Recommendation 28

For each student enrolled on a T Level, colleges need to pay a set fee to those organisations developing and awarding qualifications. For the latest set of contracts with awarding organisations procured by IfATE, fees per student had increased for six contracts, by amounts ranging 79 C&AG’s report, para 3.17 80 Committee of Public Accounts, Managing colleges’ financial sustainability, Thirty-Eighth Report of Session 2019–21, HC 692, 27 January 2021 81 Q 23; HMG, April 2025 - confirmation of additional support for T Levels, 28 April 2025 82 Q 11; C&AG’s Report, Para 11, 2.14 83 Q 24 84 ITL0002, ITL0003, ITL0008 85 Q 34 17 from 26% to 149%. For the remaining two contracts, costs per student decreased by 18% and 37% respectively.86 We pressed the Department on why the second-phase contracts were so much more expensive.87 It described how the first contracts made a loss due to initially being priced too low by awarding organisations. Lower-than-expected student numbers then created additional financial pressures.88 It confirmed that IfATE used an adaptive pricing approach, where student entry fees could be increased or decreased depending on student numbers, to ensure awarding organisations did not carry all the volume risks on the latest contracts. As a result, colleges may need to pay higher student fees to awarding organisations.89 The Department described how the higher fees were comparable with the fees for three A levels, presented value for money for colleges and were a small proportion of colleges’ overall costs. This contrasts with what we have heard from some colleges however, who felt fees were too high.90 86 C&AG’s Report, para 16 87 Q 64 88 Q 68; C&AG’s Report, para 16 89 Qq 68, 71; C&AG’s Report, para 3.11 90 Qq 64, 69-71 18