Education Funding for 18-year-olds

Stephen Timms Excerpts

Tuesday 28th January 2014 Westminster Hall

[Kate Green]

I very much agree with the hon. Gentleman that the impact assessment, which paints a rather puzzling picture, does not appear to support the decision that the Government have taken. It certainly attempts to paint a rosier view than the one that college principals and sixth-form college heads have painted. The Government’s somewhat thin assessment pays no attention to wider issues, such as the implications for bursary funding, and it pre-empts the outcome of the Cabinet Office review of provision for 16 to 25-year-olds.

[Stephen Timms (East Ham) (Lab)]

I am grateful to my hon. Friend for securing a debate on this very important issue. She has talked about what college principals are saying. Let me quote what the principal of Newham sixth-form college has said, describing those affected:

“These are ambitious and aspirational students who have stuck with their commitment to education. They are doing the right thing…How were they to know that the system would decide that they don’t deserve to be funded for 3 years of further education at the same rate as those students who only need 2 years?”

Is not it a very arbitrary and damaging cut that has been introduced?

[Kate Green]

It is indeed a damaging and arbitrary cut. Little attention seems to have been paid to the educational life chances of these students and why they need this additional year of full-time education at age 18.

There are also, it is fair to say, a number of flaws in the methodology used in the Government’s impact assessment. It compares 18-year-old students with all 16 to 18-year-olds, not with 16 and 17-year-olds, which means that the distinct circumstances and backgrounds of 18-year-old students and their particular needs and characteristics are obscured. It fails to do a comparison with students in school sixth forms, and so underplays the disproportionately diverse backgrounds of FE and sixth-form college students. It ignores 18-year-olds studying for between 450 and 539 hours, and it makes no mention of the disparity between the funding for five to 15-year-olds, and the funding for 16 to 18-year-olds, which the Association of Colleges has pointed out already stands at 22%.

Even so, as the hon. Member for Cornwall—I forget the exact constituency—[Interruption.] It is not all of Cornwall. As the hon. Member for St Austell and Newquay (Stephen Gilbert) pointed out, the impact assessment does acknowledge that there is a disproportionate impact on disadvantaged students. A disproportionate number of black and ethnic minority students are affected. It also recognises that the majority of students affected are undertaking vocational courses of study.

The impact assessment recognises that five out of six students affected are in FE colleges. That means in practice that the effect of the policy overall is a 5% funding cut for FE colleges, compared with a 1% cut for schools. It is likely that, in colleges, the effect will be felt not just by 18-year-old students, but by all 16 to 18-year-old students, because they are often taught together as a single group.

The impact on colleges is compounded by the lagging in their funding, which was highlighted when the Secretary of State appeared before the Select Committee on Education on 18 December 2013. That lag means that the effect of the introduction of a cut in August 2014 is that the funding received for students who have already started two-year courses will be at a rate lower than had been anticipated and budgeted for in their second year. That means that colleges are having to rethink fundamentally their budgets and business plans for next year, and their future admissions policies. I was encouraged by the fact that the Secretary of State recognised that point when it was raised with him at the meeting of the Select Committee and agreed to give it further consideration, including the possibility of delaying the cut until September 2015. I very much hope that this Minister will be able to update us today on what further thought has been given to that.

In conclusion, there are real concerns about the impact of the cut both on institutions, especially further education colleges and sixth-form colleges, and on the students they teach. The policy appears to run counter to all the Government’s ambitions to increase social mobility, to invest in vocational education, to increase the employability of young people at risk of becoming NEET, and to level the funding playing field for colleges and schools.

Of course everyone understands the scale of the challenge, given the financial settlement in the spending review 2015-16, but as has been pointed out, other spending choices could have been made. As the Chair of the Select Committee, the hon. Member for Beverley and Holderness (Mr Stuart), pointed out on 18 December, colleges are losing out, while free schools and academies are being funded for what he graphically described as “phantom students”, often in areas where there is already plenty of provision.

The Sixth Form Colleges Association points out that nine free schools for 16 to 19-year-olds established since 2011 will educate just 1,557 students when they have recruited fully in line with their plans—if they manage to do so—compared with an average of 1,687 students per single sixth-form college, so the investment in free schools certainly does not look like an efficient use of funds at a time when spending for this age group is under such pressure.

Against that background, the choice to cut funding for vocational training, and to cut funding that is more likely to reach students from less advantaged backgrounds—the very group that the system has repeatedly failed—seems at best ill informed and at worst simply perverse. That approach is likely to have a far-reaching impact on the life chances and prospects of the very group of young people for whom we should want to do most. I very much hope that Ministers will take a step back for further reflection and rethink their approach, given the widespread concerns, and I very much look forward to the Minister’s response to those concerns.