Chartered status for colleges and training providers could be used to crack down on subcontracted teaching and training deals that offer poor value and are not in the interests of students.

Proposals for the criteria for chartered status drawn up by the government include at least 10 new measures of quality, student voice, employer engagement, contribution to the community and transparency.

As part of these requirements, the government proposes that colleges aiming for chartered status, which is intended as a badge of high quality in FE, will have any subcontracting arrangements examined to make sure they are managed effectively and provide clear benefits for students or employers.

Subcontracting has boomed since the Skills Funding Agency (SFA) refused to offer any direct contracts below #163;500,000 as part of cost-cutting measures. A list of the arrangements worth #163;100,000 or more published by the SFA earlier this year showed that at least #163;430 million of its budget was being passed down to smaller providers. At one provider, #163;10 million of work was subcontracted.

While some of this work is to meet the needs of niche markets or to fulfil government demands to move funding out of Train to Gain provision, a number of high-profile failures prompted the SFA to put the approach under greater scrutiny.

The collapse of a football coaching apprenticeship run by Luis Michael Training, led by ex-Wales international Mark Aizlewood and former Middlesbrough player Paul Sugrue, put about #163;6 million of public money at risk, which colleges such as Sparsholt in Hampshire were expected to repay.

South Nottingham College was forced to find new apprenticeship places for 400 students after its subcontractor in Wolverhampton, JML Dolman, went into liquidation.

An Ofsted survey of subcontracting said some providers “clearly saw it as a way of generating income for doing little work”, saying that they charged fees of up to 35 per cent while doing little to monitor quality besides filling out the paper audit trail. Subcontracting had weakened accountability, inspectors said.

Chartered status would be voluntary and available only to high-performing colleges and training providers. But FE minister Matthew Hancock said its prestige would be an incentive for all providers to try to meet the standard. “Chartered status will be a demonstration of quality,” he said.

As well as measuring the effectiveness of subcontracting, colleges and training providers will have to demonstrate that they have a full programme of extra-curricular activity, that students feel safe at college, that they have a formal complaints process and that there is equal opportunity.

Employer involvement in the design of provision will be measured and chartered providers will be expected to have a “robust fee policy” that clearly shows that employers and individuals contribute to funding courses as well as the government.

Providers will be asked to engage with their community, in line with Baroness Sharp’s report Colleges in their Communities, working as the centre of a network of institutions helping to bring more people into education. They will also have to respond to the priorities set out by Local Enterprise Partnerships, and will be measured on their level of transparency and openness of data for the community and their customers.

Martin Doel, chief executive of the Association of Colleges, said one benefit of chartered status could be to distinguish publicly funded institutions from private colleges, which sometimes damage the sector’s reputation.

“Although there is scepticism from some colleges about another badge, there may be advantages in a legally protected name and an external assessment of good practice,” he said. “This helps raise standards and fend off unwarranted criticism of the way colleges operate.

“We’re a sector that believes in continuous improvement and, although it is good to have award schemes that last for a long time, there are also benefits in innovation. We’ll be addressing some practicalities in our response to the consultation - for example, who should carry out the assessment, whether the criteria are the right ones and how to ensure chartered status does not just become a passing fad.”

MEETING THE STANDARD

The government’s proposed quality measures for chartered status:

- Show that subcontracting is managed effectively and has clear benefits.

- Provide a full extra-curricular programme.

- Ensure that students feel safe.

- Provide a formal complaints procedure.

- Ensure equal opportunity for students.

- Involve employers in the design of courses.

- Implement a fee policy with clearly shared responsibility for funding.

- Engage with the community, as Baroness Sharp recommends in her report Colleges in their Communities.

- Gain the endorsement of Local Enterprise Partnerships.

- Make data open and transparent to communities and customers.