College governors brand SFA’s new apprenticeship contracts ‘ludicrous’

College governors have branded the SFA’s new apprenticeship contractual arrangements “ludicrous” during a heated discussion at the AoC’s Governance Summit.

There is due to be a shift from contracts between the SFA and colleges to legal agreements between colleges and employers – which will amount to “a commercial relationship” with employers – according to Keith Smith, the SFA’s director of funding and programmes.

“You are entering into a commercial relationship with an employer because they are choosing to use you and buy services from you,” he told attendees.

Stunned governors were urged “make sure you know what you are selling” and to “understand you have the right terms and conditions to protect yourself” if an employer decides to end the relationship.

The discussion soon became heated, as governors expressed their shock at the new arrangements – which will also see employers drawing up their own separate contracts with the SFA.

One unnamed governor blasted the system as “ludicrous” and a “nightmare”.

“I can see people walking away from contracts and there is no incentive to enforce it,” he warned. “The legal fees for doing so could swamp the potential gain.”

Mr Smith admitted in response that commercial relationships between colleges and employers did risk becoming “tricky, rocky and volatile”.

He continued: “That’s why I say to you when you enter into these relationships, what indemnity and safeguards have you put in place?”

But he insisted that employers “can’t walk away from paying the levy and can’t walk away taking money out of the account and do something else with it”.

From his point of view, he said, these contracts mean that the SFA would get the levy cash one way or another, and that his department would “make sure it’s spent for the benefit of apprenticeships”.

Earlier in the session, he warned governors that the SFA would not step in if colleges have any contract disputes with employers, saying: “I can’t get involved in any contractual dispute or commercial disputes when the employer has instructed me to stop paying you.”

Nor can the SFA get involved in contract negotiations between employers and providers – “that’s for you now,” said Mr Smith.

Governors were therefore urged to ensure that management teams were aware of the upcoming changes.

The “safety nets” created by the involvement of the SFA were due to “change significantly”, he said, “and you just need to be aware of the risks of these things”.

“As a governing body you need to make sure you are quizzing and questioning your management teams on how on the ball they are,” he went on.

“If they say ‘don’t worry, this is all normal, we do this all the time’, then I would probably worry.”

Julian Gravatt, AoC’s assistant chief executive, said his organisation had been working with colleges to prepare for the reforms “for several years”.

“Getting the relationship between employer, apprentice and college right will be vital to make this work,” he said.

“Employers will clearly now have the ability to change their mind if colleges get things wrong.

“But it is inevitable that the government will need to intervene in some cases to protect the apprentice and to ensure that training continues in the right areas.”

Mark Dawe, chief executive of AELP, said: “Independent training providers welcome this brave new world. They are used to dealing with employers in negotiating agreements.”

SFA already finding ineligible employer incentives and will ‘strengthen’ funding rules

The apprenticeship funding rules will be beefed up to stop inappropriate employer incentives, just two months ahead of the launch of levy-funded apprenticeships.

The Skills Funding Agency said in their weekly update that they were aware of providers offering incentives, such as payments to employers to refund fees, which was ‘contrary to the policy intent’.

“Following the publication of the Apprenticeship funding and performance management rules 2017 to 2018, we have been made aware of some emerging delivery models that are contrary to the policy intent.

“For example, some providers are offering incentives for employers by paying or re-funding them for certain aspects. These include:

  • inflating training costs to refund the employer’s co-investment
  • funding ineligible costs to employers as subcontractors
  • claiming higher prices to fund non-English apprentices free of charge to the employer

“Providers must not make payments of this kind to employers.

“We will continue to review these practices and will shortly be strengthening the funding rules to prevent this.”

Struggling college bailed out by SFA after bank refusal

A Warwickshire college in financial dire straits has been bailed out by the Skills Funding Agency, and is now seeking a merger partner following the departure of its principal.

Stratford-Upon-Avon College was rated ‘good’ by Ofsted in March 2015, but ran into money problems this year after planned projects which were expected to bring in new funds came to a halt.

Chair of the corporation at Stratford-Upon-Avon College and former Confederation of British Industry boss, Lord Digby Jones (pictured above), spoke to FE Week about the fast-developing situation on Tuesday.

