Guidance

Advice: Individualised learner record (ILR) funding returns 2025 to 2026

Updated 25 June 2025

Applies to England

This guidance covers the period 1 August 2025 to 31 July 2026 and is our current advice for the funding year. 

This summary applies to all of the 16 to 19 education funding guidance  that will be available from Department for Education (DfE) once published: 

• 16 to 19 funding rules  

• rates and formula 

• individualised learner record (ILR) funding returns (this page) 

This guidance outlines the main features of Department for Education (DfE) funding arrangements for 2025 to 2026 and are an integral part of our funding agreements for young people aged 16 to 19 and those aged 19 to 24 funded for study programmes. All of this guidance should be read in this context, unless specifically stated otherwise. This is the definitive guidance for 2025 to 2026 and replaces any previous funding guidance for young people. 

General Data Protection Regulation (GDPR) 

Institutions must adhere to GDPR in respect of the information they retain, particularly when it is personal or sensitive. It is the provider’s responsibility to ensure that it is fully compliant with GDPR. 

DfE sets out in its privacy notice how we collect data and used it to perform statutory functions on behalf of the Secretary of State. We will rarely ask for data from you outside of the individualised learner record (ILR) and school census. 

Where we do ask for information outside of the ILR and school census, we will set out clearly what we need and why we need it. We will always request that you send all personal or sensitive information using a secure method of transfer that is fully compliant with GDPR. You must not send us personal or sensitive information at any other time or in any other way. 

If you have questions after reading our guidance, or if there’s anything else you need help with, you can find more support in our customer help centre. 

What’s new for this year? 

The Education and Skills Funding Agency (ESFA) closed on 31 March 2025. All activity has moved to the Department for Education (DfE). Where we previously wrote ESFA, we will now write DfE. We have:

• made changes on the requirements for returning final claims for the 2025 to 2026 funding year. Institutions that deliver 16 to 19 education are not required to submit a mid-year claim, year-end claim or sign off a final claim through MYESF. Only institutions that have DfE adult funded provision should follow the advice in the how to return ILR funding claims to DFE guidance in making their returns to the funding body

• clarified the process and dates on under performance and overperformance calculations

• updated Annex C to reflect the most up to date calculation steps and timelines for recoveries  

• updated the list of PDSAT report to reflect the post-16 funding reports that are available

Understanding the terminology 

When we refer to ‘you’ or ‘institutions’, this includes schools, further education (FE) college, sixth-form college, work-based earning providers and training providers who receive DfE funding from us to deliver education and training to learners. 

Introduction and background 

We have written funding guidance for young people 2025 to 2026 on behalf of the Secretary of State for Education who funds the provision of education, using their powers through DfE. 

 This guidance sets out DfE’s funding guidance for all funded programmes for young people in 2025 to 2026 and cover all 16 to 19 funding provided by DFE. Separate funding arrangements apply for 16 to 19 apprenticeships. 

The funding guidance is an integral part of DfE’s funding agreements. Read all guidance in the documents in that context, unless specifically stated otherwise. We receive ILR funding returns. These data returns include student numbers and the associated generated total funding with reference to your 2025 to 2026 funding allocation. We use this data to determine future funding allocations. In general, we will use the ILR data for all in-year monitoring purposes. 

We require a year-end estimate from all funded institutions after submitting their ILR R10 data. Additional returns will only be required from: 

• contract institutions that are subject to reconciliation and that do not hold an agreed funding contract for the 2025 to 2026 funding year

• institutions that fail to make an accurate and timely ILR returns 

Any institution that fails to meet the deadlines for DfE ILR returns set out in table 1 must return a funding estimate. We will identify such institutions as high-risk institutions for all funding purposes, and we may take further action such as putting their name forward for a funding audit.  

The 16 to 19 funding claim report is available from either the funding information system (FIS) or the submit learner data (in previous years the Hub). When making electronic returns for the ILR, you should refer to the funding claims guidance.  

Where your returns are subject to a funding audit by DfE, by either an DfE auditor or a contracted funding auditor, the auditor reports to DfE. We have set out the required returns and the timetable in  table 1. The table explains the contents of the annexes in this guidance. 

Deadlines for returns 

You must return all associated funding audit documentation to the DfE in accordance with the timetable agreed between you, your funding auditors and DfE. 

In order to meet the returns timetable, set out in table 1, you must ensure that you share your 16 to 19 funding claims and ILR data with auditors in time for them to meet the return timetable. Funding auditors have requested that you should share final data with them at least one month before the final claim is due, that is no later than 23 September 2026. 

Table 1: Deadlines for ILR returns 2025 to 2026: all institutions 

Type of return (all types of institutions)	Deadlines for returns in 2025 to 2026
In-year monitoring   ILR R04 ILR R06 ILR R10 ILR R13	All DfE-funded institutions that make ILR returns must make sure their data on the web portal is uploaded in accordance with the dates set out below: 5 December 2025 (R04 latest return date) 6 February 2026 (R06 latest return date) 5 June 2026 (R10 latest return date) Year-end claim return (after R10 return) 12 September 2026 (R13 latest return date)
Final ILR and final claim	23 October 2026 (final claim follows R14 return)
Submit Learner Data (SLD) final claim report and ILR R14 (2025 to 2026)	You must return DfE electronic final funding claim in accordance with our returning ILR funding claims guidance. Where needed, you must meet the agreed deadline for funding audit reports on individual funding claim returns.
Delivery subcontracting declarations	At least twice during the funding year in line with other funding streams.  Refer to the subcontracting funding rules.

