1. 16-19 Funding Update Kevin Street & Jane Spence 13 June 2012

2. Context for 2012/13 Goals Full participation Policy Wolf proposals for learning programmes and simplifying funding Green Paper on Special Educational Needs (SEN) Apprenticeships Vision/Growth Strategy - Department for Business, Innovation and Skills (BIS) Encouraging new types of provider 16-19 Bursary Fund New cross government strategy – Building Engagement, Building Futures Implementation Overall tight fiscal policy underpinned by simplification / bureaucracy reduction Year of minimal change New funds – youth contract, work experience pilots

3. Enough funding to provide 1.58m places and enough places for 98% of 16 year olds, over 92% of 17 year olds and 65% of 18 year olds Extension of Transitional Protection by one further year for those with the biggest adjustments 34,000 more places than we expect to deliver in 2011/12 and against a fall in the cohort of over 20,000:  new places created to assist LAs to respond flexibly to pockets of need 18,000 Apprenticeship places more than we planned for 2011/12 to support the emphasis on Apprenticeships New funds and pilots Key Messages 2012/13

5. Increasing investment Increase investment by £150m for disadvantage uplift and Additional Learning Support Fund increased numbers of learners and larger programmes for those not yet participating on a full-time basis Protect funding to support provision for LLDD Support increases in funding for core education provision and low level ALS ESF investment of £164m (January 2011 – December 2013) Youth Contract with £1bn investment over 3 years Funding for 2012/13

6. Improving retention between years 12 and 13 NEET Group age 16 and 17 Improving the contribution for participation and progression from Foundation Learning New Cross-Government Strategy – Building Engagement, Building Futures Priorities for 2012/13

7. Larger Provider Base Declining Cohort Wolf Substantial programmes English and maths Apprenticeship 1 in 5 Free Schools Studio Schools UTCs Broader Curriculum Offer Public Spending Pressures Fewer 16-18 year olds by 2015 RPA

8. Challenges in the run up to RPA 2013 and 2015……

9. 1,044,400 (82.2%) are in Full Time Education 80,700 (6.3%) are in Training 57,700 (4.5%) are NEET What are 16-17 year olds currently engaged in? 25,700 (2.0%) are in Jobs Without Training Source: Statistical First Release, Participation in EET (June 2011) 62,800 (4.9%) are in Work Based Learning

10. Past the peak Population will keep dropping until 2018 Population - ONS projections

11. Year 12 Learners who undertook A-Level or Level 3 programmes in 2009/10

12. ‘Cross-over’ point between C and D Grades

13. 60,000 16-17 year olds not participating 60,000 16-17 year olds in part time learning 25,000 in Jobs w/o Training 25% Fail to complete at Level 3 Evolution of Foundation Learning towards Full Time Maths and English What issues do we face ahead of RPA?

14. 16-19 Funding Formula Review

15. Case for change Wolf Review Schools White Paper Purpose of funding formula review “We are also committed to all young people staying on in education and training to age 18 and a simple post-16 funding system which is fair and transparent will underpin this commitment.” Funding for full-time students age 16-18 should be on a per programme basis, with a given level of funding per student [adjusted] for differences in the content-related cost of courses, and for particular groups of high need students.” Students without Grade C English and maths should progress towards them post 16 To ensure the 16-19 funding formula better supports the Government’s aims for transparency and fairness To respond to the social mobility agenda through funding for disadvantage To support the reforms recommended in the Wolf Review Compulsory participation for 16 and 17 year olds by 2015. Raising of the participation age

16. Supports full participation in education and training up to age 18 by 2015 and continued drive to close the gap between rich and poor Removes risks of perverse incentives to ‘pile up’ qualifications and steer students onto easy courses Funding follows the learner based on lagged funding Where practical, the basic elements of the formula should be aligned with proposals for a fair funding formula pre-16 The formula should contain as few variables as possible and the main users are able to understand how budgets are calculated Funding is based on inputs (currently guided learning hours) which recognise the cost of delivery, not outputs Delivers change without additional costs over the SR period The formula should allow costs to be managed – no ‘hidden’ demand-driven elements The changes should be managed carefully for example through transitional protection, to avoid destabilising quality provision Supports policy objectives Fair Simple and transparent Affordable Avoids destabilising quality provision A clear set of principles will underpin the new system

17. Autumn 2011Consultation with the sector Summer 2012Decision on and announcement of the changes to be made 2013/14Raising of the participation age to 17 2013/14Implementation of new funding formula for 16-19 providers 2015/16Raising of the participation age to 18 Timescales

18. Single fund covering disadvantage uplift and low cost ALS with a separate fund for low cost LLDD Retain separate funds for disadvantage uplift and low level additional learning support Retain a fund for disadvantage uplift /create a fund for low level LLDD support and move low level ALS funding into the main programme budget In all approaches funds for disadvantage would be at a flat rate per student Introducing simpler and more transparent funding for disadvantage

19. Mirror pre-16 eligibility Index of Multiple Deprivation Income Deprivation Affecting Children Index (IDACI) Options for calculating and allocating disadvantage funding

20. Wolf recommendation 11 Funding for full time students age 16-19 should be on a programme basis, with a given level of funding per student. (This can and should be adjusted for differences in the content related cost of courses, and for particular groups of high-need students). The funding should follow the student Simplifying participation funding

21. Funding all full time learners at the same rate Uplift to recognise larger programmes  a rate for the majority of provision that reflects the historical average of delivery and a rate for a smaller number of learners on large programmes  a weighting applied to the basic rate for larger programmes Funding to recognise different programme sizes  A basic full time programme which would include the basic entitlement.  An enhanced full time programme to recognise delivery of programmes, that require more teaching time, for example 4 A levels and level 3 vocational programmes.  A large full time programme as described in option 2, to include programmes for example 5/6 A levels and the International Baccalaureate and large vocational programmes. Simplifying participation funding

22. Part time programmes

23. Current Weightings are: 1.12 For Higher cost subjects 1.00 For other subjects Proposal is: Increase baseline rate to equivalent of 1.06 for all A Levels and other academic subjects Weightings for programme funding

24. Continue to recognise success Remove the success factor completely from the funding formula Remove the achievement element, but keep the retention element  retention element calculated at programme component level  retention element calculated at learner level Success Rates

25. Area costs  retain the current uplifts, which align with the Skills Funding Agency uplifts, or  align with the proposed methodology for pre-16 school funding –retain the current general labour market (GLM) approach. –combine the GLM approach with the specific costs approach (SCA). Residential care standards  we propose that the residential element of funding is removed from the formula and is distributed directly to the providers that qualify. Short programme modifier  we propose to remove the short programme modifier from the formula. Further simplification

26. to implement all changes in 2013/14 with transitional protection for a three year period. to extend the period of transitional protection by applying a maximum limit to the change in funding per learner each year. Transitional protection

27. Questions