The Sixth Form Colleges Association is urging the government to keep the option for its members to convert to academy status open indefinitely, as the “arbitrary” deadline for doing so fast approaches.

Becoming an academy, and in doing so enjoying the luxury of not paying VAT, has been a possibility for nearly all SFCs since former chancellor George Osborne changed the rules in November 2015.

However, the window of opportunity closes in March when the £726 million restructuring facility – a fund designed to help colleges implement area review changes – ends and reverts back to the Treasury.

None of this was explored at the time when the government opened up the academy option to colleges

Bill Watkin, the chief executive of the SFCA, said this “cannot be right” and there is no “logical reason for rejecting colleges after an arbitrary date”.

“The government must continue to support those colleges that wish to academise after March – after all, some, such as the Catholic colleges, have not yet been free to adopt academy status because of a technical barrier that is no fault of theirs,” he told FE Week.

“The restructuring facility has not been deployed as much as was originally envisaged and should be extended.”

Guidance on applying to become an academy for SFCs, updated in January 2017, confirms that the option is “linked to the area review process”.

It adds, however, that the government will “consider in the light of experience from the area reviews whether further opportunities to apply should be available once the reviews are complete.

“But this opportunity does not exist at the moment, and colleges which wish to submit an application will need to do so as part of the relevant area review.”

When asked whether the Department for Education has made a decision on allowing SFCs to academise beyond March 2019, a spokesperson would only tell FE Week that the option is being looked at and more information would be available in due course.

Becoming an academy means SFCs no longer have to pay VAT – letting them off an average annual bill of £385,000.

The first to convert was Hereford SFC in March last year. Nineteen have since followed suit, leaving 62 designated SFCs. Three of these are, however, in the process of converting.

In an update from the ESFA about the restructuring facility last month, it was revealed that 30 applications to the fund have been made from 31 sixth form colleges “expressing plans to convert to academy status”, but the “majority have not been allocated any funding to support this conversion”.

A group of 14 which are Catholic-run have been completely prevented from converting due to their religious character, which would not be maintained under current government rules.

If they converted, they would lose protections in areas of curriculum, acts of worship and governance. The SFCA and Catholic Education Service have been trying to get the government to add a clause to the education bill to rectify this, but the DfE has not obliged.

Mr Watkin said “some more colleges are still interested in the possibility of converting” but academisation has “not always been an easy process”.

“The ESFA and the Transaction Unit [which administers the restructuring facility] have had to come up with solutions to unanticipated conversion problems; regional schools commissioners have had to adapt to a new and unfamiliar landscape; and pioneering colleges have had to navigate an untrodden path and overcome some significant snagging issues,” he told FE Week.

“RSCs and the national schools commissioner were not always on the same page and there were regional variations; some gave permission to colleges to become single academy trusts, some insisted on a multi academy trust (even if an unpopulated MAT); some then insisted on a populated MAT and now some are saying that there are already too many MATs in the region, they don’t want another one, so a college must join an existing MAT.”

He added: “None of this was explored at the time when the government opened up the academy option to colleges as a way of offering VAT relief.”

Ofsted has denied cuts to its budget have affected the number of FE inspections it carries out, despite analysis by FE Week finding full inspections plunged by a third in just one year.

Inspections with an apprenticeship grade saw the most dramatic fall of over 40 per cent, leading to the shadow secretary of state for skills describing a “black hole on what we know about their quality”.

The findings come less than three weeks before the chief inspector of Ofsted is due to publish her state of the nation annual report, on December 4.

The figures to August 31 2018 show that just 203 FE providers received full Ofsted inspections in 2017/18, a fall of 32 per cent from the year before when 298 were inspected.

Most strikingly, the number of ITPs – including employer providers – which received full inspections almost halved, falling 44 per cent from 126 to 70.

And the number of full inspections which graded providers on their apprenticeship provision dropped 42 per cent from 189 to 109.

