Source · Select Committees · Public Accounts Committee
Recommendation 24
24
Acknowledged
Our 2021 report also noted, however, that the financial health of the college sector had...
Conclusion
Our 2021 report also noted, however, that the financial health of the college sector had previously been, and remained, fragile and that financial pressures were affecting provision for students. These pressures had caused some colleges to narrow their curriculum and reduce the length of courses. Some colleges had significantly reduced enrichment activities for students, such as careers advice and employability activities, and some were particularly concerned about reduced mental health support for students.37 We asked DfE about the impact of funding concerns on colleges’ ability to provide the courses and skills needed. DfE told us that the 2021 Spending Review had allocated an extra £2.8 billion of funding for skills. It also said that it was looking to give colleges more funding certainty through its ongoing review of funding and accountability, and it aimed to offer investment that allowed colleges to make longer-term decisions. More specifically, DfE asserted that scaling up the T levels programme would give colleges more funding certainty.38
Government Response Summary
The government will provide an additional £1.6 billion for 16-19 year olds education, uplift funding rates, increase cost weighting for specific subjects, address uneven monthly payments to colleges, and invest in direct support for the FE sector including bursaries and recruitment campaigns.
Government Response
Acknowledged
HM Government
Acknowledged
5.1 The government agrees with the Committee’s recommendation Recommendation implemented 5.2 The government has made available an extra £1.6 billion for 16-19-year-olds education in 2024-25 financial year, compared with 2021-22. The department is using part of this increase to uplift 16-19-year-olds funding rates for 2023-24 academic year. As well as a base rate increase of 2.2%, the department is increasing the cost weighting for engineering, construction and digital subjects to help providers with the additional costs of recruiting and retaining teachers in these subject areas – where providers are facing some of the greatest workforce challenges. 5.3 To help colleges manage their cashflow, the department is addressing the historical issue of uneven monthly payments from central government, which leave colleges out of pocket by March every year. The department will invest £300 million before the end of the 2022-23 financial year in bringing forward payments. This will smooth out the funding for a new even profile for colleges from 2023 to 2024 for both the 16-19-year-old and adult education budgets. 5.4 The department is also investing in a package of direct support for the FE sector in 2022-23 to assist with the recruitment, retention and development of teachers. This includes bursaries worth up to £26,000, a recruitment campaign, initial teacher education reforms, and the Taking Teaching Further (TTF) programme to support industry professionals to become FE teachers.