FE BRANCH OFFICERS UPDATE
1 March 2013
Learning and Skills Sector Funding 2013/14
This briefing note for branches provides: 
•	a summary of the main changes to 16-19 and adult learning funding for 2013-2014 (A more detailed document is available at http://www.ucu.org.uk/media/pdf/7/4/Briefing_on_FE_funding_2013.pdf 
•	an indication of possible implications 
•	model questions to management.  
Please send details of management responses to your Regional Office and Dan Taubman dtaubman@ucu.org.uk 

Changes to Funding: main points to note

For both 16-19 and adult learning  
•	No cuts to actual funding rates
•	Minimum performance levels (MPLs) will be applied to both 16-19 and adult programmes. Different performance levels apply to 16-19 and to adult courses.  For both there are new simplified MPLs. If colleges have programmes that fall below these levels, there may be intervention by the funding agencies and possible withdrawal of funding for these courses
•	Big changes to both funding methodologies but in different ways.
•	More cuts still to come. BIS may have to lose another £1b in 2015-2016.  DfE hasn’t yet said how it will meet the £450m cut that was announced in the Autumn Pre-Budget Statement December 2012
16-19 learners
•	16-19 student numbers already with colleges. 
These are allocated on the basis of last year’s enrolments. Known as ‘lagged’ numbers.   Actual funding rate should come in March.
•	Raising of the age of participation arrives from Sept 2013. All 16 year olds will have to  undertake at least 240 hours of learning. All 17 year olds will have to do the same by 2015.
•	The big change to funding is that funding will no longer be for individual courses, but for a study programme. A study programme is a ‘substantial’ qualification such as 3 A levels, A BETC National. It will also include English and Maths if the student hasn’t got at least a C, tutorials, work placements if necessary and other activities that will need staff time e.g. rehearsals and performances for performing arts students.
•	Full time programmes including all or some of the above will have a minimum of 540 guided learning hours (glh) and a maximum of 600.
•	Any course below 540 glh will be a part time course and there are going to be 3 funding rates for these.
•	From 2013-2014 any course which is between 450 and 540 glh will be treated as full time for that year only.
•	 The glh for the study programme now  called ‘planned hours’ is divided into ‘qualification’ hours i.e. teaching and ‘non-qualification’ hours which includes non-qualification activity, tutorials, work experience, and voluntary/community activities.
•	There is a new funding formula. Success rates have been dropped but retention is now included within new definitions of retention.
•	The number of programme cost weightings which reflect the relative cost of programmes, have been reduced from 7 to 5.
•	Additional learning support is now divided into 2 blocks: 1 for ‘economic deprivation’ based on the student’s home post code, and Block 2 for prior achievement based on GCSE English and Maths results. 
•	What used to be funds for individual student support is now with local authorities who have the responsibility for the young person to 25. They will undertake the 	assessment and fund the requirements.
•	There are special arrangements for LDD students whose needs exceed £6000.
•	There is funding protection until 2014-2015 which means no provider can drop below 97% of what they received the previous year.
•	14-16s students in colleges will be funded in the same way as 16-18s.
Adult learners
•	The funding methodology for adult learning (19+) is also changing. 
•	The basis for adult funding will not be guided learning hours but units in the Qualification and Credit Framework, the QAA framework or Apprenticeship Framework. Funding is attached to band within these units. 
•	Some courses are not in the load bands but are listed separately. These have a set number of guided learning hours.
•	The funding rates for functional English and Maths have been doubled this year and this will continue for next year.  The rate for adult GCSEs will increase the same way as for functional 	skills.
•	Funding may have been cut to adjust the college down to the students it actually achieved.
•	From September 2013 new statutory entitlements will restrict free 1st level 2s and level 3s 	to those aged 19-23.
•	From September 2013, there will no longer be BIS/SFA funding for students over 24 undertaking level 3 or above programmes.  FE loans will be introduced which will range from £300 to £4000 and above, subject to similar conditions as apply to HE loans. For apprentices the maximum loan is 50% of the full funded rate.
•	Colleges will be given an indicative amount of funding that students will be able to draw down as loans to attend courses at that college. This is based on the numbers of students last year that would be within the scope of loans.
•	Universal Credit is replacing all current benefits from April 2013. This will in time remove all 	the benefits that fee remission is based on however there is a roll out until 2017 and existing students that are claimants will remain on their current benefits for some time.
•	Colleges will continue to be able to exercise discretion to waive fees for ‘inactive claimants’ if the claimant will seek work in the future.
•	Under Universal Credit, Job Centre Plus will be able to attach conditions on a claimant such as attending training courses. Failure to do can result in benefit sanctions.
•	The £210m  budget for adult and community learning remains  but renamed the  “Adult Safeguarded Budget”. However local authority funding for adult and community learning services may well be cut as may access to local authority premises for classes.
•	In Prison education funding is also to based around guided learning hours and the new mainstream FE adult and skills funding stream. This is likely to result in providers trying to get as many prisoners as possible enrolled onto prison education programmes so that they can claim 80% of the available funding for each student and then if the student achieves another 20% , although this is likely to seem  a less important element than the 80%. 
•	Last year HEFECE made student numbers available for FE colleges if they charged less than £9000 fees. This continues for 2013-14 but with far fewer numbers. Remaining partnership arrangements will also be under threat as universities may well claw back numbers given that HE admissions have fallen in the face of the high fees. Universities also have to be very careful with their numbers as they can be penalised if they enrol above their set numbers.
Some possible consequences of the funding changes

