Guidance

16 to 19 special post-16 institution (SPI) revenue funding allocation guide: 2021 to 2022

Updated 18 March 2021

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Applies to England

© Crown copyright 2021

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This publication is available at https://www.gov.uk/government/publications/16-to-19-funding-allocations-supporting-documents-for-2021-to-2022/16-to-19-special-post-16-institution-spi-revenue-funding-allocation-guide-2021-to-2022

1. Introduction

This guide helps you understand how we have calculated your 16 to 19 revenue funding allocation for the 2021 to 2022 academic year.

2. Who this note is for

This guide is for special post-16 institutions (SPIs).

In relation to delivery for 2020 to 2021, you should also refer to the separate guides and the 16 to 19 funding guidance for 2020 to 2021. Further information regarding the high needs funding system is available in the publication High needs funding arrangements: 2021 to 2022.

The ‘Changes for 2021 to 2022’ section shows the changes in academic year 2021 to 2022 at a glance and where the changes are reflected in your allocation statement.

3. Further advice and guidance

We have produced this guide to walk you through your allocation statement. It is important that you also refer to our 16 to 19 funding guidance for 2021 to 2022. The guides will help you to understand how we have calculated your funding allocation for 2021 to 2022. We publish these guides on GOV.UK before the start of the academic year.

You should read this note alongside our detailed guidance on:

4. If there is an error in your data

The figures in the statement are your final funding allocation which, under normal circumstances, will not be changed.

We reserve the right to reduce or withdraw your allocation at any stage should issues arise through audit or other processes which:

  • significantly affect the data underlying your allocation calculation
  • significantly affect contract compliance, or
  • leads us to believe that by making an allocation we will be putting public funds at risk

By exception, we will consider evidenced and credible business cases from institutions where there has been a significant error in the data returned by the institution.

Please be aware that once you have submitted your 2020 to 2021 R14 data in October 2021, we will use this to check the accuracy of the R06 data, which was used to calculate your allocated student numbers. If, using the R14 data, we determine that your R06 data was materially inaccurate, you should expect to have your allocation reduced in-year. These checks and potential reductions will apply to both elements 1 and 2.

In addition, we will use your academic year 2020 to 2021 individualised learner record (ILR) R06 return to calculate local authority import/export adjustments for the financial year 2021 to 2022. Local authorities will have the opportunity to review the number of high needs students you have recorded in your data and, if we determine that your R06 data was materially inaccurate because of an enquiry raised by a local authority, you should expect to have your element 2 allocation for high needs students reduced in-year.

Please note that, for funding purposes, the definition of a high needs student is one where the institution is receiving top-up funding from a local authority because the authority has agreed that the student’s additional support costs are in excess of £6,000.

5. Enquiries

If you have any questions that we do not cover in this or other published guidance, please contact us using our online enquiry form.

6. Changes for 2021 to 2022

Offset high value courses for school and college leavers in-year programme funding for 2020 to 2021

The amount is shown in the summary table of your statement.

Teachers’ pension scheme payments

7. Special post-16 institution funding allocation

SPIs who will be delivering their first year of ESFA funded provision are currently completing the ESFA high needs due diligence process and, where successful, we expect to issue allocations to them by the end of June 2021. For these SPIs, we will allocate programme funding (element 1) and high needs funding (element 2) using the place numbers returned to us by local authorities through the 2021 to 2022 high needs place change notification process.

For SPIs who will be delivering at least their second year of ESFA funded provision, we will allocate programme funding (element 1) and high needs funding (element 2) using counts of valid students from 2020 to 2021 ILR R06 data returns. We will use a reference date of 1 February 2021.

For 2021 to 2022, we will continue to use the 16 to 19 national funding formula to calculate programme funding (element 1) for SPIs.

For all SPIs, the total high needs place number allocation (element 2) is described in table 5 of the funding statement.

Where student numbers exceed allocated places

  • most other further education (FE) institutions and independent learning providers (ILP) have a single ‘provider local authority’ responsible for returning to ESFA, the number of element 2 places required for all the institution’s high needs students in the following academic year
  • in the case of SPIs, however, ESFA is responsible for determining the allocations of both element 1 and element 2, and does so based on the prior year’s ILR data
  • element 2 funding is initially included within local authorities’ overall high needs allocations. The national funding formula that calculates local authorities’ allocations includes adjustments, also based on ILR data, that remove from their final dedicated schools grant allocations the element 2 £6,000 per high needs place
  • this means that ESFA is acting like the ‘provider local authority’ and is responsible for considering the need for further funding where the actual number of high needs students exceeds the high needs places that have been funded; although, in normal circumstances, the lagged funding methodology will fund SPIs for any additional students in the following year
  • where local authorities place, in SPIs, significantly more students compared to their allocated places, the ESFA may, exceptionally, increase allocations in-year. In these circumstances, we will review the student numbers recorded in in-year ILR data returns. As this is a data driven exercise, it is not necessary for SPIs to submit a business case
  • we will also consider under-delivery at the institution in the previous year and the national picture of placements. We will base any additional funding on a standard threshold determined by affordability. It is possible that we will calculate additional funding using marginal rates. We may also require additional eligibility or audit checks before allocating any additional funding. Institutions receiving exceptional in-year funding will be notified by April 2022

