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AoC responds to the Spending Review

11 June 2025

David Hughes 5

Responding to the Spending Review, David Hughes CBE, Chief Executive, Association of Colleges said: "It is good to see post-16 education and skills feature in this Spending Review, with clear areas of investment that we asked for in our submission earlier this year. We made the case that investment in skills, through colleges, is central to achieving economic growth and breaking down barriers to opportunity as well as delivering across the government's missions.

"It is therefore positive that HM Treasury has recognised the growing numbers of young people we estimate will be in post-16 education over the next few years with an increase of £1.2 billion to the 16-18 budget. However, the 65,000 extra 16-18 places will only just keep up with population growth, so the budget may not be sufficient if the improving participation we have seen in recent years continues.

"We need to know more to have a balanced view of this Spending Review, with little information at this stage on adult skills or plans for growth in other sectors to match the construction plan. This month's industrial strategy and the forthcoming skills plan may address the issue and there is mention of a skills workforce plan for defence. We would like to see workforce plans for skills in all of the priority sectors, including health. The announcement sets out increased investment in employment support, but at this stage it is unclear how much of this will support skills development for young people who are not in education, employment or training and for adults who are on benefits or inactive.

"College leaders will be relieved that there are no more obvious cuts to adult spending, but will be disappointed that their biggest challenge of low pay for college staff will not be helped by these announcements. College pay lags a long way behind schools and industry, hampering colleges from being able to deliver on the government's missions.

"The Spending Review announcements are high-level, so I look forward to understanding more of the details in the coming days. More than anything else, we hope that this will allow the Department for Education to make longer-term plans for further education and skills in the coming months. I would like to see early discussions about how DfE plans to achieve its 5% savings and efficiencies target, in order to dampen fears that colleges might be facing any further cuts in the coming years."

A full A-Z of further education can be found here, and a cheat sheet of key policies and issues in FE can be found here.