Hundreds of learners on loans-funded courses are facing an uncertain future after their training provider received the lowest Ofsted rating.
Health and Fitness Education Ltd, in Lancashire, received an ‘inadequate’ across the board in a report published June 27.
It delivers training in health and fitness through government-funded advanced learner loans, and had around 225 learners taking courses at level three and four at the time of its inspection last month.
The rules are fairly clear: where a private provider under contract with the Education and Skills Funding Agency is rated ‘inadequate’ by Ofsted, the government usually terminates their contract with a three-month notice period.
But the Department for Education confirmed to FE Week that while it was aware of HFE’s report, it hadn’t made a definite decision as to whether it would withdraw funding, and would provide an update shortly.
Lee Cain, the managing director of HFE, remained upbeat – saying the advanced learner loan provision only represented a “small portion of our turnover” and the company was in “great financial shape”.
HFE recorded £499,409 shareholders’ funds in 2016, according to the company’s most up-to-date accounts with Companies House.
“As such we will not be going bust or cutting any jobs, irrespective of what action the ESFA decides to take,” Mr Cain told FE Week.
“I can’t speculate on what will happen in the future, but even if the ESFA did withdraw the funding, we’ve made a commitment to these students and we will support them until the end of their qualification.”
We’ve made a commitment to these students and we will support them until the end of their qualification
HFE’s contract amounted to £248,538 for advanced learner loans in March this year.
In previous occasions in similar circumstances, for example with the Darlington-based provider Focus Training & Development Ltd, the withdrawal of government contracts has caused providers to go bust.
Students on advance learner loans courses are then left with hefty loans debt but no qualifications to show for it as their training cannot be completed.
The HFE case follows an FE Week campaign to help students left with huge loan debts and no qualifications when their providers go bust.
We have been demanding government action on the issue since January, as part of #SaveOurAdultEducation, when we discovered cases like this for hundreds of learners at John Frank Training, Edudo Ltd and Focus Training & Development Ltd.
In April, after months of sustained pressure, the government said it would defer repayments for learners in such circumstances for one year – a partial victory in our drive for loans justice.
However, we are still campaigning on behalf of the learners for their debt to be entirely written off.
In HFE’s case, the provider has pledged to continue to deliver the training for its affected loans learners, until their qualifications are achieved, even if the government funding is pulled.
The DfE said that in circumstances where funding is pulled, it is the department’s priority to help affected learners as soon as possible.
In this week’s damning Ofsted report, inspectors said almost half of learners at HFE “do not achieve their qualifications” and of those learners who are successful, “too few” achieve their qualifications within the planned timescales.
Directors are also “not sufficiently knowledgeable” about the requirements of delivering public-funded qualifications, according to the watchdog.
Mr Cain said he was “naturally disappointed” with the outcome of the inspection and there have been some “key lessons learned” from the process.
“It was our first Ofsted inspection and this is the first time we’ve held a direct contract,” he admitted.