Table 2: Explanatory annexes in this document 

Annex	Description	Applies to:
A	guidance for completing forms: ILR funding estimate 2025 to 2026	all institutions
B	FIS or submit learner data ILR 16 to 19 funding claim report 2025 to 2026	all institutions
C	funding reconciliation for contract institutions 2025 to 2026	contract institutions only
D	funding claim report 2025 to 2026: additional technical information	all institutions
E	16 to 19 funding data returns 2025 to 2026	all institutions

Independent learning providers (ILPs) are regarded and referred to as contract institutions. ILPs are usually the only funded institutions that are subject to funding reconciliation in 2025 to 2026, and we will monitor funding and where necessary adjust payments through your ILR data returns. 

This will enable us to determine which contract institutions need an in-year allocation adjustment for underperformance to reduce the recovery value at the final claim stage. 

We now require all higher education institutions (HEIs) who previously returned funding data through the Higher Education Statistics Agency (HESA) data return to make ILR returns.  

Arrangements 

We will automatically populate the data from the FIS 16 to 19 funding claim report for all institutions making ILR final 16 to 19 funding claims. For contract institutions only in March and July 2026 after we have processed your respective ILR R06 and R10 data, we will send you an estimated reconciliation statement through Document exchange.  

We will send final reconciliation statements through Document exchange to all institutions after we have received final claim and data returns. You and your financial statement auditors will be able to use these documents to help complete your college financial statements. The statements will confirm any change to allocations and/or retrospective recovery for institutions. Guidance on completing the forms is in  annex A.

You should follow the funding claims guidance when you make your final return. If you cease delivery during the funding year, you must return a signed version of the 16 to 19 funding claim report that matches your final ILR submission. This is part of your agreed closure arrangements with DfE. 

Institutions must keep the original document as a financial record in accordance with the advice in the 16 to 19 funding rules 2025 to 2026. 

We will populate your funding generated from ILR R14 in your final funding claim. You must run the relevant funding compliance and eligibility Provider Data Self-Assessment Toolkit (PDSAT) reports and the post-16 monitoring reports dashboard and associated guidance to verify your ILR data during the year. 

You must use your unique UK Provider Reference Number (UKPRN) on all funding claim and ILR data returns. 

Funding principles: all institutions 

We expect you to deliver your full funding agreements each year. We will review your performance from previous years, to ensure that allocations are accurate. Student numbers are the key indicator of performance and have a direct effect on future allocations. We have not designed any tolerance and non-reconciliation of funding to reward persistent underperformance. 

For the purposes of monitoring institutions, we will calculate the performance of each institution in 2025 to 2026 as described in this guidance and in the other funding guidance. In particular, we will compare your student number and funding outturn with your student number and funding in your allocation and/or contract. To support this approach, we will also apply the condition of funding deduction (calculated from 2023 to 2023 student data) to both the allocation and the outturn for 2025 to 2026. This is further explained in  annex D. 

Adjustments to payments: all institutions 

Reconciliation of 16 to 19 funding for either under or over performance will not apply to the majority of institutions. This should mean that there are no mid-year or retrospective reconciliation funding adjustments if you are a grant-in-aid institution. We will not normally fund any growth for grant-in-aid institutions delivering more than their allocation. 

Final underperformance adjustments (recovery) are usually only necessary for contract institutions. We usually profile funding recoveries between April 2026 and December 2026 and within DfE’s own financial year ending in March 2027. 

When you submit your final ILR return by 23 October 2026, we will usually base your final funding reconciliation on that return. The data will replace any interim data that you have submitted previously. 

We usually determine your final funding adjustment using: 

• ILR R14 

• your final funding claim 

• any additional funding audit documentation  

• and, in exceptional circumstances, the results of any separate funding audit or DfE investigation

In the separate subcontracting funding rules, we have set out the principles for recovering funding for ineligible or non-existent subcontracting provision. 

In exceptional circumstances, we can make grant-in-aid institutions subject to reconciliation. You may be subject to the same funding adjustment rules for underperformance as contract institutions or to any additional conditions of funding we may apply to your allocation. If this applies, we will write to you.  

We expect all funded institutions to have achieved a minimum outturn of 30% of your total allocated programme funding allocation at R04. Where you have not met this threshold, we will review and if necessary, adjust allocations.  

Where you are planning to close or run down your 16 to 19 study programmes (either on a permanent or temporary basis), you must notify DfE at the earliest opportunity and as a minimum before the start of the academic year in which you cease recruitment for year 12 students. In such cases, we will partly or fully withdraw the allocation we made for that academic year. This will be dependent on whether there are year 13 students on roll. Where you provide late notification of closure, after the start of the academic year, we will recover funding from the year in which you cease recruitment for year 12 students. If you had not planned to close your 16 to 19 provision but data returns reveal that you have not enrolled or students, we will withdraw the allocation and will also action recovery of funds where we have already made payments. 

Contract institutions (only): funding reconciliation adjustments 

As a contract institution we can adjust your allocations for under and over performance. We will use the final ILR R14 data collection to either recovery for under-performing institutions or to pay responsive growth funding to over performing institutions. Responsive growth payments are subject to affordability, and we will pay the initial in-year growth at 50% of the reconciliation value. We may reduce the final 50% growth payments by an affordability factor. To make the reconciliation as easy as possible for both us and our institutions, we will pay responsive growth in accordance with our published priorities and in the following order: 

1: Initial 50% in-year payment based solely on ILR R06 returns that considers all 16 to 19 funded delivery above both the allocation and the usual responsive growth tolerance (any ear-marked growth priorities we identify during the funding year). 

