Question to the Department for Education:

To ask the Secretary of State for Education, what recent assessment he has made of the impact of energy costs on further education college budgets.

The department knows that one of the biggest challenges facing some colleges is the rising cost of energy. The potential impacts of the rising cost of energy on educational providers is being kept under review by the department.

Further education (FE) colleges are autonomous institutions responsible for their own financial sustainability.

The Department for Business, Energy and Industrial Strategy has outlined the range of support on energy cost increases that will be available for businesses, the public sector and households. As part of that, the Energy Bill Relief Scheme will provide a price reduction to ensure that all businesses and other non-domestic customers, including colleges, are protected from high energy bills this winter. Discounts will be applied to energy usage initially between 1 October 2022 and 31 March 2023.

Schools and colleges in England will also be allocated a share of £500 million in capital funding in the 2022/23 financial year. This comprises £447 million for schools and sixth form colleges and £53 million for FE colleges to spend on energy efficiency upgrades.

These upgrades will not only help schools and colleges save money, but they will also make schools and colleges more energy efficient during the cold period and increase winter resilience for future years. A FE college group will receive £290,000 on average from that additional funding. Allocations were published on 6 December 2022 to help colleges plan and payments are expected to be made in January 2023.

The department assesses and reviews colleges’ financial health on a regular basis and uses this information to determine where support and intervention from the department, Education Skills Funding Agency and FE Commissioner can help colleges to improve their position. More information is available here: https://www.gov.uk/government/publications/college-oversight-support-and-intervention.