The entire £1.5 billion adult education budget should be put out to tender owing to “persistent annual underspends and too much poor-value subcontracting”, the Association of Employment and Learning Providers has said.

It wants the “now totally discredited system” of allocating funds abandoned, including in devolved areas, which are set to take control of half the AEB from September.

Analysis by the AELP shows a budget underspend of £63 million in 2016-17 and an estimated underspend of £76 million in 2017-18 – a year in which private providers could only win AEB cash by bidding in a £110 million tender, while colleges had their contracts automatically renewed.

We can’t afford to tolerate any more the poor value being delivered

Colleges were, however, allowed to bid to gain extra funding, and FE Week research published last week showed that, of those colleges who won in the procurement, they underspent their original procured allocations by 26 per cent.

In stark contrast, all other providers exceeded their initial contracts by 31 per cent.

Moreover, four of the 19 college tender winners failed to deliver any of their procured AEB funding, and admitted that their non-procured contracts were sufficient to meet demand.

AELP estimates that in the same year, just under a quarter of total AEB was subcontracted, “essentially by colleges to independent providers for the latter to deliver adult skills provision”. 

A spokesperson said that while good AEB subcontracting “plays an important role, it is AELP’s view that too much subcontracting is not being driven by strategic planning designed to benefit local communities”.

“This results in less money reaching frontline training because funding is being swallowed up by management fees and undesirable brokerage,” he added.

A new policy paper by the AELP has also described how the devolution of the AEB for 2019-20 has resulted in “major changes” to the way the funding is being allocated and procured across England, which has led to “unintended consequences”, particularly for private training providers.

There is now a risk that “flexible, high-quality and specialist adult education and skills provision may be removed from areas, leaving gaps for learners and potentially having a detrimental impact on the social mobility of unemployed adults and adults in employment looking to progress”, it said.

The Greater London Authority and six other mayoral combined authorities are due to get control of half the country’s total AEB funding from 2019-20.

Nearly all of the devolved areas have procured anything between 22 and 30 per cent of their allocations. But one, Tees Valley, has put all of its devolved AEB out to tender.

The AELP said a 100 per cent procurement approach for the national and the devolved AEB would be an “effective way to ensure the funding is directly available to those providers who meet the local needs for individuals and employers”.

Under AELP’s proposals, all provider groups would be required to bid for “realistic” funding amounts based on their capability to deliver against the priorities set out under each area’s skills plans and emerging Local Industrial Strategies.

The association has also called for greater transparency around the level of AEB that is being subcontracted, with twice-yearly reporting by the authorities and agencies of the relevant data.

AELP’s chief executive Mark Dawe  (pictured) said: “The uncertainty over Brexit means that it would be foolish for anyone to get their hopes up on what the Spending Review might yield for further education and skills. 

“Therefore we can’t afford to tolerate any more the poor value being delivered under the adult education budget. By moving to full commissioning, more adults in local communities are likely to receive the support they need to secure sustainable employment.”

“Extremely tight” delivery timescales, a lack of viable industry placements and limited public transport are among the key challenges facing the first providers set to deliver T-levels, according to research shared exclusively with FE Week.

Speculative fears about how the new post-16 technical qualifications could falter have been widely reported since they were first mooted in 2016.

A study by the National Foundation for Educational Research, which conducted interviews with half of the 50 providers that will deliver the first T-levels in education, construction and digital from September 2020, has now exposed the true challenges that are threatening their success.

Timescales were extremely tight, which could impact on the quality of their initial offer

According to the report, all of the providers were enthusiastic at the opportunity to be at the “forefront of what they saw as a major, exciting change to England’s technical provision”.

However, detailed information on T-level content, assessment and the industry placement is not scheduled to be available by March 2020, a timescale which means providers “only have about six months to fully develop their curriculum and industry placement plans, properly assess their capacity to deliver and the resources required, and address any skills and knowledge gaps”.

“Interviewees highlighted there was a large amount of work for them to do and the timescales were extremely tight, which could impact on the quality of their initial offer,” it added.

T-levels were originally meant to be rolled out from September 2019 but skills minister Anne Milton announced a delay of a year in July 2017.

The Department for Education’s permanent secretary, Jonathan Slater, then had a request for another year-long delay rejected in the first ever ministerial direction issued by an education secretary last May.

Since then, top government officials including the Institute for Apprenticeships and Technical Education chief executive Sir Gerry Berragan have expressed fears about the “worringly tight” delivery timescales.

One of the biggest concerns found by the NFER was around the controversial minimum 315 hours T-level industry placement.