Programme funding formula

This section shows the various elements of the funding formula that apply to SPI funding allocations shown on page 1 of your allocation statement and the resulting funding from the application of each. The dates on your allocation statement will show as ‘2021/22’. We have written the dates in full in this guidance for clarity.

Retention factor

  • this remains 0.983. This was the average factor used in calculating 2020 to 2021 allocations for SPIs

Programme cost weighing

  • this remains 1.054. This was the average factor used in calculating 2020 to 2021 allocations for SPIs

Level 3 programme maths and English payment

  • as set out in the level 3 programme maths and English payment section

Disadvantage funding – block

  • this remains 3.80%. This was the average factor used in calculating 2020 to 2021 allocations for SPIs

Disadvantage funding – block 2

  • a default value of 2 instances per student has been used for all SPIs, which attract the £480 funding rate

Large programme funding

  • not applicable to SPIs

Area cost allowance

  • some areas of the country are more expensive to teach in than others and the area cost weights the allocation to reflect this. Area cost is calculated either from the head office location of the institution or from the delivery location of the learning in that institution, depending on the geographical spread of provision.

The values on your statement are rounded to various numbers of decimal places. However, we calculate your funding using un-rounded values. This may result in some slight differences when you work through the calculation yourselves.

8. Student numbers

This section explains how we have calculated the student numbers in your 16 to 19 revenue funding allocation statement. Student numbers include students aged 19 to 24 with education, health and care plans.

2020 to 2021 ILR R06 students

  • student numbers taken from the 2020 to 2021 ILR R06 data return, with a reference date of 1 February 2021

Exceptional variations to lagged student number

  • an increase or decrease applied to the lagged student numbers. This is where we’ve agreed an exceptional case

Total student numbers for 2021 to 2022

  • ‘2020 to 2021 ILR R06 students’ + ‘exceptional variations to lagged student number’

Student number methodology used

  • the data source used to calculate student numbers. For all SPIs this is the 2020 to 2021 ILR R06 return

9. Student number methodology

Our funding rates and formula guidance has full details of how we calculate student numbers for different types of institutions. Our default approach is to base allocations on lagged numbers. The lagged approach applies when there is a reasonably consistent level of delivery over time and applies in most but not all circumstances.

Exceptions to the lagged approach include student numbers for new institutions, closing provision, transferred provision (including in relation to subcontracting), exceptional in-year growth, and in-year closures. In these situations we may remove an institution from the lagged approach at any point, which may result in a change to their funding allocation.

10. Breakdown of funding by band

This section explains how we calculate funding bands in your 16 to 19 revenue funding allocation statement. You can find further information about national funding rates in the funding rates and formula guidance.

Student numbers 2019 to 2020

  • the student numbers for each funding band, as recorded in your 2019 to 2020 ILR R14 data return

Proportions used in 2021 to 2022 allocation

  • band 5 students are students with annual timetabled hours of 540 and over. All students in SPIs are funded at the band 5 rate

Number of students allocated in 2021 to 2022

  • the percentage proportion for band 5 applied to the ‘total student numbers for 2021 to 2022’ shown in the ‘student numbers’ table

National funding rate

  • the base amount of funding for each student in the band

Student funding

  • the total student funding for each band
  • Band 5 ‘Number of Students allocated in 2021 to 2022’ × ‘national funding rate’

Total student funding

  • the total student funding for all bands

11. Level 3 programme maths and English payment

This section explains how we have calculated the level 3 programme maths and English payment in the 16 to 19 revenue funding allocation statement for the small number of SPIs that receive this funding. We give extra funding to providers to deliver maths and English to students doing substantial level 3 study programmes and T Levels.

