Funding guidance for young people: subcontracting controls

Reforms to subcontracting: @ESFAgov compliance and control requirements and advice for institutions using third parties for ESFA-funded provision.

2020 to 2021 Subcontracting control guidance changes

Reforms to subcontracting

Earlier this year ESFA ran a consultation seeking views from providers who have an interest in subcontracted delivery to inform our thinking about reforms to subcontracting arrangements. In June we published our response to the consultation exercise.

Over the next 3 years we will be implementing a series of reforms that will strengthen ESFA’s oversight of the approach to subcontracting in the sector.

We have been clear from the outset that we wish to see a significant reduction in the overall volume of subcontracted delivery in the sector, and that is why we have asked that all providers review their existing subcontracting activity and take steps to reduce that activity across the next 3 years to 2022 to 2023. We will apply a cap on the volume of subcontracting and will take forward work this academic year to establish the right threshold for that cap and timescales for a staged reduction.

For academic year 2020 to 2021, we have:

• set out in paragraph 4 that we require all providers to publish a clear educational rationale for their subcontracting position on their website alongside their management fee structure and a list of subcontracting partners
• clarified in paragraph 59 that the use of brokers to source a subcontracting partner is not permitted and will be treated as a breach of contract/funding agreement.

As we have set out in our response to the consultation exercise, the other reforms will be introduced over the next 2 to 3 years. We will publish further details about how those changes will be implemented later this year.

2019 to 2020 Subcontracting control guidance changes

All directly funded organisations must properly monitor and control all subcontracted delivery. They must ensure that safeguarding is rigorously policed, that students enjoy the same entitlements as those learning in schools and colleges and that their education is of high quality.

Directly funded institutions should set out in their organisation’s strategic aims their reason for subcontracting, which must enhance the quality of their student offer. They are also responsible for the selection and actions of their delivery subcontractors.

From 2019, the ESFA will introduce an annual review of subcontracting for all providers (referred to as institutions in our 16-19 study programme funding stream) who subcontract. This will look across ‎all the ESFA programmes including 16-19 funding, the Adult Education Budget, Apprenticeships, and the European Social Fund. It will protect students by looking for signs of non-compliance and checking with directly funded institutions that the rules are being followed.

2018 to 2019 Subcontracting control guidance changes

This guidance has been reviewed and substantially revised to make it easier to use and to strengthen requirements in a number of areas in response to issues identified in recent investigations. Concerns relate to the robustness of controls exercised by some funded institutions, the extent to which students on subcontracted provision receive the full entitlement and the attention paid to ensuring students are safeguarded. These concerns are exacerbated where the whole of a student’s programme is subcontracted and where the delivery is at a distance from the directly funded institution. This is often the case where subcontracted provision in sport is delivered alongside sports academy/sports club activities. It is essential that the delivery of the ESFA funded programme and the delivery of the academy/club’s activities are distinct from each other and that students understand the rules and requirements pertaining to each. In the document the individual improvements to the guidance are highlighted at the end of the summary.

Published 13 August 2013
Last updated 16 July 2020 + show all updates

1. 16 July 2020

   We have added the Funding guidance for young people 2020 to 2021 subcontracting control regulations

2. 3 July 2019

   We have updated the subcontracting controls guidance for academic year 2019 to 2020 and highlighted the key changes.

3. 21 June 2018

   The sub-contracting document for 2018 to 2019 has been added.

4. 29 June 2017

   Funding guidance for young people: 2017 to 2018 sub-contracting controls has been added.

5. 19 July 2016

   A letter from Peter Lauener to schools and academies drawing attention to the new arrangements on post-16 sub-contracting has been added.

6. 14 July 2016

   Funding guidance for young people: 2016 to 2017 sub-contracting controls has been added.

7. 17 December 2014

   Updated 2015 to 2016 documents added

8. 11 March 2014

   Annex A added to funding guidance for young people: sub-contracting controls.

9. 13 August 2013

   First published.