Most providers felt “reasonably confident” in securing the required placements for 2020. However, they reported “challenges in securing digital placements” due to the “small size of many of these businesses, as well as intellectual property and safeguarding issues”.

And, “over the longer term, as T-levels are scaled up, both providers and sector representatives viewed the capacity of local employers to provide placements of the necessary quality and duration as a major challenge”.

Their concerns included: “Not having the required number and types of employers/sectors in their area from which to secure placements (a more acute issue in rural areas); and the capacity of employers, especially micro and small businesses, to provide placements and find time to mentor students and concerns about over-burdening employers.”

Most interviewees said they were having to use up their Capacity and Delivery Fund – a pot of cash that is only currently available to the first T-level providers – in order to develop their employer engagement infrastructure and expertise.

One provider said: “In the longer-term, we are worried about how we will deliver 700/800 longer placements without the additional funding that we have now.”

Suzanne Straw, NFER’s education to employment lead, said it was “clear that providers, students and employers all need sufficient and sustained funding if the industrial placement is to be a workable element to this ‘gold-standard’ technical qualification” and the government should not ignore the plea.

The DfE has partly listened to concerns by introducing some flexibilities to industry placements – including allowing multiple placements at different employers, as announced last month, as well as a trial of employer cash incentives.

But the NFER said even more flexibilities need to be introduced, including “more focus on students responding to employer briefs, simulations and virtual learning”.

Providers also reported public transport travel issues.

“This was a more critical issue in rural areas where large numbers of students travel into college by bus, as this provider pointed out: ‘An 8.30am to 5pm day which T-level students will need to cover the hours needed is not possible with the bus times we have’,” the report said.

Staff expertise was also noted as a concern, with providers reporting that they need extra funding for “incentives to help attract staff to fill key skills gap”.

Recruiting and retaining staff in digital and construction programmes, and engineering in the future, was a “major challenge because of education-industry salary differentials”, which “could lead to patchy and/or lower quality delivery of T-levels”.

A Department for Education spokesperson said: “As the NFER’s report recognises, we have worked closely with providers from the very beginning to make sure we get the delivery of T-levels right.”

She added that alongside the recently announced package of support, the DfE is “investing almost £60 million for post-16 providers to build capacity” to provide industry placements, as well as £20 million to “help prepare the sector for the introduction of the new courses and have announced a further £3.75m to support next year’s roll out”.

The findings of NFER’s research will be presented today at the Festival of Education, which is run by FE Week publisher LSECT.

A college has announced plans to cut its staff numbers by 10 per cent, months after the FE Commissioner reported it was in a “cash crisis”.

Fifty one full-time jobs out of a total of 466 are expected to go at Northumberland College, which was graded as ‘requires improvement’ by Ofsted before merging with Sunderland College and Hartlepool Sixth Form College to form the Education Partnership North East in March.

Principal Nigel Harrett (pictured) said that at the point of the merger, Northumberland was in an “unsustainable financial position”.

“Regrettably an inevitable part of our transformation includes reducing unusually high management and staffing cost,” he added. “We will be doing all that we can to mitigate unnecessary job losses.”

All affected staff have been informed and the college said it has consulted trade unions about its proposals.

It comes after an FE Commissioner report in October found Northumberland College faced a substantial shortfall in 2017/18, which had not been detected until January 2018 and meant it had to hurriedly renegotiate deferring contractual repayments with its local authority.

The report said previous leaders were guilty of “major failing in financial management and oversight” and had set “wholly unrealistic targets” for new levy apprenticeships, “over-optimistic” income targets, and lacked oversight of new educational and commercial initiatives.

These included a career college, recruitment agency, MOT and service centre and leisure learning courses, which “compounded an already declining financial position”.

Last July, the the Newcastle Chronicle reported over 40 staff had taken voluntary redundancy after the college slashed its course offering.

The ESFA handed the college a notice to improve in November, which has now been closed, after assessing it as having ‘inadequate’ financial health.

The college’s 2017/18 accounts show it generated a deficit of £2.3 million and had spent £730,000 on restructuring alone.

Harrett was appointed principal of Northumberland when it merged into the Education Partnership North East in March. He was previously deputy principal at Sunderland College.

Commenting further on the job losses, Harrett said: “At Northumberland College we are looking to put in place three-year curriculum growth plans, and in doing so anticipate a number of new courses, and possible discontinuation of any courses that do not result in positive progress for students.

“In order to achieve our new vision for excellence and ensure the sustainability of high quality further and higher education within Northumberland, we will be moving away from being a minimum wage employer to a real living wage employer.

