Stephanie Mason, Head of Further Education and Skills, RSM

As the academic year comes to a close, you’d think that minds would be turning to holidays but instead leadership teams within providers will be focusing on Individualised Learner Record and data cleansing ready for submission of year end and final funding claims.

Some providers may also have been notified of an ESFA funding assurance review.

Due to the number of changes impacting the sector this year, especially from apprenticeship reforms, reporting this year is more complex and is throwing up a number of issues, which could have a significant impact on next year’s cashflow.

We consider below some of the issues often raised to help FE organisations navigate the changes and ensure funding is not affected due to inaccurate or inadequate data.

The impact of apprenticeship changes

There are a number of areas where more evidence of full compliance with the apprenticeship requirements is often needed.

Negotiated price

Although apprenticeships have been allocated into funding bands, there is an expectation that there will be negotiation between the provider and the employer, and that evidence to support the final price is agreed and recorded in both the contract and the ILR.

It’s important that all elements of the price are clearly set out, so eligibility can be easily identified. Also, ensure that the negotiated price recorded in the ILR is the same as the price recorded in the contract, as this could lead to incorrect funding being drawn down, and in some cases an underclaim.

Off the job training

Whilst off the job (OTJ) training is not new within the apprenticeship programme, the mandatory requirement for all learners to undertake a minimum of 20 per cent OTJ training is new. Common issues identified in relation to this requirement include:

  • no evidence to confirm that the 20 per cent OTJ requirement had been quantified; or it had been calculated on an annual basis rather than equating to 20 per cent over the duration of the apprenticeship;
  • not having a plan in place to demonstrate how the 20 per cent OTJ requirement would be delivered over the duration of the apprenticeship; and
  • not meeting the 20 per cent requirement as the provider did not consider issues such as planned provider closures over the summer period, or included activity which is ineligible, such as progress reviews.

Providers should discuss with employers how apprentices will be released for learning and what elements of OTJ will be delivered in the workplace, such as mentoring or shadowing.

New agreements and commitment statement

The new requirement for a written agreement between the provider and the employer, and a separate commitment statement between the employer, provider and learner has led to compliance errors such as:

  • Written agreements between the provider and the employer constituting more of a service level agreement than a legally binding contract.
  • Missing data from commitment statements including details on which elements are eligible for funding from the employer’s digital account or government/employer co-investment and details of the 20 per cent off the job requirement.

Payment of employer contributions

Another major change relates to the mandatory requirement for non-levy employers to pay a 10 per cent cash contribution towards the cost of the agreed apprenticeship and the total of any negotiated price over the funding band maximum.

Evidence should be available to confirm that employers had been invoiced for the 10 per cent co-investment, or the value of any negotiated price over the funding band maximum.

Are learners enrolled on the right course?

Enrolling learners on the appropriate level of English and maths courses and providing evidence of assessment/prior attainment is a common issue across all funding streams.

This could include:

  • Learners who have not been enrolled at the level above what they have been assessed at. Common reasons for this are that the learner has a ‘spiky profile’ and, therefore, has been enrolled on the level at which they have been assessed to ensure that they can progress. Whilst this approach ensures the learner continues to progress, it can impact funding.
  • In apprenticeships, learners who have not already achieved Level 2 in English and/or maths are not always enrolled to an appropriate level; and often there is insufficient evidence to demonstrate that learners have been offered progression to Level 2 if they complete their Level 1 before the end of the apprenticeship.
  • 16-19 learners not meeting Condition of Funding is a common issue as some students withdraw prior to 42 days or have not attended at all.

How many providers will be caught out?

We are in a period of unchartered water as the financial impact of not fully meeting the new criteria is still under consideration but what is clear is that FE providers need to review reports and data capture to mitigate any potential risks and ensure everything is in place to secure their financial position.

Stephanie Mason, Head of Further Education and Skills, RSM

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