How will Brexit affect the FE sector? The sector responds to the news

With a vote of 51.9% to leave the EU, how does this affect the Further Education, Work Based Learning and Employability sectors? We have asked a number of the sector’s experts to share their thoughts. There will obviously be a period of change, but the implications of the Brexit vote are huge, with the Prime Minister already handing in his resignation, but promising to ‘steady the ship in the coming months’. 

Mark Dawe, chief executive of the Association of Employment and Learning Providers (AELP), said about the news: 

‘We believe that the scheduled April 2017 start for the apprenticeship levy should not be delayed.  If anything, the referendum result means that a skilled British workforce will be needed more than ever, so the target of 3 million apprenticeship starts by 2020 takes on a new significance.

All sectors, especially examples such as construction, hospitality and care, are and will be heavily dependent on having good quality training in place, so it is vital that government investment in skills programmes is maintained backed by the levy.’

David Hughes, chief executive at the Learning and Work Institute shares his views on the Brexit vote:

“The decision of the British people to leave the European Union presents a period of great uncertainty across many areas of society and the economy. It is too early to properly understand what this might mean for the FE sector although there are clearly some obvious questions about transition from funding through the European Social Fund and Erasmus as well as critical issues about EU students and their status in the future. Prior to the vote there was already some unease about the lack of details about apprenticeship reforms; now we need decisive action from BIS to provide certainty about the reforms. More delays will lead to more caution by colleges, providers and employers and the result will be people missing out on apprenticeship opportunities.”

Kirsty McHugh, Chief Executive of the Employment Related Services Association (ERSA) shared her thoughts on the news: “

Today’s referendum result is likely to have far reaching implications – for the economy, for employment levels and, as a consequence, for the employment support sector.  Many of these implications are hard to predict.  However, I wanted to share with you our understanding at this point in time.

Many of you hold DWP contracts or hope to hold DWP contracts.  We have been in contact with the DWP and asked that a statement is put out to the sector.  We are aware that it will take time to work through the  implications of the vote with HM Treasury and the Cabinet Office.

Our understanding is that the DWP element of the Work and Health Programme procurement is not affected by the decision.  However, what is now uncertain is the extent to which additional ESF monies can be committed to the contracts at combined authority level. 

Many organisations are bidding for ESF contracts at the moment.  It is uncertain how long negotiation of withdrawal from the European Union will take. The speculation is that this will be a minimum of two years from the triggering of Article 50.  This could well mean that ESF monies are likely to be safe until 2018 as a result. However, there will need to be confirmation of this from HM Treasury before new ESF contracts can be let. 

The situation is different for contracts which are already let.  The Big Lottery Fund, for instance, has today put out this statement on the Building Better Opportunities programme:

“Building Better Opportunities is jointly funded by the Big Lottery Fund and the European Social Fund. The Big Lottery Fund remains committed to the Building Better Opportunities programme until delivery is complete in 2020. We look forward to working with grant holders on local projects that will tackle poverty and promote social inclusion”

There are also, as we know, political implications.  Although we expect the big policy drivers in our world (the aim of halving the disability employment gap for instance and a focus on youth unemployment) to remain in place, clearly the change in Prime Minister will lead to a number of unknowns.  We will keep all ERSA members briefed on developments.

Finally, ERSA’s job is to make the case for social spending on programmes which reduce unemployment amongst today’s and tomorrow’s jobseekers, regardless of membership of the European Union. We do not know what will happen to unemployment in the short, medium or longer term, but we do know that the government, in a post EU world, will want to keep unemployment in check and that our programmes are a key component in delivering this. 

Our strong push will therefore be twofold – first, to ensure that expected procurements take place as soon as practicable; and second, to work with partners, including local authorities, LEPs and other agencies, to make sure that monies that are lost to social spending through the end of structural funds in the longer term are replaced through other means.”

Jim Carley from Carley Consult shared the following about the Brexit news “Following the Leave vote the key for the sector now is to understand how the EU exit negotiations may impact upon it, such as how it will affect the delivery of ESF programmes and access to provision for EU nationals. Just as pertinent will be the impending Cabinet shake-up following the departure of David Cameron, which could see new Ministers taking on responsibility for key reforms at a critical time, such as the Work & Health Programme and Apprenticeship Levy. Providers and colleges will be anxious to get greater certainty of future funding and commissioning, but the political fall-out may well make this far harder to plan for.”  Prior to the Brexit vote, Jim Carley shared some thoughts on the implications of a Brexit in this article

Fran Parry, from Bright Sparks Consultancy Ltd shares: “The full ramifications of the Brexit decision will take months, even years, to play out. We need to approach this new era with calmness and a resolve to continue to work for the very best outcomes for our customers. However two particular concerns come to mind and need to be resolved quickly. Firstly, much provision that currently supports our most challenged communities is currently resourced from European Social Funding (ESF) and we must ensure that comparative funding is  available from UK Treasury and if necessary we must push for these ‘UKSF’ resources to be appropriately ring-fenced. Secondly, and more immediately, politicians who have been focused on the campaign must now re-engage with their portfolios as a matter of priority and commit themselves to supporting their departments through these complex times. On Monday  it must be ‘business as usual’.