“We are also investing in new posts to improve quality, and embarking on an investment programme across our estates to improve resources for students to provide them with the best possible education and training.”

The consultation on Northumberland College’s job losses started on 6 June.

The race to decide the next Association of Colleges president has taken another turn, after the challenger candidate pulled out – on the last day of voting.

Trafford College Group principal Lesley Davies had been the only challenger to incumbent AoC president Steve Frampton.

However, owing to “personal reasons”, she has withdrawn.

“Due to personal reasons I am withdrawing my application to become president of the AoC for 2019/20,” she told FE Week.

“The AoC continues to play a vital role in, and for the sector and I would like to take this opportunity to wish the new president every success for the upcoming term where I will continue to offer my full support as principal and chief executive of The Trafford College Group.”

The AoC has since confirmed that Frampton will continue as president into 2019/20.

“I really do #LoveOurColleges,” he said today. “I have loved being your AoC President this last year and I am thrilled to have the honour for another year.

“I would like to personally thank Lesley for a great contest and wish her all the best. She is a great champion for our sector, and I know that she will continue be so.

“This has been one of the privileges of my life.”

David Hughes, chief executive of the AoC, said: “This is a really exciting time for AoC and for the sector so I am delighted that Steve will be onboard as president for another year. It was a shame that Lesley had to pull out, for personal reasons, and I want to thank her for putting herself forward.

“Steve has made a big impact over this last year, bringing with him enormous amounts of energy, enthusiasm and dedication, not least to the Love Our Colleges campaign. I know that he’s got lots he wants to achieve over his final year as president and I look forward to working with him on it.”

Frampton, the former principal of Portsmouth College, reapplied for the role after having completed one year of his two-year term, under rules introduced after Ian Ashman served the previous maximum one-year term in 2017.

Every college which is an AoC member got one vote in the election; which must run over a two-week period.

Davies was the first person to challenge an incumbent president of the association under the new rules.

Ashman’s immediate successor, Alison Birkinshaw, served only one year as president before retiring. Frampton was elected, unopposed, to replace her in May 2018.

The principal of Trafford College since 2016, Davies oversaw its merger with Stockport College in April last year, which created the Trafford College Group.

She had intended to stay on as principal if she was elected AoC president.

In her election pitch, Davies promised to work on behalf of association colleges to “ensure government puts the long-term sustainability of colleges at the heart of its policymaking”.

During Frampton’s tenure, the association has helped shape the new Ofsted inspection framework, worked with the DfE on teacher recruitment and retention strategies, and launched the #LoveOurColleges campaign.

In his re-election pitch, he said serving as president was “great privilege” and he was “excited for the task ahead”, referring to making sure colleges were in the strongest possible position for this year’s Comprehensive Spending Review.

A troubled land-based college has officially been rated ‘inadequate’ for the second time in a row, with Ofsted criticising leaders and governors for failing to improve its performance.

FE Week revealed last month that Moulton College, which is attempting to avoid a merger, was heading for another grade four after the education watchdog found it delivering “unsafe” training in 2018.

Its latest Ofsted report, published today, said the health and safety concerns previously identified have now been rectified, but other areas have seen a drop in performance.

The quality of teaching, learning and assessment has declined

“The quality of teaching, learning and assessment has declined since the previous inspection,” inspectors said.

Self-assessment is “often too generous in terms of grading and does not reflect accurately weaknesses that need to be rectified”.

Teachers’ expectations of students “are too low and, as a result, too many students make insufficient progress”, and attendance levels for learners “is poor across most programmes and is particularly low in sport, English and math lessons”.

Ofsted continued: “Managers do not use data well enough to judge accurately the impact of actions that they have taken, or to inform future actions for improvement.

“Students on vocational programmes, for whom the college receives high needs funding, do not benefit from teaching that meets their specific learning and support needs.”

Moulton College had just over 2,000 learners at the time of inspection, 1,350 were on study programmes, mainly on land-based, sport and construction courses.

Ofsted found that managers and teachers “do not know how many students on 16 to 19 study programmes have completed external work placements”.

However, the inspectorate did point out that a “recently enhanced” board of governors and new leadership team have “changed the culture of the college so that it focuses on the student and staff experience; as a result, staff turnover has decreased, and staff morale has improved”.

Leaders and managers have also rectified “poor behaviour” identified at the previous inspection.

Following the college’s first grade four, its principal Stephen Davies resigned and was replaced by interim Ann Turner.

