Correspondence

ESFA Update further education: 1 March 2023

Published 1 March 2023

Applies to England

1. Information: borrowing following reclassification

The Department for Education (DfE) is committed to launching a new DfE capital loans scheme to provide funding to eligible FE capital projects either underway, or in advanced stages of planning that now face a funding gap as a direct result of commercial borrowing restrictions resulting from the reclassification of the FE sector.

The new scheme will be time limited, with repayable capital loan funding for projects to be drawn down by March 2025 at the latest.

We plan to confirm full details of this new scheme, including eligibility criteria, in April 2023 and aim to begin providing loan funding by the early summer.

We have recently written to all accounting officers in colleges seeking confirmation of any undeclared commercial borrowing they had in place or had planned to put in place at the point of reclassification with respect to financing of capital projects through to March 2025.

2. Information: funding allocation statements for 2023 to 2024

We have started to upload 16 to 19 allocation statements for further education colleges. We are on track to issue them all by the end of March 2023.

Once your allocation statement is available, you will receive a notification and can find it on Document Exchange in the ‘Documents received from ESFA’ section. Your allocation statement includes a breakdown of our calculation.

We have published guidance to help you understand your statement.

3. Information: 16 to 19 additional hours in study programmes

We increased funding for academic year 2022 to 2023 for the introduction of an additional 40 hours for band 5 study programmes, T Levels, and for a proportionate increase in hours for other study programmes from the start of academic year 2022 to 2023.

This investment is part of the government’s commitment to a long-term education recovery. This, alongside other education recovery programmes such as the 16 to 19 tuition fund, will help ensure gaps in learning caused by disruption to education can be filled.

This week, we published guidance on 16 to 19 additional hours in study programmes for academic year 2023 to 2024. We also published a sample of what we anticipate the end of year report for academic year 2022 to 2023 will look like and updated the monitoring section to remind institutions that we’ll issue guidance for the end of year digital report in October 2023.

The policy remains the same however we have removed the requirement for an end of year report to reduce burdens on institutions.

If you have any questions after reading the guidance, please contact our customer service team.

4. Information: earnings uplifts in FE adult education budget (AEB) for non-devolved areas in academic years 2022 to 2023 and 2023 to 2024

To support FE providers of adult skills in the current economic landscape, we are increasing provider earnings within AEB for academic years 2022 to 2023 and 2023 to 2024, in non-devolved areas. This will give providers an increase in funding before we introduce the new funding rates that will apply to the ESFA skills fund for the academic year 2024 to 2025.

In addition, we are increasing the AEB over-delivery threshold, as we did last year. The new level of 110% will apply permanently going forward, meaning providers can deliver up to 110% of their allocation giving providers confidence to increase the volume of training and invest in high value skills provision.

In academic years 2022 to 2023 and 2023 to 2024 we will apply a 2.2% increase to the final earnings for all AEB formula-funded provision (excluding associated learner and learning support). In addition, we will apply a 20% boost on top of earnings for all AEB formula-funded provision in 6 sector subject areas: Engineering, Manufacturing Technologies, Transport Operations and Maintenance, Building and Construction, ICT for Practitioners, and Mathematics and Statistics.

These funding boosts will apply to both grant and contract funded providers. We will apply it automatically to your total earnings at the end of each of the 2 academic years . You will not see the increases in your earnings each month through the current system.

We will provide further details on the operation of the earnings boosts and allocation thresholds in the AEB funding rates and formula guidance.

5. Information: FE Capital Transformation Programme funding announcement

The government is investing over £2.8bn of capital funding in skills over this spending review period alone, including significant investment in upgrading the FE college estate through the £1.5bn FE Capital Transformation Programme. All colleges have already received investment from the FE Capital Transformation Programme, with 60 colleges delivering their own capital projects and a further 16 working in partnership with DfE to address some of the worst condition sites in the country.

We are announcing today that the final stage of the £1.5 billion FE Capital Transformation funding will be an allocation of approximately £285m to eligible FE colleges and designated institutions, targeting funding towards the poorest condition that still remains in the FE college estate.

We expect to publish eligible colleges, what they will receive and conditions of grant in March 2023 and colleges will receive the funding from May 2023. The funding will be provided in financial years 2023 to 2024 and 2024 to 2025

Details of the FE Capital Transformation Programme can be found on GOV.UK.

6. Information: Local Skills Improvement Fund (LSIF)

The Department for Education (DfE) is investigating ways to deliver the Local Skills Improvement Fund (LSIF), building on the Strategic Development Fund. The LSIF is part of a long-term change programme, supporting investment in new facilities, provision, and teaching expertise to deliver on Local Skills Improvement Plans (LSIPs). The Department for Education (DfE) will run an early market engagement event on 9th March 2023, 10.30am to 12:00pm via Microsoft Teams, for providers to feed into plans for LSIF roll out.

General FE colleges, institutions which have been designated as being in the FE sector (SDIs) and FE colleges in their capacity as licensee of an Institute of Technology (IoT) are eligible to lead an LSIF application. Other providers are eligible to receive LSIF funding where they play an active role in the consortium. Independent Training Providers can receive LSIF funds for revenue activities and for capital equipment, but not for capital infrastructure projects.

Providers interested in attending the event should register through the Jaggaer procurement portal and following the on-screen instructions - ‘view opportunities’ and then select: ‘6955_Local Skills Improvement Fund 2023-25’. Joining instructions will be issued following registration. If you cannot attend the event, information will be available on Jaggaer afterwards.

7. Information: the Turing Scheme is now open for applications

Applications are now open for Turing Scheme funding for the 2023 to 2024 academic year, until 4:00pm, 6 April 2023.

The Turing Scheme is the UK government’s global programme to study and work abroad, with £110 million invested for this academic year. Participants can do study or work placements anywhere in the world, subject to FCDO travel advice.

For this (2022 to 2023) academic year, the Turing Scheme is providing funding for over 38,000 UK pupils, learners, and students to study and work in over 160 destinations across the globe. Around 20,000 of these opportunities are for participants from disadvantaged backgrounds.

Find out more and access our application portal.