Instances per student

  • the number of instances where a student does not hold a GCSE grade 4 or C (or above) in GCSE maths or English as their highest prior attainment and are on a 1 year or 2 year substantial level 3 study programme taken from the 2019 to 2020 ILR R14 data return

Number of instances

  • instances per student’ × ‘total student numbers for 2021 to 2022’ in ‘student numbers’ table

Rate

  • the rate of funding per student for a 1 year programme and a 2 year programme

Funding

  • ‘number of instances’ × ‘rate’

12. Distribution of disadvantage funding

This section explains how we have calculated the disadvantage block 1 and block 2 funding in the 16 to 19 revenue funding allocation statement. For more information on disadvantage funding please refer to the funding rates and formula guide.

12.1 Disadvantage block 1

Economic deprivation funding

  • the block 1 average factor of 3.80% is applied to the programme funding total, up to and including the level 3 programme maths and English payment

Care leavers

  • the number of successful 16 to 19 bursary fund claims for 2019 to 2020 for vulnerable students who were ‘in care’ or ‘care leavers’, at a rate of £480 per student

Total block 1 funding

  • ‘Block 1 Funding’ + ‘Care Leaver Funding’

12.2 Disadvantage block 2

Total 2021 to 2022 instances attracting funding per student

  • for SPIs the instances per student value is defaulted to 2

Total funded instances for 2021 to 2022

  • ‘Instances per student applied in 2021 to 2022’ × ‘total student numbers for 2021 to 2022’ in ‘student numbers’ table

Total funded instances, funded instances attracting the full time/part time/full time equivalent (FTE) rate

  • ‘Total funded instances for 2021 to 2022’ split between the full time and part time bands according to the proportions in breakdown of funding by bands’ table. In SPIs, all students attract the higher rate

  • ‘Number of funded instances in each band’ (higher rate) × ‘block 2 funding rate’

Total block 2 funding

  • the sum of block 2 funding

  • ‘Students attracting the Higher Rate’ + ‘Students attracting the Lower Rate’ + ‘Students attracting the FTEs Rate’

Minimum top up if applicable

  • if the total disadvantage funding (‘total block 1 funding’ + ‘total block 2 funding’) for an institution is less than £6,000, disadvantage funding is topped up to £6,000

Total disadvantage funding

  • the sum of Disadvantage Funding

  • ‘Total Block 1 Funding’ + ‘Total Block 2 funding’ + ‘Minimum top up’ 

13. Large programme uplift

No SPI will receive the large programme uplift in the 2021 to 2022 academic year.

Maths and English condition of funding (CoF)

This section explains how we have calculated the maths and English condition of funding (CoF) adjustment in the 16 to 19 revenue funding allocation statement. For more information, please see the condition of funding interactive tool and 16 to 19 maths and English condition of funding guidance.

National funding rate in 2019 to 2020

  • the 2019 to 2020 national funding rates are used to calculate the CoF adjustment

Total students (2019 to 2020 R14)

  • the total number of students in 2019 to 2020, as recorded in your 2019 to 2020 ILR R14 data return, split by funding bands 1 to 5. Student numbers in this table exclude age 19+ continuing students and may differ from the student numbers shown in the ‘breakdown of funding by band’ table

National funding rate applied to total students (2019 to 2020 R14)

  • the student funding associated with the total number of students

  • ‘total students (2019 to 2020 R14)’ (FTEs for band 1) × ‘national funding rate in 2019 to 2020’

Students not meeting CoF (2019 to 2020 R14)

  • the number of students not meeting the CoF in 2019 to 2020, as recorded in your 2019 to 2020 ILR R14 data return, split by each funding band. You can identify these students in your allocation calculation toolkit (ACT)

National funding rate applied to CoF non-compliant students

  • the student funding associated with the students not meeting the CoF

  • ‘students not meeting the CoF (2019 to 2020 R14)’ (FTEs for band 1) × ‘national funding rate in 2019 to 2020’

Total

  • shows the sum of bands 1 to 5 for ‘total students (2019 to 2020 R14)’, ‘national funding rate applied to total students (2019 to 2020 R14)’, students not meeting CoF (2019 to 2020 R14) and ‘national funding rate applied to CoF non-compliant students’

5% of national rate funding for total 2019 to 2020 R14 students

  • the 5% tolerance before any adjustment is applied
  • 5% of total ‘national funding rate applied to total students (2019 to 2020 R14)’

Funding for non-compliant students less 5% of funding

  • the resulting adjustment following the 5% tolerance

  • Total ‘national funding rate applied to CoF non-compliant students’ - ‘5% of national rate funding for total 2019 to 2020 R14 students’

Final CoF adjustment (at 50%)

  • in order to mitigate the effect of the CoF adjustments, the final adjustment is at 50%

  • 50% of ‘funding for non-compliant students less 5% of funding’

14. Advanced maths premium funding

This section explains how we calculate the advanced maths premium in the 16 to 19 revenue funding allocation statement. We give institutions additional funding to increase the number of students studying for certain advanced maths qualifications. The funding will help institutions remove barriers to advanced maths study and build their capacity to deliver this provision.

