The largest college group in the country is to be dropped from the government’s final bidding round for Institutes of Technology after Ofsted hit it with a grade three rating, FE Week understands.

Two teams of inspectors were deployed to NCG last month, in a visit prompted by achievement rate concerns.

FE Week understands that they are expected to deliver an overall ‘requires improvement’ rating for the group, down from ‘good’, raising particular concerns with its leadership and

Its training provider, Intraining, was subject to a separate report and is also expected to be awarded a grade three.

The ramifications of a ‘requires improvement’ are likely to be severe. For instance, FE Week also understands that NCG will now be thrown out of the final stage of the government’s competition to open an IoT.

It was one of 16 providers to make the cut in bids for a share of £170 million put aside for the institutes.

In a wide-ranging interview below, NCG’s chair Peter Lauener (pictured above left) explains that NCG’s bid was a “good model” which included a “hub and spoke involving a lot of other providers”.

However, he would not be drawn on Ofsted’s findings, nor his thoughts about the bid being dropped by the DfE, other than to say “that is not a decision for us”.

DfE guidance for opening an IoT states that a provider’s Ofsted grade must be at least ‘good’.

As revealed by FE Week last month, alarm bells started ringing at NCG after Ofsted took a highly unusual decision to extend its inspection.

Generally the watchdog would expect only to carry out a short inspection had there been no concerns. NCG was rated ‘good’ in September 2016 following a five-month standoff during which it successfully overturned a lower grade.

Intraining was also given a grade two that June.

However, overall achievement rates at NCG are well below the national average. In 2016/17, the combined overall apprenticeship achievement rate for NCG’s colleges was just 55.6 per cent, while Intraining’s was 58 per cent.

Both are around 10 points lower than the national average of 67.7 per cent, and lower than the minimum threshold of 62 per cent, according to the latest government data.

And for the all-important 16-to-18 study programmes, NCG was 4.4 points below the national average of 81.5 per cent.

It is understood that Ofsted wanted to reinspect NCG last year, but had been unable to analyse the group’s achievement rates because “data glitches” absented it from the 2015/16 tables.

Mr Lauener, who joined the group in March after retiring as chief executive of the ESFA, admitted that NCG’s achievement rates are “not where we want them to be and are not high enough”.

“We are absolutely committed to improving standards and we actually expect to see some quite rapid improvement in achievement rates in 2017/18,” he insisted.

He has “full confidence” in the group’s chief executive Joe Docherty (pictured above right), despite anticipated criticism of leadership and management from Ofsted.

“I think Joe is a first-rate chief executive,” he told FE Week. “I am absolutely confident he is the right person to realise the potential of the organisation.”

At the same time as dealing with these inspections, NCG is cutting staff numbers by up to a fifth at Intraining and its other private provider Rathbone Training in an effort to save £3 million.

The group was further shaken in April when staff at Lewisham Southwark College, a long-distance merger partner, voted to strike over pay and last week announced the free school they sponsor, the Discovery School, is to close.

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