‘No one has a clue’ about devolved skills funding

11th March 2016 at 00:00
Local authorities need a clear strategy, or the devolution of FE funding will fail

the devolution of adult skills funding to regions across England will disrupt provision and risks creating additional costs and bureaucracy, sector leaders have warned.

Devolving powers, including the commissioning of some FE provision, to regional authorities was one of the Conservative Party’s key general election pledges.

But, just two years before a significant portion of government funding for post-16 education and training is due to be diverted through combined local authorities instead of nationally through the Skills Funding Agency (SFA), many questions remain unanswered.

‘Clueless’ authorities

Labour peer Lord David Blunkett has claimed that “no one has a clue” about how the new arrangements will work (see box, opposite).

TES understands that combined authorities, which will assume responsibility for commissioning provision, may put contracts out to tender, meaning local providers could lose out to others from further afield.

Deals have been agreed with several cities and regions (see map on pages 46-47) which will transfer accountability for the delivery of a number of objectives – including those regarding skills training through the new adult education budget (which covers most nonapprenticeship provision).

The government has argued that devolution will allow local areas to provide opportunities and pathways for learners that will be more tailored to the needs of the local economy.

But, while the process of transition remains unclear and arrangements are likely to vary between regions, it is anticipated that the adult education budget will not simply flow to independent learning providers and colleges from combined local authorities as it currently does.

From 2017-18, regions and cities with responsibility for skills will put contracts for provision from independent learning providers out to tender. Several experts told TES that college provision was also expected to be put out to tender in some parts of the country.

Stewart Segal, chief executive of the Association of Employment and Learning Providers, said that he believed that each provider could have a minimum level of contract without tendering. However, he added that the new process would “disrupt existing provision and any tendering process involves cost that gets diverted away from frontline delivery”.

He continued: “We have to work together with the SFA so that the needs of learners and employers are the key drivers of change. We would not want to see the sort of delays and fragmented bidding processes that we are seeing with the current process to allocate [funding from the] European Structural and Investment Fund at local level.”

Localism as a solution

Sue Pember, director of policy at adult community learning provider network Holex, said that moving from a centralised government-led adult skills system to a locally led system was “probably the right thing to do at this time”.

“There is much good practice where services such as adult education and health have worked together locally to help find a solution to social problems. We hope that practice will become the blueprint for localism,” she added.

“However, there is also the risk that we just replace a relatively flexible centralised system with a more bureaucratic, rule-driven regional one that doesn’t allow for real local decision-making and the needs of the student are lost in the process.”

Ms Pember said that one concern was whether combined authorities and local enterprise partnerships would be adequately prepared for the switch to the new system in 2018.

“It is doable, but people will have to move quickly to prepare for the practicalities of funding adult learners who are often the furthest away from the labour market and the education providers that support them,” she added.

David Hughes, CEO of the Learning and Work Institute, said that the overhaul of skills funding would bring risks and opportunities. “There will be some fantastic benefits in some areas, and some things that are not done very well and potentially some failures.”

But he warned against panic over what changes the different commissioning process might bring. “I understand why people might be fearful, and I suspect there might be some change. But I think that [the changes] will be relatively slow rather than cataclysmic”.

Planning ahead for students

David Corke, director of education and skills policy at the Association of Colleges, told TES that colleges would receive a three-year funding grant under the new system, allowing for greater stability and planning.

“This allows the flexibility to deliver qualifications such as BTECs or A levels, while also providing support to adults in getting back into work through courses that provide employability skills but don’t result in a certificate,” he added.

A Department for Business, Innovation and Skills spokeswoman said: “The labour market in which such learners are, or need to be, engaged is a local one. Local commissioning of skills provision, freed from national rules, will increase the prospect of tailored packages of support, which should increase impact and value for money. Combined authorities will have freedom to put in place such commissioning arrangements as they see fit.”

Local deal agreements specified a number of “readiness conditions” regions had to meet before the budget would be devolved. These included safeguards for learners and training standards, she added.


Lord Blunkett: ‘I’m very worried about this’

“No one has a clue” about how the devolution of skills will work, a former education secretary has warned. Labour peer Lord David Blunkett said that the overhaul of funding would create serious challenges for the new commissioning authorities.

“I’m very worried about this,” he said at a debate in London last month, organised by the Learning and Work Institute and the RSA (Royal Society for the encouragement of Arts, Manufactures and Commerce). “Not because the principle isn’t right, but because, sitting in a city region and now voluntarily chairing the Sheffield partnership, it’s absolutely clear that no one’s got a clue what they’re doing.

“They don’t have any idea about accountability or engagement of the people for whom it is intended, and unless we get that in place cynicism will be reinforced by further cynicism.

“With devolution, and the modest amount of money [available], comes several challenges. Money has to reflect the need and it’s not just devolving a sum of money, it’s being able to recognise where the need exists.”

The power to put skills training on the map

The devolution agenda involves handing greater powers to local areas with the aim of boosting economic growth around the country, with devolving non-apprenticeship skills funding being a key part of the plans.

Providers are already required to demonstrate that they are working with local enterprise partnerships to deliver economic priorities but, under devolution, local control and accountability will go much further.

Combined authorities will take a leading role in reshaping and commissioning the use of the adult education budget. Rather than money coming centrally from the Skills Funding Agency, combined authorities will eventually receive block grants; they will then commission providers to deliver training linked to specified strategic outcomes.

The plan is to make FE funding simpler, more efficient and more predictable for providers – but with many details still to be announced, whether this comes to pass is less than clear. More information could be published in chancellor George Osborne’s Budget on Wednesday.


Devolution timeline

Below is the schedule for regions that adopt devolution of the adult education budget:

2016-17: this year will be spent preparing for local commissioning. Outcome agreements – covering what kind of provision should be delivered in return for funding – will be drawn up.

2017-18: the areas with devolution deals will form the basis for block grant allocations made to providers.

2018-19: full devolution will begin, with combined authorities assuming the responsibility for skills funding and outcomes.

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