A major training provider is walking away from adult education budget delivery this summer due to the “continuing tight labour market”.
PeoplePlus Group has decided not to renew its AEB contracts, currently held across multiple mayoral combined authorities, for the 2023/24 academic year. The company will switch its focus from face-to-face direct delivery to its online digital delivery platforms.
The decision appears to have been made abruptly, considering the firm was awarded a new AEB contract in the North of Tyne area just two weeks ago.
PeoplePlus held the largest national AEB contract among all independent training providers in 2020, with an allocation of £5.6 million. At the time it was delivering courses to around 8,000 adults and training to around 3,000 apprentices.
But the scale of this provision has plummeted in recent years after the company failed to secure another national contract with the Education and Skills Funding Agency in the controversial 2021 AEB tender.
PeoplePlus also sold its “loss-making” apprenticeship business to Babington Business College in December 2020.
The company was downgraded from ‘good’ to ‘requires improvement’ by Ofsted last month when it had just 148 adult learners on its books studying level one and two courses in subjects such as security, health and safety, customer service and digital technology.
Ofsted reported that achievement rates across PeoplePlus’ students were “too variable”, and that there was not enough effort to improve learners’ English and mathematic skills.
On some courses, the “type or location of work opportunities are not always compatible with the needs of the learners”, inspectors added.
PeoplePlus said all current learners would be “unaffected” by the decision to discontinue its AEB delivery, adding that the provider will support them to complete their qualifications.
The company would not confirm whether any jobs were at risk.
PeoplePlus currently holds AEB contracts with combined authorities in West Yorkshire and Tees Valley and a five-year contract with Liverpool City Region, worth more than £1.2 million, £755,800 and £657,000 respectively.
It also recently secured a five-year contract with Cambridgeshire & Peterborough Combined Authority for an unknown amount of funding.
Last August PeoplePlus scooped a seven-year £15 million contract to offer teaching at the Werrington Young Offender Institution in Staffordshire and was delivering education programmes across 22 adult prisons at the time.
PeoplePlus is owned by Staffline Group PLC, one of the biggest recruitment firms in the UK. In its latest annual report for the year to December 31, 2022, Staffline noted that PeoplePlus was “impacted by the disruption to its skills training as a result of the tight labour market, with workers being able to go straight into jobs without pre-job training”. That caused its revenue to slide by 6.3 per cent from £83.1 million to £77.9 million, according to Staffline’s accounts.
Staffline also devalued PeoplePlus by 12.1 per cent to £59.6 million, which it blamed on a “reduction of forecast earnings by the division”.
A spokesperson for PeoplePlus said: “In the continuing tight labour market, we want to ensure that our adult education offering in England is optimised for these new conditions and the changing requirements of learners.
“This means that, from the 2023/24 academic year, we will be revising our footprint in the sector to allow us to focus on the continued rapid growth of our digital learning platforms and our portfolio of partner services through which we support a fast-growing number of fellow provider organisations.
“Learners on our 2022/23 programmes will be unaffected by the transition to this new service model as we support them to complete their qualifications.”
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