However, the inspectorate has insisted that the fall in inspections “isn’t a funding issue” and has “nothing to do with funding”.

“We carried out the number of inspections that we intended to carry out in 2017/18, and included a sample of monitoring visits to new providers,” a spokesperson said, adding that Ofsted now has the extra cash needed to monitor and inspect all new providers in 2018/19 and 2019/20.

“We deployed our inspection resources in 2017/18 to ensure that providers were inspected in accordance with the timescales and frequencies detailed within the handbook.

“We completed all the inspections we were required to, and in addition we deployed our remaining inspector resource to inspect a number of providers identified through our risk assessment process, and conducted a limited number of new provider monitoring visits.”

However, shadow skills minister Gordon Marsden warned that the government’s “failure to fund Ofsted adequately for colleges and apprenticeships is leaving a black hole on what we know about their quality.

“Taken together with the Department for Education’s snail pace on delivering end-point assessment, it adds up to the department being asleep on the job whilst FE becomes ever more fragile.”

Ofsted is in line to lose £15 million between 2016/17 and 2019/20 from its inspection budget, which is predicted to fall by 10 per cent from £141,685,000 to £127,100,000.

Between 2010/11 and 2016/17, the watchdog’s financial resource was reduced by over £54 million.

In April, FE Week reported that Ofsted was in line to save around £400,000 this academic year by elongating the maximum period between inspections for ‘good’ providers.

Grade two providers previously received a short inspection within three years, but now can wait for up to five years before they are visited again.

A spokesperson for Ofsted said one of the reasons for the drop in the number of full inspections was because there were “a greater proportion of short inspections carried out last year” ahead of the change.

However, although short inspections did rise by almost a third – from 94 to 122 – this was not sufficient to make up for the plummeting levels of full inspections. The total number of inspections, when taking full and short together, still fell by 17 per cent last year, from 392 to 325.

The spokesperson also said apprenticeship provision is only graded in full inspections, hence the fall in the number of reports which inspected it. Although Ofsted has now introduced monitoring visits of new apprenticeship providers, she admitted that even when these visits are added to the number of apprenticeship judgments made in full inspections there was still an eight per cent drop compared with 2016/17.

The monitoring visits only assess providers on three measures – or four if they offer adult education – and only concentrate on new providers, meaning that existing apprenticeship providers are still going unmonitored.

The DfE declined to comment.

More than three quarters of colleges are now rated ‘good’ or ‘outstanding’ and none are deemed ‘inadequate’ by Ofsted as further education continues its ascent into excellence.

FE Week analysis of Ofsted results shows that an impressive 76 per cent of all general FE colleges are now rated in the inspectorate’s top two categories, up from 69 per cent in 2016/17.

The last academic year also saw more than twice as many colleges move into Ofsted’s sweet spot of grade one or two than fall out of the top ranks.

A total of 19 colleges moved up to grade two in 2018, with one climbing up the ranks from ‘inadequate’ to ‘good’. In contrast, just eight fell out of the top category, with seven becoming grade three after being ‘good’ and one falling from ‘outstanding’ to ‘requires improvement.’

David Corke, director of policy at the Association of Colleges, said: “This analysis only further goes to affirm the good work and support colleges provide to the 2.2 million people studying and training in colleges every day.

“As we edge ever closer to leaving the European Union, colleges will need to be supported adequately as they look to provide the right training and solutions – and this means the right level of investment.”

There are currently no colleges labelled as Ofsted’s lowest grade of ‘inadequate’. However, part of the reason for this is the mergers of poorly rated colleges which have been carried out over the past year. When two colleges merge, both have their Ofsted grades wiped.

Stockport College, Huntingdonshire Regional College, Mid-Cheshire College of Further Education, Redcar and Cleveland College and Amersham Wycombe College all lost their grade-four ratings after a series of mergers.

 The proportion of sixth form colleges rated ‘good’ or ‘outstanding’ has remained steady at 81 per cent, after falling from 89 per cent in 2016. Independent learning providers, including employer providers, have experienced a small fall from 81 per cent in the top two categories last year to 78 per cent this year.

