The Education and Skills Funding Agency has suspended starts at an apprenticeship firm with multimillion-pound subcontracting deals while it investigates the provider, following revelations in FE Week about its shady set-up.
SCL Security Ltd, a private provider based in Kent that is run by Andrew Merritt, has taken £16.5 million from Brooklands College in Surrey over the last three years to deliver hundreds of level three IT apprenticeships, for mostly 16- to 18-year-olds.
But, despite the substantial contracts, SCL Security Ltd only employed eight people in 2017, according to its most recent company accounts, and seven the year before.
I understand from speaking with the ESFA that the issue was with regards to apprenticeships and contracts of employment
It is also not known exactly where the provider trains its apprentices, as Mr Merritt has repeatedly refused to share his delivery addresses despite numerous requests from FE Week.
This newspaper reported in November that the government was looking into SCL Security Ltd and it has now been confirmed that a formal investigation has begun.
While the investigation is being carried out, the ESFA has suspended the provider from taking on new apprentices.
Mr Merritt did not provide a comment, despite numerous requests.
A Department for Education spokesperson said: “We do not comment on the details of any investigations, ongoing or otherwise.”
Brooklands College said it was “unable to comment on behalf of the ESFA” and did not respond to questions about whether it still has a working relationship with SCL Security Ltd.
SCL Security Ltd also subcontracted for Ealing, Hammersmith and West London College, with deal worth £1.7 million in 2018/19, which covered basic English, maths and IT skills for learners whose first language is usually not English.
However, the college has now terminated this relationship.
EHWLC’s principal, Karen Redhead, said: “I understand from speaking with the ESFA that the issue was with regards to apprenticeships and contracts of employment. We do not subcontract to SCL Security Ltd on apprenticeships.
“We did robust due diligence and we have done some really robust quality checks and have found absolutely nothing that causes concern.
“We did have a contract with them for a value of £1.7 million but as a result of FE Week’s probes some while ago we terminated it in relation to new starts.”
SCL Security Ltd secured its first direct ESFA contract this year, which totals £1 million and includes apprenticeships and adult education budget cash, bringing it in scope for Ofsted inspection.
As previously reported by FE Week, one area of interest to the ESFA will be SCL Security’s relationship with a recruitment firm called Workforce Solutions Group Ltd, which is headed up by two brothers who were at the centre of an FE Week investigation in 2016.
Paul and Joe Alekna switched the ownership of a successful provider they ran from one parent company – eResponse – to another, before transferring out £6 million, liquidating it, and leaving learners and creditors on the hook for millions of pounds.
Meanwhile, the brothers continued to run another provider called Options 2 Workplace. But when FE Week exposed the situation, the ESFA cancelled its contract.
SCL Security claims on the government’s Find Apprenticeship Training website to “operate training centres nationwide”, but its own website makes no reference to any training venues – the only address is for a head office in Kent.
As a result of FE Week’s probes some while ago we terminated it in relation to new starts
However, a Google maps search locates one of their training sites as “9 Church Rd, Redditch” – the same building that Workforce Solutions Group operates out of.
Paul Alekna previously told FE Week that Workforce “specialises in temporary and permanent staffing, focusing in the manufacturing, logistics and transport, food manufacturing and office appointments sectors”, and insisted “that’s all we do”.
But he refused to deny that Workforce and SCL Security have a working relationship.
Mr Merritt offered a list of “delivery locations”, which includes Hounslow, Greenwich, Ashford and Nottingham.
He said all are “under short-term rental/lease arrangements responding to demand” and the Redditch location was “one such rented room”, but declined to comment on the relationship between SCL Security and Workforce.
He added that the “exact addresses” of the other locations “are known to all learners, staff, delivery partners and all official bodies” but refused to give them to FE Week.
Brooklands College also refused to release the addresses of where its apprentices were trained with SCL Security.