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Funding updates

Funding updates

January 2019 Funding Update

This update will cover:

  • We are running a webinar on 31 January about AEB Funding and devolution. Click below on the right to register
  • Adult Education Budget (AEB) eligibility rules to help you support lower paid workers and ESOL learners improve their skills
  • devolution of the AEB and what it means for providers in devolving areas and around the rest of the country
  • the 16-19 Funding changes announced by the ESFA in December 2018.

AEB Eligibility – ESFA Flexing of Funding Rules

In 2018/19 the ESFA have made some learner eligibility changes to the Adult Education Budget (AEB). For many providers, using all the AEB allocation has been challenging in the last few years. The changes to the 2018/19 AEB funding rules allows providers to offer fully funded programmes to learners on wages of £15,736.50 or less, where previously, many of those learners would have to contribute 50% of the costs. This is a welcome opportunity to spend more of your AEB budget to support learners who may not have been able to access your courses and programmes before, whilst increasing social mobility.

The new flex also applies to ESOL learners. This is a big opportunity to increase local access to ESOL programmes. Many individuals who don’t speak or write good English remain in low paid jobs because their English skills are poor. Being low paid means they often cannot contribute towards their course costs, keeping them in a cycle of low skills/poor employment opportunities. City & Guilds has worked hard to develop an offer which best suits the specific needs of ESOL provision, supporting flexible delivery, responsive assessment and encouraging maximum learner engagement.

City & Guilds ESOL Information

The ESFA has agreed that up to 3% overspend is available in 18/19 for all providers with AEB funding agreements, if provider history shows that Ofsted grades, minimum quality standards, financial health, financial management and controls meets ESFA requirements. The 103% tolerance calculation will include non-formula funded community learning delivery, but only up to the amount set out in your funding agreement.

These new flexibilities are only available during this academic year at the moment.  ESFA and DfE will announce later in the spring if they intend to extend the flexibility into next year’s funding rules.

The new low wage flexibility rules are on pages 24 and 28 of the ESFA AEB funding rules;

Adult Education Budget Funding Rules 2018/19 >

City & Guilds has a dedicated AEB Funding page on our website; City & Guilds AEB Funding Information >


Adult Education Budget Devolution

After a slow start, it now seems devolution of the AEB is moving towards us at terminal velocity! Whilst the opportunity for local areas to develop plans that meet local skills needs is great and much needed, there are going to be some challenges for providers that come with the new arrangements. So, first of all, which areas are devolving?

Two further Mayoral Combined Authorities (MCA’s), North of Tyne and Sheffield City Region, devolve one year later in the 2020 to 2021 academic year, if the ESFA assesses them as ready.

All MCA’s are going out to tender to procure their adult education provision. London, Liverpool City Region and Manchester have already published their Invitations to Tender (ITT) late in 2018. Tees Valley ITT is open now, West Midlands is due to publish in January, with the remaining MCA’s due to publish ITT’s early in 2019, so it’s worth keeping an eye out on MCA websites and signing up for News Bulletins on the links above to keep track of opportunities to deliver AEB programmes in an MCA area.

Any provider with AEB funding will be affected by devolution, even those in non-devolved areas. MCA’s will fund learners with a home postcodes in their area. ESFA will fund all other learners. So providers may have a single funding agreement with a commissioning authority or multiple funding agreements covering one or more MCA’s and ESFA. So, it’s important that providers understand how much of their delivery (direct and sub-contracted) is to residents of devolved areas. The new arrangements will make for some interesting boundary issues for providers. Also for learners that commute into an area, or that are close to a boundary and local provider but their postcode is outside the MCA locality.

Finally, all MCA’s are setting their own funding rules, rates and formula, and will expect a separate data return from the ESFA ILR returns. MCA’s are working with ESFA to make this this as painless as possible, but it’s likely to add some extra administrative burden if providers AEB contracts cover more than one area. 


City & Guilds Support

City & Guilds provides a catalogue of our funded qualifications, which is broken down by sector subject area, level and size. This will make it easy for you to work out which qualifications support your local MCA priorities and how much funding you can draw down.

City & Guilds Qualification Catalogue >


16-18 funding changes

In December 2018, the ESFA announced a funding change resulting from their Review of 16-19 study Programmes. The funding change proposed, which would have been introduced in 2019/20 academic year, was that students with prior attainment in English and maths at Grade 4, or above that are undertaking a vocational qualification, would not be expected to be on an Entry Level or Level 1 core aim, even if they had no previous experience in the vocational area – they should undertake a core aim at L2 or above, except in exceptional circumstances.

After consultation with the sector, the ESFA have announced that they will not introduce this new funding rule but will consult further and decide whether to introduce the change in 2020/2021 instead. It’s a welcome delay to a rule that could have had a profound and potentially negative affect on learner’s progression and achievement.