 Across the entire FE sector, 63 per cent of providers were rated ‘good’ or ‘outstanding’ in inspections this year, bringing the total in the top half of Ofsted grades up to 80 per cent.

Amanda Spielman, the head of Ofsted, backed calls for more 16-to-18 funding last month, and warned that some colleges were struggling to reach the top Ofsted grades because of their tight finances.

In a letter to the public accounts committee on October 30, she warned that “real-terms cuts to FE and skills funding are affecting the sustainability and quality of FE and skills provision”, and said this verdict was “based on our inspection evidence”.

“My strong view is that the government should use the forthcoming spending review to increase the base rate for 16-to-18 funding,” she wrote.

 “Over time our evidence shows that many colleges have reduced the teaching time allocated to some programmes of study, reduced the number of teaching and/ or support staff employed, reduced the number of courses offered and reduced the amount of enrichment or extracurricular activity provided.

“These measures all have an impact on the provision offered.”

FE Week also discovered that six of the highest-rated sixth-form colleges have not been inspected in over a decade. Hills Road Sixth Form College, Circencester College, Woodhouse College, Carmel College, Richard Huish College and Winstanley College are all still rated as ‘outstanding’, despite the fact they were all last inspected between the November 2006 and October 2007.

Ms Spielman has previously urged the government to authorise more regular inspections of ‘outstanding’ schools and warned they lack oversight and create “real blind spots” for the inspectorate.

A spokesperson for Ofsted confirmed Ms Spielman’s comments about the outstanding exemption, which was introduced in 2011, applied to all providers including FE.

Labour has accused the government of “slipping out” a damning report that raises huge concerns about the security risk posed by a government apprenticeship provider on the same day as the Brexit announcement.

The cabinet office approved provider, which trained hundreds of apprentices in offices including the Department for Work and Pensions, HM Revenue and Customs and the Home Office, was slated as ‘insufficient’ across the board in an Ofsted monitoring visit published earlier today.

The report found that the recruitment processes followed by Premier People Solutions Limited, which trades as Premier Partnership, were “not safe enough” and warned that leaders and managers “cannot be sure that their members of staff are safe to work in the sensitive environments”.

Anne Milton, the skills minister, confirmed exclusively to FE Week earlier today that the Education and Skills Funding Agency had terminated Premier’s levy contract as a result.

However, Labour has accused the government of sneaking out the report on the same day as the Brexit announcement to try and detract attention from its findings.

Angela Rayner, shadow secretary of state for education, said: “These revelations, slipped out on the same day as the Brexit announcement, raise serious concerns about both the Tories’ apprenticeships programme and their management of government itself.

“That the government’s preferred provider of apprentices to its own departments has been found inadequate across the board is a stark reminder that they are failing to deliver high-quality apprenticeships for all those who want them.

“But it is also deeply alarming that there were staff working across the public sector with no assurances that it was safe for them to access sensitive information.”

She added: “Ministers must  come clean on how this happened, what steps will be taken to provide new training providers and what assessment has been made of potential security risks arising from these disturbing events.”

The cabinet office has confirmed that the government departments included HMRC, the DWP and the Home Office, including the UK Visas and Immigration service.

When asked about the Ofsted criticisms concerning security, the spokesperson said it was for individual departments to comment and said all civil service apprentices will be able to continue their training “as normal” after the change in training provider.

According to the find apprenticeship training service, Premier has been delivering apprenticeships to public sector departments for over six months. It had 686 apprentices at the time of the Ofsted visit, and all but five were on the level three public service delivery officer standard.

It will now be removed from the register of apprenticeship providers. Usually when a provider is rated ‘insufficient’ after an Ofsted monitoring visit, it only receives a temporary ban on recruiting new starts until a full inspection can be carried out within a year.

The Ofsted report warned that leaders and managers “do not have safe enough recruitment procedures”.

