A Norfolk-based provider that was hit with a grade four Ofsted rating in May has entered into administration, FE Week understands.

The news on Norfolk Training Services was confirmed this afternoon to FE Week by administrators Larking Gowen.

FE Week reported three months ago that the provider had received the lowest possible overall-Ofsted rating. The report included grade fours for effectiveness of leadership and management, 16 to 19 study programmes, and quality of teaching, learning and assessment.

The Education and Skills Funding Agency was unable to confirm ahead of publication if NTS’s £1.3 million government funding – as of June this year – had been pulled as a result of the Ofsted rating.

It is though normal practice for independent providers to be given a termination notice of their skills funding contracts, after receiving a grade four.

FE Week, which attempted to contact NTS ahead of publication without success, received an email from an employee claiming to be from the company, lamenting the distressing developments.

“Just to let you know that Norfolk Training Services entered administration today,” he said.

“Staff were informed at 12pm, most of whom were laid off with immediate effect.”

When asked if this was true, a representative from Larking Gowen would only say: “Yes that is correct.”

The provider had made it onto the new apprenticeships register when it was quietly revised in April, after the ESFA revisited a number of applications in exceptional circumstances.

That decision was understood to be related to the way RoATP Ofsted rules were interpreted for an inspection report that was, at the time, yet to be published.

When the report was published in May, it revealed the provider had received a grade four overall but a grade three for its apprenticeship provision – which meant it was eligible to be on the register.

In the report, inspectors criticised leaders at the independent training provider for their “ineffective” efforts to “improve the weaknesses identified at the previous inspection” in February 2015, which resulted in a grade three rating overall.

“Leaders and managers do not identify most weaknesses accurately or plan to rectify them swiftly,” the report noted.

However, inspectors noted in its first monitoring visit since then, published last week, that leaders had established a quality improvement plan that features a “comprehensive range of actions to rectify all the weaknesses identified at inspection”.

Managers were said to have “intensified” their actions to support and challenge tutors whose practice was as below expectations.

 

Update:

The administrators provided the following statement on August 17:

Andrew Kelsall and Lee Green of Larking Gowen were appointed as joint administrators of Norfolk Training Services Limited on August 16.

The Company is the leading independent provider of apprenticeships and logistics training in Norfolk and operates mainly from sites on Hall Road Norwich, but also in Great Yarmouth and Kings Lynn. The Company has approximately 60 staff and 400 apprentices in training.

Andrew Kelsall, head of business recovery at Larking Gowen said “Obviously, this is very disappointing for all involved from employees, apprentices, directors, shareholders and creditors, but with the company having incurred trading losses over past months and no predicted upturn the company has simply exhausted all working capital.

“The company has been placed into administration to avoid further losses and will to cease to operate.

“We will contact all employers, apprentices and trainees to inform them of the situation and will enter into discussions with the ESFA regarding the continuity and completion of apprenticeship training.”

Mr Green added that the ESFA would be making contact directly with the apprentices and employers/Guardians regarding the provision of future training.

The country’s biggest training provider has had its desperate attempt to appeal against a judicial review flatly rejected – in a move that will finally give Ofsted leave to publish its damning ‘inadequate’ inspection report.

Skills giant Learndirect lost its first High Court bid to overturn the grade four-overall verdict that will cost it £100 million in government grants two weeks ago, but it applied for permission to appeal the decision late last week.

FE Week can now reveal that the appeal application has been thrown out by Mr Justice King, a decision about which Ofsted said it is “very pleased”.

The report is based on an inspection undertaken way back in March and is now scheduled for publication on Thursday.

It will, by Learndirect’s own admission, oblige the government to withdraw more than £100 million in public funding contracts, and this they say, may force them to call in the administrators.

In his ruling at Manchester Administrative Court, the judge said: “Permission to appeal is refused, as I do not consider any of the grounds sought to be pursued has a real prospect of success.”

Mr Justice King dismissed Learndirect’s insistence that he’d been wrong during the initial judicial review to reject its claim that Ofsted’s sample size of apprentices was not large enough to reflect the size of the company.

Lawyers acting on Learndirect’s behalf complained, during the two-day hearing in July, that Ofsted had spoken to just 0.6 per cent of apprentices, an “insufficient sample leading to unreasonable conclusion”.

