Rethinking Post-16 Funding: Why a learner-led model could be the key to unlocking growth and inclusion
Paul Stannard
16 to 19 Senior Policy Manager, AELP
Rethinking Post-16 Funding: Why a learner-led model could be the key to unlocking growth and inclusion
AELP is advocating for a more responsive funding system that supports Independent Training Providers (ITPs) to meet the evolving needs of learners, employers, and communities. Despite the critical role ITPs play in delivering over two thirds of apprenticeships and substantial adult education provision, current funding methodologies in post-16 education are holding independent providers back from delivering much needed sector capacity.
We are calling on policy makers to launch a review of the current funding methodologies and move toward a more learner-led, real time funding model with the ability to unlock capacity blockages, reward responsiveness, and deliver for the hardest-to-reach learners. Accessing training can often be limited to locality, a change to methodology could unlock choice and provider learners with the opportunity to access local and flexible education and training programmes.
Allocations issues
Under the current funding regime, ITPs face a number of barriers:
- Capped allocations: Providers are often given rigid annual funding caps, which restrict their ability to scale up delivery in response to employer demand or regional skills needs.
- Inflexibility: Even if demand spikes during the academic year, providers cannot grow unless additional funds are reallocated, which is a slow process. They also face the added complication of an ‘affordability’ factor for future growth being implemented from the 2024/25 academic year, meaning even more uncertainty, and therefore less investment.
- Innovative delivery disincentivised: Current methodologies lack mechanisms to reward providers for reaching learners in remote or underserved areas, where delivery is more resource-intensive, non-traditional in terms of start and end dates and focussed on skills development rather than qualification achievement.
A potential solution: a nuanced learner-led funding model
We believe it’s time to review the model to make the learner, not reliant on the size of the programme for funding. But what could this mean for providers and learners?
- Demand-driven & flexible: Providers are funded per learner enrolled and retained, rather than being confined by pre-set allocations. Ringfencing funding for innovative delivery de-coupled from QAR could encourage providers to build bespoke, local and employer led skills driven programmes (including appropriate qualifications) that support progression to further study and employment and are linked to local need.
- Incentivised inclusion: Additional weighting for delivery in priority postcodes, learners with barriers to learning, or provision aligned with local skills improvement plans. Potentially extending the current disadvantaged uplift to include delivery of skills and qualifications aligned with local priorities. A similar incentive to the current ‘programme weighting’ methodology.
- Be bold on English and maths: A bold change to the accountability measures for the English and maths condition of funding to support providers to offer responsive, short, medium and long programmes. A suite of qualifications that support the development of key literacy, numeracy and digital literacy skills.
- Real-Time adjustments: Dynamic funding systems could allow in-year increases for providers whose learner numbers grow, rather than waiting for retrospective reconciliations and delayed growth payments.
- Progression and outcomes-based measures: Progression, destination and outcomes metrics measured and valued with the same weighting. For some young people transition to employment and further training might occur prior to achievement of their qualification however, providers would be negatively impacted by a non-achiever and withdrawal.
The added value of multi-year funding agreements
Alongside the move to a learner-led model (particularly for 16-18 delivery), multi-year funding agreements for Adult Skills Funding (ASF) could bring significant benefits:
- Planning certainty: With secure funding horizons, providers can invest in long-term infrastructure, staffing, and curriculum development enabling more strategic delivery planning aligned to regional and national skills priorities.
- Capacity building: Multi-year settlements would give ITPs the confidence and a degree of certainty to scale delivery in a sustainable way, including in areas where provision is needed most but takes time to grow, removing what is often a short termism approach to building capacity.
- Enhanced collaboration: Employers and providers could work together on multi-year workforce development plans, knowing the funding environment supports continuity and growth.
- De-risking innovation: Longer funding cycles reduce the short-term risk of trialling new delivery models or reaching underrepresented groups, encouraging providers to innovate without the fear of financial instability if learner volumes fluctuate year to year.
- Smoother transitions: For learners, especially those furthest from the labour market or formal education, longer-term programmes often yield better outcomes and multi-year funding enables providers to offer consistent, wraparound support.
What could the benefits be?
A learner-led model would unlock:
- Scalability: ITPs can respond to local and sectoral demand quickly and effectively without funding issues or delays. A real time funding model would support the current issue of who and how growth funding is allocated.
- Inclusion: Providers are incentivised to deliver in hard-to-reach geographies and to support learners who need the most support to re-engage in learning and training.
- Employer engagement: Providers can work confidently with employers to meet skills needs, knowing funding will follow demand.
- Innovation and risk: Providers would be more willing to co-design programmes with employers (or groups of) and take more risks in relation to offering a responsive suite of training and education programmes without fearing a future financial or quality penalty.
We know we need to act to deliver the current and emerging skills, whilst rapidly understanding and designing programmes to deliver the future skills, many of which remain unknown. We also know that with rising and unacceptable NEET numbers, 18-21 youth guarantee initiatives, a negative differential for young people with SEN to gain ‘good’ jobs and a surging 16-19 population the whole sector needs the flexibility and trust to meet these challenges. ITPs are poised and ready to do this but, approaches to funding must change to mobilise this network of underutilised providers.
Rethinking Post-16 Funding: Why a learner-led model could be the key to unlocking growth and inclusion
For any questions, please contact Paul Stannard, 16 to 19 Senior Policy Manager, [email protected]