16-19 funding 

The big question is whether 540-600 hours will be sufficient to fund all that a student is 	required to undertake under a study programme. If it is not then teaching time for 16 – 19  may be affected. Colleges may attempt various strategies to make the study programme fit into the total amount of glh. Cutting teaching time is an obvious tactic that college management may try. All of these strategies may result in job losses and increased workloads.

Amongst the kind of things that colleges may do are:
•	Try to persuade different departments to carry out the cuts on their own behalf which can lead to sowing divisions amongst members in different departments.
•	Pressure those students having to continue with English and Maths to remain on these parts of their programme. If the student drops out of English and Maths, the college’s funding will be reduced accordingly.
•	Cut back on staff time on tutorials, work placement visits and other ‘extra-curricula’ activities. Cutting such activities may result in a loss of vital support for students, without which they may struggle to achieve the qualification.
•	Suggesting staff be imaginative in course design such as using a project or multi unit approach so there is less writing for students and more co-operation between teams
•	Suggest the organising of “Master Classes” to cater for high achievers to increase higher grades.
•	More resource centre based learning
•	Suggestions that 2 units could be combined and taught in 3 hours per week which previously would have been taught in 6 hours. Or a one and a half hour classes could be taught in 1 hour or teaching two groups inside the time allocated for one. 
•	The changed definition of retention and its prominence in the funding formula may lead colleges to pressure and advise students to enrol on a lower course than they want ie one that the student is more likely to achieve.  This could result in students going elsewhere for their learning.
•	Managements may well ask teachers to be more flexible and imaginative such as cutting   exam costs by the students undertaking fewer qualifications so reducing exam fees.  

Adult Learning 

•	Restrictions on the statutory eligibilities may mean a loss of both level 2 and level 3 students aged 24 and above who will have lost their entitlement to free full 1st level 2 courses, and a loss of students aged 24 to 26 on 1st full level 3 courses. This may make some programmes unviable leading to job losses and increased workloads.
•	The introduction of FE loans for those students 24 and taking a level 3 or above programme could lead to the loss of many adults from learning. An impact assessment undertaken by BIS last year showed that 250,000 adult students may be lost to learning. The research indicated that students over 40, women and Muslim students were likely to be have the highest drop out.
•	For courses which are load banded and have been given a set amount of guided learning hours we may find that the amount of teaching set is below that which students can be expected to successfully achieve. This has seemed a particular problem for ESOL courses which have been funded on the amount of guided learning hours actually delivered so enabling ESOL teachers to mould the courses around the student’s abilities, requirements, aspirations and educational background. As with 16-19 programmes colleges may try to get students to enrol on lower level courses which the student can achieve more easily but may not stretch the student.
•	The possible destabilisation of the curricula offer in ESOL is so much that the SFA have announced that it is committed to ensure the current offer is not adversely affected. It intends to allow for a sensible transition to the new ESOL offer that is currently in development. This commitment will ensure the level of earnings for the current ESOL offer within each College’s allocation will be protected.

