A group of the largest colleges are planning to band together to form their own awarding body and slash the growing costs of exam fees.
The initiative by the 157 Group has also been chosen by the Government as one of the pathfinder projects to encourage the creation of new social enterprises and employee-led mutuals - meaning they will get advice from companies like John Lewis.
Lynne Sedgmore, chief executive of the group of self-styled “large, successful colleges”, said its 28 members had already discussed plans to form a new awarding body when the Cabinet Office invited them to join its scheme to encourage entrepreneurialism in the private sector.
She said: “Adopting an employee-led mutual approach to awarding qualifications will enable significant financial efficiencies, through shared services and by keeping public sector funds within the FE sector, rather than feeding surpluses into private stakeholder profits.”
The group’s members alone paid between pound;50 million and pound;100 million to exam bodies each year, Ms Sedgmore added.
The colleges have issued an invitation to awarding bodies to join a partnership with them, with a deadline of September 9. The group expects to develop new qualifications initially, avoiding competition with existing exam boards, but could eventually offer a full line-up of vocational qualifications, A-levels and GCSEs.
Ms Sedgmore said: “Setting up an awarding body as a mutual will allow us more flexibility and control over the way in which qualifications are developed and awarded so that the needs of learners, colleges and employers can be served better.
“Employers will benefit from colleges’ ability to respond more speedily to their skills requirements and to develop new forms of employer-led qualifications.”
Other details have yet to be worked out, including who the “employees” leading the mutual would be: the 157 Group’s small staff, principals or employees of member colleges, or the staff of their awarding body partner.
It is also unclear whether exam boards will want to co-operate with an attempt to lower fees, although Ms Sedgmore said she has received expressions of interest already.
As one of the 12 pathfinder mutuals, the 157 Group will have access to support from the John Lewis Partnership, the retail company where all 70,000 employees share in the profits, as well as mentors such as Lord Victor Adebowale of the social care enterprise Turning Point, but there is no funding from Government attached.
Concerns over the cost of fees by exam boards have risen over recent years as their income has soared. A report by Ofqual estimated that awarding bodies had become almost a billion-pound business.
The growth has been driven by a surge in the number of qualifications, up from 2,771 in 2001 to 9,708 - although some were duplicates to fit into the new Qualifications and Credit Framework.
But the Government’s desire for more vocational learning to be accredited saw the number of vocational qualifications being taken almost treble from 2.2 million in 2002 to 6.1 million. It meant fees spent by colleges reached an estimated pound;200 million last year.
The Association of Colleges argued that the rise was not out of step with the growth in volume, but that exam boards were not passing on the benefits of increased efficiency, despite Government investing millions in modernising their systems over the last decade.
Most awarding bodies are not-for-profit companies, with the exception of Edexcel, owned by Pearson plc, which has seen the greatest growth in qualifications issued - attributed by the company to the popularity of BTECs.
So far, however, alternatives to exam boards have failed to take off. Only a handful of colleges, such as Walsall and City College Norwich, have taken up the right to become accredited as awarding bodies in their own right, with many fearing that they would not be able to achieve the necessary economies of scale.
