1. Train to Gain planning and funding: what went wrong and how to fix it
Nick Linford
NTRL Autumn Conference Monday 26 October (my birthday!)
ER Funding - 17/09/09

2. TtG funding history
National roll-out from Aug 2007, and by August 2008 £100m under-spend went to HE
FE Focus 08/08/08 and 29/08/08
TtG ‘flexibilities’ introduced from Aug ’08 and in less than a year demand outstripped supply
FE Focus 03/07/09 and 04/09/09

3. TtG funding pressures
The flexibilities 1
Payment profile 2
More providers 3
“it is unlikely that there will be sufficient funding to meet the high level of demand from employers and learners for new starts, particularly in the August-March period of the 2009/10 academic year”
Source: Geoff Russell’s LSC letter to providers (11/06/09)

4. 1st Pressure: flexibilities
For 2008/09 ‘flexibilities’ were introduced to stimulate both demand and supply. These included:
> Skills for Life at Entry Level
> Non-first full level 2s fully-funded (free)
> Level 3 (incl ‘first’ fully-funded)
> Selection of thin and unitised QCF quals
The policy worked too perhaps too well!
and 3% TtG premium has already been scrapped

5. Example for 1 NVQ in Construction
2nd pressure: profile
Achievements, new profile and higher rates
Example for 1 NVQ in Construction
Consequences
Monthly instalments
Instalments quickly ramp up
Funding for achievement is now starting to be claimed in big numbers
Big ‘carry-in’ funding commitments
£100
£200
£300
£400
£500 £0
Jan
Feb
Mar
Apr
May
Jun
Jul
09/10
08/09
07/08
Also
Cumulative instalments
Qualification rates simplified for 09/10, which will be expensive for LSC £0
£400
£800
£1,200
£1,600
£2,000
Jan
Feb
Mar
Apr
May
Jun
Jul
09/10
08/09
07/08
LSC and providers really struggle to forecast monthly instalment profile

6. 2nd pressure: profile
£925m TtG budget in Grant Letter (more than last financial year but less than last academic year)
Financial year Grant Letter (government budgets)
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Jan
Feb
Mar
Aug
Sep
Oct
Nov
Dec
Jan
Feb
Mar
Apr
May
Jun
Jul
Academic year provider contracts (MCVs)
About half of financial year spent on last four months of 08/09 academic year. The eight months (67%) left of financial year only covers 47% of 09/10 academic year commitments

7. 3rd pressure: more providers
Number of 19+ ER contracts (TtG and Apprenticeship)
2035
1212
920
2006/07
2007/08
2008/09
Nearly all the additional contracts have been for new providers of TtG
Source: LSC provider Allocations Spreadsheet (Feb 2009)

8. Solution p1: prioritisation
> Stop funding year-olds who should be apprentices
> Stop funding Level 3 in many, if not most cases
> Stop funding Level 2 repeats in the same sector
> Co-fund Level 2 repeats if new to the sector
> Continue to fully-fund first full Level 2
> Review numeracy and literacy/language rates
> Marginal funding rate for large employers
Return Train to Gain to its original model of a broad training offer, to suit a range of employer needs (including real fee contributions and full-cost)

9. Solution p2: payment profile
> Simpler and better understood instalment plans
> Trusted and well organised contract management
> Long-term plan to move to financial year contracts
Need to do everything to avoid

10. Solution p3: No. of contracts
Train to Gain contracts
1200
1000
53%
50%
800
47%
43%
Contracts
38%
600
35%
30%
400
25%
200
18%
10%
£20k
£40k
£60k
£80k
£100k
£120k
£140k
£160k
£180k
£200k
Contract size less than
What if the SFA only gave £200k+ contacts?
Source: LSC provider Allocations Spreadsheet (Feb 2009)

11. TtG future is uncertain
> Providers waiting for confirmed 09/10 contracts (MCVs)
> Lack of funding and cash-flow issues mean many likely to go out of business
> Government will scrap some flexibilities (claw-back 3% uplift and remove fully-funded non-first L2)
> Uncertain impact of QCF and interim ‘fullness’ definitions
> NAO report said poor value for money (21/07/09)
> Conservatives say they would scrap TtG
> Skills Funding Agency (SFA) will take it over from LSC from April 2010

12. The pre-employment market
For many providers TtG presented an opportunity to offer a package of support to SME and large employers
The biggest opportunity is for those that can act as both recruitment, induction and training agencies
New pre-employment programmes:
> Employability and Skills Programme (LSC)
> Response to Redundancy (LSC)
> Six Month Offer (LSC)
> Flexible New Deal (DWP)

13. Other stuff… The hands-on guide to post-16 funding
> 2009/10 edition with new chapters (160 pages)
> Find out more at
> Now working in partnership with The Data Service
on The hands-on guide to post-16 performance and data
> Find out more at
Funding masterclasses and free resources
> Training events around the country
> Sign-up online for access to a variety of free resources
> Find out more at

14. Any questions?
These slides will be sent to you and are a free resource on