “closer to” 2020 levels, when it employed around 7,000 people. 

The department will offer eligible staff three weeks’ salary per year of service to leave next May. Managers will “robust and fairly” assess civil servants’ applications to the scheme.

A voluntary exit scheme is not the same as voluntary redundancies, and as such can offer different terms. The DfE told staff it has no plans to make redundancies, but has also ruled out simply not replacing those who leave through “natural attrition”.

According to official figures, the DfE and its agency the Education and Skills Funding Agency employed 8,294 people as of September. In pre-pandemic February 2020, the two organisations had a joint headcount of 7,489.

If numbers are cut back to this level, this would mean a 10 per cent reduction on current levels, though the DfE today insisted it was not a target-driven scheme.

Prime minister Rishi Sunak recently axed plans to cut 91,000 civil service jobs over three years, saying he did not “believe that top-down targets” for headcount reductions are “the right way” to save money.

But he said the government would ask every department to look for “the most effective ways to secure value and maximise efficiency within budgets, so that we can use taxpayers’ money sustainably in the long term”. 

Union expresses fears over voluntary exit scheme

Helen Kenny, national officer at the FDA senior civil servants’ union, said her organisation was “concerned that there is no real waste to be cut and ministerial priorities still need to be delivered”. 

“We need to see concrete proposals regarding how the department will match commitments to resources – bluntly what work is not going to be done – otherwise our members’ health and wellbeing is being placed at risk.”

In documents sent to staff, the DfE’s leadership team said the department had “grown a lot” over the last few years, but its spending review settlement meant “we need to get a bit smaller again”. 

Last year’s spending review allocated £77 billion to the department for this financial year, an increase of almost £7 billion on 2021-22. However, the vast majority of the budget is distributed to schools, colleges and universities, leaving around £5 billion.

The DfE said it had ruled out losing staff only through natural attrition, where employees are not replaced when they leave, as this “would mean an extended period of slow and difficult recruitment constraints”. 

The exit scheme will allow the department to “move quickly, to be more confident that those who are leaving aren’t taking our best skills with them, and, when it is done, to operate with more freedom and flexibility than a long, slow attrition”.

The department said it would have a “robust and fair selection process”. But not everyone who wants to leave can take up the scheme, as it is only “for those who don’t have the skills the department needs for the future”. 

Managers could use a “range of factors” to assess the applicant, including their “core skills” and “future operating models”. DfE said it would be unlikely to support an application for someone with “hard-to-replace specialist skills” which they “continue to need”.

No staff should ‘feel pressured’ into applying

DfE insisted the scheme was “entirely voluntary” and “no one should feel pressurised into applying or taking a voluntary exit package”.

In the documents, the department said it had no plans to make voluntary or compulsory redundancies. 

Staff will have two weeks to apply later this year. If they accept the package of three weeks’s salary per year of service, they will leave in May next year. 

If a staff member leaves and is not replaced, the management team will “readdress priorities based on capacity and adjust workload accordingly”. 

It comes as ESFA staff have been moving over to the department as part of a reorganisation. 

In 2020, DfE had a total of 5,307 employees and ESFA had 2,182. In September, this had moved to 7,480 at DfE and just 814 at ESFA.

The DfE was approached for comment.

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.