He said Lloyds Bank refused to provide temporary financial support to the struggling college, meaning it was forced to turn to the SFA for assistance.

The agency agreed to a bail out but insisted that as part of the arrangement the principal, Nicola Mannock, must leave her post, he added.

Former Warwickshire College deputy principal, Andrew Cropley (pictured left), has now taken up the role of interim principal and chief executive at the college, and Lord Jones confirmed that his appointment had been approved by the SFA.

“I have found the SFA amazingly helpful,” he said.

“They did say they wished Nicola Mannock to resign and she has done so. She left our employment yesterday (February 27).”

He confirmed that this had been “a condition” of working with the SFA, but added that Ms Mannock had done “an awful lot for the college” in her time there.

In October 2015, the college marked the end of a 17-month long intervention by then FE Commissioner, Sir David Collins, which had been triggered when the SFA rated its finances as inadequate.

Sir David’s recommendations to the college following his first visit in May 2014 suggested Ms Mannock would “benefit from being mentored by an experience principal”.

Her appointment, without a competitive recruitment process, had led a number of governors to resign in protest, and was described at the time by the commissioner as “questionable”.

Looking forward, Lord Jones said: “The only project on the horizon now is to put out a request for tenders for merger.”

He admitted that while he plans to see the college through to recovery, he also intends to “step off the ship” once it reaches a “safe port”.

He said that a merger would be implemented “as quickly as we can”, ideally allowing the college to begin the 2017/18 academic year, “as a merged college with another entity”.

Lord Jones added that the unions and the SFA would both be involved in the process, and an agreement had been made with the agency that “as a condition of any merger proposal, the college in Stratford will not be harmed in any way”.

FE Week approached two local colleges about the situation at Stratford-upon-Avon College and both showed interest in future collaboration.

Stuart Laverick, principal at Heart of Worcestershire College said he was “sorry to hear” about the college’s troubles.

“We’re already working closely with Stratford-upon-Avon College and have collaborated in a number of areas.

“We will continue to support our partners and should there be an opportunity for closer working in the future of HoW College would look forward to exploring this further.”

A spokesperson at Warwickshire College Group highlighted that it had proposed a merger with Stratford-Upon-Avon College during the Coventry and Warwickshire area review, but it had been dismissed at the time.

He said: “WCG has been merging with individual colleges across Warwickshire and Worcestershire since 1996, so we have an established model to embrace other colleges into the group structure.

“WCG would be pleased to work more closely with Stratford College to secure the long term future of FE in the area and to ensure.”

The SFA was unable to comment on the record, other than to confirm what Lord Jones told FE Week.

Shocking associate partnerships need to be tackled

It is clear the SFA crackdown on subcontracting is increasingly pushing it underground.

Our findings this week on the rise of this hidden subcontracting have genuinely shocked me.

Some will try to claim ‘associate partnerships’ aren’t subcontracting because it is no different from using a recruitment agency to source a trainer.

This is nonsense, given the partner sources the learner, trainer and training facility.

It’s very clearly subcontracting in all but name, to avoid SFA bans for loans-funded provision and second-level subcontracting.

There is in fact a history of hiding subcontracting, if you go back a little over 15 years.

In 1999 the Further Education Funding Council called it ‘franchised’ provision.

Providers were found trying various partnership deals to claim it was still direct provision, and thus avoid the 1/3 automatic franchise funding discount.

In an important document at the time, FEFC circular 99/37, the funding body emphasised: “Partnership arrangements involving public funds should be transparent and available for scrutiny.”

If prompt action isn’t again taken, the SFA subcontracting bans and safeguards will be futile.

All ‘associate partnership’ deals need to be declared and should be classed as subcontracting.

No excuses and no hiding, for the sake of vulnerable learners and safeguarding public funds.

Film industry education boss lands ‘hand grenade’ assessment job at Institute for Apprenticeships

The new deputy director of assessment for the Institute for Apprenticeships, a role likened to “a hand grenade with the pin removed”, has been unveiled.

Shadow chief executive of the IfA Peter Lauener revealed today, at the Association of Colleges Governance Summit, that the job has gone to head of education and skills at British Film Institute, Nikki Christie.

