Question to the Department for Education:

To ask Her Majesty's Government what assessment they have made of the financial sustainability of the further education and skills sector.

A recent National Audit Office report on the financial sustainability of colleges in England found that 65% of colleges had good or better financial health in academic year 2018/19, up from 61% in academic year 2013/14. Early analysis by the department suggests our programme of Area Reviews helped bring this improvement about. Over the same period, quality remained high, with 82% of further education (FE) Colleges rated good or better by Ofsted in both 2019 and 2014.

The 2020 Spending Review provided £291 million in financial year 2021/22 to ensure that core FE funding for 16 to 19-year-olds is maintained in real terms per learner. This is in addition to the £400 million that the government provided from September this year, the biggest injection of new money into 16 to 19 education in a single year since 2010.

We continue to monitor the financial health of the FE sector. Financial forecasts for the current year were submitted by colleges in July, and updated cashflow projections were provided in November. We are receiving further submissions throughout the 2020/21 academic year.

Any colleges facing issues with financial sustainability due to the impact of the COVID-19 outbreak can access relevant support.