22 nd January 2010 Barking College

1. Summary of funding changes and the implications for the future Nick Linford Special Adviser on Funding and Performance(formally Director of Planning and Performance at Lewisham College) 22nd January 2010Barking College

2. Old funding stream Old funding stream 16-18 LR (DCSF) 16-18 ER (DCSF) Work-based Learning FE mainstream Adult LR (BIS) 19+ ER (BIS) Funding reform in 2008/09 Last year demand-led funding became a methodology and formula to fund FE mainstream, Apprenticeships, Train to Gain and Entry to Employment New terminology: SLN x NFR x PF (weightings) = Funding New inflexibilities: New learner and employer-responsive funding models

3. Investment Strategies and MoG BIS DCSF YPLA SFA Local authorities Funding colleges and other providers

4. 19+ ER 16-18 LR (FE) 19+ ER 4m 16-18 LR (FE) 16-18 Appren Adult LR Adult LR 16-18 Appren Demand-led funding budgets 2010/11 DCSF BIS Funding Learners £7.5bn

5. + 23.3% Learners DCSF +2.7% + 10.4% BIS -2.1% + 1.1% Total -0.7% - 25.3% Demand-led funding budgets 2010/11 16-18 LR(FE) 16-18Appren Adult LR 19+ ER Funding + 12.2% DCSF +7.5% + 6.6% BIS -6.5% -0.1% Total +2.0% -11.5%

6. The double whammy 16-18 LR & ER Adult LR 19+ ER Not rate increase 3% rate decrease 3% rate decrease (19-24 Appren) 50% fee element In-year adjustments between providers 13% rate decrease (25+ Appren) 14% SfL weighting reduction Challenge expensive colleges/programmes 6% rate decrease (Train to Gain) Massive developmentallearning cuts Roll-out of Functional Skills 50% fee element (incl. non-first Level 2 TtG) 10% allocation cut confirmed as best case scenario 14-19 Qualification Strategy

7. Fundable qualifications

8. 2 leave within first 6 weeks £10k 14 start Weighted average success rate Success Factor = 0.5 + 3 more do not finish £7.5k 79% retention 2 80% for College X 3 finish but do not pass £7.5k 73% achieve = 0.9 0.5 + 2 8 succeed £25k 57% SR 0% for College Y = 0.5 0.5 + 2 Enrolment funding Do staff know the impact of class size, retention and achievement have on learner-responsive (FE) income? Funding allocations are reduced by a success factor Target of 16 recruited at £5k each (£80k income budget) Although based on a historical average, it means 50% lost if a learner does not finish and achieve Budget missed by 31%Next allocation cut by 31%

9. Now it’s your turn Target of 20 recruited at £4k each (£ k income budget) Target of 18 recruited at £6k each (£ k income budget) 80 108 3 leave within first 6 weeks £ k start 6 leave within first 6 weeks £ k start 12 36 17 12 2 more do not finish £ k % retention 2 more do not finish £ k % retention 88 83 4 6 4 finish but do not pass £ k % achieve 1 finishes but do not pass £ k % achieve 73 90 8 3 succeed £ k % SR succeed £ k % SR 11 24 65 9 45 75 Budget missed by % Budget missed by % 30 42

10. A. Flexible New Deal (DWP) E B. Six Month Offer (BIS) D C. Young Person’s Guarantee (BIS) A C D. Response to Redundancy (BIS) E. Employability and Skills Programme (BIS) B Opportunities post-recession Funding 2010-11 £500m New funding pots to train the unemployed

11. I J A G I A J H H G F F E B D B E C C D DCSF funding (14-18) BIS funding (19+) Example college now A. 14-15 year olds (WRL) Government funding Funded learners £34m 15k

12. A A K K J J I B H G F I B C E H G F D C E D Example college next year? Government funding Funded learners A. 14-15 year olds (WRL) £37m 19k DCSF funding (14-18) BIS funding (19+) DWP funding (18+)

13. So both funding cuts as well as opportunities, with a heavy emphasis on efficiency, priorities and performance Any questions?