Jonathan Mitchell, deputy head academic at London independent Forest School, is to be deputy director apprenticeships standards development.

FE Week has also learned that job adverts for the IfA’s permanent chief executive and deputy CEO will be advertised “shortly”.

Former Barclays chief executive Anthony Jenkins, who was announced as the shadow chair in June, is now permanent.

Mark Dawe, chief executive of Association of Employment and Learning Providers, said in an exclusive FE Week webinar in January he felt sorry for whoever takes on the director of assessment post, warning against duplicating the job of qualifications regulator Ofqual.

“I imagine anyone taking on this role will feel like they have been handed a hand grenade with the pin removed,” he said.

“But the actual leg work – we don’t understand why that isn’t given to the government agency that’s there with the expertise in assessment, and that’s Ofqual.”

He said there were still talks to be had on the end-point assessment of apprenticeships, over whether it will be “valid, reliable, manageable across all the standards”.

“We’ve heard maybe 50 per cent – maybe more than 50 per cent now – of standards have an EPA organisation,” Mr Dawe said.
“They [the government] could make their lives a lot easier if they just didn’t duplicate and actually commissioned Ofqual to do the work that’s needed.”

The government launched its long awaited IfA consultation on January 4, with responses required by the end of the month.

It explained that key functions for the new apprenticeships policing body, set to be formally launched in April, will include quality assurance of apprenticeship assessments.

The external quality assurance is a direct lever that the IfA “can use to exercise its primary function to help ensure the quality of the reformed apprenticeship system. It is up to the IfA to decide what form its EQA takes.”

The government strategy on this also stated: “The IfA should consider how best to ensure that effective and high-quality external quality assurance processes are available and are applied to all end-point assessments.

“It will need to satisfy itself that all options will ensure consistent assessment and require a high standard from all apprentices.”

FE Week then reported on February 7 that the IfA will charge apprenticeship assessment organisations for external quality assurance of new standards – despite Ofqual keeping the service free.

Mr Lauener said that it was acceptable for the institute to charge for the service because “the principle of a regulator charging bodies in the industry for regulation is not uncommon at all”.

Currently, when employer Trailblazer groups submit their assessment plans for new apprenticeship standards.

They must choose one external quality assurance organisation out of four options: Ofqual; the Quality Assurance Agency, which generally deals with higher education qualifications; a professional or sector body, which the Trailblazer group can create themselves if desired; or the IfA itself.

In all, Mr Lauener showed today in his projection (above) to delegates that eight IfA roles have been filled, with only two of the deputy directors (Nikki Christie and Jonathan Mitchell) from outside the civil service. The other senior management appointments are for:

Deputy director for approvals – Ana Osbourne,

Deputy director for funding policy – Jayne McCann

Deputy director for data science – Alex Wilson

Strategic adviser – Richard Guy (part-time consultant)

Deputy director for corporate effectiveness – Helen Knee

Set-up and finance – Tony Singleton (part-time consultant)

Government is making dangerous errors on apprenticeship assessment

Although the new policy on assessment organisations is intended to drive down overall costs, it’s likely to impact quality at this critical time in the reform programme, says Rob May

Imagine you own a plumbing business.

Your business is contracted to fit the water supply for a newly designed hotel complex. The plans look challenging, but it’s all very exciting and you want to get involved because this is the kind of job you’re really good at.

Naturally, you will want to take great skill and pride in your work. After all, that’s how you’ve earned the trust of the public over decades of trading. At the very least the plumbing system you install will need to meet a minimum standard of regulations as set out by an independent body, which is focused only on the safety and reliability of the water supply, irrespective of what’s going on with the rest of the build.

Sounds straightforward…

But then, you learn the client and the building company have got together and agreed a price deal on the project without consulting you at all. They’ve squeezed the cost of the build right down, and now they simply expect you to accept less money for the same work.

Getting it wrong could have devastating consequences for learners

Not only that, but because there is less money, you may no longer be able to meet even the minimum specifications demanded by the regulator within budget, yet alone make any profit to re-invest in new tools.

This is the situation facing awarding organisations today.

