In-year growth for 2021 to 2022
Information about in-year growth funding for 2021 to 2022.
Applies to England
Subject to affordability, each year we review the early data returns from institutions delivering 16 to 19 education (including up to 24 for those with high needs), and award in-year growth. There are 3 strands to the in-year growth exercise:
- exceptional in-year growth for student numbers
- exceptional in-year growth for specialist post-16 institutions (SPIs)
- free meals in FE and bursary
Exceptional in-year growth for student numbers
The primary way in which we account for increases in student numbers is through lagged funding. In-year growth funding is exceptional and is intended only for those with significant recruitment above their allocation, to provide a contribution to the additional in-year costs. It does not fund increases in programme size.
This process does not apply to Independent Learning Providers for whom there is a separate reconciliation process.
This process is entirely data driven; we do not accept business cases. We make growth awards on the assumption that the in-year data used is materially accurate. If later data returns (usually the R14) show that the in-year data returns are inaccurate, we will recover some or all of the in-year growth award.
Each year, we revisit the methodology for awarding growth and the thresholds at which individual institutions become eligible for a growth award. The key considerations of this process are the levels of growth in the sector and affordability. This year we have been able to retain the method and thresholds introduced for 2020 to 2021, which was introduced in response to the coronavirus (COVID-19) pandemic. Compared to the method used in 2019 to 2020, institutions with very significant growth will receive the same growth award, but those with more modest growth will now receive some growth funding where previously they would not have been eligible.
This does not set a precedent for the method used or thresholds in place in future years. Each year is assessed independently with thresholds and marginal rates dependent on levels of over-delivery and affordability.
The calculation of growth awards this year (2021 to 2022) is a 4-step process:
- Calculate over-delivery (in numbers of students)
- From the over-delivery, calculate growth
- Adjust for previous under-delivery
- Apply a growth award minimum
Step 1. Over-delivery
The method we use to calculate student number over-delivery to feed into the growth calculation is dependent on the institution type.
For colleges and higher education institutions submitting the individualised learner record, we calculate the student number using the reference date of 1 November. Over-delivery is the lower of:
- 2021 to 2022 R04 students multiplied by 2020 to 2021 R04:R14 ratio, less the 2021 to 2022 allocated students
- 2021 to 2022 R04 students less the 2020 to 2021 R04 students
For schools and academies submitting the school census:
- 2021 to 2022 autumn census students less the 2021 to 2022 allocated students
For local authorities:
- 2021 to 2022 R04 students less the 2020 to 2021 R04 students
Step 2. Growth calculation
There are 2 thresholds, and we fund over-delivery at different marginal rates for the over-delivery above each threshold. The 2 thresholds are:
- lower threshold - 7.5% of the 2021 to 2022 allocated student number, with a minimum of 25 students and a maximum of 100 students
- upper threshold - 15% of the 2021 to 2022 allocated student number with a minimum of 50 students and a maximum of 200 students
We do not fund over-delivery below the lower threshold. We fund the over-delivery between the lower and upper thresholds at 100% of the average funding per student. We fund the over-delivery above the upper threshold at 50% of the average funding per student.
We only fund the over-delivery that is above the particular threshold at the marginal rate, as shown in the example below.
Example:
An institution with an allocation of 2,000 students would have a lower threshold of 100 students and an upper threshold of 200 students. If the over-delivery is 250 students, we calculate the growth as follows:
- over-delivery below the lower threshold – not funded
- over-delivery between the lower and upper thresholds – funded at 100%, i.e. 100 students
- over-delivery above the upper threshold – funded at 50%, i.e. 25 students
Growth funding for this institution would be a total of 125 students.
Step 3. Previous under-delivery
We make a deduction for any under-delivery in 2020 to 2021 before finalising the growth award. If there was under-delivery in 2020 to 2021, we deduct half of this figure from the growth award.
