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The real cost of underspending

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By: Esme Winch

Managing Director

Wednesday 18 October 2017

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We welcome the announcement from the Education and Skills Funding Agency (ESFA) indicating that they have issued letters to providers affected by the ongoing Adult Education Budget tender fallout. They state their new modified run-down extension contract value and the arrangements that will apply for the period 1 November 2017 to 31 July 2018.

It’s our understating that the ESFA will now bring funding up to the value of 75% of last year’s amount. Whilst not the best outcome we could have hoped for, at least it provides some level of market continuation, as well as assurance for learners that their courses will go ahead as planned.

This stopgap measure has been introduced thanks to an underspend of £200million in the Adult Education Budget, brought about because of ESFA restrictions on funded courses and learners. Although it’s worrying that this much of the Adult Education Budget was lying fallow, it’s encouraging that the ESFA have used this money to fix the problem created by their procurement process.

What’s clear however, is that this could have been avoided. We hope that for the next round of procurement for the Adult Education Budget, the ESFA allocates a more realistic proportion of the budget, and works with all providers in the Further Education sector to come up with a stable and enduring offer that will ensure continuity to face the skills challenges of the future.

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