Previously, the guidance issued to assessment bodies was to charge a maximum of 20 per cent of the funding amount allocated for the specific apprenticeship standard being delivered. Now they can only charge 20 per cent of actual price agreed between the employer and the training provider.

A new policy directive on apprenticeships from the Department for Education says exam boards must base their fees for apprenticeship end-point assessments on deals negotiated between employers and training providers, which are likely to take place without their input. With some employers seeking to drive hard bargains with training providers that are eager to secure funding, this could mean a race to the bottom.

The basis for the earlier guidance was itself unsubstantiated and even that model looked challenging for awarding bodies, many of whom were not included in assessment development plans but were left grappling with how to design some fairly impractical tests.

To give employers more control over the content and assessment of apprenticeships, every new apprenticeship standard has an assessment plan produced by ‘trailblazers’ (employer-led groups). This employer panel creates an assessment plan, independent of the workplace and off-the-job training provided.

Employers are certainly well-placed to identify the knowledge, skills and behaviours that apprentices need to have, and they are already used extensively in our qualification development, but most employers readily accept that they do not necessarily have the relevant technical experience in ‘assessment’.

Awarding organisations are experienced in ensuring that assessments are manageable, fair and reliable. It’s what they do day-in, day-out, and under close regulatory scrutiny.

But now delivery and assessment have been merged together when it comes to setting a price for the apprenticeship, which could make the assessment plan desired by employers unworkable.

High quality or low price?

Decoding assessment plans is a complex task. In some instances there is little guidance from trailblazers on core principles such as the required size of the test, the frequency of testing, how to aggregate marks into a final grade and the required size of the question bank needed to avoid predictability over time. Make no mistake, these apprenticeship assessments are highly technical products in a high-profile, high-stakes landscape. Getting it wrong could have devastating consequences for learners starting out on a career. Awarding bodies know this.

The new rules are unviable in an open market

To help make the case on the cost and complexity of translating the trailblazers’ assessment plans into reality, and in the spirit of transparency and co-operation, a number of awarding organisations (including YMCA Awards) presented their fully-worked costings to the Skills Funding Agency, an exercise which now appears to have been a wasted endeavour.

Although the new rules are intended to drive down overall costs, it’s likely to impact quality at this critical time in the reform programme, with the employer levy about to kick in from April. It could even slam on the brakes as awarding bodies which were already thinking twice, must now take a long hard look at the financial feasibility of developing end-point assessments.

What separation?

Another defining feature of the reforms is that assessments will either be delivered by an independent third party, or in such a way that no party who has been involved in delivery of the apprenticeship can make the sole decision on competence and passing the end-point assessment. In other words, quite rightly ensuring separation between provider and assessor to avoid a conflict of interest in the assessment decision.

However this independence doesn’t seem to count when it comes to price-setting. Assessment organisations will want to collaborate closer than ever before with training providers to ensure that appropriate pricing models are used.

Most of the organisations involved in DfE’s recent wave of workshops on ‘How to become an end-point assessment organisation’ have been training providers, looking to set up an ‘independent’ trading vehicle for assessment. Never mind the fact that there are already 160 recognised awarding organisations. Apparently government wants fewer of them and more new, untested and unrecognised assessment organisations.

The move demonstrates yet another fundamental misunderstanding of the education system by policy makers and a lack of knowledge of what’s involved in developing and maintaining high-quality assessment throughout its life-cycle.

The new rules are unviable in an open market, and with only around half (81 out of 159) of standards with at least one assessment organisation in place, the latest directive is not likely to see a surge of apprenticeship assessment organisations entering the market. And if it does, the Institute for Apprenticeships must ask searching questions on the quality of assessments being offered.

Instead of an apprenticeship system that is built to last, is the government building one destined to fail?

I sincerely hope not. The principles underpinning the overhaul of our apprenticeships system are laudable, and we will work hard with government departments and training providers on finding ways to make it work, but in return the DfE must start to listen to the experts and make some sensible decisions, urgently.

 

Rob May is director of YMCA Awards and a board member at the Federation of Awarding Bodies

First sixth form college converts to academy status today

Hereford Sixth Form College has won the race to become the first to convert to academy status.

