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Transparent , but still out of touch

The 2004-05 funding allocation to colleges had an element of certainty about it. "Any competent finance officer should be within pound;1,000 of the total," I was told recently. So, all is fairly predictable this year with no changes to methodology.

Each college is funded on the basis of student achievement, entry costs, fee waiver factors, full and part-time advanced and non-advanced fees, college and student remoteness, social inclusion entries and retention rates.

Also included will be the costs per weighted student unit of measurement (WSUM). This is based on extended learning support and 18 programme areas ranging from the small (printing, with 1,132 students, 0.2 per cent of total enrolments) to the colossal (computing, with 112,066 enrolments, or 21.8 per cent). So tribute must be paid to the abilities of hard-pressed finance officers.

Simple it isn't, but it is transparent in so far as its complexity is clearly visible. At the time of the formation of the funding council in 1999, colleges were chasing endless growth in activity in order to stand still in relation to their peer group, and funding was allocated some 18 months after growth had been achieved - often at the expense of greater expenditure than was compensated for by the growth grant.

This year may, however, be the last for some time in which college finance officers will have such clarity. It appears that the new "activity measurement method" (AMM) will be applied to the allocation for 2005-06, and no one knows with any certainty what the outcome of that will be.

Data is not currently available which would allow the AMM to be fully modelled. It is likely to be better for a college to have more part-time than full-time work and more advanced than non-advanced courses, but no one knows how a rescaling of the number of units of activity affecting full-time provision will alter the balance of college budgets. Colleges have been in this opaque world before.

It cannot be denied that the policy of historical funding has been successful in achieving growth in the period since incorporation. The 2002-03 activity target for the system was 2,208,560 WSUMs (a figure that excludes advanced work in the University of the Highlands and Islands colleges, which has also become lost in the mists), against the 1,405,893 achieved in 1993-94. The growth over the period of 57.1 per cent is testimony to the success of the policy.

Yet the unit of resource, including fees element, is currently pound;164.12, against a real terms equivalent of pound;239.68 for 1995-96. This shows a decline to 68.4 per cent of its then value.

In 2001-02, the number of colleges in operating deficit had fallen to 18.

But these and other colleges, all of which are about to enter a period of funding uncertainty, may sometimes wonder about the fairness of the rules as they seek to deliver elements of the Scottish Executive's policies for social inclusion through the pursuit of lifelong learning.

Current funding council policies constrain colleges' ability to grow or to mitigate loss of activity as a result of local variations. It is usual to expect a resourcing strategy to follow and be consistent with a service development strategy, to be consistent and fair, and to be broad brush rather than detailed. The funding council is charged with securing adequate and efficient provision of further education in Scotland.

Adequacy could be expected to address issues of participation and engagement with individuals and groups identified in national policies and those whose needs make them "desirous of becoming students". Funding policy could, therefore, be expected to embrace these issues.

As far as efficiency is concerned, the trends I have mentioned clearly show growth and increases in operational efficiency. But the growth was not co-ordinated. Now further growth, though often required, is not funded. Nor is the need for retrenchment in areas where past growth has proved unsustainable.

Neither are the needs of colleges to maintain flexibility in the development of core curricula in support of adults re-entering education or students who need focused training supported by a formula which is becoming more rigid and inflexible in the course structures it recognises.

Currently, funding is based on a unit which was originally designed to support flexibility in curriculum delivery through being mode-free. It was adopted on incorporation in the absence of a framework for management of the sector and altered to define and parcel provision - to become a unit of measurement rather than equivalence.

It is arguable that this never met the need for a national unit of resourcing. It certainly won't in future if it is to be used to constrain and standardise provision further in the face of mounting evidence that the need is for greater not less flexibility.

Hopefully, the challenges faced by the sector, and the achievements it has made, will soon be recognised through development of a progressive method of funding which is and continues to be fair, transparent, simple and predictable.

Andy Hawkins formerly worked with the Scottish Further Education Funding Council. He is now a freelance consultant.

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