Question to the Department for Education:

To ask the Secretary of State for Education, whether he will provide in-year funding for Further Education college courses that help tackle skills gaps in the economy.

The lagged funding mechanism for 16-19 education provides institutions with clear allocations, allowing them to make plans with confidence. However, from the 2020/21 academic year we have introduced T Levels which are currently funded in-year and have been developed in collaboration with employers and businesses so that the content meets the needs of industry. Further education colleges can also benefit from a High Value Course Premium (HVCP) of £400 per student. The HVCP was introduced in the 2020/21 academic year to encourage and support delivery of courses that are both associated with higher earnings and strategically important. We have announced this premium will increase by 50% to £600 per student in the 2022/23 academic year, to further strengthen the impact of the premium in encouraging and supporting colleges to deliver these key subjects.

In the 2021/22 financial year we made £95 million available for further education providers to deliver the free courses for jobs offer, which gives all adults access to their first level 3 qualifications in sector subject areas with strong wage outcomes and the ability to address key skills needs. It was confirmed at Budget that funding will be available for the next three years, and from April 2022 eligibility for the level 3 free courses for jobs offer will be expanded to also include any adult in England who is unemployed or earns under the national living wage annually, even if they have a level 3 qualification or higher.

We are continuing to invest in education and skills training for adults through the Adult Education Budget (AEB) (£1.34 billion in 2021/22). The principal purpose of the AEB is to engage adults and provide the skills and learning they need to equip them for work, an apprenticeship or further learning.

Currently, approximately 60% of the AEB is devolved to nine Mayoral Combined Authorities and the Mayor of London, acting where appropriate through the Greater London Authority. These authorities are now responsible for the provision of AEB-funded adult education for their residents and allocation of the AEB to providers. The Education and Skills Funding Agency (ESFA) will continue to be responsible for the remaining AEB in non-devolved areas.

ESFA providers’ AEB allocations for financial year 2021/22 have stayed the same as in 2020/21, with adjustments for the impact of devolution and to remove allocations that were for one year only. This was the fairest approach, enabling providers to support local economic recovery in 2021/22.

In-year performance management processes and rules are in place and these are detailed in the Adult education budget (AEB) funding rules 2021 to 2022, found here: https://www.gov.uk/guidance/adult-education-budget-aeb-funding-rules-2021-to-2022.

For the financial year 2021/22, we are also giving providers the opportunity to earn an additional 3% on top of their ESFA AEB allocation for over-delivery to support growth in adult skills participation.