The provider, which was rated outstanding by Ofsted when it was last inspected in 2008, completed the process to become a standalone academy today (March 1).

It comes almost 16 months after former chancellor George Osborne first announced that SFCs could convert to become academies to avoid paying VAT.

Jonathan Godfrey, Hereford SFC principal, said he was “delighted” to win the race to academise.

His college’s new status will “allow us to formalise some of the collaborative work we are involved in with our excellent local 11-16 partner schools” while “the VAT refund will enable us to direct additional resources to the education of our students”.

“As the first SFC to take this step, we have been able to help shape the conversion process and we hope this will benefit other SFCs that become academies in the future,” he added.

James Kewin, deputy chief executive of the Sixth Form Colleges Association, said Hereford’s conversion marked “the beginning of a new chapter in sixth form education in England”.

“By becoming an academy, SFCs like Hereford will be able to forge closer links with local schools and invest more money in the education of their own students,” he said.

Mr Kewin added that not all SFCs would want to academise “but it is right that they have the option to do so when it is in the best interests of their students”.

SFCs were first given the option to convert to academy status in November 2015 as part of the government’s spending review.

Mr Osborne said at the time that becoming an academy would mean that SFCs would no longer have to pay VAT – which is on average £385,000 for each college, according to the SFCA’s latest figures.

It came after a campaign led by the SFCA to bring SFCs in line with school sixth forms, which don’t pay VAT.

At the moment, the option to convert to an academy is only available to SFCs through the area review process.

Hereford SFC was part of the Marches and Worcestershire review, in wave two, which completed in May.

The recommendation to emerge from that review for the SFC was to “remain stand-alone and develop its proposal for academy conversion whilst continuing to provide its core, good quality offer”, according to the report into the review published in November.

The 2,100-learner provider held a consultation on its plans to convert from September to November, with the initial aim of converting on January 1.

Its consultation document said that conversion would give it “additional funding of between £200- £300k annually”.

An estimated 70 per cent of the country’s 93 SFCs are understood to be actively considering academisation.

FE Week reported in January that a fifth of SFCs had started formal negotiations to convert to academy status.

Other SFCs understood to be close to converting include Priestley SFC, New College Pontefract and Rochdale SFC.

FE Week reported in January that Priestley was planning to convert on April 1, while Rochdale’s website says that it intends to academise on the same date.

Meanwhile, New College Pontefract is expected to convert in the coming months after its application to become a 16 to 19 academy was approved in principle by the Lancashire and West Yorkshire headteacher board on November 30.

 

Breaking: Hull College Group chief executive departs after financial mess exposed

Hull College Group has announced the departure of its chief executive Gary Warke, bringing to an end weeks of speculation after the FE Commissioner exposed a £10 million deficit there over four years.

A statement was sent to FE Week 15 minutes ago on behalf of the chair of governors Pat Tomlinson.

She said: “On behalf of the college corporation, I can confirm that Gary Warke, group chief executive, has decided to leave the college to explore new career opportunities.

“This coincides with a point where the area based review process is virtually complete and the group embarks on a new strategic plan.

“The corporation would like to thank Gary for his service to the college and commitment to FE and wish him every success. In turn, Gary wishes the college well for the future.”

She added: “Michelle Swithenbank, as deputy CEO, together with the leadership team will lead the college forward to develop and deliver those new plans.”

It comes after FE Week reported on February 14 that the group had repeatedly refused to publicly back Mr Warke, after he was urged to resign following a damning FE Commissioner report.

Commissioner Richard Atkins’ team was sent in to carry out an emergency assessment, after the Skills Funding Agency issued it with a notice of concern last November.

The resulting report, published in early February, warned that the senior leadership team had not succeeded in addressing a steady decline in financial performance, recognising a “cumulative deficit of around £10 million over the past four years” with its operating performance.

It added that “a further deficit in excess of £1m is forecast for the current year.”

It sparked widespread dismay and a call by the University and College Union for Mr Warke  to stand down.

A spokesperson for the union claimed at the time that “at an extraordinary staff meetings held at the college today, the chair of governers Pat Tomlinson was vague about CEO Gary Warke’s position.”