Baseline students

  • average number of students studying an eligible level 3 maths qualification in academic years 2015 to 2016 and 2016 to 2017, from the ILR R14 data returns

Eligible students

  • number of students studying an eligible level 3 maths qualification in academic year 2020 to 2021, taken from the 2020 to 2021 ILR R04 data return

Eligible minus baseline

  • ‘eligible students’ - ‘baseline students’ or zero, whichever is higher

Rate per student

  • the rate of funding per student for 2021 to 2022 is £600

Advanced maths premium funding

  • ‘eligible minus baseline’ x ‘rate per student’

15. High value courses premium

This section explains how we calculate the high value courses premium (HVCP) in the 16 to 19 revenue funding allocation statement. HVCP supports providers to increase the number of students studying substantial programmes in particular subjects.

Qualifying students

  • the number of qualifying students in your 2019 to 2020 ILR R14 data

Rate

  • the rate of funding per student for 2021 to 2022 is £400

Funding

  • ‘qualifying students’ × ‘rate’

16. Industry Placements Funding

No SPIs will receive industry placement funding for 2021 to 2022 academic year.

17. Care standards

This section explains how we calculate care standards funding in the 16 to 19 funding allocation statement. The funding rates and formula guide provides more information about care standards.

Eligible students

  • the total number of eligible students (≥12) taken from the 2019 to 2020 ILR R14 data return from eligible institutions

Care standards funding rate

  • funding per student is £817

Care standards institution lump sum funding

  • lump sum funding of £12,252 per institution, for eligible institutions

Care standards funding

  • (‘Eligible Students’ × ‘Care Standards Funding Rate’) + ‘Care Standards Institution’

18. 2021 to 2022 total programme funding

This table shows your 2021 to 2022 total programme funding per student.

  • the total programme funding from the summary table on page 1 of your statement / the total student numbers for 2021 to 2022

19. High needs funding

This section explains how we have calculated high needs funding in the 16 to 19 revenue funding allocation statement.

We have based allocations of high needs place funding on your 2020 to 2021 R06 ILR.

2020 to 2021 R06 total high needs students

  • this is the high needs student number count split by age 16 to 19 years and 19 to 24 years, as recorded in the 2020 to 2021 ILR R06 data return, with a reference date of 1 February 2021

2020 to 2021 R06 total high needs student proportions by age

  • the percentage proportions of students split by age

Exceptional variations to lagged high needs student number

  • an increase or decrease applied to the high needs student number. This is where we’ve agreed an exceptional case

High needs element 2 for 2021 to 2022

  • ‘2020 to 2021 R06 total high needs students’ (total students) + ‘Exceptional Variations to lagged high needs student number’

  • ‘2020 to 2021 R06 Total High Needs Student proportions by age’ is applied to calculate ‘High Needs Element 2 for 2021 to 2022’ (age 16 to 19 students) and ‘High Needs Element 2 for 2021 to 2022’ (age 19 to 24 students)

  • ‘High Needs Element 2 for 2021 to 2022’ (total students) × rate

20. Student financial support funding

This section explains how we have calculated student financial support funding in the 16 to 19 revenue funding allocation statement.

Number of funded students

  • the ‘total student numbers for 2021 to 2022’ shown in the ‘student numbers’ table

Instances per student

  • we use the SPI average for the instances per student value
  • the average for ‘element 1: financial disadvantage’ is 0.266
  • the average for ‘element 2a: student costs – travel’ is 0.140
  • the maximum ‘instances per student’ value is 1.000

Number of instances

  • instances per student for ‘element 1: Financial disadvantage’ and ‘element 2a: student costs – travel’ are multiplied by the ‘number of funded students’

  • ‘instances per student’ x ‘number of funded students’

  • no SPIs will receive ‘element 2b - student costs for industry placements’ funding

Rate

  • the funding rate for each element of the discretionary bursary for 2021 to 2022. Bursary funding rates are subject to change year on year

Funding

  • ‘number of instances’ x ‘rate’

Bursary adjustment in respect of free meals

  • refer to our guidance on 16 to 19 bursary funding and free meals in further education We calculate each institution’s percentage share of the deduction proportionally, using end of 2019 to 2020 academic year data.

