Revealed: the £2.3bn bill for Augar review's FE demands

The Institute for Fiscal Studies has calculated exactly what Augar's recommendations would cost - if implemented

Revealed: the cost of implementing the Augar review

The recent announcements of long-awaited funding boosts for FE - in the shape of £400 million in post-16 cash and £100 million to cover the pensions hike - have been heralded as a welcome first step for the sector, as they mark the end of a lengthy funding freeze.

But there's little disagreement that more money is needed. But exactly how much? Today the respected Institute for Fiscal Studies has published its annual report on education funding - and we may finally have an answer.

Written in collaboration with the Nuffield Foundation, the report analyses funding across the sector and sets out recommended budgets needed to achieve the Department of Education's targets.

The report attempts to quantify the asks contained in the the Augar Review, and estimates how much each one would cost to implement. 

And the overall bill? A cool £2.3 billion. 


News:  £1.1bn extra needed to reverse FE funding cuts

Background: What is the post-18 review and what does it mean for FE?

Opinion:  Could Jo Johnson's resignation earn Augar a reprieve?


Extend tuition fee and maintenance loans for Level 4 and 5 courses 

The Augar review said that individuals taking level 4 and 5 qualifications in further education should be entitled to maintenance loans as well as tuition fees. It also recommended that lower fees of £7,500 should be aligned across higher and further education. 

Estimated cost: £0.3– £0.6 billion

Fully fund level 2 or 3 courses for all and increase funding rate for ‘economically valuable’ adult education courses 

At the moment, full funding is only available for first level 2 courses for individuals under 24 or unemployed,and level 3 courses for individuals under-24. The Augar review recommended that all level 2 and 3 courses be fully funded, and that the funding rate for ‘economically valuable’ courses be increased. 

The report says it’s difficult to judge which courses are most economically valuable a priori, particularly given that current economic returns relate to courses with the current level of funding. But it says that both of these proposals would reverse some of the large cuts to the adult education budget that have taken place in recent years.

Estimated cost: £0.5 billion 

Reverse cuts to rate for 18-year-olds, and other changes  

18-year-olds are funded at a lower rate than 16 to 18-year-olds in FE and sixth forms. The Augar review says there’s no justification, and that the rate should be increased.

Estimated cost: £0.2billion (includes cost of additional teaching grants for FE, a careers strategy and additional bursaries for Level 2 and 3 courses).

Prioritise workforce from extra funding 

The IFS doesn’t provide an estimated cost for a rise in teacher salaries. Instead it says: “Over the past decade, there have been significant cuts to teacher pay in 16–18 colleges, particularly in further education colleges. Teacher salaries are now about 17 per cent lower in further education colleges than in secondary schools (Dominguez-Reig and Robinson, 2019). This is likely to make it extremely challenging for further education colleges to attract high-quality teachers. 

“The Augar Review highlights such difficulties facing the workforce in colleges. There is no specific proposal for extra funding for the workforce, but the review highlights the importance of using the extra funding for adult education courses to support and enhance the workforce, e.g. by increasing salaries and providing more training.”

£1 billion of capital investment

The Augar review called for £1bn capital investment to fund infrastuture in colleges. The IFA says that it would be welcome, particularly given the introduction of T levels and the growing student population. 

Cost: £1bn

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