Agenda item

A report was submitted to the Committee which provided an overview of the Adult Education Budget and the context in which the Authority was commissioning delivery of the devolved budget from August 2021. The report explained the budgets, the provider landscape, the nature of provision and how that related to learner needs.

H George informed the Committee that South Yorkshire would receive a 3% share of the national Adult Education Budget (AEB) which equated to approximately £39.3m.  The budget came with a number of statutory responsibilities which were included in an Annex to of the report.

In addition to the AEB there was £2.79m of Adult Skills Offer funding which was ring-fenced for adults aged 24+ studying towards an approved Level 3 qualification.

The Committee noted that the provider base is currently large and varied.  It includes nine South Yorkshire based grant funded providers.  In June 2020 the Education, Skills and Employability Board had decided that the grant funding arrangements should roll forward for these nine providers but not for other grant funded providers based outside South Yorkshire.  This was part of the approach to rationalise the landscape.  At the moment there are 347 providers which means there is a risk of additional work in terms of management and administration.  The aim was to reduce these costs and secure greater accountability and outcomes.

A procurement exercise was underway against Lots with an indicative value of £10.2m.  Details of each Lot were set out in Annex 1 to the report.

2021/22 will be a transition year, to ensure a smooth transition to devolved arrangements, making progress towards achievements, signalling priorities and building towards further achievements in future years that supported the MCA’s programme of priorities.

Cllr Lofts asked how much work had been done to define the skills that would be needed in a post-pandemic, post-Brexit world.

H George replied that the work done when developing the Recovery Action Plan had been used to identify broad areas where focus was needed   It was known that young people and the hospitality and retail sectors would be particularly affected.  The Education, Skills and Employability Board had also identified people losing jobs later in their careers as a concern.  A full mapping exercise had not been done as the present focus was on transition.

The Education, Skills and Employability Board were looking more deeply into the future labour market and other skills programmes and funding streams to assist people back into employment, noting that not all come under the remit of the AEB.

Cllr Ennis noted that the provider base was 75% direct provision and 25% sub-contracted and asked what the nature of the sub-contracting was.

It was explained that arrangements varied considerably. As the move was made into devolved funding, sub-contracting would not be ruled out but all providers who wanted to sub-contract would be asked who and what would be delivered and the rationale behind the sub-contracted provision.

The Chair commented that 347 providers was a very large number which made quality assurance and monitoring of delivery very difficult and sought assurance that this would be done adequately.

H George replied that the report showed the current provision from government funding.  The aim was to change the provider base as we move into devolved funding arrangements.

It is envisaged that, going forward, there would be nine grant fund providers and an estimated 40-50 providers overall which was a much more manageable number.

Delivery was tracked through an Individualised Learner Record which all providers had to complete.  The data was then fed back to the Education and Skills Funding Agency who would produce a report showing outcomes for each provider.   Under devolved arrangements, that data would be sent to the Authority for rationalisation against the plans and contracts the providers had supplied.

The Chair questioned whether, under the present system, there were any penalties for poor performance, quality or quantity of learners and could assurance be given that there would be going forward.

It was noted that assurance on quality is provided in a number of ways including:

• Periodic assessment through the OFSTED regime.
• Measures in terms of the quality and volumes that providers were delivering was monitored by the Education and Skills Funding Agency – this function would transfer to the Authority’s Performance Management Team.
• Assessment of providers’ financial standing were completed to ensure they had the resources to deliver the learning.
• Guarantees and protections were in place for learners should they have problems with a particular provider.

The Authority had not yet published its full set of funding and performance management rules. This will be done as part of the grant award process.

Cllr Jones questioned why the nine grant funded providers had not been included in the procurement process and whether the Authority had the capacity to cope with the work that would be transferred due to the devolution of funding.

H George informed the Committee that as part of the devolution agreement with government, the Authority had committed to act in a way which does not destabilise the FE landscape, including our FE Colleges. Grant funded providers will receive a grant at 2018/19 levels, but the Authority is challenging them by requiring them to develop 3-year delivery plans and making sure those plans were aligned to the priorities set out in the Strategic Economic Plan and the Recovery Action Plan.

With regard to capacity, resources would be needed for the management of the provider base and contracts.  This was being looked at in line with benchmarks from other MCA’s who had already received devolved funding.

If the government suggested new funding there was an internal process where Finance and HR would analyse the knock-on incremental costs, for example, audit, communications and governance, and if necessary, seek government permission to negotiate additional administration costs.

RESOLVED – That the Committee note the update on Adult Education Budget Commissioning.