Some questions for branches to ask management

(Please remember let Regional Offices and Head Office know what answers you get from your management)
Both the funding agencies, the EFA and the SFA have given providers the software to run the current year’s funding allocation through next year’s different funding methodologies. Branches should ask management if they have undertaken this exercise and what the results were in terms of funding and any consequent job or programme losses.

16-19 funding 
•	The college has received its allocation of numbers of 16-19 year olds for 2013-2014. Is this increased, decreased or the same as last year? If the numbers have decreased what is the cause of this?

•	In the light of any new academies, free schools, studio schools and University Technical Colleges, does the college expect to be able to enrol the numbers of 16-19s they have been given? How will they achieve this?

•	Does the college believe that it can deliver 16-19 study programmes within the 600 hour limit that is being set? If not what strategies are the college contemplating to make study programmes fit into the new limit? Will there be consequences for jobs and programme losses? What will be the likely consequences in terms of student achievement?

•	Will tutorials, work placement visits and other staffed activities be cut next year in the light of the funding for the study programmes?

•	 Does the college have any indication of how many 16-19 students may require additional English and Maths? How will this affect workloads for those delivering this additional work?
•	Does the college meet the new minimum performance levels for 16-19 programmes? If it does not, what are the consequences of this?

•	 There is a new element in the funding formula for retention. How is this likely to impact on the college’s funding for 16-19. What are the consequences of this is terms of job and programme losses?

•	There are new arrangements for 16-19 additional learning support. How will this impact on the college and LDD students? Local authorities will have the responsibility of assessing and funding young people with LDD until the age of 25, is the college in discussions with the local authorities they serve? What are the indications that the local authority will be able to undertake and fund the assessments it makes? If the local authority is unable to give assurances on assessments and funding what will be the impact on the college and its LDD students?

•	 What preparations have the college made in the light of the introduction of raising the age of participation of young people?

Adult learning
•	Has the college estimated how many students are likely to be lost by:
•	The new restricted entitlements for adults to have free level 2 and 3 programmes up to the age of 24?
•	The introduction of FE loans for those over 24 taking level 3 and above programmes?

•	What preparations has the college taken in the light of the introduction of FE  	Loans? 
•	Have existing students who will have to take out loans been informed of this? Have staff, especially those staff involved in admissions and enrolment been briefed and prepared for the introduction of FE loans? If not when will this take place? 
•	What other steps is the college taking to publicise the introduction of loans locally? 
•	Are systems in place for students to receive independent financial advice? 
•	Have staff received information on whether there are bursaries available and how they will be allocated?
•	 Will they monitor shortfall on what would be normal application rates for 24+ students? 
•	Have staff received information about apprentices taking out 24+ loans? 

115. Is the college using the discretion granted to it in 2011 to not charge students who are in ‘inactive’ claimants if they signed a statement that they would be seeking working in the future?  If so will they continue to do so? If not why are they not using this and will they consider changing their policy? 

•	How does the college think that the introduction of Universal Credit will impact on the college and its students? Will they be informing and training staff involved with enrolment 	and admissions in the light of the introduction of Universal Credit?

•	 The adult funding methodology is changing its basis from guided learning hours to being based on bands of credits. How is this going to affect the college’s adult funding? What are the consequences of the changes in terms of job and programme losses and increased workloads?

•	There could be particular problems in the change of adult learning funding for ESOL students. Is the college aware of the recent changes announced by the SFA in respect of ESOL and other basic skills funding for 2013-2014? What will be the impact on these programmes?

•	Does your college have the contract to deliver in-formal/non formal adult and community learning from a local authority? If so does it receive any additional funds from the local authority, and if so have these been cut for 2013-2014? Are there other local authority cuts that may impact on the college’s provision in this area?

•	ACE branches: is your service going to have cuts in local authority funding? If so how is this going to impact on the service in terms of job and programme losses and delivery of 	learning?

•	Prison education: how is the change of funding methodology going to impact on provision of your prison education programme? Will it mean job and programme losses? If so what job and programmes may be lost? 

•	HE in FE: if your college delivers HE programmes, have the numbers of student places been cut? If your college is in a relationship with higher education institutions, is still continuing? Are there any changes in terms of student places? If the college’s HE in FE programmes are being cut what are the consequences in job and programme losses?

Barry Lovejoy
National Head of Further Education