The judge’s notice, seen by FE Week today, scotched the claim

“The claimant seeks to raise on appeal a ground not pursued before me,” he wrote. “Namely that the defendant had no particular expertise as regards the sufficiency of the evidence base, and accordingly the court erred in law in giving the deference it did to the defendant’s own assessment of the sufficiency of the base.”

He also alluded to a previous criticism that the provider’s legal team had not brought forward an expert witness to explain why it felt the evidence base was too small.

“Not only was this ground not pursued before me, but I also do not consider it can be correct,” he said.

“Decisions about the adequacy of the evidence base must be an integral part of the defendant’s inspection process and part of her core functions as an expert.”

He saw no other “compelling reason for the appeal to be heard”, adding that “this was a decision applying established principles to the facts and circumstances of the particular case”.

An Ofsted spokesperson confirmed to FE Week this afternoon that the inspectorate would now publish the report on Thursday, August 17.

“We are very pleased with this outcome,” he said.

“Seventeen inspectors took part in this inspection over four days, when they spoke to learners and apprentices.

“Inspectors interviewed employers, apprentices and learners in person and over the phone, reviewed portfolios of work, and looked at progress reviews when they gathered evidence.

“As well as visiting apprentices in their workplace, inspectors also reviewed a wide range of evidence to ensure that both the judgements and inspection grades were secure.”

A spokesperson for Learndirect said it was “extremely disappointed” by the result of the appeal.

“Ofsted’s inspection was challenged because we believe the process did not give a true reflection of Learndirect’s training quality and performance,” he added.

“The business presented compelling evidence as part of the appeal to support this view.”

The provider had previously warned that if it were given a grade four, the government had confirmed it would serve a three month-termination on all contracts, which are worth over £100 million in total.

This, Learndirect previously claimed in court papers seen by FE Week, would force the group and learndirect to become “insolvent and forced into administrators”, leaving more than 1,600 of its staff at risk of losing their jobs and over 70,000 learners in need of help to find an alternative provider.

But it has now told FE Week: “The outcome of the inspection does not affect the non-ESFA and e-assessment contracts held within our adult skills business, Learndirect Limited or Learndirect Apprenticeships Limited, which is independent and was not subject to an inspection from Ofsted.

“Learndirect Limited will continue to be well-supported by our stakeholders and we will ensure our employees remain fully engaged around the ongoing evolution of the business.”

The government has been accused of “making it up as they go along” on critical questions over non-levy tendering, especially concerning maximum bid sizes.

The Education and Skills Funding Agency launched a new tender process for delivering apprenticeships to employers not subject to the levy last month, after its first attempt was “markedly oversubscribed” and later ditched.

It claims that this new minimum-£440 million procurement has a number of “critical differences”, including new tender value caps and contract award limits.

These, it says, will “ensure greater confidence that awards are set at realistic levels” – but many in the sector have blasted official replies to queries about the way these caps are calculated for doing anything but.

Guidance put out by the ESFA as part of the invitation to tender states that the cap for new directly contracted apprenticeship providers will be based on their turnover in 2015-16.

The assumption widespread across the sector was that this would exclude providers if they weren’t trading in 2015-16, as they wouldn’t have published accounts showing turnover for that year.

But in an official response to clarification requests from bidders, the ESFA indicated that this may not be the case.

“Organisations who were not trading in 2015-16 and therefore cannot provide turnover for this period, should submit 2016-17 turnover values,” it said on its Bravo e-tendering portal.

There are now concerns about how the ESFA intends to verify providers’ 2016-17 turnover claims, seeing as that year’s accounts have yet to be published.

One bemused sector expert, Steve Lawrence, the managing director of East Essex Vocational Training, complained to FE Week that “they appear to be making up the rules as they go along”.

“The whole thing in terms of guidance and clarity gives no real faith in the process,” he said. “The process of making procurement simple for small- and medium-sized enterprises appears to have gone out of the window, along with the idea of what the answer should be with regard to the turnover.”

This was not the only confusing answer to one of more than 140 questions: one provider asked which financial year start and end dates it should use as its accounting period differed from the standard April 1 to March 31 window.

