Equality of Funding: Post-16 Education

Rupa Huq Excerpts

Tuesday 25th February 2020 Westminster Hall

[Lloyd Russell-Moyle]

My hon. Friend is quite right; that is very worrying. A headteacher in my area talks about the difficulty of recruitment into the sector when there are far better options for pay within the wider teaching sector, let alone the idea that teachers of STEM subjects can often get better pay elsewhere. That seems wrong.

With the Budget and a spending review looming, the Government’s short-term priority should be to raise the rate, but the long-term ambition must be to level up funding and undo the mistake of 2011 to ensure that 16 to 18-year-olds receive the same investment in their education as younger students. There is little point in investing heavily in pre-16 education and even more heavily in higher education at £9,000 per student—depending on current moves in the HE review—if the pivotal stage in the middle continues to be overlooked and underfunded.

Sixth-form colleges and general FE colleges also face a number of specific disadvantages that exacerbate the issue. For example, since incorporation, colleges cannot reclaim their VAT costs, but schools and academies can. The Sixth Form Colleges Association estimates that the average sixth-form college has to redirect around £350,000 per year—4% of their income—away from frontline education of students to pay the VAT “learning tax”. What sits behind that and many other funding inequalities is the inexplicable decision to classify colleges as private sector bodies. Even private schools and private sixth-form colleges are not classified in such a way because they are third sector charities

[Dr Rupa Huq (Ealing Central and Acton) (Lab)]

My hon. Friend is making a passionate speech. I would add to his list another disadvantage to colleges. Ealing, Hammersmith and West London College was in massive arrears. The current principal, Karen Redhead, has turned it around towards being back in the black again, but the insolvency regime promises to punish her even further, while other people are being bailed out for not managing things as well as she has. Will my hon. Friend comment on that?

[Lloyd Russell-Moyle]

We need to look at those issues, particularly the way that we manage debts linked to buildings, which has got a lot of colleges into trouble in the past.

For sixth-form colleges in particular, the vast majority of their income comes from the Government, and a private sector classification is simply impossible to justify. A few years ago, the Government allowed a pathway for sixth-form colleges to become academies, but it is not right that the Government require a change of governance in the organisation for it to be classified as part of a particular tax band, rather than working out the best governance for the institution to give the best education, which is what we should focus on.

All colleges suffer when the Government decide to exclude them from initiatives such as early career payments, or funding streams such as the teachers’ pay grant, which was afforded to schools. Their incorporation in 1983 by the then Secretary of State, Keith Joseph, removing them from local authority oversight—a historic mistake that has led to a widening of the gap since the 1990s. Only the equalisation of structures across the board will solve the problem.

Brighton, Hove & Sussex Sixth Form College—or BHASVIC—is one of the sixth-form colleges in my constituency. It has grown by 630 students since 2014, but its income has grown by £1.5 million only, meaning that the student body is up by 21.7% but the income is up by 13% only. The principal of BHASVIC wrote to me saying that

“Whilst the additional income for 2020-21 is welcome, it barely makes up for inflationary cost pressures over the last couple of years”.

BHASVIC will use the money simply to plug the gap, rather than actually investing in IT, teacher development and other things that are needed, particularly for student wellbeing—colleges also face the burden of rising rates of mental health problems.

BHASVIC is one of the lucky few. It has been able to bid and draw from a limited pool of funding for capital works on academies. Unlike school sixth forms, colleges do not hav a dedicated pot of money and must bid against academies for building and maintenance. For general FE colleges, it is even more complicated in that they have to bid with local economic partnerships for funding. The myriad capital funding streams to pay for buildings leads to a lack of joined-up thinking and a postcode lottery of facilities in our education system.

The views of education providers, teachers and principals are unanimous: the funding gap has a devastating impact and is felt widely. When I secured this debate, the House of Commons digital engagement team posted on Facebook asking for feedback from students and staff. Abi, one of the respondents, said that her sixth form cannot even afford basic items such as extension cables for computers, and teachers are having to pay out of their own pockets for printing. That is totally wrong. A Reddit user said that A-level politics was dropped midway through their course because the teacher left and the school could not afford a new specialist in the department. Another student reported that their college has had to shut its canteen, which it cannot afford to maintain, so students now eat at the fast-food joints across the road, blowing out of the water any aspirations for healthy living and eating.

One way colleges have tried to manage those difficulties is through a flurry of mergers into super colleges in an attempt to pool costs or recreate the services that the local education authority provided before 1993, but such mergers often mean a centralising of course provision in just one or two campuses across the network, and lead to teachers and management being further away from the students and communities they serve. I do not want to say anything bad about any individual colleges—many have staff who do fantastic work—but the mergers render the Ofsted regime not fit for purpose. Multi-academy trusts are inspected per campus, but for a multi-campus set of FE colleges, there is only one inspection, so we have no idea of the differences between two campuses offering the same courses and options. That lack of granularity renders the Ofsted inspections almost worthless.