2: Growth over 50% will be subject to an affordability check later in the year and we will then determine if we then need to ring fence any of the growth for full payment if part of the overall responsive growth fails our affordability checks. 

3: Review above responsive growth funding cap delivery after R10 for both affordability and eligibility checks and we will repeat these processes after the R14 return to see if any interim or final part or full payments are possible. 

The principles of contract institution funding adjustment and final reconciliation for over performance for this year are as follows: 

• we make any in-year allocation payments on profile

• we calculate final full-year funding variances are calculated by comparing an institution’s outturn (for the full year delivery) with your final funding allocation as paid for the year subject to the next three bullet points

• underperformance and growth funding adjustments are subject to a tolerance, as small marginal changes in activity are not subject to either upward or downward reconciliation

• reconciliation applies to all programme funding including block 1 and block 2 of disadvantage funding and to the English and maths payment premium

• high needs funding is not usually subject to reconciliation for any institutions; however, we expect you to show you spending your r allocation appropriately in supporting high needs students

Underperformance (recovery) calculation 

When calculating final reconciliation recovery calculation, we will apply a tolerance of the higher of 1% of the programme allocation or £5,000 when comparing the total programme cash delivered against the total programme allocations. 

We do not apply in-year funding reductions that disadvantage contract institutions when it comes to calculating final reconciliation. If you have significant underperformance, we will implement an in-year recovery rather than a change to your agreed allocation. 

We do not apply in-year funding allocation reductions that would disadvantage contract institutions when undertaking reconciliation. Therefore, an institution with significant underperformance in-year will be subject to in-year recovery rather than a contract variation to reduce the agreed funding allocation. If subsequent ILR returns confirm increased delivery, appropriate adjustments will be made to reinstate funding in line with the evidenced delivery against the allocation. 

We will review ILR R04 performance and where programme delivery is below 30% of allocated programme funding, we will start recovery from February 2026 to take account of under-delivery in the funding year. 

Contract institutions whose ILR R06 funding outturn is below 75% of their programme funding allocation will be subject to recovery from April 2026. The detail is set out in annex C and the contract institution reconciliation example workbook. For contract institutions with persistent underperformance, we will seek to ensure sufficient recovery is recovered in-year to ensure that monthly allocation payments are possible throughout the next funding year. 

Over performance (responsive growth) calculation 

For the purposes of responsive growth payments, we will compare your total eligible programme funding cash delivery with your programme funding allocation. 

As with recovery, we do not fund small marginal changes and therefore do not fund the higher of either the first 1% or £5,000 of any positive variance. 

The responsive growth cap is normally 30% of the allocation with a minimum value of £100,000 and a maximum value of £500,000. 

Processes for any responsive growth funding payments to contract institutions 

Before we pay any responsive growth funding, we will ensure that claims are reviewed for compliance with funding eligibility criteria. Where this review raises any eligibility concerns, responsive growth funding will not be paid until additional funding audit assurance is obtained to support the institution’s funding return. 

Contract institutions: adjustment profile 

The recovery profile for contract institutions will be based on their allocation profile. It will apply to all reconciliations, whether determined by ILR returns or funding audits. The recovery profile period will usually run from April to December 2026, as set out in  annex C. We will review ILR R04 performance and where programme delivery is below 30% of allocated programme funding, we will start recovery from February/March 2026 to take account of under-delivery in the funding year. 

We have designed the recovery profile to reduce the risk to delivery while also meeting Treasury requirements to recover and protect unused public funds. To meet these requirements, we will continue to spread your underperformance recovery for 2025 to 2026 across your allocation payments for each year.  

In order to protect public funds, we reserve the right to bring forward any recovery of funding as deemed necessary to avoid either any potential loss to DfE or the need to invoice an institution later in the year where future monthly allocation payments for either the current or next year are insufficient to repay the scheduled recovery. 

When a contract institution does not have a guaranteed allocation in 2026 to 2027, we need to safeguard public funds and so will apply a different recovery profile. We will also apply this profile to any institution that has received either a provisional or confirmed Ofsted inadequate judgment (grade 4) or where significant concerns are raised over the financial health of the institution. In these cases, recovery will take place: 

• during the 2025 to 2026 funding year (between April and July 2026) 

• with any final return recovery following receipt of updated ILR data in autumn 2026 

We will make interim growth payments in April 2026. These will be 50% of the interim reconciliation value for contract institutions that have already achieved their full year allocation, according to their ILR R06 data return. At the R10 return we will then calculate a revised reconciliation value that has been achieved above the full year allocation and calculate 50% of that revised figure. We will deduct any growth already paid as a result of the R06 process and pay the outstanding balance in August 2026. Subject to affordability, at the R10 stage we may also increase the 50% figure up to a maximum of 75% in calculating the growth payment in August. Following R14 data return, a final reconciliation takes place to determine any outstanding responsive growth funding. Subject to the affordability and eligibility checks outlined in this guidance, this final payment may, where applicable, bring the total responsive growth paid up to 100% of the value calculated, within any published growth caps.  

