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Further Education: Finance

Question for Department for Education

UIN 122779, tabled on 30 November 2020

To ask the Secretary of State for Education, what assessment he has made of the effect on further education college finances of the extra intake of 16 to 18 year old students in academic year 2020-21 and Education and Skills Funding Agency lagged funding methodology which means colleges will not receive additional income for those students until next year.

Answered on

8 December 2020

The 2020/21 academic year has seen a significant boost to levels of funding for 16-19 education. In August 2019, the government announced that it would invest an extra £400 million in 16-19 education in the 2020-21 financial year. This is the largest injection of money in a single year since 2010, and represented an increase of 7% in overall 16-19 funding. In November 2020, an additional £291 million was announced for 16-19 education in the 2021-22 financial year, building on the £400 million made available in 2020-21. The base rate of 16-19 funding has increased by 4.7% this academic year, up from £4,000 to £4,188. Further guidance about 16-19 education funding is available here: https://www.gov.uk/guidance/16-to-19-funding-how-it-works.

The lagged funding methodology allows us to make clear allocations based on data about students and the courses they study. The department recognises that there can be a financial pressure on institutions if they recruit significantly more students in an academic year than allowed for in their allocation. However, the current funding process does provide for exceptional in-year growth funding to be made available to colleges or other educational providers, with significant increases in student numbers over and above the lagged calculation, subject to affordability. The department will consider the affordability of exceptional in-year growth funding for the 2020-21 academic year in light of student recruitment by colleges and other providers.