The providers that will be protected from adult education budget devolution have been announced.

Certain providers will continue to be funded nationally by the Education and Skills Funding Agency for two years between 2019/20 and 2020/21 after devolution goes ahead, the skills minister confirmed in Parliament last week.

They have now been named, and feature providers which qualify for a “residential uplift” for their learning provision, which receive more than two thirds of their income from the AEB, and which “predominantly target their provision at the most disadvantaged in society”.

They are Fircroft College in Birmingham, Hillcroft College, which now part of Richmond and Hillcroft Adult and Community College in London, Northern College in Barnsley, and Ruskin College in Oxfordshire.

A government spokesperson said that this will be “to aid their transition to devolution/delegation given their specialist nature and reliance on AEB”. 

Traineeships for 19- to 24-year-olds will meanwhile “remain a nationally funded programme” with allocations provided by ESFA, regardless of where trainees live.

But providers were advised to prepare for widespread handover of responsibility from local to central government.

“Providers who wish to deliver AEB provision, post devolution/delegation, in one or more of the mayoral combined authorities and Greater London Authority areas should start to build, if they have not already done so, effective working relationships with the relevant authority,” the spokesperson said.

The “final AEB to be devolved” to the mayoral combined authorities and delegate the AEB to Greater London Authority for the 2019/20 funding year “is expected in early 2019”, once “the functions necessary for the delivery of adult education have been transferred” and the AEB budget for that year has been finalised.

There has been widespread dismay at the lack of information on how AEB devolution will work in practice.

FE Week reported in February that the regional mayors tasked with overseeing devolution had met the Department for Education to “voice concerns” over the process.

High among their issues was a lack of influence over the budgets, and not enough funding funding during the transition year, as well as what were described as “challenging” timescales for the handing over of power.

“As part of the preparations for devolution/delegation the DfE has issued illustrative AEB allocations for 2018 to 2019 to MCAs and the GLA,” the spokesperson added.

FE Week has asked to see the illustrative allocations.

“These illustrative budgets give MCAs and the GLA an indication of the AEB they can expect to receive in the funding year 2019 to 2020,” they said.

“The budgets are based on 2016 to 2017 actual grant delivery and assumed 2017 to 2018 independent learning providers’ delivery to learners resident in MCAs/GLA areas.”

The government is launching a review into how the current system of funding for FE meets the costs of “high-quality” provision, Anne Milton has revealed.

The skills minister announced the plans in the House of Commons today during educations questions, after she was asked what the Department for Education had made of “recent trends” in education funding for 16- to 19-year-olds.

Alongside the post-18 review of education funding, she said “we are also looking at the efficiency and resilience of the FE sector”.

“We need to make sure that existing and forecast funding and regulatory structures meet the costs of high-quality, first-class provision,” she continued.

“I’ve asked my officials to assess how far the current funding system meets the costs of high-quality provision in the further education sector and will update the House shortly.”

The Sixth-Form Colleges Association has claimed this is a “significant win” for its ‘Support Our Sixth-Formers’ campaign, which was backed by FE Week.

One of its main objectives has been to secure a review of sixth-form funding to ensure it is linked to the “realistic costs of delivering a rounded, high-quality curriculum”.

James Kewin, the association’s deputy chief executive, described the announcement as an “important step on the road to ensuring that 16-to-19 providers are fairly and sufficiently funded”.

“We look forward to working with ministers and officials on the detail of this project and have already shared some of our existing evidence base with colleagues in the DfE,” he added.

A DfE spokesperson said: “We are looking at resilience, funding, regulation and the institutional structures within the sector to make sure that we can deliver high quality provision.

“This is not an external review, but it will draw on the views of providers across the sector.”

The Support Our Sixth-Formers campaign was dealt a blow in January when the DfE ruled out an increase in funding for 16- to 18-year-olds next year.

In a letter to providers, the department said the national base rates of £4,000 per full-time student aged 16 to 17 and £3,300 for 18-year-olds were to be “maintained for academic year 2018 to 2019 as are the part time funding rates”.

The Support our Sixth-Formers campaign, also backed by the Association of Colleges, has been calling for a £200 “SOS uplift” in 16-to-18 per-pupil funding rates.

The SFCA claimed in November that sixth-form colleges were at “tipping point” after their overall Ofsted ratings fell for a third year running, largely as a result of funding pressures.

And Amanda Spielman, Ofsted chief inspector, said during her speech at the launch of the Ofsted annual report in December that the “sector will continue to struggle” without an increase in the base rate funding for this age group.

This is the sixth year that the funding rate for 16- to 18-year-olds has remained unchanged – meaning that providers have faced a real-terms funding cut over that time.

A merger between a cash-strapped London college and a nearby university will be going ahead after all – even though the college has been searching for other potential partners.  

Lambeth College originally said it would join London South Bank University in December 2016. But it emerged in January that those plans had hit the buffers, and that it was in the market for a new partner.

The college has reverted to its original plan, and is set to join the LSBU “family” of institutions at a yet-to-be confirmed date in the future.

“Joining the LSBU family heralds the beginning of an exciting new era for Lambeth College,” said Monica Box, the college’s principal.

“We look forward to working with the team at LSBU to improve further education provision in Lambeth and to build on our position as the careers college of choice for the local community.”