We will only make any final growth funding payments when all the affordability and eligibility checks explained in this guidance have been conducted. Any final responsive growth payments will only be considered after receiving timely ILR returns for the year. 

Review of final 16 to 19 funding claims: all institutions 

Annex D explains in detail how we calculate funding outturn figures on the FIS 16 to 19 funding claim report. You must check your funding totals calculated from your ILR data before submitting data and returns. Institutions may find the following checks helpful; they are particularly important before making ILR data submissions: 

• check the validation reports on submit learner data before making the ILR submission; these will show any students that are not included on the FIS 16 to 19 funding claim report

• review the FIS 16 to 19 funding claim report to check that all students who have turned 19 during the second or subsequent year of their programme are correctly recorded; see  annex D  for how to code these students 

• students shown in row C on the 16 to 19 funding claim report must have an education, health, and care (EHC) plan; the ILR field learner funding and monitoring type must equal EHC, and the learner funding and monitoring code must be set to 1

• review PDSAT reports to reduce the risk of inaccurately recording students in ILR returns

• review the post-16 monitoring reports dashboard and associated guidance to check for any potential errors 

Compliance and funding audits of ILR data 

Funding auditors, both in house and appointed by us, must use the funding audit documentation specified by us. 

If you appoint your own funding auditors, you should use their own audit documentation. Individual audit firms may find our funding audit documentation helpful for their work. 

You must send your ILR return to funding auditors by 23 September 2026. This also applies if we have notified that you are subject to a funding audit of your final funding data or claim. It also includes all funding audits undertaken by a DfE appointed auditor under our agreed joint contract. The return is then due to DfE by the published date. 

If you or funding auditors anticipate that your final funding data or claim will be late, and received after 23 October 2026, you must send a letter to DfE via the customer help centre before this date that: 

• explains the reasons for the delay 

• explains the action that you will take

• provides a clear date by which we will receive your signed final claim 

All final ILR returns must meet the 23 October 2026 deadline. 

You must pass the final claim to your funding auditor and ask them to send it to DfE with your associated funding audit report on your final funding claim and supporting data. When funding auditors cannot place reliance on the funding data or claim, we are likely to require further work by both you and your funding auditor. 

The funding audit for this year places emphasis on the importance of the accuracy of your funding data or claim. You must explain the reasons that your funding audit documentation is delayed. Submitting funding audit documentation after the deadline will mean that we record you as not submitting timely data returns. The final claim data must be available in good time to sign off college financial accounts, which are due no later than 31 December 2026. 

You must run relevant ILR through the funding audit PDSAT and use the post-16 monitoring reports dashboard to verify your own data during the year. When you want to simplify your ILR funding audit, we recommend that you run the reports and clear them before any substantive visits from the funding auditor. You should review planned hours for all funded students who attend a study programme for less than 6 weeks in accordance with the additional advice in our 16 to 19 funding rules  and annex C. We have also set out some additional advice in  annex E. 

When you are subject to funding audit and have substantial eligibility issues, we may require additional scrutiny or work above the standard funding audit contract. We may charge you for this work. 

Subcontracting delivery declarations 

We expect FE institutions to provide a delivery subcontractor declaration for 16 to 19 funding as we do already for other funding streams. You must provide a fully completed delivery subcontractor declaration by the dates we give you. This will be at least twice during each funding year. If you do not subcontract, you must still provide a nil return to confirm this. You must also update your subcontractor declaration if and when your subcontracting arrangements change during the year. 

Annex A: guidance for completing forms: ILR 16 to 19 funding claim 2025 to 2026 

Calculating funding 

We set out our funding methodology in our 16 to 19 funding guidance. DfE’s default in-year position is to use the ILR data returned through submit learner data to monitor your performance against your funding agreement. 

To help you complete the forms, FIS includes a 16 to 19 funding claim report that reports funding in a similar way to your funding allocation statement. This includes the final claim declaration on the final page of the report. Technical information on the report is set out in  annex D. If an institution has no claim in a category, the report will show ‘0’ (zero). 

Completing the form 

We monitor performance against each type of allocation through ILR data returns, as most institutions for 16 to 19 funding no longer need to make manual adjustments to their final ILR funding total. 

The submit learner data or FIS DfE funding claim report contains all valid 16 to 19 funded students who count as a start for funding purposes and their associated funding. This report should help you understand your total student numbers and the cash that you have delivered for the academic year. 

All 16 to 19 funding claims (required by audit) must be returned as set out below: 

• each institution has programme funding as part of its funding allocation; the format of the FIS 16 to 19 funding claim report is similar to the submit learner data version 

• we will populate your 16 to 19 education final claim with your data from your ILR R14 submission

• if you have a 16 to 19 education allocation, your principal or delegated authority must submit a signed version of your final funding claim. You do not need to submit a mid-year or year-end claim 

• you should follow our  final funding claims guidance  

FIS: all institutions 

FIS helps you make your funding returns for the year. You must read annex D for further advice on the FIS funding claim report, particularly before compiling your ILR returns. 

All funding audits use your ILR data. 

Advice on funding and ILR data monitoring 

We will use ILR data returns to monitor your delivery against your allocation (contract institutions in particular). We may require separate funding returns if you fail to return ILR data according to our published timetable. We will notify you when we require such separate funding returns. 

