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Funding: All Change

Raymond Clarke, Chief Executive of IQ, takes a look at the upcoming changes to funding rules and considers their wider impact.

Those in the training world that contract for public funding will be familiar with the regular change in funding rules that coincides with the new academic year each August. Over the past few years the rules have been becoming less generous, with the exception of apprenticeship training, and funding for older students and larger companies has all but disappeared.

The changes announced this summer by the Skills Funding Agency in England, where funding for training and qualifications outside of the apprenticeship framework will be directly related to the number of credits in the resulting qualification, are likely to have a significant impact upon provision. Qualifications such as the Level 2 Certificate in Providing Security Services (NVQ) and the Level 2 NVQ Certificate in Team Leading will be reduced by some 35%, whilst the Level 2 NVQ Certificate in Customer Services will increase in value.

Whilst the proposed change is an attempt to link funding to the size of the qualification, it fails to reflect the cost of delivering a qualification. This risks skewing training delivery towards the availability of funding rather than employer and sector need. The impact will be that we will see many qualification programmes disappear as they become less viable to deliver in the absence of employer funding. The worry is that in the absence of consideration of competitiveness issues and the strategic value of programmes, combined with the reliance on a blunt assessment of credit value, the funding system will not focus on strategic and sector priorities.

If the SFA model is to survive, the medium term solution is for Sector Skills Councils and Sector Skills Bodies to review the size and structure of their National Occupational Standards to ensure that strategic and operational priorities are packaged in a way that fits with the new funding methodology. The challenge is that the change in funding methodology requires strong leadership and action from Sector Skills Councils/Bodies at a time when their development funding is being squeezed.

In the short term, providers are advised to check the funding rates for next year and talk to their funding providers to determine whether the transitional relief that is being provided by the SFA will be applied to their contracts moving forward. IQ is able to provide some advice to those affected by the changes and it should be understood, that the apprenticeship programmes have been largely protected in these changes.

Jun 03, 2013 09:41 AM