Step 4. Minimum growth award
After we have deducted half of the under-delivery from the previous year, if the remainder is less than 10 students, we do not make a growth award.
Exceptional in-year growth for specialist post-16 institutions (SPIs)
Element 1 growth for SPIs
For the calculation of programme funding increases under the national 16 to 19 funding formula (element 1 growth), the general principles outlined above are the same. However, we calculate over-delivery as:
- 2021 to 2022 R04 students less the 2021 to 2022 allocated students
The thresholds are:
- lower threshold - 7.5% of the 2021 to 2022 allocated student number, with a minimum of 5 students
- upper threshold - 15% of the 2021 to 2022 allocated student number with a minimum of 10 students
Example:
An SPI with an allocation of 80 students would have a lower threshold of 6 students and an upper threshold of 12 students. If the over-delivery is 20 students, we calculate the growth as follows:
- over-delivery below the lower threshold – not funded. This means we would not fund the first 6 students
- over-delivery between the lower and upper thresholds – funded at 100%. This means we would fund 6 students at 100%
- over-delivery above the upper threshold – funded at 50%. This means we would fund 8 students at 50%, i.e. 4 students
Growth funding for this institution would be a total of 10 students.
We deduct half of the under-delivery in 2020 to 2021 as outlined above, but there is no minimum growth award.
Element 2 growth for SPIs and centrally funded exceptions
As with element 1 growth, we calculate element 2 over delivery as:
- 2021 to 2022 R04 students less 2021 to 2022 allocated students
There is a single threshold:
- the lower of 10% of the allocated element 2 places and 10 element 2 places.
If over-delivery exceeds the threshold, we fund all over-delivery above the threshold at the full annual rate of £6,000 per place. There are no deductions for previous under-delivery.
We also use this methodology for a small number of institutions (the ‘centrally funded exceptions’) which have their element 2 in-year growth calculated by ESFA, rather than their provider local authority.
Example:
An SPI has an allocation of 50 element 2 places, and records 62 in the R04 return. The threshold is 5 element 2 places (i.e. 10% of allocation). We therefore fund 7 element 2 places.
Free meals in further education (FE) and bursary in-year growth
Both bursary and free meals in FE allocations are linked to the allocated student number and so an increased student number allocation resulting from the exceptional in-year growth for student numbers process may also result in increased bursary and free meals allocations.
In addition, we are releasing additional bursary funding outside the main growth process where analysis of the data suggested that an increased student number could put an institution’s bursary allocation under considerable pressure.
We are also releasing additional free meals in FE funding to ensure that institutions have sufficient funding to support the students they recorded as eligible for, and in receipt of free meals, in their in-year data return.
However, the transitional arrangements for bursary funding continue to apply. This means that an institution with a bursary allocation that was already capped at the +50% threshold above the 2019 to 2020 bursary baseline level at the start of the in-year growth process does not receive any additional bursary funding.
Institutions that do qualify for additional bursary funding will only receive additional funding up to a maximum of the higher threshold (+50%).
Institutions whose bursary allocation (prior to any in-year growth calculations) was uplifted to the lower threshold (-50%) of their 2019 to 2020 bursary baseline are potentially in scope for additional bursary funding. However, we will deduct the amount of uplift we applied to set the allocation at the lower (-50%) threshold from any additional bursary funding that we have calculated through the in-year growth process. This could mean that institutions that have met the nominal threshold for growth do not receive any additional bursary funding through this process, with their bursary allocation remaining at the lower threshold (-50%) of their 2019 to 2020 bursary baseline.
Growth calculator
An is available which will allow you to input your institution’s figures and will calculate the potential growth award. There is a separate tab for SPIs and centrally funded exceptions (element 2 only).
Payments
In most cases, growth payments will start to be received from March 2022 and will be profiled across the remainder of the current academic year.
Growth for 2022 to 2023
We have not yet made a decision on in-year growth for 2022 to 2023. Institutions should not assume that the 2021 to 2022 rules above will be continued next year.