UCU regional official, Julie Kelley, told FE Week this morning: “The recent report from the further education commissioner made it quite clear that Mr Warke’s position was no longer tenable.

“Staff and students need a new management team in post prepared to put the educational needs of local people first. A good college is one that offers a varied curriculum and we hope that Hull College will now reassess its primary function and focus on supporting staff to deliver education to students.”

The SFA issued Hull with a notice of concern on November 11 last year, triggering the visit from Mr Atkins’ team.

The subsequent report explained that the notice was issued because the college had been rated ‘inadequate’ by the SFA for financial health (based on its 2016 to 2018 financial plan) and had also requested exceptional financial support.

It revealed that “the college intends to put in place a different management structure in early 2017”, including a newly appointed “‘turnaround director’ to help to deliver financial recovery”.

It added: “Although the senior leadership team has a range of skills and experience, it has not succeeded in addressing key issues facing the college, including steady decline in financial performance and loss of market share.

“There is concern at all levels of the organisation that the college lacks strategic vision and strong, resolute leadership and that this is frustrating and demotivating for staff.”

Mr Atkins’ report made a number of recommendations, including instructions for the corporation to “respond accordingly in relation to leadership and governance”.

FE Week previously reported, in May last year, that Mr Warke had been accused of trying to bully a member of the shadow cabinet for supporting a staff strike action.

Karl Turner, who is the MP for Kingston upon Hull, joined “angry and demoralised” Hull College workers on the picket that week in a row over pay and a controversial new lesson observation system.

He subsequently called for an investigation into Mr Warke, after he was allegedly sent a “threatening and derogatory” letter. Mr Warke declined to comment any further on the matter.

#SaveOurAdultEducation call for loans justice is raised in House of Lords

Leading government skills adviser Professor Alison Wolf has added her voice to calls, through FE Week’s #SaveOurAdultEducation campaign, for justice for learners saddled with large loans when training providers go under.

The author of the influential 2011 Wolf Report, on the future of vocational education, spoke out in the House of Lords yesterday.

This came just over an hour after our campaign was officially launched, in the Houses of Parliament, before 200 people.

#SaveOurAdultEducation is calling for advanced learning loans debt to be written off, where blameless adult learners have been left unable to complete their courses if their training provider goes bust.

The government is currently refusing to do this – despite FE Week reports revealing hundreds of learners have been left, for example, at least £8,500 in debt, but with no qualifications to show for it.

“It is extremely important to recognise that a large number of people are now taking out loans who are not in FE colleges and who receive very little protection,” Professor Wolf, who is also a Baroness and became a crossbench peer in 2014, said during a committee session on the Technical and Further Education Bill.

She urged government to extend the protection that will be offered to learners at FE colleges through the bill “to the many thousands of people who have loans and are with training providers, and where a continuation of this flux, collapse or reforming movement among these small organisations leaves them in an even worse situation than in the past”.

Speaking exclusively to FE Week after the session, Professor Wolf said: “I will definitely return to the issue at report stage”.

Professor Wolf [pictured above] referred to FE Week’s recent stories on the demise of training two providers – Hampshire-based Edudo Ltd, and London-based John Frank Training – during yesterday’s committee session.

“People were left with student loans that were really sizeable—especially in relation to the incomes many of them were earning—but no recourse and no obvious regime to help them,” she said.

Private training providers had “been an extraordinarily ill-monitored part of the training sector” until now, she added.

The introduction of loans – particularly to learners at private training providers which can “get overstretched and many start up then close down as they do or do not get contracts” – had “dramatically changed the nature of post-18 education and training across the country”.

“We need to make sure that government accountability catches up with it,” she urged.

The call for unwarranted loan debts to be written-off is one of three demands of #SaveOurAdultEducation.

The campaign is also calling on the government to consult on a proper adult education strategy, one that does not disappear under the political weight of apprenticeships and devolution.

The third demand is for the introduction of FE maintenance grant loans for adult learners, which would make retraining possible for many more older people, by helping cover their living costs while studying, something that is already available to mature students in higher education.

FE Week revealed before Christmas that the Department for Education had indefinitely delayed a decision on whether to extend maintenance loans to FE.