With the Euro struggling to survive, George Osborne’s Autumn Statement on Tuesday 29 November 2011 was probably optimistic. But hidden among the severe warnings from the Office of Budget Responsibility, it contained nearly two dozen pointers for those who follow Education Funding. This piece summarises the main ones.

This was also the week when Department of Business, Innovation and Skills almost unnoticed published two further episodes of “New Challenges. New Chances” – papers for Further Education Reform and Funding.  Whether these are Green or White Papers, they are both significant and are covered in a separate blog alongside this.

I am sorry that this blog is long. To make it more digestible, throughout there are links to pages in the Education Grants Menu.

The Education Funding Agency – Early Years to Further Education

Before the Budget next spring, this may be the last big Economic Statement before the Education Funding Agency gets going. From April 2012 EFA will handle direct funding for all age 3 to 19 provision, including Free Schools, Academies, and resources for local authorities to pass to schools which aren’t academies.

Following the end of Building Schools for the Future and Sebastian James Report on Schools Capital Expenditure in April 2011, EFA will also handle schools capital expenditure. Again, this will include Free Schools, Academies, UTCs and maintained local authority provision. Partnerships for Schools closes as a Non Departmental Public Body in March 2012 with its staff and resources moving to the EFA. Its site still has a handy map of schools. The Government has been consulting on how capital spending will be distributed locally.

All this means that the EFA will distribute and allocate £50bn revenue and capital funding each year, as well as capital spending for all publicly funded schools. Its funding will range from the Dedicated Schools Grant and Pupil Premium to capital allocation and distribution for 16 to 19 year olds.

Free Schools

The Chancellor’s Statement contained £600m to fund an extra 100 Free Schools, including new specialist Maths Free Schools for 16-18 year olds, “supported by strong university maths departments and academics.”

This included invitations to those seeking to establish Special Free Schools. The Green Paper “Support and Aspiration: a New Approach to Special Educational Needs and Disability” in March 2011 showed the Government’s intention to give parents a choice of school from any state funded school including Free Schools. Special Free Schools will normally only admit pupils with Special Education Needs. Children without SEN may be admitted in exceptional circumstances. Special Free Schools should ensure curriculum plans are tailored to meet the individual needs of pupils, as set out in their statements of Special Educational Need.

Funding for Free Schools

The Government is currently consulting on a longer term funding system for schools – including Special Free Schools. But interim funding arrangements enable Special Free Schools to receive a base level funding of £10,000 per place. There may also be funding from the local authority, depending on individual needs. Special Free Schools will also receive an additional grant to compensate for services that maintained schools receive free of charge from their local authority.

Free Colleges

It is also possible to set up a Free Further Education College for provision up to age 19, since funding for all providers for this age group will in future be the same. Proposed changes for FE Colleges’ governance and corporation structures are summarised under “New Challenges. New Chances” in a separate posting appearing very soon.

School places

There will be an extra £600m from 2012/13 to help fund an extra 40,000 places for those local councils facing additional demand. There is more on maths and science teaching later in this blog.


The Autumn Statement included £17mn for 19 apprenticeship partnerships of employers and training providers, following a competitive bidding process in July 2011 as part of a £25m fund for Higher Apprenticeships.  A further £1.7m has been invested in 2 new ‘Trailblazer’ projects in information technology and science, engineering and manufacturing, delivering 6,000 Higher Apprenticeships.

Though the Higher Apprenticeship Fund supports thousands of apprenticeships up to degree equivalent, most of the 250 employers are larger companies, including Leyland Trucks, Unilever, TNT, and Burberry.

So the Government is providing an additional £30mn for 20,000 places – a £1500 incentive for smaller firms to take on young apprentices, bringing the total number of payments available to 40,000 next year.

Though there will also be an employer-led review into quality and standards in spring 2012, the small number of apprenticeship places in smaller firms still gives cause for concern.

There will be a further round of bidding in Spring 2012 for Higher Apprenticeship places.

Science teaching

There will be £10m over 5 years from 2013/2014 to improve the quality of science teaching in schools. This will be channelled through Project Enthuse, matched by the Wellcome Trust.

The Government will offer undergraduates access to mentoring from the existing network of STEM Ambassadors to give undergraduates insight into STEM occupations and raise the profile of the STEM sector.

Youth Contract

Though Government announcements about the Youth Contract in the Chancellor’s Statement range over different websites, the following seeks to summarise them.

With around 1.16mn 16 to 24 year olds not in employment, education or training, the £1bn (£940m) Youth Contract programme over 3 years aims to provide work placements, apprenticeships and advice and guidance for 18-24 yr olds and particular support for 16-17 yr old NEETs.  Overall 410,000 work and training placements will be created.

