Make FE funding more flexible to promote innovation, government urged

Providers should be given more freedom and flexibility in terms of funding and structures, according to the Skills Commission

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The government should review its funding arrangement where they limit the development of flexible ways of delivery, according to to a new report published today.

The report by the Skills Commission, Going Places – Innovation in Further Education and Skills, argues that provision should to be flexible to fit around learners and employers. Where funding conditions or statutory requirements limits the development of flexible and bespoke delivery models, the Department for Education (DfE), the Education Funding Agency and the Skills Funding Agency (SFA) should review whether exemptions could be made, it states.

It also recommends providers should have more freedom and flexibility over their business models and structures. “Providers and provider groups should be better able to use their funds to invest in the future. The SFA should review funding arrangements so they are less retrospective and can encourage growth, especially in apprenticeship provision," the report adds.

Currently, for example, colleges that sell off buildings originally funded through capital grants must return a fixed proportion of the proceeds to the SFA. In an interview with TES in February, SFA chief executive Peter Lauener suggested colleges could be allowed to keep the proceeds from selling off campuses to invest in learning technology. This would be considered as a way to support colleges that were “thinking creatively” about rationalising their assets, Mr Lauener said.

'Uncharted waters'

The Skills Commission enquiry, which engaged over a hundred individuals and organisations, aims to highlight the inspiring innovation and leadership taking place in further education and skills across the UK at a time when the sector faces "wholesale change".

In the foreword to today's report, enquiry co-chairs Dame Ruth Silver (pictured) and Barry Sheerman MP write: “The acknowledgement that we are entering uncharted waters was the driving motivation behind this inquiry. The beginnings of any new phase can be painful and we are only too aware of the unease and uncertainties created by the social, economic, and political conditions in which we now find ourselves. However, with such challenges come opportunity, and changing times require visionary thinking and fresh ideas to be brought to the table.”

A spokesperson from the DfE said:“We will look at the report and consider its recommendations.”

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