Policy paper

Skills for jobs: implementing a new further education funding and accountability system consultation response summary

Published 13 July 2023

Applies to England

The formal government response to our Implementing a new FE funding and accountability system consultation is the next milestone in our funding and accountability reforms.

Our milestones

Date	Milestone
January 2021	Published the Skills for Jobs White Paper
July 2021	Launched the Reforms to further education (FE) funding and accountability consultation
July 2022	Published our response to Reforms to further education (FE) funding and accountability and launched Implementing a new FE funding and accountability system consultation
July 2023	Responded to Implementing a new FE funding and accountability system consultation

What we asked

We asked 26 questions, covering 14 topics including:

• funding
• accountability
• equality impact assessment

Who responded

We received 249 responses to the consultation, of which:

• 240 were made online
• 100 were from local authorities (or other local government)

Responses by organisation type

Organisation type	Number of responses
Local authority (or other local government)	100
Learner	49
General further education college	22
Independent training provider	13
Designated institution	10
Mayoral combined authority	9
Representative body	9
Specialist post-16 institution	1
Other	46

Results

We’ve summarised the responses to the consultation. You can read all of the responses in the Implementing a new FE funding and accountability system response.

Respondents liked	So we are
Our overall approach to our reforms and the aim to make Further Education funding and accountability more effective and outcome focused	Introducing the Adult Skills Fund, introducing accountability agreements and setting national skills priorities
Our proposal to increase funding rates for courses in high priority skills	Introducing 5 adult skills funding bands for qualifications that reflect the relative economic benefit of courses as well as their relative cost
Our proposal to encourage innovation by allowing providers to use a proportion of their allocations to develop new innovative provision	Allowing eligible providers to earn up to 3% of the adult skills funding allocation for the development of new innovative provision

Respondents agreed with	So we are
Our proposed approach to multi-year funding - 68% agreed with this proposal	Moving to a multi-year funding approach within each spending review period
A dashboard that holds providers to account for the outcomes they deliver	Measuring and sharing high-level outcomes for FE providers through a performance dashboard

Respondents were concerned about	So we are
The proposed objectives for non-qualification provision and the loss of wider benefits such as improved mental health and well-being	Ensuring the Adult Skills Fund is primarily focused on progression into employment, but it can also support wider outcomes such as social-well-being and improved mental health
That our proposal to allocate a fixed sum to grant funded providers for learner and learning support wouldn’t simplify the system - 85% disagreed or were not sure about this proposal	Maintaining the existing system of funding for disadvantage, learner and learning support
That the reforms were being introduced too quickly without sufficient lead-in time	Updating the implementation timeline of our reforms to give providers sufficient lead in times

Respondents wanted to hear more about	So we are
How our reforms impact areas with devolved responsibilities for adult skills	Clarifying that for all our reforms, authorities with devolution deals will continue to be responsible for both what they fund and how they fund it and can use our reforms as a basis for their funding if they wish. We are also introducing a national model for funding and strengthening accountability for devolved skills funding through new annual skill stocktakes, improved data transparency and a new non-statutory diagnostic review
Which types of providers are in scope for our accountability reforms	Articulating that all statutory FE providers are in scope for our accountability reforms and local authority providers will be in scope for some elements, on a proportionate basis
How we assessed the equality impacts of our reforms	Publishing our Equality Impact Assessment

Timeline of our reforms

Accountability reforms

	Academic year 2022 to 2023	Academic year 2023 to 2024	Academic year 2024 to 2025
Enhanced Ofsted inspections	Implemented	Implemented	Implemented
Single improvement plans	Implemented	Implemented	Implemented
Accountability agreements	Developing	Implemented	Implemented
Performance dashboard	Developing	Implemented	Implemented

Funding reforms

	Academic year 2022 to 2023	Academic year 2023 to 2024	Academic year 2024 to 2025
Innovative provision	Developing	Implemented	Implemented
Funding framework	Consulting	Developing	Implemented
Adult Skills Fund	Consulting	Developing	Implemented
New funding rates	Consulting	Developing	Implemented
Reforming non-qualification provision	Consulting	Developing	Implemented

Next steps

We recognise that we still have further to go to simplify the system, in the next phase of our reforms we will:

• continue to review the Individualised Learner Record to test how we can ease the reporting burden on providers by reducing the number of fields
• simplify enrolments and reduce administrative burdens by introducing a digital wallet for learners, supporting learner identification and enabling data sharing between learners and providers
• reduce administrative burdens on the sector by reviewing opportunities to simplify current financial and non-financial oversight
• use a Single Development Fund to deliver funding for improvement and new investment purposes, rather than multiple separate funds
• develop and consult on a needs-based formula to distribute funding between authorities with devolution deals and ensure public funding is distributed fairly and effectively