HM Treasury’s “Autumn Statement 2011” on page 43 states the objective “to ensure that every young person not already in work, education or training has support to get into the workplace”. The Youth Contact will:

  • fund a new £50 million a year programme providing support to some of the most disadvantaged 16-17 year olds not in education, employment or training across the UK.  The programme will help 25,000 16 and 17 year olds into an apprenticeship or into work and also provide 20,000 additional incentive payments for firms offering apprenticeships to 16 – 24 year olds
  • provide extra support from Jobcentre Plus for unemployed 18-24 year olds, with additional advisor time and a careers interview from the National Careers Service after three months on Jobseeker’s Allowance, and with weekly, rather than fortnightly, signing for all 18-24 year olds from month fiv3
  • provide an offer of a work experience or Sector Based Work Academy place for every unemployed 18-24 year old who wants one after 3 months on JSA, before they enter the Work Programme. The Government is providing an additional 250,000 places
  • provide for young people still unemployed after nine months on JSA to transfer to the Work Programme

In addition, the overall programme will:

  • provide funding for an estimated 160,000 wage incentives of £2,275 to make it easier for private sector employers to take on young peopl3
  • provide for longer-term JSA claimants over 6 months to be referred to full-time training for up to 8 weeks while remaining on JSA. The Autumn Statement on page 12 says that this “will allow people claiming JSA for 6 months or more to be referred to training of up to and including 30 hours per week and remain on JSA, rather than transferring to a training allowance, provided training is only for 8 weeks. Whilst on training, claimants will be required to remain actively engaged with the labour market. This will take effect from November 2011. These will be JSA claimants for 6 months or more who have been identified with a skills need. This is estimated to be around 9,000 people per year, based on internal forecasts of training starts.”

Work Experience

£4.5m will be provided over 2 years to support post-16 work experience with particular emphasis on small businesses taking on recruits. For 18 to 24 year olds, a £2,275 subsidy is payable to firms giving 160,000 unpaid work experience for 6 months. This is more than enough to cover an employer’s National Insurance contributions for a year. There will be an additional 250,000 Work Experience places over the next 3 years, taking the total to 100,000 a year.

The Autumn Statement on page 60 says that the Government will support work experience as part of post-16 learning and work with the Federation of Small Businesses and other employer groups to review regulation affecting work experience by the end of December 2011. A guide will be published on common misconceptions about work experience.

The Post 16 Labour Market

This programme is ambitious. However, though details above on the Youth Contract and Work Experience above project 410,000 new work places for 18 to 24 year olds, there are cash subsidies for 160,000. Youth Contract is open to all businesses, including those that already employ large numbers of young people – like retail and construction – and emerging sectors like the green economy, creative industries and ICT.

But this still leaves around 500,000 young people not in employment, education or training. Because employers – and who can blame them – will choose most the qualified and work-ready young people to participate, this majority who do not participate will be those needing most help.

Increasing apprenticeship numbers is only part of the solution. But from 126,000 new apprenticeships places created last year, 89,000 were taken by employed people over 25.

Getting into the labour market for Post 16s is a major issue, especially for those who failed after previous economic downturns. As Alison Wolf’s Vocational Training Report in March sought to explain, the Post 16/Post School Labour Market has almost disappeared. IPPR and others are forecasting that regions like North West may not reach 2008 output levels until 2020 and the North East in 2020 may only recover to 1990 levels.

So we need to think seriously what Post 16s are expected to do. Though raising the school leaving age to 17 and 18 is part of the solution, we should think seriously what Study Programmes for 16-19 are appropriate. For many, GCSE English and Maths may not be the answer. This is part of the Government’s ongoing consultation on Study Programmes, concluding in January 2012. Whatever emerges, skills provision should be built into or linked to initiatives for entering the labour market.

Careers Advice

£4.2m over 3 years will provide careers interviews for 18-24 year olds on JSA for 3 months or more.  The Autumn Statement on page 60 projects an “improved careers information portal as part of the National Careers Service from April 2012, through which the public can access up to date, employer-sourced information on occupations, progression routes, wages and employment trends”.

Destination Data

The Autumn Statement on page 60 says that the Government “will publish destination information at ages 16 and 18 from spring 2013 to encourage schools’ focus on young people’s future beyond school as well as attainment. The Government “recognises the contribution that strong links between schools, colleges, and business can make to outcomes for young people, and will keep the impact of this measure under review and consider stronger incentives if needed”.

Course Kite Marking

A group of Science, Technology, Engineering and Mathematics (STEM)-focused Sector Skills Councils – Science, Engineering and Manufacturing Technologies, Chemicals, Pharmaceuticals, Nuclear, Oil and Gas, Petroleum and Polymer Businesses and E Skills – will lead an industry group to kite-mark courses, indicating those valued by employers. Other Sector Skills Councils will be encouraged to follow. However because elsewhere, under the proposed Employer Ownership Pilots (see “Employers’ Funding”), there will be a diminished role for SSCs, this sounds rather incoherent.

Employer Ownership Pilots

As already announced, employers will be able to bid into a new £250m fund from early 2012 to help develop and ‘buy’ the vocational training they want. This is will be described in more detail in Grants for Employers.

In summary, these pilots represent the beginning of the end for direct public funding of employer led courses. This future training agenda will be for employers to decide and fund. The Government will create appropriate market conditions – but as funding supporter rather than direct funder.

Adult Literacy and Numeracy

The Autumn Statement on page 61 says that the Government “will reform adult basic literacy and numeracy provision by piloting a new funding method for the providers of courses, which creates incentives for them to deliver the greatest skills gains for learners on basic skills courses”. There is more about Adult Community Learning on in Community Project Grants.