Protection is then applied so that no institution:

  • experiences a reduction of greater than 25% for their 16 to 19 bursary fund allocation
  • experiences a reduction that is greater than the reduction applied in 2020 to 2021, and
  • has a 16 to 19 bursary fund allocation of less than £500

Discretionary bursary fund

  • the sum of each bursary element before transition arrangements are applied *‘element 1: financial disadvantage total’ + ‘element 2a: student costs travel total’ + ‘element 2b: student costs industry placements’ - ‘bursary adjustment in respect of free meals’

2019 to 2020 Discretionary bursary funding – baseline for transition

  • your total 2019 to 2020 bursary allocation, which will include any confirmed 2019 to 2020 in-year growth, will be used as a baseline to calculate the transition lower and upper limits (-/+50%)

Transition lower limit

  • 50% of the baseline for transition amount. In 2021 to 2022 academic year institutions will receive no less than 50% of the baseline transition amount following the change to the methodology

Transition upper limit

  • 150% of the baseline for transition amount. In 2021 to 2022 academic year institutions will receive no more than 150% of the baseline for transition amount following the change to the methodology

Exceptional adjustment

  • an increase or decrease applied to your discretionary bursary funding. This could relate to funding to help students on the current European Social Fund (ESF) not in education, employment or training (NEET) programme, merger adjustments, converter adjustments, etc

Discretionary bursary fund total

  • your total discretionary bursary fund allocation for the 2021 to 2022 academic year. The minimum allocation value is £500

Residential bursary fund

  • total funding allocation for the residential bursary fund

Residential support scheme

  • this is the total funding allocation for the residential support scheme

Residential funding total

  • the sum of residential funding

  • ‘residential bursary fund’ + ‘residential support scheme’

21. Free meals in FE funding

Total students

  • the total number of 16 to 19 year olds recorded in end of 2019 to 2020 academic year data returns

Free meals students

  • the number of students recorded in end of 2019 to 2020 academic year data returns as being eligible for and in receipt of free meals in further education

Proportion of students on free meals

  • ‘free meals students’ ÷ ‘total students’

Total students in 2021 to 2022 funded for free meals

  • the total number of students that will attract free meals funding in 2021 to 2022
  • ‘proportion of students on free meals’ × ‘total student numbers for 2021 to 2022’ in the ‘student numbers’ table

Free meals higher rate, lower rate and FTE Rate

  • ‘free meal students’ at higher, lower and FTE rates are determined by taking the proportions in table 1b and applying the percentage proportions to the ‘total students in 2021 to 2022 funded for free meals’. In SPIs, all students attract the higher rate

Free meals funding

  • ‘free meals students’ (higher) × ‘free meals rates’

Free meals administration

  • 5% of ‘total free meals funding’

Exceptional adjustment

  • an increase or decrease applied to your free meals in further education funding. This could relate to funding to help students on the current ESF NEET programme, merger adjustments, converter adjustments and so on

Total free meals funding

  • the sum of free meals funding *‘free meals funding’ higher + ‘free meals funding’ lower + ‘free meals funding’ FTEs + ‘free meals administration’ + ‘exceptional adjustment’

Total student support funding

  • the sum of student financial support funding ‘discretionary bursary fund total’ + ‘residential funding total’ + ‘total free meals funding’

22. Teachers’ pension scheme payments

This section explains how we have calculated allocations to meet increased employer contributions to the teachers’ pension scheme (TPS) in the 16 to 19 revenue funding allocation statement.

Payments made to Capita for TPS, financial year 2019 to 2020 rebased at 16.4% for the full year

  • the latest available audited payments made by institutions to Capita for TPS, related to financial year 2019 to 2020 including employer contributions annual payments at the rate of 16.4%
  • as the employer contribution rate changed part way through the 2019-2020 financial year, the figure for the actual pension contributions has been adjusted to reflect the equivalent value if a rate of 16.4% had applied for the full year

Annual payments increased to 23.6% equivalent for the full year

  • employer contributions annual payment increase of 23.6% to annual payments for financial year 2019 to 2020

1.2% uplift for 2020 to 2021

  • 1.2% uplift reflects the Office for Budget Responsibility’s (OBR’s) nominal wage growth forecast for 2020 to 2021

2.1% uplift for 2021 to 2022

  • 2.1% uplift reflects the OBR’s nominal wage growth forecast for 2021 to 2022

Revised annual cost funding

  • ‘annual payments increased to 23.6% equivalent for the full year’ + ‘1.2% uplift for 2020 to 2021’ + ‘2.1% uplift for 2021 to 2022’

Teachers’ pension scheme grant (difference between 2019 to 2020 payments at 16.4% and revised annual cost)

  • ‘revised annual cost funding’ - ‘Payments made to Capita for TPS, financial year 2019-2020 rebased at 16.4% for the full year’
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