“They do not hold references for too many of the trainers who they employ to work with apprentices. Leaders apply for references, but if they are not returned, they do not pursue them. In addition, they accept references that are not from the trainer’s most recent previous employer.

“As a result, leaders and managers cannot be sure that their members of staff are safe to work in the sensitive environments of the employers for whom their apprentices work.”

David Pearson, managing director at Premier People Solutions, said: “Premier Partnership takes safeguarding extremely seriously and Ofsted noted that all of our team are appropriately trained, and our policies and procedures are sound and implemented.

“In response to the comments around recruitment, we emphasise that all our recruits are subject to security checks prior to commencing work and we follow CIPD guidance about taking up references. Premier has enhanced its already comprehensive risk assessment and action plan.”

Both Ofsted and the government are looking into a mysterious training provider after FE Week revealed it has secured multi-million-pound subcontracting deals despite employing fewer than 10 staff, it is understood.

SCL Security Ltd, a private provider based in Kent that is run by Andrew Merritt, has taken £16.5 million from Brooklands College over the last three years to deliver hundreds of level three IT apprenticeships, for mostly 16-to-18-year-olds.

It also subcontracts for Ealing, Hammersmith and West London College, with a current deal worth £1.7 million.

But questions surround exactly who the apprentices at SCL Security are, and where it trains them.

The provider only employed eight people in 2017, according to its most recent company accounts, and seven the year before.

Mr Merritt has refused to release exact training delivery addresses despite multiple requests.

But FE Week understands that Ofsted has taken interest in the provider, as well as Brooklands. SCL Security secured its first direct Education and Skills Funding Agency contract this year, bringing it in scope for inspection. Brooklands was rated ‘good’ by Ofsted five years ago.

It is also understood that the ESFA has itself raised an eyebrow at the situation and is making enquiries.

One area of interest to them will be SCL Security’s relationship with a recruitment firm called Workforce Solutions Group Ltd, which is headed up by two brothers who were at the centre of an FE Week investigation in 2016.

Paul and Joe Alekna switched the ownership of a successful provider they ran from one parent company – eResponse – to another, before transferring out £6 million, liquidating it and leaving learners and creditors on the hook for millions of pounds.

Meanwhile, the brothers continued to run another provider called Options 2 Workplace. But when FE Week exposed the situation the ESFA cancelled its contract.

SCL Security claims on the government’s Find Apprenticeship Training website to “operate training centres nationwide”, but its own website makes no reference to any training venues – the only address is for a head office in Kent.

However, a Google maps search locates one of their training sites as “9 Church Rd, Redditch” – the same building that Workforce Solutions Group operates out of.

Paul Alekna told FE Week that Workforce “specialises in temporary and permanent staffing focusing in the manufacturing, logistics & transport, food manufacturing and office appointments sectors”, and insisted “that’s all we do”.

He refused to deny that Workforce and SCL Security have a working relationship.

Mr Merritt offered a list of “delivery locations”, which includes Hounslow, Greenwich, Ashford and Nottingham.

He said all are “under short-term rental/lease arrangements responding to demand” and the Redditch location was “one such rented room”, but declined to comment on the relationship between SCL Security and Workforce.

He added that the “exact addresses” of the other locations “are known to all learners, staff, delivery partners and all official bodies” but refused to give them to FE Week.

Brooklands College also refused to release the addresses of where its apprentices are trained with SCL Security.

A spokesperson would only say: “Brooklands College has very successful apprenticeship provision and works in partnership with training providers to meet the needs of a range of employers.

“Brooklands College is not able to comment on commercially sensitive information.”

The DfE said it could not comment on individual cases, but a spokesperson reiterated that it has a “duty to protect learners and ensure that public money has been used in accordance with the condition in which it was given”.

Ofsted said: “As part of our risk-assessment process, we take account of all of the relevant information we have about an individual provider.