We will issue final reconciliation statements in a format similar to the allocation statement. They will also include the outturn and reconciliation information. We will send them through Document exchange to: 

• contract institutions, in autumn 2026 (these will also include the profile of any reconciliation adjustments for 2025 to 2026) 

• all  ILR funded grant-in-aid institutions, in autumn 2026; these will help you to prepare final accounts for sign off by financial statement auditors after receiving final ILR data in October 2026

Purpose of final claim as part of a funding audit: all institutions 

The final claim has several purposes: 

• it provides DfE with assurance from the accounting officer over the regularity of the institution’s 16 to 19 ILR data returns

• it provides an agreed final outturn that can be compared with the allocation on an institution, territorial and national basis 

• it determines whether funding will be adjusted by recovery; we expect the cash claimed to be consistent with financial provision made by the institution in its financial statements

To assist them in making good-quality ILR and funding returns to us, all funding institutions must also use the PDSAT reports and 16 to 19 funding rules monitoring reports that are relevant to their own provision and data before submitting their final ILR data return.  

We will use the final 16 to 19 funding data/claim to determine retrospective funding adjustments. This will take account of any audit qualifications and, in exceptional circumstances, the results of any separate DfE investigation. 

Purpose of funding auditor’s documentation on a final claim: all institutions 

The funding audit provides DfE with supplementary assurance over the funding claimed by you, as we require assurance for our own account that the funding claimed poses no risk to public funds. The funding audit documentation also provides us with a final view on your funding data, which allows us to inform you and your financial statement auditor of the expected final funding position for this year. 

Manual adjustments (recorded in annex B part 2, funding difference form) 

We do not expect manual adjustments to be necessary. The only exception is where either we or an appointed funding auditor, determine that we must apply an error (either individually calculated or calculated through extrapolation) to your final ILR data return. We expect such adjustments to be rare and exceptional. We expect any overall audit adjustments to be negative: an institution under-claiming must make the necessary changes to their underlying ILR data. 

The rules on manual adjustments in part 1 and part 2 of the 16 to 19 funding claim are not the same for cash and student numbers. The cash adjustments in parts 1 and 2 should match exactly, while the student numbers may be different. 

In some cases, this will include a number of separate calculations and a sheet of background material explaining how you have calculated the proposed adjustment. These calculations and material must reconcile with claim value recorded on part 2 of the claim annex B, part 2. 

No manual adjustment numbers used in previous years are claimable and you must not use these for this year. 

Annex B part 1: ILR 16 to 19 funding claim 2025 to 2026 report 

The 16 to 19 funding claim report, which is available from either FIS or the submit learner data, supports the required funding claim returns.  

Purpose of 16 to 19 funding claim report 

It is used for institutions where reconciliation is appropriate to determine whether any funds paid for this year will be recovered for underperformance. Any adjustment of funds will be finally determined using any audit qualifications and, in exceptional circumstances, the results of any separate investigation. 

Annex B part 2: final funding difference form 2025 to 2026 

You do not need to return this part of the form unless you are making a valid audit manual adjustment to the ILR funding return as part of your final data or claim return. If so, print this page together with the FIS 16 to 19 funding claim report 2025 to 2026 (which we will be treat as the funding figure page of your final funding claim). 

Reference: ILR funding returns 2025 to 2026 

If you receive funding from us for 2025 to 2026 you must complete this form whenever you are claiming a manual adjustment on part 1 of this form. You must return it with part 1.  

You should use this form to record the reason(s) for the difference between the 16 to 19 funding claim and the cash generated by processing the relevant ILR return through the notified versions of the FIS using the notified release of the find a learning aim, or any updated version. 

Part 2 of final funding claim 

Institution name in 2025 to 2026 (please print): 

UKPRN code in 2025 to 2026: 

Manual adjustment number	Description	Students affected (number)	Difference (funding)
2025-001	Funding audit (or DfE) adjustments may be made to reduce funding in the following circumstances: - to reflect errors in an institution’s claim or the lack of an adequate audit trail to remove funding for ineligible students or programmes, and/or - to remove funding for students duplicated in other funding streams or in other institution funding claims
Total difference arising from manual adjustments (cash adjustments must match total manual cash adjustment in part 1)

Annex C: Funding reconciliation for contract institutions 2025 to 2026 

The examples in table C1 (and are unchanged from last year) are based on the rules set out in the main section of this guidance. 

Table C1: Final reconciliation examples 

1.0	examples	A	B	C	D
1.1	funding allocation	£500,000	£500,000	£500,000	£500,000
1.2	tolerance – standard 1.0%	£5,000	£5,000	£5,000	£5,000
1.3	funding growth cap(standard 30%)	£150,000	£150,000	£150,000	£150,000
1.4	funding outturn	£485,000	£497,500	£505,000	£535,500
1.5	responsive growth †	£0	£0	£0	£30,500
1.6	recovery †	-£10,000	£0	£0	£0
1.7	performance against funding agreement	97.0%	99.5%	101.0%	107.1%

† See the following notes for explanation of figures in rows 1.5 and 1.6: 

A) Contract institution delivers 97% of their funded allocation with DfE recovery of allocation funding as they delivered below 99% of their programme allocation. 

B) Contract institution delivers 99.5% of their funded allocation with zero recovery of allocation funding as they delivered 99.5% of their programme allocation which is within the 1.0 % recovery tolerance. 

C) Contract institution delivers 101% of their funded allocation but we do not pay responsive growth funding as all over delivery is within the growth tolerance. 

D) Contract institution delivers 107% of their funded allocation and subject to affordability receives growth funding of £30,500. In the example we will cap any final responsive growth in 1.5 at the value in 1.3. 