They appear to be making up the rules as they go along”.

It was told to “provide your organisation’s declared turnover from the published accounts for the year 2015-16”.

This left providers whose accounting periods go by calendar year – from January to December – scratching their heads over whether they should state their turnover from 2015 or 2016 – and if it is the year ending 2016, some won’t be verifiable as they haven’t been published yet. And some had an extended accounting period in 2015-16, covering 15 months.

In another twist, the ESFA today notified bidders that they are “currently dealing with a number of queries in relation to mergers. We are aware that you are awaiting our response and we will come back to potential providers as quickly as possible.”

The current tendering process for delivering apprenticeships to non-levy paying employers was launched on July 28, and covers the period between January 2018 and the end of March 2019.

According to the ESFA’s ITT document, providers can be awarded contracts from a minimum of £200,000 up to a maximum “derived from the annual figure, as set out, adjusted to reflect that the initial contract period is a 15-month term (1.25 years)”.

The upper limit varies depending on the status of the provider, be it a new provider, a subcontractor or an existing apprenticeship provider.

These range from “turnover 2015-16 financial year multiplied by 1.25, or £750,000; whichever is lower” for new providers, to “110 per cent of non-levy historical delivery for 2015-16 funding year (August 1, 2015 – July 31, 2016), multiplied by 1.25” for existing providers who delivered more than £1.5 million of apprenticeships to non-levy paying employers that year.

A spokesperson for the Department for Education said: “Providers can find out this information and more by submitting a query via the message boards on our e-tendering portal, Bravo.”

A major college has been bumped up from a grade three to a two by Ofsted, in a report that was finally published after a 90-day delay, while Pizza Hut’s FE skills training has been rated ‘requires improvement’.

South Essex College, which teaches around 11,500 students, received a ‘good’ overall grade in a report published on August 7, after three consecutive previous reports since 2012 said it ‘requires improvement’.

FE Week understands that the delay was as a result of an “extended quality assurance process” after the new grade two was challenged.

However, it has at last been rated ‘good’ in every headline field Ofsted looks at save one, adult learning programmes, which was given a grade three.

Inspectors said apprentices and learners on vocational courses develop “skills that prepare them well for progression to the next steps of learning or employment” and more learners “now complete and achieve their qualifications than at the time of the previous inspection”.

Ofsted highlighted the “large numbers” of learners who study at level three, as well as the many apprentices in subcontracted provision, who are “particularly successful”.

Managers have taken “effective steps” to raise learners’ progress and attainment in English and maths this current year, but inspectors said low attendance in these subjects means that too many learners are still “not making sufficient progress, particularly in maths”.

Ofsted also said that too few learners sitting A-levels at the college “achieve their qualifications”. South Essex College is in the bottom four per cent of the country for its A-level provision.

Meanwhile Pizza Hut was given a grade three across the board for its delivery of skills training.

The employer-provider currently trains around 60 apprentices on intermediate and advanced apprenticeships in the hospitality and catering sector.

Ofsted found that too many apprentices did not achieve their qualifications in 2015/16 and, although current apprentices “make the progress expected of them”, too many have left their programmes early in 2016/17.

Leaders “do not self-assess” the quality of their apprenticeship provision “effectively, particularly with their subcontracted provision” and as a result, improvement planning and intervention have been “too slow”.

However, inspectors did note that the “vast majority” of apprentices develop good technical skills, which they use “assuredly” in their teams, and their employers “greatly appreciate” the value they bring to the business.

Ofsted added that apprentices enrolled on the new standards apprenticeship programme make “good progress” because of “high-quality” coaching and mentoring from their employers.

Learners gain good practical skills, such as how to slice a pizza correctly and how best to present food to their customers, as well as “theoretical competence”.

Norfolk Training Services Limited meanwhile had its first monitoring visit since it was given an ‘inadequate’ rating in May.

Inspectors said that since the inspection, leaders have established a quality improvement plan that features a “comprehensive range of actions to rectify all the weaknesses identified at inspection”.

Managers have “intensified” their actions to support and challenge tutors whose practice was as below expectations, and leaders have “refined” the role of a part-time employed equality and diversity officer and “increased the specific focus” on leading the promotion of British values to apprentices and learners.

