1. Skills Funding Agency In London 01

2. Coalition Approach Investment strategy for truly lifelong learning, nurturing sustainable economic growth & social renewal Based on: – Fairness – Shared responsibility – Greater freedom And in context of Skills for Sustainable Growth strategy

3. Headlines FE resource budget reduced by 25% to 2014-15 Savings through: – Efficiencies – Policy changes – Unit cost reductions – Changes to statutory entitlements – Re-balancing who pays – More freedoms for colleges

4. Skills Strategy sets out key commitments Expand Adult Apprenticeships – Over 200,000 starts per year – 75,000 increase by 2014/15 – Prioritise Level 3 Employers – Financial support to SMEs to co-fund the costs of training up to and including a Level 2 Unemployed – State subsidy for targeted provision for people on active benefits to help them obtain work

5. Skills Strategy sets out key commitments (2) Individuals – Government backed loans to help finance intermediate and higher level qualifications from 2013/14 – Lifelong Learning Accounts for all adults – All Age Careers Service The Funding System – Simplified systems and processes – Greater alignment across pre- and post-19 systems – Remove regulations to free colleges to deliver to their local communities

6. Reform of Funding Who is eligible for funding? From 2011/12: More flexible delivery for unemployed through funding units and full qualifications Greater focus on those on active benefits Consequent narrowing of fee remission category Continued full funding for literacy and numeracy (uplift removed) Changes to ESOL funding Skills for Life uplift (1.2) removed from literacy and ESOL Rates reduce by 4.3% - new and existing learners

7. Reform of Funding What is eligible for funding? From 2011/12: Growth in Adult Apprenticeships Adult Apprenticeships continue to be co-funded; expectation that employer contributions will increase Co-funding at Level 2 for workplace learning outside of Apprenticeships will only be available to SMEs (fewer than 250 employees) Level 3 and above delivery in the workplace (outside of Apprenticeships and current entitlement) will no longer be eligible for funding Adult Safeguarded Learning protected

8. Reform of Funding Further changes for 2012/13 and 2013/14 Make use of the summary on the website Fee Loans

9. Simplification of funding system For 2011/12 Single Adult Skills Budget Minimum Contract Level (£500k) Introduction of Outcome Payments From 2012/13 Simplified rates system Removal of provider factor (except area costs) Simplification of data returns Simplification of learner support / hardship fund Disadvantage uplift incorporated into Learning Support

10. Rationale for the Agency Implement government policy set out in Skills for Sustainable Growth and Investing in Skills for Sustainable Growth. –establish a simpler and more efficient funding and regulatory system –responsive to learners and employers –better use of management information –able to intervene where necessary –promote lifelong learning –sustainable economic growth

11. To fund, promote and manage skills outcomes in response to government targets. To regulate 250 FE colleges & 15 specialist colleges in respect of both adult and young people. To contract with private training providers, third sector and Local Authorities for the provision of adult further education and Apprenticeships. Rationale for the Agency

12. Outcomes focus public funding on outcomes outcomes judged by the needs of economy and society rather than simply funding qualifications accountability for those judgements moves from Whitehall to local communities

13. What does this mean? Stakeholder power…direct relationships with colleges and providers, informing and influencing –College and providers need to respond to local communities and economies –Expect active pursuit of direct engagement with a range of stakeholders (LEPs, Local Authorities, Jobcentre Plus, employers, Sector Skills Councils, learners, Probation Service etc) –Consult on business plans and set out how public money will be used –Publish information on how plans have been delivered

14. What does this mean? (2) More responsibilities for colleges/providers –Transfer of central planning to local planning –Engagement with / responsiveness to stakeholders and customers –Tougher decisions on use of scarce resources/focus on those who need it most.

15. Skills Offer for JCP Customers

16. Background Discrete Programmes for the Unemployed ended 31 st March 2011: Employability Skills Programme, R2R, Six Month Offer, Routes into Work Work Focused Training

17. Going Forward The Priority is to meet skills needs of JCP customers on active benefits pre-Work Programme (primarily those unemployed for up to 12 months, up to 9 months for 18-24 year olds) Skills Investment Strategy encourages providers to meet the needs of JCP customers from their Single Adult Budget.

18. The Offer Small Regional ESF programme from Spring 2011 April 11 – July 11: FE Colleges strongly encouraged to meet needs of JCP customers from their Single Adult Budget within existing funding rules August 2011onwards: freedom, flexibility (unit funding and Job Outcome payment incentive)

19. Our role Ensure successful transition from current to new arrangements Assist JCP understand changes in the skills landscape/brokering discussions with providers Monitoring progress and taking action as required

20. Benefits Improved offer to jobseekers/employers Reduced bureaucracy Lower unemployment/reduced numbers progressing to the Work Programme

21. Related Developments Unit funding Service academies Skills Conditionality JCP structure and remit Work programme

22. Key Messages JCP Customers on active benefits are a priority group. (full fee remission) Delivery ideally to be roll on roll off, short sharp inventions Training should be tailored towards known or potential vacancies in local area focused on learners entering sustainable employment Regular communication with local JCP essential