Planned ‘clawback’ of adult education funding puts recovery plans in jeopardy

Government’s recovery plans in jeopardy because of cuts to adult training funds 

The government’s ability to deliver its skills agenda could be severely damaged if it goes ahead with a planned ‘clawback’ of adult education funding, after colleges have been unable to deliver practical courses face-to-face during the pandemic.

The clawbacks, announced late in the academic year, could amount to cuts of around £50 million, which the education and training sector have described as ‘damaging’ and ‘self-defeating’ risking reducing the government’s ability to train and retrain adults, just as furlough ends and the risks of mass unemployment are sky high. 

In a letter to the Education Secretary, Chief Executive of the Association of Colleges, David Hughes has warned that if the cuts go ahead, colleges may have to scrap courses – including delivery of the government’s flagship T Levels, as well as finding themselves at risk of being plunged into financial intervention, or being forced to make large numbers of redundancies. 

A letter detailing these pressures has also been sent to the Prime Minister Boris Johnson on Wednsday (14 Apr).

The impact of the AEB clawback

Below is an overview of three colleges which illustrate the severe impacts the clawback decision will have on their ability to deliver adult learning and training:

Furness College – £640,000 clawback

Furness College has seen a striking reduction in adult participation in further education due to the pandemic. It is currently forecasting delivery at only 50% of its full Adult Education Budget allocation.

This will result in a £640,000 clawback and the college returning a budget deficit at the end of July. Should the decision not be revisited, the college will not be able to offer the same volume of training in future years. 

Furness College has seen a reduction in adult participation in further education for the following reasons:

• The vast majority of our adult provision is in technical training, such as welding, electrical engineering and construction skills. Clearly, it was impossible to deliver these courses during the lockdown period when the college was closed.
• Adults showed significant reluctance to participate in further education from September choosing to defer their starts until September 2021. This led to more than a 50 per cent decline in September adult enrolments.
• There have been very limited opportunities to reskill the adult workforce as there have been fewer redundancies in Furness compared to the national average, reflecting the Engineering and Advanced Manufacturing dominance of local industry, including supply chains. Whilst this is obviously very good news for the area, the college has not been able to engage adult for reskilling as have other colleges.
• The college furloughed a very low number of employees during both lockdown periods – solely staff whose salaries were funded by commercial income. Had the college been aware that they would not be funded for half of our adult provision this year, they would have furloughed a much larger number of tutors and student support workers leading to additional income in the region of £236,000.

The College acted with integrity in this regard and we have now been penalised, having to pay these salaries from their limited reserves, which ultimately will impact on the resources they can invest in facilities for students. This decision risks hitting college finances at an already extremely damaging time. In particular, it will cause colleges across England to reduce capacity for adult skills which is entirely at odds with the country’s longer-term needs as we nationally seek to recover from the impact of the pandemic. Furness College is currently forecasting delivery at only 50 per cent of its full Adult Education Budget allocation for the reasons already highlighted. This will result in the College facing a clawback of £640,000 which would result in the College returning a budget deficit at the end of July. This is a devastating outcome which is particularly hard to understand given the huge amount of work the college has done have done throughout the year, particularly during the January to March lockdown. For example, the college set up a mass testing centre for its staff and students with no external support or funding (unlike schools), resulting in over 4000 tests being undertaken.

This is naturally in addition to maintaining high-quality education and skills training to 1500 young people, 750 apprentices, 850 adult students and 500 degree students.

Discussing this, Furness College CEO and Principal Andrew Wren said:

“I cannot stress enough how devastating this decision will be for both the College and the area it serves. It will inevitably necessitate a review for operational efficiencies over the summer.

“However, it is my duty as Chief Executive to sustain the college as a going concern for future years. It is regretful that, should this decision not be revisited, the college will not be able to offer the same volume of training in future years.”

Leicester College – £4 million clawback

The decision to reconcile AEB grant contracts at 90% means they will have to pay back around £4 million. Multiple lockdowns and restrictions in Leicester since March 2020 has meant it has been a difficult year. Returning such a significant sum will have severe implications for education in Leicester.

Likely impacts will be to capital programmes and future plans for 2021/ 22, including for new T Level accommodation and facilities, and for expanded student numbers, which are all now at risk.

In 2019/ 20, there was a recognition of the challenges faced by colleges and threshold was set much lower at 68 per cent; however, 2020/ 21 has been an infinitely more difficult year, especially for Leicester, because of the multiple lockdowns and restrictions and yet the Government has decided that colleges like Leicester College should not be supported. Leicester College has been in continuous lockdown with the rest of the city since March 2020.

Leicester is also among the top 20 per cent most deprived areas of the country and the extended lockdown has only exacerbated this problem, particularly within the city’s black, Asian and minority ethnic communities, who were specifically advised that there were at higher risk from Covid-19 and to stay at home, as well as lower-income households.

Returning such a significant sum will have significant implications for education in Leicester. It is clear that there will be consequences for college cashflow to which the college must respond prudently. Likely impacts will likely be to capital programmes and future plans for 2021/ 22, including for new T Level accommodation and facilities, and for expanded student numbers, which are all now at risk.

Gateshead College 

The ability for Gateshead College to deliver its adult education allocation has been severely curtailed. In addition, the procured North of Tyne contract requires eligible candidates to be employed, and with the number of businesses closed, workers furloughed and the restrictions in place since September 2020 in the North East, the impact of Covid-19 has been more severe.

As the North East region has been under a variety of Covid-19 restrictions for the whole academic year (entering Tier 3 restrictions from December and lockdown from January) the ability of Gateshead College (likewise with others in the region) to deliver its adult education allocation has been severely curtailed.

Gateshead College’s adult education programmes are focused specifically on providing opportunities for individuals to gain training to move directly into jobs or providing additional skills, such as English for Speakers of Other Languages (ESOL), to help prepare individuals for the world of work. Their sector-based work academies in the rail, manufacturing and health sectors have enabled the college to support thousands of unemployed individuals into jobs over the last few years. They are designed to be responsive to employer needs and therefore, by their very nature, start and finish throughout the year on a rolling basis and do not all begin in September.

The college’s programmes in these sectors are delivered through face-to-face learning to provide the hands-on technical skills and the behaviours needed to succeed in work. In ESOL delivery, learners are taught communication skills such as reading, writing, speaking and listening and lockdown measures has impacted on the college’s ability to provide the learning experience required.

The college has been unable to deliver an entire term for ESOL learners; enrolments were down by 824 for the period November 2020 – March 2021 compared to the same time the previous year.

In addition, the procured North of Tyne contract requires eligible candidates to be employed, and with the number of businesses closed, workers furloughed and the restrictions in place since September 2020 in the North East, the impact of Covid-19 has been more severe.