Four other providers, Hertfordshire County Council, Maritime + Engineering College North West, John Laing Training and Buzz Learning Limited, held onto their ‘good’ grades following short inspections this week.

 

GFE Colleges	Inspected	Published	Grade	Previous grade
South Essex College	09/05/2017	07/08/2017	2	3

 

Independent Learning Providers	Inspected	Published	Grade	Previous grade
Norfolk Training Services Limited	06/07/2017	10/08/2017	M	M

 

Employer providers	Inspected	Published	Grade	Previous grade
Pizza Hut	06/06/2017	08/08/2017	3	–

 

Short inspections (remains grade 2)	Inspected	Published
Hertfordshire County Council	21/07/2017	07/08/2017
Maritime + Engineering College North West	14/06/2017	10/08/2017
John Laing Training Ltd	28/06/2017	08/08/2017
Buzz Learning Limited	05/07/2017	07/08/2017

More than a million pounds of public money has been spent on mergers that subsequently collapsed, FE Week analysis has revealed.

Details of the area review transition grants awarded to general FE and sixth form colleges to date were finally published by the Department for Education today, after FE Week repeatedly pushed for the information over the last 10 months.

Analysis of the payments showed that of the £5.6 million awarded so far, almost £1.04 million was specifically meant to support 11 mergers that since failed or significantly changed.

A total of 84 grants have been made to 50 FE colleges, 33 sixth form colleges and one specialist designated institution.

According to government guidance published last year, the grants were “to ensure providers can access the best change-management skills, and have the capacity to make the changes at the pace required”.

The size of the payments varied depending on the scale of planned changes – with mergers involving more than two institutions, or two institutions with a combined turnover of more than £25 million, attracting higher sums.

It’s not clear whether colleges with failed mergers will have to repay the cash; FE Week put the question to the DFE, but did not receive an answer before publication.

The largest failed grant was for £200,000, to South Cheshire College, and was intended to create a single Cheshire-wide college from the four in the area. But it later broke into two separate mergers, with South Cheshire joining forces with West Cheshire College in March, and Mid Cheshire College and Warrington Collegiate merging on August 1.

Bury College was awarded £100,000 for a proposed three-way merger involving Bolton College and the University of Bolton – yet Bury was dropped from this plan in April.

Barking and Dagenham College also received £100,000 for its failed partnership with Havering College.

And Stockport College got £100,000 for a three-way merger with Oldham College and Tameside College, which was subsequently called off by the FE commissioner.

South Staffordshire College was granted £100,000 for its partnership with Walsall College, scrapped in May.

The City Literary Institute in London – the only non-FE college or SFC to receive a transition grant – was awarded £100,000 for its link-up with Kensington and Chelsea College, which was called off in February.

The three collapsed Tees Valley mergers were also supported to the tune of almost a quarter of a million pounds, with £100,000 each going to Darlington and Middlesbrough colleges for their link-ups with Stockton Riverside and Redcar and Cleveland Colleges.

Hartlepool College received £49,500 for its failed merger with Hartlepool SFC.

And Farnborough College of Technology and Guildford College were each separately awarded grants of £50,000 and £37,500 respectively to explore the possibility of a merger – but talks between the two were paused back in February.

Looking at the wider picture, 26 of the 84 grants awarded so far were for mergers that have either completed or are still underway, totalling £2.24 million.

A further 29 grants, worth a combined total of £1.3 million, were awarded to SFCs to convert to academy status.

The remaining 18 grants, worth £1.01 million, cover a range of different outcomes including shared services, collaboration, setting up apprenticeship companies and, in one case, a “fresh start”.

An FE Week Freedom of Information request revealed last December that £726 million had been set aside by the government to cover the cost of implementing area review recommendations – of which £12 million was to cover transition grants.

That came after repeated rejected requests to the DfE over the size of the pot, and how many grants had been awarded, going back to October.

A week ago, the DfE published the reports into the final two waves of the reviews, bringing the process to a close.

At the time David Hughes, the chief executive of the Association of Colleges, warned that despite the government cash, colleges were still “funding the majority of upfront costs of these structural changes themselves”.

Area review transition grants awarded for mergers that subsequently failed: