Championing Young People’s Learning Allocations 2011/12 January 2011 Championing Young People’s Learning

Allocations 2011/12 Timeline December – February  The YPLA uses data alongside information provided by local authorities to calculate provisional provider allocations.  The first step will be an allocation of learner numbers and the final funding rate will be set later in the process.  The YPLA exchanges information with providers, where required, to refine allocations. Local authorities receive information on provisional allocations to providers. March  The YPLA confirms the final funding rate and final allocations to providers. May – August  The YPLA issues funding agreements/contracts to organisations either directly or through the lead contact, which are required to be signed and returned by the funded organisation. August  Payment commences for the academic year through the lead contact organisation where applicable.

Championing Young People’s Learning Allocations 2011/12 Overview Lagged learner number basis for funding for vast majority of provision – but not ‘lagged funding’ Policy to be confirmed on exceptions/gaps All calculations (SLN, factors, rates) will take into account final decisions on savings

Championing Young People’s Learning Worked Example Lagged Learner Numbers Data returnedLagged Learner Numbers A – FE College B – Private provider 1500 x C – School sixth form400 LR01 return – December 2010 School census – November 2010 F05:F01 ratio – 2009/10 F05 return 09/10 and LR02 return Feb 11: In learning for last 12 months (Feb 10-Jan 11)

Championing Young People’s Learning Learner Numbers 2011/12 Exceptions Infrastructure Changes New/closing/mergers/guaranteed commitments Re-distribution on quality grounds MLP, Inspection, Finance, breach of contract Re-distribution by agreement By LAs/Providers - remedial action – collaboration etc

Championing Young People’s Learning Learner Numbers 2011/12 Exceptions (2) New provision (sixth forms/SFCs) – agreeing numbers to be funded:  Year 1 – starting point one-third of long-term capacity - exceptions to be moderated  Year 2 – double lagged numbers in year 1  Year 3 – fully lagged Any other situation – only if there is an existing formal written commitment, negotiated up to that level

Championing Young People’s Learning SLN/Learner Ratio Update SLN/learner ratio to use 2009/10 outturn data Update to reflect reduction in entitlement Manage range of ratios by reducing top 20% halfway to 80 th percentile to part fund increases to 2009/10 levels One-off change to reflect start of CSR period - no guarantee that the ratio will be uprated each year

Championing Young People’s Learning Worked Example Volume of Provision Learner Numbers SLN/learner ratio SLN to be funded A – FE College B – Private provider C – School sixth form Based on 2009/10 actual data with policy changes and cap applied

Championing Young People’s Learning Provider Factor 2011/12 Overview Latest whole-year data used – 2009/10 ILR and schools census Will take into account the reduction in entitlement funding – so using 2011/12 rates Main areas to be aware of:  Programme weighting – impact of policy changes  Disadvantage factor – update to IMD 2007  Success factor

Championing Young People’s Learning Provider Factor 2011/12 Disadvantage Factor For 2010/11 and earlier years used Index of Multiple Deprivation from 2004 (IMD 2004) Updated to IMD 2007 for 2011/12 allocations General principle to use most up to date data – but also keep track of developments in pre-16 schools funding and 19+ funding Impact of changes likely to be offset by impact of policy changes (additional funding for disadvantage)

Championing Young People’s Learning Disadvantage Factor 2011/12 Impact of changes 10 LAs with biggest decrease10 LAs with biggest increase ManchesterBlackburn with Darwen GatesheadGreenwich TraffordTorbay North TynesideBlackpool SunderlandNewham Newcastle upon TyneBarking and Dagenham KnowsleyWaltham Forest NottinghamBexley HartlepoolRedbridge LiverpoolLeicester Range of changes (maximum impact 2%, vast majority less than 1%)

Championing Young People’s Learning Disadvantage Factor 2011/12 Impact of Changes LAs with highest disadvantage factors:

Championing Young People’s Learning Provider Factor 2011/12 Success Factor The only element of the provider factor based on 2008/09 rather than 2009/10 data FE - stable methodology - main issues likely to be next year when we will be using 2009/10 data (earlier close) Schools data is based on DfE matching process – hence recent detailed checking exercise with schools.

