Funding for nerds

The decision has been taken to move the budget for funding London’s adult and further education to the Mayor of London. By itself, not a bad decision – we are an over-centralised country, and tying in the post school training and education system to locally accountable people seems sensible enough. The problem comes in that the responsibility is being moved to people who know nothing of the work in hand – because since 1992 the responsibility for commissioning and delivering further education has been national.  As a result, the management of the system gets into the hands of people who are attracted to all sorts of whizz-bang ideas, often ones that have been tried and failed or (worse) that have previously been proposed and rejected as being bad.

And that’s what we’ve got.  The Mayor has first of all top-sliced the budget to create new layers of bureaucrats (I’m not sure of the need for 18 third tier posts earning six figure salaries). We now have a proposal that the providers of education and training will be paid by results (an idea the Victorians tried and gave up). Not just results – employment outcomes.  Colleges and trainers will get more money if their students get into jobs.  This falls into the category of “ideas that sound clever but are in fact stupid”.  Here’s why.

Problem 1:  What happens when there is a variation in the overall national rate of unemployment ? Suppose, for example, Brexit leads to another 2008 style crash ?  Do we cut the budgets of every provider because their magical job outcome statistics have fallen ?

Problem 2: How do we find out whether students have got a job ? There is an enormous problem in the cities, where young adult students change addresses frequently.  In the past, responses to postcard or phone surveys have faced this problem, and also the problem of differential response. You’re more likely to respond if you have succeeded in finding a job you like.

Problem 3: And anyway, what is a job ?  How many hours a week (we’ve recently discovered that when the government boasts of higher employment figures, they count one hour a fortnight as a job) ? Paid ? Intern ? Community volunteer ?  And for how many weeks must it be held ?  Does it have to be in the course subject you were trained for – e.g. is someone who finishes a hairdressing course considered unemployed if they are working in retailing ? And if a plasterer is working as a brickie ?  Administrators might be able to give an answer – I’m not sure that thousands of surveyed ex-students will.

Problem 4: It is usually much easier to find the outcomes of an 18 year old who has finished an “A” level course at a school sixth form or sixth form college. They progress to higher education, which presumably ticks the right box as a positive outcome.  In my day, an institution could simply look up the UCAS print-out – I guess they still can.  So the proposed system will favour institutions which teach mostly stable, middle class kids.

Problem 5: The effect on providers.  Let us not fall into the trap of thinking the employment based funding will be new money: it won’t.  It’ll be scratched out of the existing budget.  So how is this employment-related element to be paid ? Will colleges get a lower fee – say 90% of cost – with the last 10% to be paid at some future date ? If that’s how it works, who will pay the teachers, buy the library books or fund the gas bill while they’re waiting for the money ?  Or perhaps trainers will get the full unit cost, but be subject to claw-back later.  This is open to the same question as before – so who will pay the costs of provision ? – adding an additional note of uncertainty.  Remember, these are not well-funded institutions with large, Oxbridge-style alumni funding; recent research showed post 16 funding for colleges and trainers had fallen by 17.5% in recent years. Think of the outrage this would cause in the NHS, in police or the army – or in schools.  The result will not surprise you.  Private trainers frequently collapse.  In the public sector, we have lost more than 100 colleges since incorporation and independence in 1992.  Only last month, a Yorkshire college had to be bailed out to the tune of £50m.  This really isn’t a good sector to use to try out fancy-Dan funding changes.

Problem 6: A job-based funding system will encourage low-skilled courses (cleaning, care) where providers can be pretty sure they can tick the boxes later, rather than high-skilled (journalism, accountancy). It is surely up to the student to choose what to study, as long as they know the realities of the job market.

Problem 7: A job-based funding system works against challenged students. Why enrol a kid with mental health difficulties when they will yield less than a less problematic entrant ? Who needs a student with second-language needs when they will probably do less well at interview later ?  Remember too that London has rich and poor areas – are we sure that such a funding system will be as fair to those in Newham and Brixton as those in Bromley and Richmond ?

Problem 8:  The invitation to corruption by over-claiming is substantial, especially for a small trainer working on the edge of their budget. Where similar schemes have been tried in the past, there have been corrupt or semi-corrupt examples.  For example, employing your own students for the prescribed period (say, six weeks in the office) has been known.  So, for that matter has blatant lying.  Are we sure that even the army of auditors that will be needed to run this system – many more than a simple payment for work done – will find out the wrong ‘uns ?

I could go on, but in the spirit of “I know what you’re against – what are you in favour of ?”, I have some suggestions.  A far better idea would be to fund providers on student numbers, weighted for expensive courses (e.g. construction) or special needs (e.g. learning difficulties or second languages).  Better still, do so on planned numbers – it is no more expensive to run a course for 18 computer students as for 12, no cheaper to train 12 nursery nurses than 15.  And do not penalize under-recruitment – outside posh universities, no provider turns away qualified applicants.  Paying for planned numbers has the advantage of keeping provision in place during recessions, rather than making (it happened) building teachers redundant only to find five years later we have no plumbers.  This doesn’t mean we ignore the labour market – volumes commissioned can be adjusted in following years in the light of vacancy and unemployment numbers.  But, of course, this was the system we had in the late 1980s, under those inefficient local authorities, before the think-tanks and saloon-bar planners came to power.  So it can’t  right.  Can it ?

 

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