Profiles for funding adjustments for contract institutions for 2025 to 2026 

This annex sets out the percentage profiles used each month used for recovery. 

Recovery profile for continuing institutions 

We have set out the profiles for the recovery of under delivered allocations for contract institutions with a funding contract agreed for 2025 to 2026 by 31 March 2026 in tables C2 and C3. These are subject to the additional safeguards to protect public funds. This will apply to all funding reconciliations, whether determined by ILR returns or final claims. 

We now review ILR R04 performance and where programme delivery is below 30% of allocated programme funding, we will start recovery from February 2026 to take account of under-delivery in the funding year. 

Table C2: R04, R06 and R10 programme outturn as used to determine in-year recovery for those institutions also funded in 2026 to 2027 

R04, R06 and R10 programme outturn	Recovery
If R04 less than 30% of full year allocation	Recovery=full allocation payment for February and March (reviewed again at R06)
If R06 less than 50% of full year allocation	Recovery = full allocation payment for April to July†
If R06 is between 50% and 65% of full year allocation	Recovery = half allocation payment for April to July
If R06 is between 65% and 75% of full year allocation	Recovery = one-third allocation payment for April to July
If R06 is between 75% and 85% of full year allocation	Recovery = half allocation payment for July only
If R06 is greater than 85% of full year allocation	No in-year recovery before July
If outturn has improved at R10	The recovery position will be recalculated based on the R10 outturn. Any resulting adjustments, such as a reduction in previously calculated recovery or a balancing payment where applicable, will be processed in August
If outturn at R10 is below 95% of the full-year allocation	The total recovery requirement will be recalculated based on the R10 outturn. This recovery will be profiled for recovery between August and December. The position is subject to final review at R14

†   Where the recovery mechanism involves withholding the ‘full allocation payment’ for a period (for example, if the R06 return shows programme outturn is less than 50% of the full year allocation), the following clarifications apply: 

1: The term ‘full allocation payment’ in this context refers specifically to the reconcilable core programme funding. Payments for non-reconcilable funding elements, such as High Needs Support (HNS), the 16-19 Bursary Fund, and Free Meals in FE, are not affected by this particular recovery and will continue to be paid as per the usual profile. 

2: To facilitate the processing of a monthly remittance, a nominal sum (for example, £5) will be paid to the institution from the reconcilable funding amount. In such cases, the actual amount withheld from the reconcilable programme funding will be the relevant profiled allocation payment less this nominal sum. 

Table C3: Recovery profile for 2025 to 2026 for those institutions also funded in 2026 to 2027. 

Month	R10	R14
August	20.00%	Not applicable
September	20.00%	Not applicable
October	20.00%	Not applicable
November	20.00%	Not applicable
December	20.00%	100.00%

We apply the above profile from August to December 2026 to the balance of R10 recovery. This is after considering any funding that we have already recovered in-year as withheld allocation payments (see table C2) before the end of July 2026. 

We will review the recovery figures and finalise them at R14. This will impact on the recovery values in December. 

Where R10 delivery is at least 95% of the programme allocation, any recovery indicated at this stage is usually profiled for recovery in December; this amount is then subject to final review against the R14 data return and updated to reflect the final position before any recovery is processed. 

2025 to 2026 recovery profile for those institutions without an agreed contract for 2026 to 2027 

We will restrict payments to you for the following year to match your outturn at R06. This avoids the need to invoice you for the recovery of unused public funding if you do not have a future contract. 

This policy also recognises that you may be winding down your operations during the latter part of the funding year and ceasing to recruit any new students later in the funding year. 

We will profile the full recovery calculated from the R06 return so that we only pay you an allocation between April to July 2026 that you have already earned from your R06 return. 

16 to 19 study programme allocation profile for 2025 to 2026 

The 16 to 19 study programme funding allocation profile is for equal monthly payments with any small balance paid in July each year. 

Table C4: 16 to 19 allocation profile payment 

month	Profile percentage
Every month from August to July	8.33333%
Total	8.33333%

Annex D: 16 to 19 funding claim report 2025 to 2026 

Additional technical information 

The FIS 16 to 19 funding claim report sets out the funding outturn figures for DfE funded students. We show the general layout and coding of the report is shown at the end of this annex. 

The reporting code reflects the16 to 19 funding calculation covers the following groups: 

• students aged 14 to 16 under a direct 14 to 16 funding contracts with DfE 

• students aged 16 to 18 including 16 to 18 high needs students

• students aged 19 to 24 with an EHC plan for 2025 to 2026 

• students who started programmes aged 18 (or less) in the first year of their programme but who are aged 19 or over on 31 August 2025 (known as 19+ continuers) are funded under the 16 to 19 DfE funding methodology

To keep the 16 to 19 funding claim report as simple as possible, it uses the following ILR fields: 

• source of funding 

• funding model 

• learner funding and monitoring type 

• learner funding and monitoring code 

• date of birth 

• planned learning hours and planned enrichment, employability and pastoral hours

Students must have at least one learning aim coded in the ILR data, as set out in  table D1  to be funded under the 16 to 19 funding methodology. 

The FIS 16 to 19 funding claim report puts students in the full and part-time funding bands as set out in the rates and formula guidance. It then applies the national rate to each band. When calculating students’ programme funding, the report uses the same funding factors as your funding allocation. 