A permanent principal has since been appointed. Corrie Harris, the current vice-principal at the Bedford College Group, will take the reins from next month.

Reacting to today’s Ofsted report, a spokesperson said: “Moulton College was disappointed with the outcome of the recent Ofsted inspection, which does not reflect the significant progress made in the last 12 months.

“The college is pleased to see that the enhanced board of governors, new leadership team, the change in culture, the high priority placed on ensuring students are safe with very effective, strengthened safeguarding practices, good student behaviour and improved staff morale are all acknowledged.

Governors are confident that we have a stable, passionate committed workforce

“The work on improving teaching and learning has still to have the impact desired, but improvements are ongoing to ensure that every Moulton student receives the best possible student experience.”

Moulton College has been in FE Commissioner intervention since February 2017 due to its poor finances, particularly high levels of commercial loans and falling cash balances, and was recommended to merge.

But with a new chair of governors and an interim principal making improvements to the finances, the college was permitted to follow a standalone strategy and recruit a full-time principal.

Despite the clear financial and quality-of-provision concerns, FE Week understands that Moulton, under the leadership of its new chair David McVean, who started in February 2019, is continuing to pursue a standalone strategy.

The college’s spokesperson said the college has “radically overhauled” its workforce in the past year and governors are “confident that we have a stable, passionate committed workforce”.

The skills minister has hailed the success of traineeships after research revealed 75 per cent of learners move on to work or further study within a year of completing their programme.

It will be a boon for the pre-employment programme, which has been plagued by falling learner numbers and a lack of investment that has frustrated sector bodies.

The policy, which was only launched in 2013, appears to have fallen off the political radar, evidenced by FE Week failing to find any reference to traineeships in any of Anne Milton’s public speeches since she became skills minister two years ago.

Following today’s research report, Milton said she was “thrilled” to see how traineeships are “supporting young people to start their apprenticeship journey, get their first job or go to further study”.

The government also announced today it will introduce a new traineeships achievement rate measure for the academic year 2019/20, which will help the government monitor the programme’s effectiveness.

This is in addition to providing £20 million through the adult education budget for training providers, to encourage more young people aged 19-24 to start a traineeship.

Milton said the achievement rate measure will provide “greater transparency and help young people make informed decisions about their next steps”.

Traineeships are six-month programmes, which were introduced to provide 16 to 24-year-olds with English and maths tuition, work experience and work preparation training.

Today’s report focuses on the cohort of trainees from 2013/14 and draws on surveys with learners, providers and employers; case studies; and analysis of national administrative data.

It did find a marked divide between 16 to 18 and 19 to 23-year-old trainees, with the younger group less likely to begin employment within 12 months of a traineeship – 19 per cent compared with 53 per cent.

And while traineeships increased the probability of both age groups going on to further learning, evidence suggested traineeships reduced the likelihood of a learner progressing to vocational courses above level 2, compared to if they had not participated in a traineeship.

But employers, including global professional services firm Aon, reported how traineeships have helped them to “recruit people from a range of backgrounds leading to more diverse workforces”.

Adrian Johnson, UK Apprenticeship Lead for Aon, told FE Week that since the inception of its “Step Up traineeship scheme” in 2018, the firm has offered 15 traineeships, with nine trainees going on to permanent positions.

“The recruitment of a more diverse group of professionals is key to the future success of Aon and our market as a whole, and we are proud to support these young people in their career development,” he added.

Mark Dawe, the chief executive of the Association of Employment and Learning Providers, said today’s report will help “reinvigorate” traineeships by encouraging young people to take advantage of the programme.

Traineeships are in need to reinvigoration, having seen their starts numbers fall from 24,100 to 17,700 (26 per cent) between 2015/16, before reforms to the apprenticeship system came into force, and 2017/18.

Dawe said last year the government is “so consumed” by apprenticeships and T-levels, there was a danger that traineeships “don’t get a look-in”.

His colleague, AELP policy officer Ceara Roopchand said in May the ESFA’s Qualification Achievement Rates and the negative publicity around companies offering unpaid work experience to trainees had meant “public support for the programme have dwindled dramatically”, to the hindrance of NEET learners, and those from disadvantaged backgrounds.

An FE Week investigation in 2018 found colleges had delivered fewer than a quarter of traineeships in 2016/17, which was blamed by the Association of Colleges on rigid duration rules.

David Hughes, chief executive of the AoC, today stressed the importance of “stepping stone programmes” like traineeships which allow people to progress to the levels of competence that employers are seeking.

He added that there were many positive outcomes from traineeships, that colleges were helping to deliver.