“However, we cannot disclose when we will inspect individual colleges and skills providers.”

Almost two thirds of university technical colleges overestimated their student numbers last year and will have to repay funding to the government, with five owing more than half a million pounds each.

A freedom of information request has revealed that a total of 30 of the 49 UTCs which are still open drastically misjudged their ability to recruit learners in 2017/18 and now face paying over £6.5 million back to the Education and Skills Funding Agency between them.

The five worst offenders accumulated debts of over £500,000 each, with Bolton UTC furthest in the red with a debt of -£688,364.

Estimating pupil numbers is hard for UTCs. There are many factors involved.

It was closely followed by London’s Elutec on -£672,075, and Salford’s UTC@MediaCityUK on -£657,273. Wigan UTC and Medway UTC also made the top five, with -£609,038 and -£504,496 respectively.

A spokesperson for the Baker Dearing Trust, which represents all UTCs, insisted pupil numbers were rising at the controversial 14-to-19 free schools.

However, as FE Week reported last week, although the overall number of learners has risen at UTCs as more have opened, the average intake of 14-year-old learners per UTC has actually fallen this year.

The BDT spokesperson said: “Estimating pupil numbers is hard for UTCs. There are many factors involved.

“Nearly all other secondary schools have feeders and recruit at a standard age so they can estimate their numbers more easily.”

She added that the total amount owed by UTCs has fallen since 2016/17 last year, from £11 million to £6.6 million, and said all UTCs have a financial recovery plan to repay the money owed to the ESFA.

A spokesperson for the Department for Education said the timescales for repayment “vary on a case-by-case basis”.

“Funding that is provided to set up new free schools and UTCs is based on estimates of pupil numbers,” she said. “Once the school or UTC opens, this funding is then adjusted to reflect actual figures and where necessary we work with the institutions to recover funding.

“We have agreed recovery plans in place for most free schools and UTCs that have pupil-number adjustments, and we are in discussion with the others about terms for recovery.”

Most UTCs have a capacity for 600 learners. In 2017/18, Wigan UTC had the fewest learners of the top five, with just 116 enrolled students, leaving it 81 per cent below its maximum capacity. UTC@MediaCityUK had the most at 372, but was still just 62 per cent full.

Medway UTC was the only one of the five owing more than £500,000 to respond to requests for comment. Medway, which was rated ‘inadequate’ by Ofsted in May, was renamed as Waterfront UTC when it joined The Howard Academy Trust earlier this month.

A spokesperson said none of the UTC’s existing team were in post when the estimated pupil numbers were submitted and so it could not comment on why they had been overestimated, but said a repayment plan had been agreed with the ESFA as part of its transfer to the new trust.

Studio schools have fared slightly better than their technical cousins, with 11 out of a possible 21 left owing the government money after overestimating pupil numbers last year. However, just one studio school has a debt of over £500,000, with Manchester Creative Studio owing -£521,297.

Manchester Creative Studio closed this summer after being dogged by low pupil numbers and significant financial challenges. It had been placed in special measures after being rated ‘inadequate’ in every category in March 2017 and did not take on any new pupils in September of that year.

We have agreed recovery plans in place for most free schools and UTCs that have pupil-number adjustments

Martin Shevill, chair of the school’s trustees, said the pupil-prediction numbers had been submitted shortly before the previous trust board had disbanded, and the closing financial position of the trust was being finalised with the DfE.

“The remit of the new trust board was to assess the viability of the school going forward. Very early on we made the decision that the school should not take in another intake of Year 10s and Year 12s while the school’s future was so uncertain,” he said.

“This meant that the school population was effectively halved. In addition, other parents made the decision to withdraw their child from the school following a difficult Ofsted inspection.

“As a result, there was a significant gap between the optimistic pupil predictions that the previous trust submitted, and Manchester Creative School’s actual student population once critical decisions had been made.”

Studio schools were designed to take on cohorts of up to 300 learners. In its final year, Manchester Creative Studio had around 40.