Commissioned in November 2009, the report recommends clarifying and reiterating co-investment to providers and learners ensuring that, while disadvantaged participants continue to receive important assistance, government co-investment will be reviewed for those better able to provide it themselves.

Christopher Banks, former chairman of the Learning and Skills Council, who headed the report, said: "In certain cases, individuals or employers are supposed to be contributing with government to the cost of further education courses ... The current system for ensuring this co-investment happens is not fit for purpose.

"At the very time that we need it to be operating to its greatest potential, it is failing us."

Mr Banks stressed that the report was not about raising fees or increasing the number of people paying them, but ensuring that those expected to co-invest actually do so.

First on the list of recommendations, is for government funding to follow contributions already made by the participants, matching it up to a maximum level.

Clarity and definitions follow. Colleges should define and publicise a total price for courses and the amounts of co-investment learners can expect to pay and receive. The Department of Business, Innovation and Skills (BIS) should also clearly set out which courses are eligible for co-investment in the first place, how much they will pay and to whom.

The idea of this last point is to create a "demand-led system", with individual and employers "co-investing in courses of value to them". On the surface, this may imply that those embarking on less popular courses may not in future receive co-investment.

For individuals expected to co-invest, the review proposes expanding and relaunching the system of Professional and Career Development Loans (bank loans where government pays the interest for the duration of the course and a month after completion) to spread the cost of courses.

According to the review, the very culture surrounding co-investment should also change. Co-investment should be prioritised by colleges and BIS, processes put in place for "identifying, sharing and implementing good practice", and that training providers and the government redefine "the language they use to communicate, particularly with individuals and employers".

Long term recommendations include developing an online account system, reconsidering the criteria used to determine who gets full funding in the future, and monitoring the proposed new system to ensure vulnerable groups do not miss out.

John Hayes, Minister of State for Further Education, Skills and Lifelong Learning, thanked Mr Banks and the review group for the report, saying that he welcomed "the valuable contribution this document will make to addressing issues within the current system in place for co-investment in Further Education, and the broader challenges facing the sector".

He reiterated the spirit of the review, adding: "We are committed to making the Further Education system as flexible, effective and efficient as possible, as well as ensuring learners, employers and the Government achieve best value for their investment.

"My own determined view is that however we move forward, the most disadvantaged learners should not be worse off."

BIS now plans to conduct further consultations in the FE sector to determine how to implement the recommendations put forward in the review.

Daniel Wallis

(Pictured: Former LSC chairman Chris Banks)