Professor David Phoenix, vice-chancellor of London South Bank University, said the two institutions had been “working closely” for two years and described today’s announcement as “an exciting development”.

“The unique ‘family’ approach creates a coordinated group of specialist institutions, each sharing a common educational framework that focuses on the learner,” he added.

The exact arrangements of the partnership still need to be finalised between the Department for Education, the college and the university.

Earlier this month FE Week reported on a new merger model being pioneered by Bolton College and the University of Bolton.

That model, proposed by the DfE, would see the college retain its own principal and governing board, giving it greater protection than it would through a traditional merger model.

Lambeth’s troubles began in 2016, when a “significant deterioration” in its cashflow prompted an intervention by the former FE commissioner Sir David Collins.

His report, based on a visit that September, found problems with the college’s finances that were so severe it was “no longer sustainable” unless it merged.

Lambeth emerged from the central London area review, which ended two months after Sir David’s visit, with a recommendation to pursue one of three options: a merger with LSBU, one with Lewisham Southwark College, or joining the new grouping of City of Westminster College and the College of North West London.

The following month, the college announced that it would “join the LSBU family in principle”.

FE Week reported in June last year that the college was preparing to hand over wide-ranging control of how it was run to the university, via controversial changes to its governance.

It consulted on changes to its instruments and articles of governance that would have seen its principal stripped of many of their duties, and at least half of the college’s governors appointed by the university.

Those changes were due to take effect by mid-June – but in September FE Week reported that implementation had been delayed.

The merger with LSBU, which had been due to complete in July, had been delayed “with submissions of further financial and strategic plans to the Education and Skills Funding Agency and the minister of state”, according to the college’s accounts, dated December 2017.

“At the date of the signing of these financial statements these plans are to be tested against other proposals through an FE commissioner-led structure and prospects appraisal that will conclude by February 2018,” it continued.

The same document also revealed that the college was depending on government bailouts to keep it afloat.

It had received £8 million in exceptional financial support, and was expecting to receive funding from the “restructuring facility of around £25 million in early 2018”.

The majority of NHS trusts in England will spend their apprenticeship levy at a faster rate than other employers – even though most are frustrated by the policy’s “inflexibility”.

The news will be welcomed by the government as it struggles on to reach its three million apprenticeship starts target by 2020 – given that the NHS is the largest employer in the country with tens of thousands of people to train each year.

However, one significant sticking point appears to be the 2.3-per-cent apprenticeship target for the public sector, which most trusts do not feel confident in meeting.

A major survey of 175 trusts, conducted by BPP University, found that 95 per cent plan to use their levy money rather than lose it, and half (52 per cent) would spend the cash in the first year.

This compares to less than a fifth (18 per cent) of employers outside the NHS, such as those in banking, engineering and construction, and law, who say they’ll use their funds that quickly.

Four-fifths of the trusts (81 per cent) envisage spending their levy by year two, while only slightly over half of other employers (54 per cent) reporting that they will do the same.

It is gratifying to see so many in the health service embrace apprenticeships with enthusiasm

Meanwhile, 79 per cent of NHS employers plan to expand their number of apprenticeship programmes and almost all plan to offer clinical as well as non-clinical options – 89 per cent, for instance, plan to offer health care support and 85 per cent nursing degree apprenticeships.

“Many people in the NHS, especially those in clinical roles, had until recently little experience of apprenticeships,” said Professor Lynne Gell, director of nursing and healthcare education at BPP.

“So barely a year or so after the introduction of the apprenticeship levy, it is gratifying to see so many in the health service embrace them with enthusiasm.”

The findings will be taken as a boost by the apprenticeships minister Anne Milton, who is under pressure to urgently increase starts.

Figures released by the Department for Education in January revealed starts have fallen 41 per cent since the introduction of the levy in May, compared with the same period in the previous year.

For the government to hit its target there would need to be an average of at least 50,000 starts a month.

Ms Milton identified September as the month by which she expects to see a surge in starts, in an exclusive webinar with FE Week last month.

The NHS, which has a total workforce of 1.3 million, estimates its levy spend will be £200 million a year, and will achieve 28,000 starts by July 2018.

However, it appears the health service is not content either with how the levy is currently set up or the way the government is allowing it to spend its fund.

Ninety-one per cent of those surveyed said they wanted more “flexibility” in how they spend the levy and none are satisfied with the status quo.

Large majorities wanted to be able to use the levy pot for in-house training programmes outside of apprenticeships (84 per cent), programme overheads (81 per cent) and salary and headcount (82 per cent).

But while the rules are as they are, NHS trusts are focusing most of their levy funds on internal rather than external candidates.

Two fifths said they would use 80 per cent of the levy on internal apprentices.

Professor Gell said the government’s 2.3-per-cent apprenticeship target for the public sector is partly responsible for employers’ focusing on existing staff rather external hires.

What is worrying is that less than half of trusts (48 per cent) said they felt confident they would meet this target.

One of the major stumbling blocks the NHS is coming across when delivering apprenticeships is the 20-per-cent off-the-job rule – which was identified as the biggest barrier to apprenticeship recruitment in an FE Week survey earlier this month.

Three -quarters of NHS respondents said the requirement remains a problem.

Despite the sector-wide concerns about this rule, Ms Milton recently confirmed she would not budge on it.