Funding for the FE sector is vital if we are to deliver the critical skills the country  needs

Funding cuts over the last decade have hit further education particularly hard; with a looming crisis and  government unwilling to intervene, this could impact the sector in irreparable ways, writes Bill Jones, Deputy CEO of Luminate Education Group

The government already acknowledges that the FE sector is vital to the UK’s economic growth and productivity. This was made apparent in the summer and autumn budgets last year when the then chancellor, Rishi Sunak, planned to apportion more than £3.8 billion towards skills development by 2024-25, equivalent to a cash increase of 42 per cent (26 per cent in real terms) compared to 2019/20.

However, beyond this promise, there was a failure to provide clarity about how much of the allocated funding was additional as much of it appeared to have been rehashed from a pot that had previously been awarded.

The current education budget is not sustainable in our current climate

Even based on the 2021 budget, which included a further £1.7 billion, college spending per pupil in 2024 will still be around 10 per cent below what it was a decade ago. School sixth form spending per pupil will be 23 per cent below 2010 levels, which is not ideal in our current economy. 

We are already in the throes of a recession and this is going to bring about challenges such as unemployment, which will amplify skills gaps. Education in every sense is a fundamental factor of development. No nation can achieve sustainable economic development without a sizeable investment in ‘human capital’. FE colleges will be key to supporting people to gain additional skills and knowledge that can help them stand out from the competition. It will also play a crucial role in securing economic and social progress and improving income distribution.

The reality is that school and college spending has seen major cuts over the past decade and like the Association of Colleges, and other unions/organisations, I agree that a real-terms cut in funding will be detrimental. It is also concerning that there are considerations being made for further ‘efficiencies’ in public spending but with the rate at which the economy is going, there is no room for efficiencies.

Further efficiencies, means further cuts, and where the education sector is concerned, will mean that our ability to deliver programmes that prepare young people and adults for the labour market will be reduced because of lack of resources. It will also result in the most disadvantaged people missing out on vital education and the country further combating skills gaps.

The government needs to expand opportunities within the FE sector, based on efficiency and equity. This means ensuring that we are at the heart of its strategic plans as essentially, we are the drivers of skills development.

We recently wrote to the education secretary and expressed our concerns about the lack of funding and the impact it will have on the delivery of quality education, teaching staff and resources.

As a sector, we are a first choice provider and offer young people and adults a second chance to gain the necessary knowledge and skills that lead them on to higher education or employment; FE needs to be taken seriously. Robust frameworks need to be put in place so that it is not lagging behind when it comes to allocation of resources. We want to be in a position to respond to the different and changing needs of people who want to learn and  improve their lives through education. 

Apprenticeships need more reform and promotion

In April 2017, the government introduced the apprenticeship levy, which aimed to put skills development in the hands of employers to address skills shortages within their business. While we welcomed the move, we would like to see reform of the apprenticeships system to make it more flexible and transparent, as it will help achieve a bigger boost to skills development.

Apprenticeships will be an integral part of the UK’s growth strategy in the years to come, therefore, there needs to be assurance that funding created through the levy is sustained and used effectively for the national good.

Adult education budget needs to be revisited 

Adult education has been impacted very significantly across England over the last three years. I believe that the adult education budget needs to be revisited as the clawback on adult skills funding from colleges and other grant-funded organisations like local authorities, risks hitting colleges at an already very challenging time. 

We want to continue supporting adults who need to upskill or reskill in order to secure more sustainable employment, but in order to do this, the 90% threshold needs to be reduced or it could force providers to lose focus on these priority learners and cause colleges across England to reduce capacity for adult skills.

More cuts will greatly impact driving the skills agenda nationally 

We want to be able to do more to drive economic growth/recovery, as well as tackle some of the wider regional issues and social inequalities. However, the funding model needs to reflect and support the huge social and economic benefits that come from that.

We are already seeing cuts in extra-curricular provision, such as school trips and clubs, across the country. If we are not prioritised in terms of funding, we will see learners not developing the transferable skills required by the jobs market. This will have a knock-on effect as the UK continues to face growing skills shortages.

Declining funding has real consequences for learners, especially those from disadvantaged backgrounds and if no more money is funnelled into the sector, we will see educational outcomes get worse in the future as a result of this neglect.

Colleges have fixed budgets from the Department for Education but with energy prices set to quadruple, we’ll have to cut the resources we have for staff at a time when we are already experiencing staff pay difficulties. 

Over the last decade, college staff pay has fallen behind inflation by 35%, this means that the vast majority of college staff are financially insecure.

FE staff are highly skilled and their work is essential, not only to our students and sector as a whole, but to the region’s future prosperity. With the rise in the cost of living, the impact on the profession over the last two years has been incredibly challenging, leaving us concerned about retaining some of our best staff. 

I believe that the levelling up agenda that the government has been pushing must also include saving the vital support staff jobs which are dwindling, with huge damage for students with special educational needs and disabilities (SEND), who need personalised support. 

Make VAT status same as multi academy trusts

One feasible suggestion is looking at the VAT status of the FE sector. For many years, successive governments told FE colleges that we could not have the same VAT status as academies and schools because of European Union rules. I am calling upon the treasury to review and consider creating a level playing field in post-16 education and move FE corporations onto the same VAT status as multi-academy trusts and 16 to 19 free schools.

If the government wants us to deliver T Levels, increase apprenticeship delivery, and grow adult provisions, there needs to be a full commitment to providing the FE sector with the necessary financial backing. It also needs to strongly support the courses that strengthen the UK’s thriving industries.

Bill Jones is the Deputy CEO of Luminate Education Group