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The New Funding System 2008/09 Presentation to London CFDG

The New Funding System 2008/09 Presentation to London CFDG. Nick Linford Head of Planning, Funding and Projects 8 November 2007. Presentation Contents. The New Funding System 2008/09. What do we know so far? Summary of changes to the funding system 16-18 model

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The New Funding System 2008/09 Presentation to London CFDG

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  1. The New Funding System 2008/09Presentation to London CFDG Nick Linford Head of Planning, Funding and Projects 8 November 2007

  2. Presentation Contents The New Funding System 2008/09 • What do we know so far? • Summary of changes to the funding system • 16-18 model • Adult learner responsive model • Employer responsive model • The new demand-led funding formula • Modelling the impact at sector level • Modelling the impact at provider level • What’s next and closing remarks

  3. What do we know so far? • Initial aim of LSC in 2004 was to simplify FE funding formula • Three LSC funding formula consultations in as many years • Reform now widened to include FE, Apprentice, E2E, TtG and SSF • Modelling software (DLC) available to all FE providers • Changes to be applied for planning and funding 2008/09 • New models and formula to be published next week? HEALTH WARNING The final changes have yet to be published and are subject to ministerial (DCSF and DIUS) sign-off

  4. School 6th Forms 16-18 model Entry to Employment Adult learner responsive model Further Education Apprenticeships Employer responsive model Train to Gain Summary of changes to the funding system 2007/08 2008/09 * * 16-18 apprenticeships planned and budgeted in 16-18 model (DCSF)

  5. School 6th Forms Entry to Employment 16-18 Further Education 16-18 model 16-18 model • Strategic commissioning (Quality and 14-19 Partnership critical) • Transitional protection and no reconciliation • New demand-led funding formula with historical provider factor • Significant change for schools but likely to have higher rate per SLN • Funding via the LEA rather than the LSC from 2010/11 • New products with new contracting arrangements (Diploma)

  6. Adult learner responsive model 19+ Further Education (excluding employer based NVQs) Adult Learner Responsive • Strategic commissioning (PSA targets and prioritisation are key) • Transitional protection likely to be +/- 2.5% • Mid-year and end-year reconciliation with tolerance and cap • New demand-led funding formula with historical provider factor • Co-funded SLN rates for those paying tuition fee (42.5% in 08/09) • Likely to have a lower rate per SLN than in the 16-18 model • New products being piloted such as FLT and Learner Accounts

  7. Employer responsive model 19+ FE employer based NVQs Apprenticeships (incl. 16-18) Train to Gain (incl. SfL) Employer Responsive • Primarily PSA targets in the form of NVQs and Skills for Life • Monthly payments in arrears on 10th working day of following month • New demand-led funding formula with actual not historical factors • Area Cost Uplift to be based on location of main enrolment • Train to Gain funding to be paid monthly with 25% for achievement • Interesting dynamic with switch in funding from FE (e.g. TtG A) • Co-funded SLN rate for those paying tuition fee (e.g. ESOL)

  8. More complex in reality SLN could be listed or unlistedand has maximum per learner x £/SLN may be subject totransitional protection x PF has up to six elements,based on history (16-18 & adult)or actual (employer model) + ALS allocations will include formula and negotiation element = Total funding has a cap The new demand-led funding formula Simple at first glance Standard Learner Number (SLN) x National Funding Rate (£/SLN) x Provider Factor (PF) + Additional Learning Support (ALS) = Total funding Oh, and three census dates replaced by minimum number of weeks

  9. Modelling the impact at sector level LSC analysis of the impact that the new funding formula will have on General FE colleges in 2008/09 via the 16-18 model: Requires protection Requires protection If transitional protection is +/- 2.5% then 48% of colleges will need protection in 08/09, with 6% still not ‘harmonised’ by 11/12

  10. Modelling the impact at provider level The Demand Led Calculator (DLC) converts an FE 06/07 ILR into SLNs But we don’t yet know: • The National Funding Rates • Approved SLN qualification values • The final Provider Factor (will be based on 06/07 8 Feb ILR F05) • The transitional protection % • And a great number of other technical uncertainties So the DLC builds awareness, but I would suggest wecannot reliably model the impact at present

  11. What’s next and closing remarks • DIUS/DCSF Grant Letter, LSC Annual Statement of Priorities (PfS 3) and descriptions of funding models published next week? • DLC version 3 released to include final SLN values, National Funding Rates and non-FE modelling? • Detailed funding guidance not anticipated until March 2008 • New funding systems operational from August 2008 Clearly a significant change to all LSC funding systems, alongside even greater emphasis on priorities and performance measures (e.g. MLP, FfE and mid-year reconciliation) Soon we will begin completing the SSoA in the PaM system to include SLNs (taking account of 06/07 baselines, allocations and performance in 07/08 and of course 08/09 plans) The SSoA figures will become our targets for 08/09!

  12. Questions and or comments nick.linford@lewisham.ac.uk www.lewisham.ac.uk/pf

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