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AoC attacks 'failed' employer ownership scheme

A government scheme to give employers control of skills funding has been attacked as an “expensive, failed project” by the Association of Colleges (AoC).

An evaluation of the first round of projects under the employer ownership of skills pilot says “unrealistic” targets were set. Recruitment of students to training was only just over a third of the number expected.

The scheme was based on the idea that employers and employees would be more willing to invest in skills development if they were given greater “freedom and leverage” over the use of government funding.

The evaluation report says the scheme represents “a significant and high profile public investment”, totaling up to £340m over four years from government.

However, the report says that based on provisional performance data, the 36 round 1 projects have delivered “substantially fewer” learner starts than expected, just one-third (37 per cent) of those originally planned in the grant offer letters.

It says innovation resulting from the pilot is “subtle”, and most projects did not produce “transformative, unique innovations”.

It also says employers have been reluctant to use cash to fund the activity work, with financial contributions instead coming in kind, mostly in staff time. Without continued public funding, many of the projects are unlikely to continue, it adds.

While the evaluation of the pilot is ongoing and incomplete, the report says some early impacts have been noted, including the fact it created opportunities for businesses to work together, either directly or through an intermediary, which would be “unlikely” under traditional funding models.

But Martin Doel, chief executive of the Association of Colleges (AoC), said: “We’ve always had considerable doubts about the employer ownership pilot, and it gives us no pleasure to note that the recruitment of students to training was only just over one-third of that which was expected.

“Financial contributions to skills education or training from employers were also mostly in-kind and the project’s sustainability is an ongoing concern.

“We hope the next government learns lessons from this expensive failed project, which was based upon unsubstantiated assertions and unrealistic assumptions rather than hard evidence. 

“This project should be scrutinised by the new Public Accounts Committee, not only in relation to the waste of scarce funds but also the approach to policymaking that it embodied.”

Related stories

Employers must take the lead in skills development, report says – November 2014

World Economic Forum praises government initiative to boost skills – February 2014

Skills cash goes unused by half of employers – April 2013

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