Skills Funding Agency could be born under a bad sign

Although the demise of the Learning and Skills Council and its replacement by two smaller agencies may appear progressive, it could inadvertently lead the way for the re-emergence of one of the bodies the council replaced, especially if the Conservatives have their way. After spending more than £86bn since 2001, the Learning and Skills Council ceased to be on 31 March. Its writ, to improve the nation's learning stock, has passed to the Skills Funding Agency (SFA) and the Young Peoples' Learning Agency (YLPA) which came into being on 1 April. However, a Conservative victory in the upcoming general election, or a coalition with the Liberal Democrats, will cast a shadow over the SFA's future. The present plan for the agency is that it will annually distribute about £4bn of funds to further education colleges and other approved providers of post-19 education and skills development including Train to Gain. The YPLA will monitor the £7bn budget that local authorities will have to spend on funding the education of 1.6m 16 to 19-year-olds. It will also be responsible for funding local academies of which there will be 300 by September 2010 and will provide funding to about 750,000 16 to 19-year-olds through education maintenance allowances, currently £30 a week. The SFA will house the National Employer Services, the National Apprenticeship Service and the Adult Advancement and Careers Advice service. It will also fund Train to Gain, launched by the LSC in 2006 as part of the Government's response to the Leitch Report on the UK's skills needs. During its nine year life as the UK's biggest quango, the LSC was never far from controversy, most notably in its mismanagement of the government's college building programme . It encouraged bids from about 144 colleges for funding that it did not have, resulting in the waste of millions of pounds in bidding processes which had almost no hope of success. The fiasco led to the resignation of LSC chief executive Mark Haysom. Geoff Russell took over in April 2009 and will head the SFA. So what will change? Well the SFA will be a much smaller beast than the LSC but will still undertake many of the same functions, principally managing the funding of FE colleges. And the same staff will perform those functions as most SFA personnel have transferred from the LSC. But what will be the SFA's fate if there's a change of government after the upcoming general election? The Conservative's thinking is encapsulated in a recent policy consultation document, The Further Education Funding Council (FEFC) Model and Skills Accounts, which builds on an earlier green paper. Lead author David Willetts, shadow minister for Skills and Universities, recommends something of a return to the Further Education Funding Council, replaced by the LSC in 2001. However FEFC Mark II would also fund – presumably approved – private training providers as well as FE colleges. Ominously, for the SFA, Willetts et al say there should be a "slimmed down" FEFC to do handle funding of FE colleges and approved training providers. The consultation document also argues for the abolition of bodies such as the Regional Development Agencies and Employment and Skills Boards. It also recommends the introduction of individual skills accounts, based on the Scottish model, where students are effectively given grants to spend on skills acquisition at FE colleges and private training providers. These accounts would likely be limited in number and amount. They echo the disastrous individual learning accounts scheme which was launched in September 2000 and closed in November 2001 because of suspected fraud by many training providers . The Conservative's consultation document acknowledges the risk of fraud but suggests that can be overcome by providing virtual funds to account holders that are only activated when the student "plugs in" to an approved course at an approved provider. As for the Liberal Democrats, a spokesman said: "We will create a single council for Adult Skills and Higher Education. This would simplify funding in this area and reduce the number of quangos involved in skills and further education funding." That would result in the SFA merging with the Higher Education Funding Council for England and arming it with a budget of about £9bn. Clearly how many birthdays the SFA will enjoy remains to be seen, but it will do well to get to the toddler stage should the current government lose the general election. Skills Funding Agency facts: · Head office in Coventry plus 20 offices across England · 1,800 staff, 400 of them at the National Apprenticeship Service · Budget for colleges and training providers: about £4bn annually · Staff and admin costs: £81.4m · Train to Gain budget 2010-11: £983m · Offender learning budget: £135m The LSC – a life in numbers: · Total expenditure since 2001: £86bn · Spend on under-19s: £47bn · Spend on adults: £26bn · Number of employers that have used Train to Gain: 175,000 · Number of employees that have used TtG: 1m