The outturn calculation manages the disadvantage elements differently to the other funding factors, as disadvantage funding is added to the programme funding. The outturn must include the disadvantage element and at the same time reflect what proportion of the allocation you have delivered. That is, the difference between the allocation’s student numbers and the actual student numbers recruited during the year. The calculation is as follows: 

• calculate the total block 1 and block 2 funding as a percentage of the programme funding (less disadvantage and before area cost) 

• FIS applies this percentage, at the same standard percentage to each individual student’s programme funding. This is before adding disadvantage funding or using the area cost factor. The FIS tables in the column labelled PrvDisadvPropnHist shows your standard disadvantage uplift factor

• add the English and maths payment premium to the outturn based on the percentage of the premium paid within the total programme funding allocation

• FIS calculates the outturn including both the programme and disadvantage funding. This total is then further uplifted by the area cost factor to produce the outturn

The outturn calculation manages the large programme uplift calculation using the same principles set out above for disadvantage funding. 

The cash reduction made to 2025 to 2026 allocations for students who did not meet the condition of funding in 2023 to 2024 is also applied your funded outturn in 2025 to 2026. 

This ensures that we are treating institutions equally in respect of the condition of funding. This approach ensures that the funding we removed from 2025 to 2026 allocations through non-compliance with the condition of funding for some students in 2023 to 2024, cannot be offset by delivery in 2025 to 2026. This deduction will not affect the calculation of lagged funding allocation values for 2026 to 2027. These will be affected, where applicable, by the condition of funding reduction arising from non-compliance with the condition of funding for students in 2023 to 2024. 

We issue full guidance on the ILR 16 to 19 funding claim report in the FIS guidance. 

ILR data recording issues 

You must update the data entry in ILR field ‘source of funding’ for all continuing students that change funding body responsibility for a later year of their programme. Therefore, the ILR learning aim record for these students will be different across funding years. 

We fund students who started programmes aged 18 (or under) in the first year of their programme but who are aged 19 or over on 31 August 2025 (known as 19+ continuers) under the 16 to 19 funding methodology. 

You must record all students with an EHC plan with learning funding and monitoring type = EHC and learning funding and monitoring code = 1. This enables us to ensure the funding position mirrors our statutory responsibilities. 

Read how to record T Level data correctly to improve the quality of your T Level data submissions. 

ILR data checking support and reports we make available 

We expect institutions to use PDSAT reports to verify their own ILR data during the year. KPMG have developed the software and will provide support. Support is via their helpdesk facility as detailed on the main PDSAT page, where you can also find a PDSAT e-learning guide. Institutions must also use the post-16 monitoring reports dashboard and associated guidance. 

Notes on FIS DfE funding reports 

The notes at the bottom of the FIS 16 to 19 funding claim report are set out below. 

Disadvantage is calculated as the total block 1 and block 2 elements of your 2025 to 2026 allocation as a proportion of the total programme funding (less disadvantage and before area cost) in your 2025 to 2026 allocation. 

English and maths funding will also be added to the outturn based on the percentage of the funding paid within the total programme funding allocation. 

Large programme uplift is calculated as the large programme element of your 2025 to 2026 allocation as a proportion of the total programme funding (less large programme funding and before area cost) in your 2025 to 2026 allocation. 

This page includes all students who have 16 to 19 funding and are identified in the ILR as 16 to 19 funded (such as source of funding code = 107). 

Any students coded as Adult funded (such as source of funding code = 105) will not appear on this report, even if their funding model is set to 25 (16 to 19 (excluding apprenticeships) funding) 

Row C includes students aged 19 to 24 on 31 August 2025 who are 16 to 19 funded (that is, source of funding code = 107) and have an EHC plan. 

Row D includes students aged 19 or over on 31 August 2025 who are 16 to 19 funded (that is, source of funding code = 107), are funded using 16 to 19 funding (that is, funding model = 25) and are not included in row C. 

All factors in this report and used in funding calculations are those used in your 2025 to 2026 allocation. 

The 2025 to 2026 condition of funding removal reflects the funding that has been removed from your 2025 to 2026 allocation in relation to students who did not comply with the condition of funding on English and maths in 2023 to 2024. The total funding (less condition of funding removal) figure will form the basis of the outturn used for all institutions, to ensure that the outturn and allocation figures are calculated on a consistent basis. 

T Levels are included as a separate category on the report to assist us in monitoring T Level delivery which is subject to its own reconciliation system as set out in our rates and formula. 

Table D1: FIS 16 to 19 funding reports 

A summary of the use of ILR fields and correct student coding for DfE funding 

16 to 19 funding claim report categories	ILR field ‘source of funding’	ILR field ‘funding model’	ILR field ‘learner funding and monitoring’	Learning delivery funding and monitoring	Age at 31 August
A 14 to 16 direct funded students	Equals: 107	Equals: 25	Not applicable	Type = LDM Code = 320	14 or 15
B 16 to 19 students (including high needs students)	Equals: 107	Equals: 25	Type = HNS Code = 1	Not applicable	<19
B 16 to 19 students (excluding high needs students)	Equals: 107	Equals: 25	Type<>HNS Code<>1	Not applicable	<19
C 19 to 24 students with an EHC plan	Equals: 107	Equals: 25	Type= EHC Code = 1	Not applicable	> = 19 and < = 24
D 19+ continuing students (excluding EHC plan students) (This is applicable to all ILR funded institutions)	Equals: 107	Equals: 25	Type<> EHC Code<>1	Not applicable	> = 19
Total funding	Total (programme funding only) = A + B + C + D (from above)	Total (programme funding only) = A + B + C + D (from above)	Total (programme funding only) = A + B + C + D (from above)	‘Not equal to’ is denoted by <>	Not equal to’ is denoted by <>
Condition of funding reduction	Allocation deduction for not meeting condition of funding in 2023 to 2024 (this is the cash figure deducted from the 2025 to 2026 allocation)

