A level playing field for Social Enterprises – I don’t think so!

Double Standards in FE funding

I keep hearing lots of rhetoric from the government about creating a level playing field for social enterprises - and that gives me a nice warm feeling after having experienced years of trying to compete with public organisations that have benefited from massive investment in their infrastructure, staffing and training for decades, all from the public purse.

Take the training and development world for example.

Colleges and universities have huge sites, paid for and maintained by the government. They have all the resources in place to be first class learning institutions, relatively easy access to funding to support their work and are staffed in a manner that allows them to take advantage of any external funding available through Europe and the like.

Contrast this with the situation a third sector deliverer of learning finds itself in;

A social enterprise (and I have to admit I’m involved in one of these) offering the same services, but offering tailored content to the sort of people who, for a variety of reasons - including disadvantage, poor previous experience of the educational system or just plain fear of big institutions – are expected to start from scratch and develop all of the things that the large institutions have with no resource to do it with.

Add to that the levels of red tape that expect small providers to be able to maintain the same record keeping, tracking systems and general administration as a large college but without resources to do so with learners that can be transitory and who don't respond to surveys and the like, and the playing field feels far from level.

Social enterprises tend to be funded just to deliver the learning which pays for frontline staff but how then are they supposed to fund the administration, higher management and building costs?

Now I know that times are getting tougher for FE colleges etc. and some are struggling and I sympathise with staff suffering as a result of cutbacks and changes, however stories like the one below tend to erode that somewhat!

Hundreds of colleges and training providers have between them failed to deliver £73 million of allocated funding, exclusive FE Week analysis has revealed.

Education and Skills Funding Agency figures show that 441 providers delivered less provision over 2016/17 than the money they were allocated from the adult education budget would have allowed.

This will be a source of major frustration for huge swathes of the sector, especially considering the heavy criticism directed recently at the government for wider underfunding of FE.

Our analysis compared figures showing the ESFA’s final 2016/17 funding year values with the most recent allocations from June 2017.

We found a whopping shortfall of £73,050,404 between what providers were allocated compared with what they actually delivered.

Of the 441 providers affected, 11 underspent by more than £1,000,000.

This was on top of the £5,059,522 that was paid to 86 colleges and local authority providers for courses that didn’t take place, thanks to a three-per-cent tolerance rule on grant-funded AEB under-delivery.

A spokesperson for the University of the Arts, London said that “like many providers” it was affected “by changes in government funding arrangements, from funded adult learning to FE loans for 19+ students”.

UAL was one of the worst culprits, delivering just £83,605-worth of adult education, from an allocation of £1.5 million. Despite this shortfall, its allocation is unchanged for 2017/18.

Capita had the largest shortfall of any provider, with actual delivery almost £2.5 million lower than its £4 million allocation.

A spokesperson said this was due to “a change in customer demand” over the year.

Earlier this year Anne Milton admitted that the “mainstream participation element” of the AEB had been underspent by £63 million over the year.

A change in procurement rules meant that private providers were forced to tender for a slice of just £110 million in AEB funding in 2017/18, while their competitors – most notably colleges and local authorities – did not.