From education to employment

Subcontracting – Marmite of the sector but an answer to higher level skills?

Dan Shelley, Vice Principal, Sussex Coast College Hastings

Subcontracting divides opinion in the skills sector almost as much as the famous yeast extract does in the general populous.

The naysayers point to high management fees and poor levels of support – and these voices are loud in the trade press and within the funding agency. Then there are those that suggest that this model is a natural solution for any market with contracts and complex delivery models (construction anyone?). A model that offers smaller providers opportunities to develop and grow with expert input, support and challenge, assuring the overall quality of the offer to the customer.

Those that fear subcontracting appear to have won this debate, with changes in the apprenticeship funding rules adding complexity to an already muddled policy arena. These changes allow, but appear to frown upon, subcontracting.  This is a huge barrier to any provider looking to meet the many diverse needs of a large levy paying company or the specialist needs of a small business.

Compounding this is the ban on subcontracting within the Advanced Learner Loan market, which has led to over £1bn unclaimed loans and a dearth of higher level skills training available which is negatively impacting upon the drive to increase the nation’s skills and productivity levels.

With the agencies who manage, inspect and oversee the sector woefully underfunded to deliver their key functions effectively I would have thought that controlled subcontracting could be a way of achieving a better skills market, with quality provision that addresses the productivity challenge.

Could we develop a register of prime contractors who are assessed as effective supply chain managers for the skills market? A ROTO or ROATP – a Prime Register (PRIMER) perhaps?

PRIMER organisations would be able to support a stable of smaller providers to navigate the funding and inspection rules and would ensure that learning continues even if a link in the chain breaks, such as a partner who ceases trading or the quality implodes. The management fee would be limited with no more 40% charges (which appear to be the root cause of concerns) with a cap at, say, 15-20%. This would ensure PRIMERs offer quality assurance and improvement support (lesson observations, audits and checks with employers and learners for quality) alongside the development of a range of added value e.g. E-learning modules, reductions in awarding body costs etc.

This would not be compulsory for smaller providers but merely a service that enables them to develop the skills needed to operate within the skills regime.

It’s just a thought, and yes the naysayers will question the use of public funds, but this could be a way to drive up quality and ensure that the nation’s skills needs were addressed.

Sussex Coast College has a long history of providing this support and our 17 partners work with us for a variety of reasons. We support, challenge and enable them to grow in a safe environment. We also ensure that they adhere to the funding rules and drive them to generate high achievement and timely rates with great employer and learner satisfaction. We have also taken on learners from liquidated providers and placed them with our partners to ensure that they are able to complete successfully and have supported learners ourselves when a couple of our smaller providers went under.

Yes we do take a management fee, but we deploy this to provide a range of services to our partners. Most markets use subcontracting to enable them to operate effectively. Big companies have supply chains to effectively manage large scale projects and costs as contract values and work levels fluctuate, so why not allow this to happen in a regulated way with a framework of primes in our sector?

Perhaps if we had a PRIMER system we could look to grow our higher level skills offer in a controlled and regulated way rather than simply banning subcontracting, or making it more complex, which risks negatively affecting the number of starts on apprenticeships and advanced learner loans.

This could also add stability for the whole system, priming it, as it undergoes revolution at almost every age and stage.

Dan Shelley, Vice Principal, Sussex Coast College Hastings

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