Correspondence

DfE Update further education: 28 May 2025

Published 28 May 2025

Applies to England

1. Information: 16 to 19 funding update

On 22 May, we announced the 2025 school teacher pay award and £615 million in new funding for schools to support them with their costs including staff pay.

We also announced an investment of £160 million in the 2025 to 2026 financial year to support colleges and other 16 to 19 providers to address immediate priorities, including recruiting and retaining expert teachers in high value subject areas.

This means that, combined with over £30 million being made available from within the £615 million to support schools with 16 to 19 provision, a total additional sum of over £190 million will be available for 16 to 19 funding in financial year 2025 to 2026.

This will boost opportunities for students and drive the critical skills needed for economic growth.

We will provide further details on the 16 to 19 funding rate increases and revised allocations in June.

Updated payments will begin from the start of the 2025 to 2026 academic year.

2. Information: National Insurance (NI) contributions grant allocations

We have published allocations and conditions of grant relating to previously announced funding to support schools and post-16 providers with the increased NI contributions:

• the school level allocations for the National Insurance contributions (NICs) grant for 2025 to 2026
• the local authority level allocations for the first and second payments of the core schools budget grant (CSBG) for special schools and alternative provision 2025 to 2026 – these include the consolidated 2024 to 2025 grants (TPAG, TPECG, CSBG)
• the local authority level allocations for the National Insurance contribution and teachers pay grant (EY NTPG) for early years – these include the new teachers pay grant funding for 2025 to 2026
• the post-16 National Insurance contribution grant (Post-16 NICs)

3. Information: Free Courses for Jobs construction expansion

We have announced that we are expanding the free courses for jobs (FCFJ) offer to support providers to deliver more construction training.

We will allocate an additional £20 million nationally for FCFJ for academic year 2025 to 2026. In areas where there are strategic authorities managing the Adult Skills Fund on 1 August 2025, the funding will be devolved.

In non-devolved areas, all Department for Education funded providers with a FCFJ allocation can expect a percentage factor uplift to their allocation for academic year 2025 to 2026 to fund/expand construction courses. 

We will:

• publish further detail on the uplift in the next month and revised allocations by the end of June
• expand the national list of qualifications eligible for this funding to include 13 new reformed construction qualifications at level 2 that providers can offer from 1 August 2025
• add 11 level 2 engineering and manufacturing qualifications to the list
• review further construction qualifications for the national list and will provide an update on approved qualifications in September 2025

These courses will be eligible for the £600 and £150 uplifts that apply to FCFJ provision.

There will be further detail on 16 to 19 funding to follow in due course with additional funding available for construction provision from academic year 2026 to 2027.

4. Information: Post-16 budget grant

We have updated section 4 of the post-16 budget grant: conditions of grant for financial year 2025 to 2026.

We have removed the timeframe by which settings need to spend the money and have added a new section (5.1) to allow providers to carry over funding after the end of academic year 2024 to 2025.

5. Information: Changes to level 7 apprenticeship funding

From 1 January 2026, the government is changing how level 7 apprenticeships are funded.

The government is refocusing investment towards young people at the start of their working lives, rather than those already in work with higher levels of prior learning and qualifications. 

What’s changing from 1 January

• Level 7 apprenticeships will continue to be government-funded for young people aged 16 to 21, and for care leavers or those with an Education, Health and Care Plan (EHCP) who are under 25 at the start of their apprenticeship in England
• any apprentice who started a level 7 apprenticeship before 1 January 2026 will continue to be funded through to completion

More information can be found at Changes to funding for level 7 apprenticeships on GOV.UK.