Championing Young People’s Learning Worked Example Provider Factor SLN to be funded Provider factor SLN weighted by provider factor A – FE College B – Private provider C – School sixth form F05 from 2009/10, except success factor (2008/09) Summer census from 2009/10, except success factor (2008/09)

Championing Young People’s Learning National Rate Policy implications for headline figures – subject to agreement Final rate calculated towards the end of the process to balance the budget but strong expectation is that we base this on the current FE rate (£2920)… Current timescale says final figure will be confirmed in February/March – will aim to make this as early as possible as long as we can minimise the resulting risk

Championing Young People’s Learning Worked Example Allocation SLN weighted by provider factor National Rate Allocation A – FE College B – Private provider C – School sixth form £2920 £7,857,720 £2,788,600 £1,699,440 All figures purely illustrative – national rate not yet confirmed

Championing Young People’s Learning Additional Learning Support - Low level (<£5500) Maintain the current split between formula driven and ‘non-formula’ Additional Learning Support (ALS) Use historical spend as the basis for allocating ‘non- formula’ low level ALS in 11/12 Clearer separation between low and high level ALS in preparation for 12/13 Additional funding as a result of overall policy changes

Championing Young People’s Learning Worked Example Additional Learning Support (low cost) SLN unweighted by provider factor Formulaic ALS FE 60% School 100% Historic ALS FE 40% Allocation A – FE College B – Private provider £300,000 £120,000 £200,000 £80,000* £500,000 £200,000 C – School sixth form560£80,000£0£80,000 * Based on formula from 2010/11

Championing Young People’s Learning Sequencing Update to 2009/10 SLN/Learner ratios Reduce ratios in line with reduced entitlement and cap Prevent any increase above 80 th percentile by provider type Reduce ratios for top 20% by provider type 50% to 80 th percentile Update provider factors using 2008/09 success rates, IMD 2007, all other data Calculate allocation using national rate Calculate Transitional Protection Calculate and add in high level ALS

Championing Young People’s Learning Transitional Protection Based on funding/learner Incorporate all change in one phase of protection: Policy changes (programme size, disadvantage/ALS) Changes in delivery (provider factor, ratio) Capping top 20% Convergence of national rates Removal of teachers’ pension funding in schools Calculate funding per learner in 10/11 and unadjusted 11/12 Allow a maximum 3% decrease in funding/learner compared to 10/11 to get final 11/12 allocation

Championing Young People’s Learning Transitional Protection Examples – Stable Numbers 2010/11Funding (£) Funded Learners £/learner College A6,765, Provider B3,937, School C1,824, /12Lagged Learners Indicative Funding (£) £/learnerRaw % change Capped % change Revised Funding (£) Transitional Protection (£) College A16506,467, %-3.0%6,562,050+94,710 Provider B11254,146, %n/a4,146,188n/a School C3801,650, %-3.0%1,769, ,560

Championing Young People’s Learning Transitional Protection Examples – Increasing Numbers 2010/11Funding (£) Funded Learners £/learner College A6,765, Provider B3,937, School C1,824, /12Lagged Learners Indicative Funding (£) £/learnerRaw % change Capped % change Revised Funding (£) Transitional Protection (£) College A18207,133, %-3.0%7,238, ,468 Provider B12404,570, %n/a4,570,020n/a School C4201,824, %-3.0%1,955, ,040

Championing Young People’s Learning Transitional Protection Examples – Decreasing Numbers 2010/11Funding (£) Funded Learners £/learner College A6,765, Provider B3,937, School C1,824, /12Lagged Learners Indicative Funding (£) £/learnerRaw % change Capped % change Revised Funding (£) Transitional Protection (£) College A14805,801, %-3.0%5,885,960+84,952 Provider B10103,722, %n/a3,641,050n/a School C3401,476, %-3.0%1,583, ,080

Championing Young People’s Learning Data Sources (1) Further Education

Championing Young People’s Learning Data Sources (2) School Sixth Forms

Championing Young People’s Learning Lagged Learner Number basis for funding except where superseded by funding agreements No in-year or end-year adjustment if grant-funded and on lagged learner numbers except in exceptional situations Pupil adjustments if the academy is not funded on lagged learner numbers Allocations in Academies

Championing Young People’s Learning In Year and Year End Adjustments to Allocations Grant funded providers must as a condition of funding operate within a regulatory framework which imposes certain restrictions on the use of public funds. Funding is paid on profile and except where emergencies happen is not reconciled. Commercial and charitable providers however are funded under a contract of services and Treasury guidelines require that the YPLA holds them to account for delivery. During 2011/12 contract funded providers will be subject to one in year adjustment should they not be on track to deliver their full year allocation at the mid year point. Reconciliation will then take place at the end of the year and be complete by March 2013.

Championing Young People’s Learning Next Steps Data collated for all colleges, schools and other providers Infrastructure changes and data issues moderated Produce first run of January allocations Review overall and at detailed level Allocations sent out by end of January Outstanding issues resolved during February Final allocations in March…