Education and Skills Funding Agency
ESFA to require reduction in subcontracted activity and introduce a new subcontracting standard, following sector consultation
New subcontracting standard to tackle poor oversight and fraud.
ESFA, as part of new measures, will implement a subcontracting standard and reduce, significantly, the volume of subcontracted activity in the sector.
We will also apply a cap on the volume of subcontracting and will take forward work this academic year to establish the right threshold for that cap and timescales for a staged reduction. All providers’ Corporations and Boards who choose to subcontract will have to publish a curriculum rationale for their limited subcontracted activity.
The new measures are being introduced gradually, following a sector wide ESFA consultation launched earlier this year, to improve the management and oversight of the limited, but necessary, future subcontracting arrangements entered into.
Before the consultation launched, ESFA’s chief executive, Eileen Milner wrote to the sector highlighting concerns about the continued rise in cases of fraud linked to subcontracting arrangements managed by ESFA lead providers despite ESFA’s tightening of subcontractor arrangements.
The consultation received over 400 responses, with a large proportion from independent training providers. The majority of proposals were supported, including the requirement for a clear curriculum rationale; control of the volume and value of provision delivered by subcontractors; simplifying third party arrangements with specialist providers such as sport; rationalising funding rules; requiring the publication of fees and charges across all funding streams; and the introduction of an externally validated standard.
Eileen Milner yesterday said:
I have been clear that the current arrangements in place for subcontracting were not going far enough from an agency, accounting officer and sector perspective.
We must all be satisfied that public money is being managed properly.
The changes ESFA is introducing will strengthen oversight by lead providers and give confidence that the limited subcontracting that is necessary in the future evidentially and defensibly meets the needs of specific learners or employer, is of good quality and is managed responsibly by the lead provider.
We will work with the sector to test and implement these changes gradually to ensure that the outcome for learners is central.
ESFA will develop the new subcontracting standard through 2020/21, will trial it in 2021/22 and fully implement, once externally validated by audit firms, in 2022/23.
Other areas that will change include:
- placing restrictions and limits on types of subcontracting that have been identified as higher risk
- acting on the use of brokers to ‘sell on’ provision to subcontractors
- improving, across ESFA, the use of the data and audit returns to identify and act on risks
Although the implementation of these reforms will begin in time for the next academic year, the changes will be brought in over the next three years, to allow for a period of adjustment.
The changes will also need to align to plans for the reform of further education and adapt as necessary.
We will be setting out the detail of these reforms later this year.
You can read the full consultation response on GOV.UK.
Latest News from
Education and Skills Funding Agency
Latest ESFA senior staff moves, December 202009/12/2020 10:38:00
An update from Eileen Milner, ESFA chief executive, on senior staff moves in the agency.
‘Build the Future’ announced as theme for National Apprenticeship Week 202101/12/2020 15:48:00
The theme for the 14th annual National Apprenticeship Week has been announced today – Tuesday 1 December.
How employers are benefitting from sector-based work academies25/11/2020 15:38:00
Examples of how the sector-based work academy programme (SWAP) can support you to create a skilled workforce for your business.
National Apprenticeship Awards 2020 regional winners announced03/11/2020 10:25:00
The National Apprenticeship Awards 2020 regional winners have been announced, with winners from a wide range of industries and occupations.
Top 100 Apprenticeship Employers announced22/10/2020 13:48:00
The Top 100 Apprenticeship Employers 2020 were yesterday revealed, with the British Army securing the number one slot as the best apprenticeship employer in the country.
National Apprenticeship Week 2021 date announced21/09/2020 15:48:00
National Apprenticeship Week 2021 aims to shine a light on the amazing work being done by employers and apprentices across the country.
National Apprenticeship Awards 2020 open for entries02/09/2020 09:10:00
Calling all apprentices, employers, and individuals who champion apprenticeships - as the National Apprenticeship Awards 2020 are now open for entries.
ESFA procurement opportunity launching soon for providers to access additional funding to deliver 19 to 24 AEB funded traineeships29/07/2020 13:10:00
ESFA are planning a procurement opportunity so providers can access funding to deliver 19 to 24 adult education budget (AEB) funded traineeships.