Annex E: 16 to 19 funding data returns 2025 to 2026 

Planning by institutions to reduce funding and/or funding audit data errors 

When we report on funding audits to National Audit Office (NAO), we must show the difference between the pre-audit values and the post-audit values. We recognise that for many institutions the full ILR data checks are usually complete by R14 data returns but may not necessarily have been done early enough for the start of any funding audit work. For 16 to 19 funding purposes for most institutions only R06 and R14 data returns count for funding purposes, and this may help explain why ‘data cleaning’ is left until the late summer period. The advice below is also intended to reduce the need for institutions to make other manual adjustments or data business cases for future allocations. 

For the few institutions selected each year for a funding audit the advice below should help keep any post funding ‘audit errors’ to a minimum for: 

• the provider 

• the funding auditor 

• DfE funding audit management team 

• NAO 

• the whole FE sector by helping us demonstrate to NAO that the sector complies with the guidance and the risk attached to 16 to 19 delivery is low and helps to reduce the numbers being audited in future years

To help reduce the risk of ‘audit errors’ in ILR data before it is presented to any funding auditor it would be helpful if the funded institution undertakes the following actions (and we have provided contractual links to support some of the items below). This work reduces the risk to us, institutions, and funding auditors of the consequences of poor data returns. 

Run the 16 to 19 Funding claim summary report (usually around 4 pages and available from either the Hub or from FIS) and ensure all of the following: 

• that the overall student numbers appear consistent with the delivery the provider is undertaking and that each sub-group is also correct – 16 to 19 including high needs, 19 to 24 with an EHC plan and 19+ continuers

• that the number expected has been cross checked to the allocation statement and that the variances in numbers are what the provider expects

Run the English and maths conditions of funding report (available from the Hub or FIS) and check that students appearing on the report as ‘not meeting the condition of funding’ have been fully checked to see if they have been correctly flagged in ILR. 

Run PDSAT and use our 16 to 19 funding rules monitoring reports and in particular the reports on 16 to 19 ‘planned hours’ issues as this is the core data for all 16 to 19 funding audits. Report 25Y-212 identifies students by funding band and planned and actual periods of attendance and is a key audit risk assessment report in respect of accuracy in planned hour data returns. This report is particularly relevant to the guidance in the 16 to 19 funding rules.  

Report 25Y-209 sets out which students may need planned hours adjustments to comply with the 16 to 19 funding rules . A PDSAT report, ‘study programmes containing significant levels of non-qualification activity’ (25Y-218) sets out which students need review as their non-qualification hours make up 50% or more of the study programme total planned hours for the year. Institutions  must review these students to take into account the published guidance in the 16 to 19 funding rules in respect of high levels of non-qualification delivery. This report excludes all students flagged in the ILR for either high needs and/or an EHC plan. The reports that must be checked before every mandatory ILR return for 16 to 19 funding (R04, R06, R10, R13 and R14) are listed below. 

25Y-201	Full time learners on short study programmes
25Y-202	Learners with high weekly study hours
25Y-203	Learners with high planned hours in-year
25Y-204	Learners with qualification hours for non-qualification programmes
25Y-205	Funded hours thresholds
25Y-206	Learners on study programmes of no more than 4 weeks’ duration
25Y-207	Withdrawals and qualifying days for funding
25Y-208	Withdrawals and qualifying days for condition of funding
25Y-209	Completions, withdrawals, or transfers within first 6 weeks
25Y-210	Withdrawals and planned hours for learners continuing from a previous year
25Y-212	Learner numbers by funding band and by planned duration in weeks
25Y-218	Study programmes containing significant levels of non-qualification activity

PDSAT reports 

Post-16 monitoring reports dashboard and associated guidance. 

FRM06	Continuing learners from last academic year who do not appear in this year’s ILR
FRM30	Students with more than 40 planned hours a week
FRM56	16 to 19 study programmes with planned learning hours but no regulated qualifications
FRM69	Proportion of planned employment, enrichment and pastoral (EEP) hours is 50% or more of total planned hours
FRM71	Planned hours for continuing students who complete or leave learning within 6 weeks of 6 September

Once notified of the relevant ILR sample produce for every student a cover sheet in accordance with the 16 to 19 funding rules  verifies the total planned hours entered on the ILR against the student enrolment and attendance records held by the institution. If the hours do not exactly match, institutions must provider an explanation where any difference would change the funding band the student is recorded in the ILR. For example, a 16 to 17-year-old student recorded in the ILR at 600 planned hours but with a cover sheet for 590 hours should not usually generate a funding error. Whereas a cover sheet showing 550 planned hours for a 16 to 17-year-old student recorded in the ILR at 600 planned hours is a potential funding error and a full explanation will be required by the auditor. 

If any funding audit work is delayed or extensive further testing is required one of the possible consequences for the provider. 

We have also updated the advice in the how to record T Level data correctly guidance to help the sector improve the quality of their T Level data submissions.